# EDGAR Filing Document

**Accession Number:** 0001593001
**File Stem:** 0001493152-26-007743
**Filing Date:** 2026-2
**Character Count:** 343809
**Document Hash:** b2f32e2d78ad548cd6533fed8cd3ac65
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-26-007743.hdr.sgml**: 20260223

**ACCESSION NUMBER**: 0001493152-26-007743

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 108

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260223

**DATE AS OF CHANGE**: 20260223

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** NightFood Holdings, Inc.
- **CENTRAL INDEX KEY:** 0001593001
- **STANDARD INDUSTRIAL CLASSIFICATION:** MISC INDUSTRIAL & COMMERCIAL MACHINERY & EQUIPMENT [3590]
- **ORGANIZATION NAME:** 06 Technology
- **EIN:** 463885019
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-55406
- **FILM NUMBER:** 26664912

**BUSINESS ADDRESS:**
- **STREET 1:** 500 WHITE PLAINS ROAD
- **STREET 2:** SUITE 520
- **CITY:** TARRYTOWN
- **STATE:** NY
- **ZIP:** 10591
- **BUSINESS PHONE:** 866-291-7778

**MAIL ADDRESS:**
- **STREET 1:** 500 WHITE PLAINS ROAD
- **STREET 2:** SUITE 520
- **CITY:** TARRYTOWN
- **STATE:** NY
- **ZIP:** 10591

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the quarterly period ended: December 31, 2025

Or

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the Transition Period from ___________ to____________

Commission File Number: **<u>000-55406</u>**

**<u>NIGHTFOOD HOLDINGS, INC.</u>**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada** | **46-3885019** |
| (State or Other Jurisdiction of | (I.R.S. Employer |
| Incorporation or Organization) | Identification No.) |

---

---

| | |
|:---|:---|
| **13501 South** **Main Street**<br> **Los Angeles, California** | **90016** |
| (Address of Principal Executive Offices) | (Zip Code) |

---

**<u>866-291-7778</u>**

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| N/A | N/A | N/A |

---

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 requirement for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

On February 23, 2026 the issuer had 222,367,889 shares of common stock outstanding.

**Table of Contents**

---

| | | |
|:---|:---|:---|
| [**PART I - FINANCIAL INFORMATION**](#ab_001) | [**PART I - FINANCIAL INFORMATION**](#ab_001) | [**PART I - FINANCIAL INFORMATION**](#ab_001) |
| Item 1. | [Financial Statements (Unaudited)](#ab_001) | 1 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations.](#ab_002) | 120 |
| Item 3. | [Quantitative and Qualitative Disclosures about Market Risk](#ab_003) | 125 |
| Item 4. | [Controls and Procedures](#ab_004) | 125 |
| **[PART II - OTHER INFORMATION](#ab_005)** | **[PART II - OTHER INFORMATION](#ab_005)** | **[PART II - OTHER INFORMATION](#ab_005)** |
| Item 1. | [Legal Proceedings.](#ab_006) | 126 |
| Item 1A. | [Risk Factors.](#ab_007) | 126 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds.](#ab_008) | 126 |
| Item 3. | [Defaults Upon Senior Securities.](#ab_009) | 126 |
| Item 4. | [Mine Safety Disclosures.](#ab_010) | 126 |
| Item 5. | [Other Information.](#ab_011) | 126 |
| Item 6. | [Exhibits.](#ab_012) | 127 |
| [Signatures](#ab_013) | [Signatures](#ab_013) | 130 |

---

i

**Nightfood Holdings, Inc. and Subsidiaries** 

**DBA Techforce Robotics** 

---

| | |
|:---|:---|
|  | Page(s) |
| [Consolidated Balance Sheets](#Y-001) | 2 |
| [Consolidated Statements of Operations](#Y-002) | 3 |
| [Consolidated Statements of Changes in Stockholders' (Equity) Deficit](#Y-003) | 4 - 5 |
| [Consolidated Statements of Cash Flows](#Y-004) | 6 |
| [Notes to Consolidated Financial Statements](#Y-005) | 7 - 101 |

---

**Nightfood Holdings, Inc. DBA Techforce Robotics**

**Condensed Consolidated Balance Sheets**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| **<u>Assets</u>** |  |  |
| **Current Assets** |  |  |
| Cash | $347338 | $350231 |
| Accounts receivable - net | 161091 | 46215 |
| Inventory | 437723 | 319491 |
| Prepaids and other | 704459 | 61529 |
| **Total Current Assets** | 1650611 | 777466 |
| **Property and equipment - net** | 24115897 | 240824 |
| **Operating lease - right-of-use asset** | 1917012 |  |
| **Goodwill** | 95686177 | 4504177 |
| **Intangible assets - net** | 6248336 | 1802067 |
| **Total Assets** | $129618033 | $7324534 |
| **<u>Liabilities and Stockholders' Equity (Deficit)</u>** |  |  |
| **Current Liabilities** |  |  |
| Accounts payable and accrued expenses | $5077182 | $3156258 |
| Accounts payable and accrued expenses - related parties | 2329478 | 322900 |
| Deferred revenue | 548398 | 557725 |
| Convertible notes payable - net | 4422515 | 4271103 |
| Mortgage notes payable | 385392 |  |
| Derivative liabilities | 2919652 | 805765 |
| Derivative liabilities - related parties | 270610 | 297227 |
| Notes payable - net | 5096218 | 1576250 |
| Operating lease liability | 297626 |  |
| Liabilities of discontinued operations | 406605 | 479005 |
| **Total Current Liabilities** | 21753676 | 11466233 |
| **Long Term Liabilities** |  |  |
| Convertible notes payable - net | 575312 | 447241 |
| Convertible notes payable - related parties - net | 59662 | 20149 |
| Mortgage notes payable | 19006081 |  |
| Notes payable - net |  | 14024 |
| Operating lease liability | 1849706 | - |
| **Total Long Term Liabilities** | 21490761 | 481414 |
| **Total Liabilities** | 43244437 | 11947647 |
| **Commitments and Contingencies** |  |  |
| **Temporary Equity** |  |  |
| Series B, Convertible Preferred stock - $0.001 par value; 0 and 5,000 shares designated none and 1,950 shares issued and outstanding, respectively |  | 5065421 |
| Series C, Convertible Preferred stock - $0.001 par value; 0 and 500,000 shares designated none and 145,966 shares issued and outstanding, respectively |  | 7415730 |
| Series D, Convertible Preferred stock - $0.001 par value; 0 and 100,000 shares designated none and 3,334 shares issued and outstanding, respectively | - | 227910 |
| **Total Temporary Equity** |  | 12709061 |
| **Stockholders' Deficit** |  |  |
| Preferred stock - $0.001 par value; 1,000,000 shares authorized |  |  |
| Series A Preferred stock - $0.001 par value; 1,000 shares designated 1,000 shares issued and outstanding, respectively | 1 | 1 |
| Series B, Convertible Preferred stock - $0.001 par value; 5,000 and 0 shares designated no shares issued and outstanding, respectively |  |  |
| Series C, Convertible Preferred stock - $0.001 par value; 800,000 and 0 shares designated 559,489 and 0 shares issued and outstanding, respectively | 560 |  |
| Series D, Convertible Preferred stock - $0.001 par value; 100,000 and 0 shares designated 1,834 and 0 shares issued and outstanding, respectively | 2 |  |
| Common stock - $0.001 par value, 900,000,000 shares authorized 213,367,889 and 136,961,021 shares outstanding, respectively | 213369 | 136961 |
| Additional paid-in capital | 140897363 | 29284708 |
| Accumulated deficit | (54737699) | (46753844) |
| **Total Stockholders' Equity (Deficit)** | 86373596 | (17332174) |
| **Total Liabilities, Temporary Equity and Stockholders' Equity (Deficit)** | $129618033 | $7324534 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

**Nightfood Holdings, Inc. DBA Techforce Robotics**

**Condensed Consolidated Statements of Operations**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Six Months Ended December 31,** | **For the Six Months Ended December 31,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenues - net** | $2211029 | $- | $2972056 | $- |
| **Costs and expenses** |  |  |  |  |
| Cost of sales | 774490 |  | 1250055 |  |
| Depreciation and amortization | 973014 |  | 1358019 |  |
| General and administrative expenses | 3988393 | 191849 | 6054979 | 410311 |
| **Total costs and expenses** | 5735897 | 191849 | 8663053 | 410311 |
| **Loss from operations** | (3524868) | (191849) | (5690997) | (410311) |
| **Other income (expense):** |  |  |  |  |
| Interest income | 5023 | 29643 | 9949 | 45629 |
| Other income | 27177 |  | 32423 |  |
| Loss on debt extinguishment |  |  |  | (127705) |
| Derivative expense | (895757) |  | (895757) |  |
| Interest expense (including amortization of debt discount) | (1586825) | (270951) | (2174898) | (609556) |
| Change in fair value of derivative liabilities | 1688040 | - | 737987 | - |
| **Total other income (expense) - net** | (762342) | (241308) | (2290296) | (691632) |
| **Net loss from continuing operations** | (4287210) | (433157) | (7981293) | (1101943) |
| **Net loss from discontinued operations** | (1110) | (46448) | (2562) | (142274) |
| **Net loss before provision for income taxes** | (4288320) | (479605) | (7983855) | (1244217) |
| **Provision for income taxes** | - | - | - | - |
| **Net loss** | $(4288320) | $(479605) | $(7983855) | $(1244217) |
| Deemed dividend on Series B Preferred Stock | - | - | - | (11566) |
| **Net loss available to common stockholders** | $(4288320) | $(479605) | $(7983855) | $(1255783) |
| **Loss per share - basic and diluted - continuing operations** | $(0.02) | $(0.00) | $(0.05) | $(0.01) |
| **Loss per share - basic and diluted - discontinued operations** | $(0.00) | $(0.00) | $(0.00) | $(0.00) |
| **Loss per share - basic and diluted** | $(0.02) | $(0.00) | $(0.05) | $(0.01) |
| **Weighted average number of shares - basic and diluted** | 182235396 | 128957407 | 162793612 | 128939201 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

**Nightfood Holdings, Inc. DBA Techforce Robotics**

**Condensed Consolidated Statement of Changes in Temporary Equity and Stockholders' Deficit**

**For the Three and Six Months Ended December 31, 2025**

**(Unaudited)**

---

| | | | | | | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | | | | | | | | | | | | | |
|  | **Series B - Convertible** | **Series B - Convertible** | **Series C - Convertible** | **Series C - Convertible** | **Series D - Convertible** | **Series D - Convertible** | | | **Series A**<br> **Preferred** | **Series A**<br> **Preferred** | **Series C - Convertible** | **Series C - Convertible** | **Series D - Convertible** | **Series D - Convertible** | | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | | | **Stock** | **Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Total**<br>**Temporary**<br>**Equity** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** |<br>**Total Stockholders'**<br>**Equity**<br>**(Deficit)** |
| **June 30, 2025** | **1950** | $**2** | **145966** | $**146** | **3334** | $**3** | $**12708910** | $**12709061** | **1000** | $**1** | **-** | $**-** | $**-** | $**-** | **136961021** | $**136961** | $**29284708** | $**(46753844)** | $**(17332174)** |
| Acquisition of Victorville |  |  | 216667 | 217 |  |  | 38999843 | 39000060 |  |  |  |  |  |  |  |  |  |  |  |
| Acquisition of Rancho Mirage |  |  | 176167 | 176 |  |  | 42279904 | 42280080 |  |  |  |  |  |  |  |  |  |  |  |
| Forgiveness of pre-existing relationship with target acquiree |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2652671 |  | 2652671 |
| Vesting of Series C - convertible preferred stock - issued as compensation |  |  | 10050 | 10 |  |  | 410030 | 410040 |  |  |  |  |  |  |  |  |  |  |  |
| Conversion of convertible debt into common stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 14980901 | 14981 | 479389 |  | 494370 |
| Contingent consideration - acquisition of Victorville |  |  |  |  |  |  | 7125000 | 7125000 |  |  |  |  |  |  |  |  |  |  |  |
| Contingent consideration - acquisition of Rancho Mirage |  |  |  |  |  |  | 4800000 | 4800000 |  |  |  |  |  |  |  |  |  |  |  |
| Net loss | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | (3695535) | (3695535) |
| **September 30, 2025** | **1950** | $**2** | **548850** | $**549** | **3334** | $**3** | $**106323687** | $**106324241** | **1000** | $**1** | **-** | $**-** | $**-** | $**-** | **151941922** | $**151942** | $**32416768** | $**(50449379)** | $**(17880668)** |
| Stock issued for cash |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 22360575 | 22361 | 872062 |  | 894423 |
| Stock issued for services |  |  |  |  |  |  |  |  |  |  | 589 | 1 |  |  |  |  | 282719 |  | 282720 |
| Warrants issued as deferred offering costs |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 258723 |  | 258723 |
| Cashless exercise of warrants |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 2465698 | 2466 | (2466) |  |  |
| Conversion of convertible debt into common stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 4285994 | 4286 | 137151 |  | 141437 |
| Conversion of accrued interest payable into common stock |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 7000000 | 7000 | 224000 |  | 231000 |
| Conversion of Series B preferred stock into common stock | (1950) | (2) |  |  |  |  | (16312) | (16314) |  |  |  |  |  |  | 16313700 | 16314 | (16314) |  | - |
| Conversion of Series D preferred stock into common stock |  |  |  |  | (1500) | (1) | (8999) | (9000) |  |  |  |  |  |  | 9000000 | 9000 | (9000) |  | - |
| Vesting of Series C - convertible preferred stock - issued as compensation |  |  |  |  |  |  |  |  |  |  | 10050 | 10 |  |  |  |  | 410030 |  | 410040 |
| Reclassification of Series B preferred stock from temporary to permanent equity |  |  |  |  |  |  | (5049107) | (5049107) |  |  |  |  |  |  |  |  | 5074421 |  | 5074421 |
| Reclassification of Series C preferred stock from temporary to permanent equity |  |  | (548850) | (549) |  |  | (89105361) | (89105910) |  |  | 548850 | 549 |  |  |  |  | 89105361 |  | 89105910 |
| Reclassification of Series D preferred stock from temporary to permanent equity |  |  |  |  | (1834) | (2) | (218908) | (218910) |  |  |  |  | 1834 | 2 |  |  | 218908 |  | 218910 |
| Reclassification of contingent consideration - Victorville |  |  |  |  |  |  | (7125000) | (7125000) |  |  |  |  |  |  |  |  | 7125000 |  | 7125000 |
| Reclassification of contingent consideration – Rancho Mirage |  |  |  |  |  |  | (4800000) | (4800000) |  |  |  |  |  |  |  |  | 4800000 |  | 4800000 |
| Net loss | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | (4288320) | (4288320) |
| **December 31, 2025** | **-** | $**-** | **-** | $**-** | **-** | $**-** | $**-** | $**-** | **1000** | $**1** | **559489** | $**560** | **1834** | $**2** | **213367889** | $**213369** | $**140897363** | $**(54737699)** | $**86373596** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

**Nightfood Holdings, Inc.**

**DBA Techforce Robotics**

**Condensed Consolidated Statement of Changes in Temporary Equity and Stockholders' Deficit**

**For the Three and Six Months Ended December 31, 2024**

**(Unaudited)**

---

| | | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | | | | | | | | | |
|  | **Series B -** | **Series B -** | **Series C -** | **Series C -** | **Series D -** | **Series D -** | | | **Series A** | **Series A** | | | | | |
|  | **Convertible** | **Convertible** | **Convertible** | **Convertible** | **Convertible** | **Convertible** | | | **Preferred** | **Preferred** | | | | | |
|  | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | **Preferred Stock** | | | **Stock** | **Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Total**<br>**Temporary**<br>**Equity** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br><br>**Accumulated**<br>**Deficit** |<br>**Total**<br>**Stockholders'**<br>**Deficit** |
| **June 30, 2024** | **1950** | $**2** | **13333** | $**13** | **1667** | $**2** | $**6036501** | $**6036518** | **1000** | $**&nbsp;&nbsp;&nbsp;&nbsp;1** | **128907407** | $**128907** | $**29027647** | $**(38626400)** | $**(9469845)** |
| Stock issued for services |  |  |  |  |  |  |  |  |  |  | 50000 | 50 | 945 |  | 995 |
| Deemed dividend associated with preferred B stock dilutive warrant adjustments |  |  |  |  |  |  | 11566 | 11566 |  |  |  |  |  | (11566) | (11566) |
| Shares issued for amended convertible note |  |  |  |  | 1667 | 2 | 113953 | 113955 |  |  |  |  |  |  |  |
| Net loss | - | - | - | - | - | - | - | - | - | - | - | - | - | (764611) | (764611) |
| **September 30, 2024** | **1950** | **2** | **13333** | **13** | **3334** | **4** | **6162020** | **6162039** | **1000** | **1** | **128957407** | **128957** | **29028592** | **(39402577)** | **(10245027)** |
| Shares issued under acquisition |  |  | 83333 | 84 |  |  |  | 84 |  |  |  |  |  |  |  |
| Net loss | - | - | - | - | - | - | - | - | - | - | - | - | - | (479605) | (479605) |
| **December 31, 2024** | **1950** | $**2** | **96666** | $**97** | **3334** | $**4** | $**6162020** | $**6162123** | **1000** | $**1** | **128957407** | $**128957** | $**29028592** | $**(39882182)** | $**(10724632)** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

**Nightfood Holdings, Inc. DBA Techforce Robotics**

**Condensed Consolidated Statements of Cash Flows**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended December 31,** | **For the Six Months Ended December 31,** |
|  | **2025** | **2024** |
| **Operating activities** |  |  |
| Net loss | $(7983855) | $(1244217) |
| Less: net loss - discontinued operations | (2562) | $(142274) |
| Net loss - continuing operations | (7981293) | (1101943) |
| Adjustments to reconcile net loss to net cash used in operating activities |  |  |
| &nbsp;&nbsp;&nbsp;Non-cash financing cost under contingent liability |  | 92000 |
| &nbsp;&nbsp;&nbsp;Interest income under acquisition note |  | (45629) |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 1184019 |  |
| &nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 174000 |  |
| &nbsp;&nbsp;&nbsp;Loss on debt extinguishment |  | 127705 |
| &nbsp;&nbsp;&nbsp;Derivative expense | 895757 |  |
| &nbsp;&nbsp;&nbsp;Change in fair value of derivative liabilities | (737987) |  |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount | 907116 | 109867 |
| &nbsp;&nbsp;&nbsp;Bad debt expense | 66177 | 48610 |
| &nbsp;&nbsp;&nbsp;Stock issued for services | 282720 | 995 |
| &nbsp;&nbsp;&nbsp;Vesting of Series C - preferred stock - issued as compensation | 820080 |  |
| Changes in operating assets and liabilities |  |  |
| &nbsp;&nbsp;&nbsp;(Increase) decrease in |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (97053) | (20372) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | (71232) | (287) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaids and other | (212207) | (34195) |
| Increase (decrease) in |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | (878912) | 446063 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses - related party | 1766578 | 113214 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues | (21327) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liability | 56320 | - |
| Net cash used in operating activities - continuing operations | (3847244) | (263972) |
| Net cash used in operating activities - discontinued operations | (74962) | (6268) |
| Net cash used in operating activities | (3922206) | (270240) |
| **Investing activities** |  |  |
| Cash acquired in acquisitions | 1269000 |  |
| Acquisition of property and equipment | (65361) | (39700) |
| Acquisition costs secured by debt | - | (223063) |
| **Net cash provided by (used in) investing activities** | 1203639 | (262763) |
| **Financing activities** |  |  |
| Proceeds from common stock issued for cash | 894423 |  |
| Proceeds from notes payable |  | 402050 |
| Repayments on notes payable | (15722) |  |
| Proceeds from convertible notes payable | 1929500 |  |
| Repayments on mortgage notes payable | (92527) | - |
| **Net cash provided by financing activities** | 2715674 | 402050 |
| **Net decrease in cash** | (2893) | (130953) |
| **Cash - beginning of period** | 350231 | 148294 |
| **Cash - end of period** | $347338 | $17341 |
| **Supplemental disclosure of cash flow information** |  |  |
| Cash paid for interest | $1004243 | $- |
| Cash paid for income tax | $- | $- |
| **Supplemental disclosure of non-cash investing and financing activities** |  |  |
| Common stock issued in connection with conversion of convertible notes payable | $866807 | $- |
| Issuance of Series C - convertible preferred stock in connection with acquisition of Victorville | $39000060 | $- |
| Issuance of Series C - convertible preferred stock in connection with acquisition of Rancho Mirage | $42280080 | $- |
| Contingent consideration arrangement - Series C - convertible preferred stock - Victorville | $7125000 | $- |
| Contingent consideration arrangement - Series C - convertible preferred stock - Rancho Mirage | $4800000 | $- |
| Warrants issued as deferred offering costs | $258723 | $- |
| Right-of-use asset obtained in exchange for new operating lease liability | $2091012 | $- |
| Net deficit of Victorville and Rancho Mirage acquisitions | $2617000 | $- |
| Forgiveness of pre-existing relationship with target acquiree | $2652671 | $- |
| Cashless exercise of warrants | $2466 | $- |
| Discounts in connection with issuance of debt and warrants - convertible notes payable | $2270000 | $70950 |
| Deemed dividend associated with Series B, convertible preferred stock - dilutive warrant adjustments | $- | $11566 |
| Series D, convertible preferred stock issued in connection with conversion of debt | $- | $113955 |
| Increase in debt principal and related accrued interest | $- | $15813 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**<u>Note 1 - Organization and Nature of Operations</u>**

**Organization and Nature of Operations**

Nightfood Holdings, Inc. and its subsidiaries ("Nightfood," "NGTF," "we," "our," or the "Company") operate as an AI-driven service robotics and hospitality technology company. Our primary focus is the development, deployment, and commercialization of AI-powered autonomous robots designed to improve operational efficiency across the hospitality, foodservice, and facilities-management industries.

To accelerate real-world testing and adoption of our technologies, we pursue strategic acquisitions of hospitality-related real estate assets. These hotels serve as controlled pilot environments where the Company can refine, validate, and showcase its robotics solutions at commercial scale.

In addition, our subsidiary SWC Group, Inc. (d/b/a CarryOutSupplies.com) provides complementary logistical and supply-chain capabilities that support both internal operations and market penetration for our robotics products. This integrated structure enhances deployment efficiency, reduces operating friction, and strengthens our overall commercialization platform.

The Company's operations are organized into three (3) principal business segments:

&nbsp;&nbsp;&nbsp;&nbsp;1. Foodservice
 Packaging:

Through its wholly owned subsidiary SWC Group, Inc. (d/b/a CarryOutSupplies.com) ("SWC"), the Company operates as a business-to-business ("B2B") enterprise focused on the wholesale distribution of disposable foodservice packaging products.

Product offerings include printed paper cups, plastic cups, food containers, bags, and related consumables for restaurants, cafés, and other foodservice establishments. Operations are conducted primarily through the Company's e-commerce platform, www.carryoutsupplies.com, which serves customers across the United States.

Activities include product design, sourcing from domestic and international manufacturers, quality control, warehousing, and fulfillment. Customers are primarily small to mid-sized businesses in the hospitality and foodservice industries, with no material dependence on any single customer or supplier.

This segment began operations in connection with the acquisition of SWC Group, Inc. on March 31, 2025.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

&nbsp;&nbsp;&nbsp;&nbsp;2. Robotics-as-a-Service
 (RaaS):

Through its subsidiaries, TechForce Robotics, Inc. (formerly Skytech Automated Solutions, Inc.) ("TechForce") and Future Hospitality Ventures Holdings, Inc. ("FHVH"), the Company develops and delivers automation solutions aimed at enhancing efficiency and reducing labor dependency in foodservice and hospitality operations. These solutions focus on automating routine and repetitive tasks to improve service quality and operating margins.

On February 2, 2024, FHVH began operating under the trade name RoboOp365.

On September 2, 2025, Skytech Automated Solutions, Inc. changed its name to TechForce Robotics, Inc.

Business Model

The Company offers its automation solutions under a Robotics-as-a-Service (RaaS) model, generally structured as multi-year lease and service agreements following an initial pilot and site-preparation period. Under these arrangements, customers pay a recurring monthly fee for deployed equipment and related services. Fees may vary depending on the scale of deployment, number of units, and customer-specific requirements. The Company recognizes revenue on a monthly basis as services are rendered.

Equipment and Ownership

The Company owns and deploys its equipment, including robotics hardware, software, and related components. All deployed units remain the property of the Company, which is also responsible for equipment replacement and refurbishment as necessary.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Support and Maintenance

The Company provides ongoing support to ensure equipment performance, including remote technical assistance, software updates, and periodic inspections. In the event of equipment failure, replacement units are deployed to minimize customer disruption. To date, customer support needs have been minimal.

Operating Costs

Recurring operating costs consist primarily of equipment maintenance, software servicing, and connectivity. These costs are integrated into the overall RaaS model and managed as part of the Company's service delivery.

Current Status

As of December 31, 2025, the Company had initiated early customer deployments under this model and commenced revenue-generating activities.

&nbsp;&nbsp;&nbsp;&nbsp;3. Hospitality
 Asset Ownership:

The Company has expanded its business model to include the acquisition, ownership, and operation of hotel properties. These properties are intended to serve both as revenue-generating hospitality operations and as dedicated deployment sites for the Company's automation technologies, enabling the Company to test, validate, and scale operational efficiencies in live environments. The hospitality segment became active in connection with two business combinations completed during the three-month period ended September 30, 2025.

Overview of Acquisitions

On August 27, 2025 and September 30, 2025, the Company acquired two hotel properties as part of its strategy to establish a hospitality asset ownership and operations platform. Each acquisition included the underlying real estate, buildings and improvements, hotel operating assets, and related working capital necessary to operate the facilities. The transactions also included franchise rights, liquor licenses, equipment, and other property integral to the hotels' operations. In connection with the acquisitions, the Company assumed certain operating liabilities, including accounts payable, accrued expenses, and debt obligations secured by the properties.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Strategic Purpose

The acquired hotels support the Company's strategy in two primary ways:

● Hospitality Operations: The properties generate recurring operating revenue through the ongoing operation of branded lodging facilities, including room rentals, food and beverage offerings, and other ancillary services; and

● Automation Deployment: The hotels provide controlled pilot environments in which the Company can implement, refine, and evaluate its robotics and workflow automation technologies prior to broader commercial deployment.

The Company believes that insights gained from these properties will contribute to improvements in operating efficiency, labor utilization, and the long-term scalability of its automation platform.

Franchise Operations

The Company owns and operates its hotels under long-term franchise agreements with established national hotel brands. These arrangements grant the Company the right to operate its hotels using the brand's trademarks, systems, reservation channels, and operating standards in exchange for various franchise-related fees, which generally include:

● Royalty fees, typically calculated as a percentage of room revenue;

● Marketing, loyalty, and reservation assessments supporting brand-wide advertising and distribution systems; and

● System fees associated with participation in required brand programs and technology platforms.

Under each franchise agreement, the Company is required to comply with the brand's operating manuals, service standards, and property-level specifications, including ongoing maintenance, periodic upgrades, and compliance with brand-mandated property improvement plans ("PIPs"). Failure to meet these requirements may result in financial penalties or loss of franchise rights. Franchise agreements generally have initial terms of 10 to 20 years and include renewal options subject to the franchisor's approval. Transfers, encumbrances, or material modifications of a franchised hotel typically require prior franchisor consent.

The Company engages third-party hotel management companies to operate the hotel properties, as required under applicable franchise agreements. While day-to-day operations are managed by third-party operators, the Company retains responsibility for capital expenditures, compliance with franchise brand standards, and oversight of financial and operating performance.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Integration and Operating Status

Following the acquisitions, the Company initiated integration activities across both properties, including evaluations of site layouts, staffing structures, and operational workflows in preparation for automation deployments. Revenue from hotel operations is recognized in accordance with ASC 606 and reported within the hospitality segment beginning in the period in which operations commenced post-acquisition.

Financial Statement Impact

The hotel acquisitions have been accounted for as business combinations under ASC 805, *Business Combinations.* The related purchase price allocations — including the fair values of property and equipment, identifiable intangible assets, acquired working capital (deficit), and goodwill — are presented in Note 9 for the acquisitions completed on August 27, 2025 and September 30, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;4. Snack
 and Beverages (Discontinued Operations):

The Company previously operated a small legacy business related to the sale of snacks and beverages. These activities have since been discontinued and will not contribute to future revenues. Accordingly, revenues from this line are presented within discontinued operations and excluded from the Company's disclosure of continuing revenue streams.

**Discontinued Operations – Snack and Beverages Legacy Line**

Management's Decision

On June 30, 2025, the Company's management elected to discontinue its nominal operations related to the legacy sale of snacks and beverages. This decision was made as part of a broader strategic reassessment of the Company's business lines and a reaffirmation of management's focus on its core revenue-generating operations. The Chief Operating Decision Maker ("CODM," our Chief Executive Officer) had periodically evaluated the financial contribution of this line and determined that its continued operation was not aligned with the Company's long-term strategic objectives.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Discontinued Operations Assessment (ASC 205-20)

The Company evaluated whether the discontinuation of its Snack and Beverages legacy business meets the criteria for classification as a discontinued operation. ASU 2014-08 provides that a discontinued operation must represent a strategic shift that has (or will have) a major effect on an entity's operations and financial results.

Although the Snack and Beverages line generated only a quantitatively immaterial contribution to consolidated revenues and assets, management determined that the exit nonetheless represents a strategic shift under ASC 205-20 for the following reasons:

● Qualitative Materiality: As referenced in SEC Staff Accounting Bulletin (SAB) Topic 1.M, Materiality, the evaluation of materiality requires consideration of both quantitative and qualitative factors. While the revenues and assets associated with the discontinued business are not significant in magnitude, the discontinuation is qualitatively material because it marks the complete exit from a non-core, consumer-oriented business activity that differs fundamentally from the Company's current focus on technology-driven operations.

● Strategic Realignment: The Snack and Beverages activity was a legacy line of business, not aligned with the Company's current and expected future strategy. Its discontinuation evidences management's focus on refining the Company's business model around its primary service offerings.

● Distinct Nature of Operations: The product-based consumer business model of the Snack and Beverages activity was markedly different from the service-oriented and technology-enabled activities that form the basis of the Company's continuing operations. Discontinuation therefore represents a qualitative shift in the scope and nature of the Company's operations.

● ASC 205-20 Criteria: While the quantitative impact does not by itself meet the "major effect" threshold, the qualitative considerations described above support classification as a discontinued operation consistent with the intent of ASC 205-20 and ASU 2014-08.

Accordingly, the Company has concluded that the discontinuation of its Snack and Beverages legacy business qualifies for presentation as a discontinued operation in the consolidated financial statements. The results of this activity will therefore be presented separately from continuing operations in the accompanying financial statements, with prior-period amounts reclassified for comparability.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Segment Reporting (ASC 280) Considerations

The Snack and Beverages activity was never managed or evaluated as a separate operating segment by the CODM, as the Company has historically operated and reported as a single segment. Accordingly, it was not disclosed as a reportable segment.

However, in connection with the discontinuation, management determined that this activity, while not separately reportable, represents a strategic shift away from a legacy business that is qualitatively distinct from the Company's continuing operations.

In light of this discontinuation and the adoption of ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, effective July 1, 2024, the Company has reviewed its segment disclosures and determined:

● Significant Expense Disclosures: The Snack and Beverages activity did not generate significant expenses regularly reviewed by the CODM. Therefore, no incremental expense disclosures are required under the new guidance.

● Other Disclosures: The Company will continue to present the historical results of this activity as discontinued operations, separate from continuing operations, and will provide appropriate narrative disclosures to describe the composition of "Other" activities, consistent with the requirements of ASC 280 and ASU 2023-07.

Accounting and Financial Statement Impact

Because the activity is being abandoned rather than sold, it does not qualify as "held for sale". However, the Company has concluded that the discontinuation represents a discontinued operation and will present the historical results of the Snack and Beverages line separately from continuing operations in the consolidated financial statements.

The Company does not anticipate recognizing any material exit costs, impairment losses, or restructuring charges associated with the discontinuation. Any remaining minor assets or liabilities will be derecognized in accordance with applicable accounting guidance.

Future Business Operations

The Snack and Beverages activity had no dedicated workforce, significant customer base, or ongoing contractual commitments. Its discontinuation will not result in employee layoffs, customer transitions, or contract terminations. The exit reflects management's strategic decision to eliminate a non-core, consumer product line and to reinforce focus on the Company's core operations, which generate the substantial majority of revenues and are expected to drive sustainable long-term growth.

See Note 14 for summary of the Company's discontinued operations for the three and six months ended December 31, 2025 and 2024, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**Fiscal Year**

The Company's fiscal year end is June 30.

**Organizational Structure**

---

| | | | |
|:---|:---|:---|:---|
| **Company Name** |  | **Incorporation Date** | **State of Incorporation** |
| Nightfood Holdings, Inc. ("NGTF") DBA TechForce Robotics |  | November 22, 2022 | Nevada |
| Nightfood, Inc. ("Nightfood") | **2** | January 14, 2010 | New York |
| Future Hospitality Ventures Holdings, Inc. ("FHVH") DBA RoboOp365 |  | October 25, 2024 | Nevada |
| SWC Group, Inc. ("SWC") DBA CarryoutSupplies.com | **1** | July 19, 2004 | California |
| TechForce Robotics, Inc. FKA Skytech Automated Solutions, Inc. ("Skytech") | **1** | October 6, 2023 | Delaware |
| Victorville Treasure Holdings, LLC DBA Holiday Inn ("VV") | **3** | February 26, 2014 | California |
| Mountain Treasure Holdings, LLC DBA Hilton Garden Inn ("RM") | **4** | July 5, 2013 | California |

---

---

| |
|:---|
| 1 Acquired on March 31, 2025. |
| 2 Discontinued operations effective June 30, 2025. |
| 3 Acquired August 27, 2025. |
| 4 Acquired September 30, 2025. |

---

**Basis of Presentation**

The unaudited interim consolidated financial statements are condensed and should be read in conjunction with the Company's latest annual audited 2025 condensed consolidated financial statements, which are included in the Company's Annual Report on Form 10-K filed with the SEC on October 14, 2025 (the "Form 10-K"). The results of operations for interim periods are not necessarily indicative of results to be expected for the fiscal year ending June 30, 2026 or for any other future annual or interim period.

**Liquidity and Going Concern**

As reflected in the accompanying unaudited condensed consolidated financial statements, for the six months ended December 31, 2025, the Company had:

● Net loss attributable to common stockholders of $7,983,855 ;
and

● Net cash used in operating activities was $3,922,206

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Additionally, at December 31, 2025, the Company had:

● Accumulated deficit of $54,737,699

● Working capital deficit of $20,103,065 ; and

● Cash on hand of $347,338

Following the acquisitions of SWC Group, Inc. and TechForce Robotics, Inc. (formerly Skytech Automated Solutions, Inc.) during the fiscal year ended June 30, 2025, the Company initiated early customer deployments under its Robotics-as-a-Service ("RaaS") model and commenced revenue-generating activities. While these deployments represent an important step toward building recurring revenue, revenues to date have not been sufficient to fund ongoing operations.

Similarly, following the acquisitions of the Victorville and Rancho Mirage hotel properties during the six months ended December 31, 2025, the Company began generating revenue within its hospitality segment. Although these hotels provide recurring operating revenue from lodging and related guest services, current levels of hotel revenue are also insufficient to support the Company's ongoing operating and development activities.

Liquidity Outlook

Based on current operating levels and cash usage forecasts, the Company's existing cash resources are not sufficient to fund operations for the twelve months following the issuance of these consolidated financial statements without obtaining additional financing.

Historically, the Company has relied on both third-party and related-party debt financing to fund operations. There can be no assurance that additional financing will be available on commercially acceptable terms, or at all. Further, there is no assurance that any financing obtained will be sufficient to enable the Company to complete its strategic initiatives or achieve profitable operations.

The Company's future capital requirements will depend on many factors, including its ability to scale the Foodservice Packaging and RaaS businesses, expand into new markets, invest in automation technology, respond to competitive pressures, and pursue strategic opportunities. Current capital needs include:

● Scaling RaaS deployments to new customers and markets;

● Maintaining and upgrading robotic systems deployed in the field; and

● Funding working capital needs and ongoing operating activities.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

If the Company is unable to secure sufficient capital, it may be required to slow expansion efforts, reduce operating expenditures, or modify its strategic plans.

While the Company sees significant opportunity to grow recurring revenue through RaaS, its ability to execute on this opportunity depends on securing additional financing. If sufficient capital is not raised, the Company may be required to slow expansion plans, reduce operating activities, or adjust its overall strategy.

Going Concern

These factors raise substantial doubt about the Company's ability to continue as a going concern within one year after the date these consolidated financial statements are issued.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Management's plans to address these matters include the following:

● Expanding into new and existing markets, with an emphasis on the RaaS model;

● Obtaining additional debt and/or equity financing to support working capital and growth;

● Pursuing strategic collaborations and partnerships; and

● Selectively evaluating acquisitions that enhance or complement the Company's business model.

**<u>Note 2 - Summary of Significant Accounting Policies</u>**

**Principles of Consolidation** 

The unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP and include the accounts of the Company and its wholly owned subsidiaries. The Company consolidates entities where it has a controlling financial interest, as defined by ASC 810, "Consolidation".

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

In accordance with ASC 810-10, consolidation applies to:

● Entities with more than 50% voting interest, unless control is not with the Company; and

● Variable Interest Entities (VIEs), where the Company is the primary beneficiary, possessing both (i) power over significant activities and (ii) the obligation to absorb losses or receive benefits.

All intercompany transactions and balances are eliminated in consolidation. The Company continuously evaluates its investments and relationships to assess consolidation requirements.

**Business Combinations and Asset Acquisitions**

The Company accounts for acquisitions in accordance with ASC 805, *Business Combinations*. Transactions that meet the definition of a business are accounted for using the acquisition method of accounting. Transactions that do not meet the definition of a business are accounted for as asset acquisitions under ASC 805-50. The Company also evaluates whether a transaction should be accounted for as a reverse acquisition under ASC 805-40.

In connection with acquisitions, the Company assesses the applicable SEC reporting requirements, including Regulation S-X Rule 3-05 for financial statements of significant businesses acquired and Regulation S-X Article 11 for pro forma financial information.

Disclosures related to the nature of the acquired business and the impact of the acquisition on the Company's operations are provided in accordance with Regulation S-K Items 101 and 303. For hotel property acquisitions, the Company also evaluates the applicability of Regulation S-X Rule 3-14.

Business Combinations

For transactions classified as business combinations, the Company:

● Recognizes and measures identifiable assets acquired, liabilities assumed, and noncontrolling interests at their fair values at the acquisition.

● Records goodwill as the excess of the fair value of consideration transferred over the fair value of net assets acquired, including any previously held equity interests.

● Expenses acquisition-related costs as incurred.

● Uses preliminary purchase price allocations, with adjustments permitted within the measurement period (not exceeding one year). Adjustments beyond the measurement period are recorded in earnings.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Significant judgments in fair value determinations include:

● Intangible asset valuations, based on estimates of future cash flows and discount rates.

● Useful life assessments, impacting amortization and financial results.

For SEC registrants, Regulation S-X, Rule 3-05 may require audited financial statements of the acquired business if the acquisition is significant. The determination of significance follows Rule 1-02(w) of Regulation S-X, which considers investment, asset, and income tests.

Asset Acquisitions

For transactions classified as asset acquisitions under ASC 805-50, the Company:

● Applies the "screen test" to determine whether substantially all of the fair value of gross assets acquired is concentrated in a single identifiable asset or group of similar assets.

● Allocates the purchase price using a cost accumulation model, assigning costs to acquired assets based on their relative fair values.

● Capitalizes direct acquisition costs as part of the asset's cost, unlike business combinations where such costs are expensed.

The classification between business combinations and asset acquisitions requires significant judgment, particularly when applying the screen test. Incorrect classification can materially impact:

● The recognition of goodwill (only in business combinations).

● The measurement and presentation of acquired assets and assumed liabilities.

● The Company's financial position and results of operations.

Regulatory and Financial Reporting Considerations

For SEC registrants, acquisitions may trigger additional disclosure and reporting requirements:

*Regulation S-X, Rule 3-05 (Business Acquisitions):*

 

Applies to acquisitions of operating businesses. If significance thresholds are met, the registrant must provide separate business-level financial statements (up to three years).

 

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

 

*Regulation S-X, Article 11:*

 

Requires pro forma financial information when an acquisition is significant, including adjustments reflecting the impact of the acquisition on the registrant's financial statements.

*Form 8-K, Item 2.01:*

 

Requires timely reporting of material acquisitions, including disclosure of the nature of the acquired business or property and, when applicable, financial statements and pro forma information under Item 9.01.

The Company continuously evaluates acquisitions, to ensure proper classification and compliance with ASC 805, SEC reporting requirements, and regulatory guidance.

Goodwill and Impairment

Goodwill represents the excess of the purchase price over the fair value of net assets acquired in a business combination. Goodwill is not amortized, but is reviewed for impairment at least annually (in the fourth quarter) or more frequently if events or changes in circumstances indicate the carrying value of goodwill may not be recoverable.

For impairment testing purposes, goodwill is assigned to the reporting unit(s) expected to benefit from the synergies of the acquisition. The Company performs either a qualitative assessment ("Step 0") to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value, or a quantitative assessment when required.

● If the qualitative assessment indicates potential impairment, the Company estimates the fair value of the reporting unit and compares it with its carrying amount, including goodwill.

● If the carrying amount exceeds fair value, an impairment charge is recognized for the difference, not to exceed the carrying value of goodwill.

Significant judgments in goodwill impairment testing include:

● Determining the appropriate reporting units.

● Forecasting future cash flows.

● Selecting appropriate discount rates and market multiples.

● Assessing macroeconomic factors, industry trends, and Company-specific performance.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Impairment Charges

**Fiscal Year End June 30, 2026**

The Company did not record any goodwill impairments during the three and six months ended December 31, 2025 and 2024, respectively.

**Fiscal Year End June 30, 2025**

The Company recorded a goodwill impairment charge of $897,542 for the year ended June 30, 2025.

The 2025 impairment charge relates to goodwill arising from the acquisition of FHVH (recorded during the fiscal year ended June 30, 2024), which was determined to be not recoverable based on the Company's annual impairment testing under ASC 350, Intangibles—Goodwill and Other. The impairment was recognized after management concluded that the carrying amount of the related reporting unit exceeded its fair value.

**Business Segments and Expense Disclosure**

The Company follows ASC 280, Segment Reporting, which requires public entities to report financial and descriptive information about their reportable operating segments.

An operating segment is a component of a public entity that:

● Engages in business activities from which it may earn revenues and incur expenses;

● Has operating results that are regularly reviewed by the Chief Operating Decision Maker ("CODM," which is our Chief Executive Officer) to make decisions about resource allocation and performance assessment; and

● Has discrete financial information available.

Based on the nature of the Company's operations and the information regularly reviewed by the CODM, management has determined that the Company operates in three reportable segments: Foodservice Packaging Distribution, Robotics-as-a-Service (RaaS), and Hotel Operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Reportable Segments

Following the acquisition of SWC Group, Inc. (d/b/a CarryOutSupplies.com) on March 31, 2025, the commencement of commercial activities under the Robotics-as-a-Service ("RaaS") model, and the acquisitions of two hotel properties during the six months ended December 31, 2025, management determined that the Company operates in three reportable segments:

1. Foodservice Packaging Distribution

Conducted through SWC Group, Inc. (d/b/a CarryOutSupplies.com).

This segment provides wholesale distribution of disposable foodservice packaging products, including printed paper cups, plastic cups, food containers, bags, and related consumable items. Revenue is generated from the sale and shipment of products to customers. This segment commenced operations in connection with the acquisition on March 31, 2025.

2. Robotics-as-a-Service (RaaS)

Conducted through TechForce Robotics, Inc. (formerly Skytech Automated Solutions, Inc.) and Future Hospitality Ventures Holdings, Inc.

This segment provides automation solutions for foodservice and hospitality environments under multi-year lease and service arrangements. Revenue is generated from recurring monthly service fees for the use of robotics equipment, remote monitoring, software services, and maintenance support.

3. Hotel Operations

Conducted through Victorville Treasure Holdings, LLC and Treasure Mountain Holdings, LLC, the Company's wholly owned subsidiaries that own the hotel properties acquired in Victorville and Rancho Mirage, California, respectively.

This segment generates revenue from lodging and related guest services, including room rentals and ancillary offerings such as food, beverage, and other guest amenities. The hotels also serve as deployment and testing environments for the Company's automation technologies. This segment commenced operations in connection with the acquisitions completed on August 27, 2025 and September 30, 2025.

The CODM evaluates performance and allocates resources based on segment-level financial information, including revenues and operating results. As such, management has concluded that Foodservice Packaging Distribution, RaaS, and Hotel Operations represent separate reportable operating segments under ASC 280.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

See Note 13 - Segment Information.

Discontinued Operations

The Company's legacy Snacks and Beverages activity has been discontinued. The results of this activity are presented separately from continuing operations.

Segment Expense Disclosure

Effective for the fiscal year ending June 30, 2026, the Company adopted ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures*. The amended guidance requires enhanced disclosures about reportable segment expenses, including:

● Significant segment expenses that are regularly provided to and reviewed by the CODM

● The measure of segment profit or loss used by the CODM

● A description of other segment items included in that measure

● How expense amounts are allocated among segments

The CODM evaluates segment performance based on segment revenues and segment operating income (loss). The CODM is not provided with, nor does he review further disaggregated expense information below the operating income (loss) level, other than consolidated-level expenses that are not allocated to the segments.

Accordingly, the Company's disclosures include the segment revenues and segment operating income (loss) reviewed by the CODM, as well as "other segment items" necessary to reconcile segment profit (loss) to consolidated loss before income taxes. No additional segment-level expense categories are required to be presented under ASU 2023-07 because no such detailed expense information is provided to or used by the CODM in assessing segment performance.

**Use of Estimates and Assumptions**

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying disclosures. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the reporting date, and the recognition of revenues and expenses during the reporting period. Actual results may differ from those estimates, and such differences may be material.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Estimates and assumptions are evaluated on an ongoing basis and are based on historical experience, current economic conditions, industry trends, and other relevant quantitative and qualitative factors. Changes in estimates are recorded in the period in which they become known and are accounted for prospectively.

Significant estimates for the six months ended December 31, 2025 and the year ended June 30, 2025, respectively, include:

● Allowance for doubtful accounts and other receivables;

● Inventory valuation and obsolescence reserves;

● Fair value measurements related to business combinations under
ASC 805, including:

● Purchase price consideration, including the fair value of Series C Convertible

● Preferred Stock issued as acquisition consideration;

● Identifiable intangible assets;

● Property and equipment;

● Contingent consideration; and

● Allocation of purchase price to identifiable assets and liabilities, including the resulting goodwill;

● Impairment assessment of goodwill and indefinite-lived intangible
assets;

● Impairment assessment of long-lived assets, including finite-lived
intangible assets and property and equipment;

● Fair value of derivative liabilities;

● Classification of convertible preferred stock between temporary
equity and permanent equity;

● Valuation of stock-based compensation;

● Estimated useful lives of property and equipment and finite-lived
intangible assets;

● Assessment of the Company's ability to continue as a
going concern;

● Valuation of loss contingencies; and

● Valuation allowance on deferred tax assets and assessment of
uncertain tax positions.

**Risks, Uncertainties and Concentrations**

The Company operates across multiple industries — including foodservice packaging distribution, robotics-as-a-service ("RaaS"), and hotel operations — that are each subject to competitive, economic, and operational risks. In accordance with ASC 275, \*Risks and Uncertainties\*, the Company evaluates and discloses risks that could significantly affect the amounts reported in the near term, including risks arising from the use of estimates and current vulnerability due to concentrations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

*Concentrations of Risk*

Revenue and Asset Concentration

Substantially all of the Company's hospitality segment revenue is generated from two hotel properties located in Victorville and Rancho Mirage, California. These properties also represent a significant portion of the Company's total assets. A decline in performance at either property — whether due to local economic conditions, competitive pressures, natural disasters, or loss of franchise rights — could have a material adverse effect on the Company's consolidated financial position and results of operations.

Geographic Concentration

The Company's hotel operations, robotics deployment activities, and warehouse and distribution facilities are concentrated in the State of California. As a result, the Company is disproportionately exposed to regulatory changes, economic conditions, natural disasters, and labor market dynamics specific to that state.

Franchise Concentration

The Company's hotel properties operate under franchise agreements with established national hotel brands. The Company's ability to generate hospitality revenue depends on maintaining compliance with franchise brand standards, including property maintenance requirements, periodic upgrades, and participation in brand programs. Loss of one or both franchise agreements could materially impair the Company's hospitality operations and the carrying value of the related assets.

Customer Concentration

As of December 31, 2025, no single customer accounted for 10% or more of the Company's consolidated revenues.

Within the Foodservice Packaging Distribution segment, the Company serves a diversified base of small to mid-sized foodservice operators, with no material dependence on any single customer.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Supplier Concentration

The Company sources robotics components and hardware from a limited number of domestic and international suppliers. Certain components used in the Company's robotic systems may be available from sole or limited sources. An interruption in supply, quality issues, or changes in supplier pricing or availability could delay deployments and adversely affect the Company's RaaS operations. Within the Foodservice Packaging Distribution segment, the Company sources products from multiple domestic and international manufacturers, with no material dependence on any single supplier.

Key Personnel

The Company is dependent on the continued services of its Chief Executive Officer, who also serves as Chief Financial Officer and controls 1,000 shares of Series A Super Voting Preferred Stock, providing effective voting control over the Company. The loss of its Chief Executive Officer's services could have a material adverse effect on the Company's operations and strategic direction.

Significant Estimates Subject to Near-Term Variability

Certain of the Company's estimates are particularly sensitive to changes in conditions in the near term. These include:

*Fair value of acquired assets and assumed liabilities*

The Company completed two hotel property acquisitions during the six months ended December 31, 2025. The purchase price allocations involve significant estimates regarding the fair values of property and equipment, identifiable intangible assets, contingent consideration, and goodwill. Adjustments to preliminary valuations within the measurement period could materially affect reported amounts. See Note 9.

*Goodwill and intangible asset impairment*

The Company has recorded goodwill and intangible assets in connection with its business combinations. Declines in projected revenues, changes in market conditions, or other adverse developments could result in impairment charges that may be material.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

*Derivative liabilities*

The Company has outstanding convertible instruments with variable conversion features that require fair value measurement at each reporting date. Changes in the Company's stock price, volatility assumptions, or other inputs could result in material changes to the reported fair value of these liabilities.

*Going concern*

As discussed in the Liquidity and Going Concern note, the Company's ability to continue as a going concern is dependent on obtaining additional financing. The outcome of this uncertainty could materially affect the recoverability and classification of recorded asset amounts and the amounts and classification of liabilities.

*Other Risks*

The Company's financial performance may also be affected by broader macroeconomic factors, including inflationary pressures, interest rate fluctuations, labor market constraints, supply chain disruptions, and changes in consumer demand. The Company is also subject to federal, state, and local regulations related to manufacturing and distribution, automation equipment, franchise operations, hotel licensing, labor practices, and financial reporting. Noncompliance could result in fines, penalties, or operational restrictions.

The Company operates across multiple industries—including foodservice packaging distribution, robotics-as-a-service ("RaaS"), and hotel operations—that are each subject to unique competitive, economic, and operational risks. These industries are characterized by rapid changes in market dynamics, evolving customer preferences, technological innovation, and sensitivity to macroeconomic conditions. As a result, the Company is exposed to various risks and uncertainties that may materially impact its financial condition, results of operations, cash flows, and strategic objectives.

**Fair Value of Financial Instruments**

The Company accounts for financial instruments in accordance with Financial Accounting Standards Board (FASB) ASC 820, Fair Value Measurements, which establishes a framework for measuring fair value and requires related disclosures. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the Company's principal market or, if none exists, the most advantageous market for the asset or liability.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Fair Value Hierarchy

ASC 820 requires the use of observable inputs whenever available and establishes a three-tier hierarchy for measuring fair value:

● Level 1 – Quoted market prices (unadjusted) for identical assets or liabilities in active markets.

● Level 2 – Observable inputs other than quoted prices in active markets, such as quoted prices for similar assets and liabilities or inputs that are directly or indirectly observable.

● Level 3 – Unobservable inputs that require significant judgment, including management assumptions and estimates based on available market data.

The classification of an asset or liability within the hierarchy is based on the lowest level of input that is significant to the fair value measurement. Level 3 valuations generally require more judgment and complexity, often involving a combination of cost, market, or income approaches, as well as assumptions about market conditions, pricing, and other factors.

Fair Value Determination and Use of External Advisors

The Company assesses the fair value of its financial instruments and, where appropriate, may engage external valuation specialists to assist in determining fair value. While management believes that recorded fair values are reasonable, they may not necessarily reflect net realizable values or future fair values.

Financial Instruments Carried at Historical Cost

The Company's financial instruments—including cash, accounts receivable, accounts payable and accrued expenses (including related party balances), and certain debt instruments—are recorded at historical cost. As of December 31, 2025 and June 30, 2025, respectively, the carrying amounts of these instruments approximated their fair values due to their short-term maturities.

**Cash and Cash Equivalents and Concentration of Credit Risk**

For purposes of the consolidated statements of cash flows, the Company considers all highly liquid instruments with a maturity of three months or less at the purchase date and money market accounts to be cash equivalents.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

At December 31, 2025 and June 30, 2025, respectively, the Company did not have any cash equivalents.

The Company is exposed to credit risk on its cash and cash equivalents in the event of default by the financial institutions to the extent account balances exceed the amount insured by the FDIC, which is $250,000.

At December 31, 2025 and June 30, 2025, respectively, the Company did not experience any losses on cash balances in excess of FDIC insured limits.

**Accounts Receivable** 

The Company accounts for accounts receivable in accordance with ASC 310, *Receivables*. Accounts receivable are stated at their net realizable value, which represents the amounts expected to be collected from customers.

Trade receivables primarily arise from:

● Foodservice Packaging Distribution – invoiced product sales

● RaaS – monthly service fees billed in advance

● Hotel Operations –

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● Guest ledger receivables, representing charges incurred by in-house guests prior to settlement at check-out

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● City ledger receivables, representing amounts due from corporate accounts, groups, travel agencies, and other third-party billing arrangements

The Company does not require collateral and does not accrue interest on past-due balances.

Allowance for Expected Credit Losses

The Company evaluates the collectability of accounts receivable and records an allowance for credit losses in accordance with ASC 326, *Financial Instruments—Credit Losses ("CECL")*. The allowance is estimated using a provision matrix approach based on:

● historical loss experience by revenue stream,

● customer aging and payment trends,

● current economic conditions, and

● reasonable and supportable forecasts.

Guest ledger balances generally have short settlement periods and historically low loss experience, while city ledger balances and trade receivables are evaluated based on aging, customer credit quality, and historical write-offs.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Receivables sharing similar risk characteristics are evaluated collectively. Amounts determined to be uncollectible are written off against the allowance when collection efforts have been exhausted.

Allowance for expected credit losses was $51,962 and $51,962, at December 31, 2025 and June 30, 2025, respectively.

The following is a summary of the Company's accounts receivable at December 31, 2025 and June 30, 2025:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| Accounts receivable | $213053 | $98177 |
| Less: allowance for credit losses | 51962 | 51962 |
| Accounts receivable - net | $161091 | $46215 |

---

Bad Debt Expense

For the three and six months ended December 31, 2025 and 2024, bad debt was as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $5019 | $- |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $66177 | $48610 |

---

Bad debt expense (recovery) is recorded as a component of general and administrative expenses in the accompanying consolidated statements of operations.

Bad debt expense related to the discontinued Snack and Beverages business, has been presented within discontinued operations.

**Inventory**

The Company accounts for inventory in accordance with ASC 330, *Inventory*. Inventory is stated at the lower of cost or net realizable value ("LCNRV") using the first-in, first-out (FIFO) method. Inventory consists of items held for sale or use in the ordinary course of business across the Company's operating segments.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Continuing Operations

As of December 31, 2025 and June 30, 2025, inventory consisted primarily of:

● Foodservice Packaging Distribution:

Finished goods including paper cups, plastic cups, food containers, bags, and other disposable consumables.

● Robotics-as-a-Service (RaaS):

None. Inventory used in RaaS deployments (e.g., spare parts, components) is expensed as incurred and not carried as inventory.

● Hotel Operations:

Food and beverage inventory and retail/minibar items held for sale. Hotel operating supplies not held for sale—such as guest amenities, linens, and cleaning supplies—are expensed as incurred and excluded from inventory.

Inventory Valuation and Reserves

Management evaluates inventory at each reporting date to determine whether reserves are required for slow-moving, obsolete, or impaired items. In performing this assessment, management considers:

● aging and turnover trends;

● expected future demand;

● historical usage and spoilage (particularly for perishable hotel F&B items);

● current market and pricing conditions; and

● estimated net realizable value.

Adjustments to inventory reserves are recorded within cost of revenues in the period identified.

No inventory write-downs or adjustments to LCNRV were recorded during the three and six months ended December 31, 2025 or 2024, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

At December 31, 2025 and June 30, 2025, inventory was as follows:

---

| | | |
|:---|:---|:---|
| **Classification** | **December 31, 2025** | **June 30, 2025** |
| Packaging and supplies | $396942 | $319491 |
| Food and beverage | 40781 | - |
| Total Inventory | $437723 | $319491 |

---

Included in these amounts were $54,213 and $92,513 of inventory in transit, respectively.

**Property and Equipment**

Property and equipment are recorded at cost, net of accumulated depreciation, in accordance with ASC 360, "Property, Plant, and Equipment." Depreciation is calculated using the straight-line method over the estimated useful lives of the assets.

Repairs and maintenance expenditures that do not materially extend the useful life of an asset are expensed as incurred. Significant improvements or upgrades that increase the asset's productivity, efficiency, or useful life are capitalized.

Property Improvement Plans ("PIPs")

In connection with operating franchised hotel properties, the Company is periodically required under its franchise agreements to complete Property Improvement Plans ("PIPs"), which generally include renovations, replacements, and upgrades to guestrooms, public areas, building systems, and other components of the hotels.

PIP-related expenditures are evaluated under ASC 360 to determine whether they should be capitalized or expensed:

● Capitalized PIP costs

PIP costs are capitalized when they represent betterments or improvements that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ● extend the useful life of the asset;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● increase the asset's capacity or efficiency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● materially upgrade the property to meet current brand standards; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● replace major components of the hotel.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Capitalized PIP costs are recorded as part of buildings and improvements or FF&E and depreciated over their estimated useful lives.

● Expensed as incurred

Routine repairs, maintenance, cosmetic refreshes, and other PIP activities that do not extend useful life or enhance the asset's functionality are expensed as incurred.

The determination of whether a PIP expenditure should be capitalized or expensed requires judgment and is based on the nature of the work performed, the condition of the underlying assets, and the extent to which the PIP activity enhances or extends the property's utility.

Disposals

Upon disposal or sale of property and equipment, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is recognized in the statement of operations.

**Impairment of Long-lived Assets** 

The Company evaluates the recoverability of long-lived assets, including identifiable intangible assets, in accordance with FASB ASC 360-10-35-15, Impairment or Disposal of Long-Lived Assets.

An impairment review is triggered when events or circumstances indicate that the carrying value of an asset group may not be recoverable. Factors considered include, but are not limited to:

● Significant changes in expected performance compared to prior forecasts,

● Changes in asset utilization, including discontinued or modified use,

● Negative industry or economic trends that impact asset value, and

● Strategic shifts in the Company's business operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Impairment Assessment Process

When impairment indicators exist, the Company performs a recoverability test by comparing the undiscounted future cash flows expected to be generated from the use and ultimate disposition of the asset group to its carrying amount.

● If the undiscounted cash flows exceed the carrying amount, no impairment is recognized.

● If the undiscounted cash flows are less than the carrying amount, an impairment loss is recognized, measured as the excess of the carrying amount over the fair value of the asset.

Impairment Results

For the three and six months ended December 31, 2025 and 2024, respectively, the Company did not record any impairment losses.

**Derivative Liabilities**

The Company evaluates financial instruments containing characteristics of both liabilities and equity in accordance with FASB ASC 480, Distinguishing Liabilities from Equity, and FASB ASC 815, Derivatives and Hedging.

Accounting for Derivative Liabilities

Derivative liabilities are revalued at fair value at each reporting period, with changes in fair value recognized in the results of operations as a gain or loss on derivative remeasurement. The Company uses a Black-Scholes option pricing model to determine the fair value of these instruments.

Conversion and Extinguishment of Derivative Liabilities

When a debt instrument with an embedded conversion option (e.g., convertible debt or warrants) is converted into shares of common stock or repaid, the Company:

● Records the newly issued shares at fair value;

● Derecognizes all related debt, derivative liabilities, and unamortized debt discounts; and

● Recognizes a gain or loss on debt extinguishment, if applicable.

For equity-based derivative liabilities (e.g., warrants) that are extinguished, any remaining liability balance is reclassified to additional paid-in capital.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Reclassification of Equity Instruments to Liabilities

Equity instruments initially classified as equity may be reclassified as liabilities if they no longer meet equity classification criteria. In such cases, they are remeasured at fair value on the date of reclassification, with changes recognized in earnings.

Derivative Liability Balances

As of December 31, 2025 and June 30, 2025, the Company had derivative liabilities of $3,190,262 and $1,102,992, respectively.

Included in these totals are amounts to related parties of $270,610 and $297,227, respectively.

See Notes 11 and 12.

**Original Issue Discounts and Other Debt Discounts** 

The Company accounts for original issue discounts (OID) and other debt discounts in accordance with FASB ASC 835-30, Interest—Imputation of Interest. These discounts are recorded as a reduction of the carrying amount of the related debt and are amortized to interest expense over the term of the debt using the effective interest method, unless the straight-line method is materially similar.

Original Issue Discounts (OID)

For certain notes issued, the Company may provide the debt holder with an original issue discount (OID), which is recorded as a debt discount, reducing the face value of the note. The discount is amortized to interest expense over the term of the debt in the Consolidated Statements of Operations.

Stock and Other Equity Issued with Debt

The Company may issue common stock or other equity instruments in connection with debt issuance. When stock is issued, it is recorded at fair value and treated as a debt discount, reducing the carrying amount of the note. These discounts are amortized to interest expense over the life of the debt.

The combined debt discounts, including OID and stock-related discounts, cannot exceed the face amount of the debt.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Debt Issuance Costs

Debt issuance costs, including fees paid to lenders or third parties, are capitalized as a debt discount and amortized to interest expense over the life of the debt. These costs are presented as a direct deduction from the carrying amount of the debt liability rather than as a separate asset.

**Right of Use Assets and Lease Obligations**

The Company accounts for right-of-use (ROU) assets and lease liabilities in accordance with FASB ASC 842, Leases. These amounts reflect the present value of the Company's estimated future minimum lease payments over the lease term, including any reasonably certain renewal options, discounted using a collateralized incremental borrowing rate.

The Company classifies its leases as either operating or finance leases. The Company's leases primarily consist of operating leases, which are included as Right-of-Use Assets and Operating Lease Liabilities on the consolidated balance sheets.

Short-Term Leases

The Company has elected the short-term lease exemption, whereby leases with a term of 12 months or less are not recorded on the balance sheet. Instead, lease payments are expensed on a straight-line basis over the lease term.

Lease Term and Renewal Options

In determining the lease term, the Company evaluates whether renewal options are reasonably certain to be exercised. Factors considered include:

● The useful life of leasehold improvements relative to the lease term,

● The economic performance of the business at the leased location,

● The comparative cost of renewal rates versus market rates, and

● The presence of any significant economic penalties for non-renewal.

If a renewal option is deemed reasonably certain to be exercised, the ROU asset and lease liability reflect those additional future lease payments. The Company's operating leases contain renewal options with no residual value guarantees. Currently, management does not expect to exercise any renewal options, which are therefore excluded in the measurement of lease obligations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Discount Rate and Lease Liability Measurement

Since the implicit rate in the leases is not readily determinable, the Company applies an incremental borrowing rate that represents the rate it would incur to borrow on a collateralized basis over a similar term and currency environment.

Lease Impairment

The Company evaluates ROU assets for impairment indicators whenever events or changes in circumstances suggest the carrying amount may not be recoverable. No impairments of ROU assets were recognized for the three and six months ended December 31, 2025 and 2024, respectively.

See Note 15.

**Revenue Recognition**

The Company recognizes revenue in accordance with ASC 606, *Revenue from Contracts with Customers*. Revenue is recognized when control of promised goods or services transfers to customers, in an amount that reflects the consideration expected to be received. The Company applies the five-step revenue recognition model prescribed by ASC 606, as described below.

Revenue Streams

The Company currently generates revenue primarily from the following three (3) sources:

&nbsp;&nbsp;&nbsp;&nbsp;1. Foodservice
 Packaging – Revenues from the wholesale distribution of disposable foodservice packaging
 products, including both custom-printed and stock paper cups, plastic cups, food containers,
 bags, and related consumable items. Sales are primarily transacted through the Company's
 e-commerce platform and are recognized upon shipment or delivery of goods to the customer,
 depending on the terms of sale.

&nbsp;&nbsp;&nbsp;&nbsp;2. Robotics-as-a-Service
 (RaaS) – Revenues generated under multi-year service arrangements for automation solutions
 deployed in the foodservice and hospitality industries. These arrangements generally include
 recurring monthly service fees for the use of robotic systems, together with implementation
 and integration services, maintenance, and technical support. Revenue is recognized over
 time as services are rendered in accordance with the terms of each contract.

&nbsp;&nbsp;&nbsp;&nbsp;3. Hospitality
 Operations – Revenues derived from the ownership and operation of hotel properties,
 including room rentals, food and beverage sales, and ancillary guest services such as event
 hosting, parking, and other amenities. Revenue is recognized at the time the related goods
 or services are provided to guests.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

The Company previously generated revenues from the sale of packaged snack and beverage products. This activity has been discontinued and is presented separately as discontinued operations (see Note 14 – Discontinued Operations).

**A. Foodservice Packaging Distribution**

Revenue from the distribution of disposable foodservice packaging products is derived exclusively from business customers on a wholesale basis through the Company's e-commerce platform and direct sales channels. Customer contracts typically contain a single performance obligation: delivery of the ordered products.

The Company has elected to account for shipping and handling activities that occur after the customer obtains control as fulfillment costs rather than as separate performance obligations, in accordance with the practical expedient under ASC 606-10-25-18A. Because sales are exclusively to registered businesses, the Company collects and remits sales taxes where required; sales to businesses are exempt only when valid resale or exemption certificates are obtained.

**B. Robotics as a Service**

Revenue from Robotics-as-a-Service ("RaaS") arrangements is recognized over time as services are provided under multi-year customer service agreements, which typically follow an initial pilot and site-preparation period. Contracts generally include a recurring monthly service fee covering access to robotic equipment, automation software, monitoring, and support services. Although agreements are typically multi-year in duration, the related performance obligation is the continuous provision of RaaS services, and revenue is recognized ratably each month as services are delivered.

The Company owns and deploys all robotic equipment, including hardware, software, and related components, which remain the property of the Company throughout the term of the arrangement. Customers do not obtain control over the deployed units. The Company retains physical possession of the equipment, directs how and when the robotic systems perform their designated tasks through proprietary software, determines operational parameters and scheduling, performs all servicing, maintenance, and software updates, and retains the right to substitute units at its discretion without customer approval. Because the customer does not have the right to obtain substantially all of the economic benefits from the equipment or the right to direct its use, management has concluded that these arrangements do not contain a lease component under ASC 842, *Leases*. Accordingly, the entire arrangement is accounted for under ASC 606, *Revenue from Contracts with Customers*.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Certain arrangements may include one-time activities such as installation, integration, or training. These activities are not distinct performance obligations and are accounted for as part of the overall service contract, with related fees recognized over the contract term. Ongoing support includes remote technical assistance, software updates, and maintenance, all of which are included in the recurring monthly service fee.

The Company generally invoices customers monthly in arrears for services rendered. Because the Company has a right to consideration in an amount that corresponds directly with the value of performance completed to date, revenue is measured using the right-to-invoice practical expedient under ASC 606-10-55-18. Contract assets and contract liabilities (deferred revenue) related to RaaS arrangements are not significant.

**C. Hospitality Operations**

Revenue from hospitality operations is generated primarily from the ownership and management of hotel properties. The Company's hotel revenues consist of (i) room revenues, (ii) food and beverage revenues, and (iii) other ancillary revenues such as meeting and event space rentals, parking, and miscellaneous guest services.

1. Room
 Revenues. Revenue from room rentals is recognized on a daily basis as rooms are occupied,
 as each night of occupancy represents a distinct performance obligation with control transferring
 to the guest at the point the room is made available and occupied. Payments are typically
 due at check-out or are settled by credit card upon completion of the stay. Advance deposits
 received prior to guest arrival are recorded as contract liabilities (deferred revenue) until
 the related stay occurs.

2. Food
 and Beverage Revenues. Revenue from restaurant, bar, catering, and banquet operations is
 recognized at the point in time the related goods or services are provided to the guest.
 In cases where deposits are received for catered events or group bookings, such amounts are
 recorded as deferred revenue until the event takes place.

3. Other
 Ancillary Revenues. Revenue from parking, resort fees, event space rentals, and other guest
 services is recognized when the service is rendered or the rental period has elapsed.

The Company acts as the principal in substantially all hospitality transactions, as it controls the goods and services prior to transfer to the customer. Revenues are presented net of any sales or occupancy taxes collected on behalf of governmental authorities.

The timing of billing and payment for hotel operations typically coincides with the satisfaction of performance obligations; therefore, contract assets and contract liabilities related to hospitality revenues are not significant.

The timing of billing and payment for hotel operations typically coincides with the satisfaction of performance obligations; therefore, contract assets and contract liabilities related to hospitality revenues are not significant.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**D. Snacks and Beverages (Discontinued Operations)**

The Company previously generated revenue from the sale of snack and beverage products. This activity has been discontinued and is presented as discontinued operations in the accompanying consolidated financial statements.

For periods prior to discontinuation, revenue was recognized net of slotting fees, trade promotions, discounts, and other sales incentives, which were classified as variable consideration. Variable consideration was estimated based on historical experience, contractual terms, and current promotional strategies. Estimates were reviewed and updated each reporting period, and revenue was recognized only to the extent it was probable that a significant reversal would not occur.

No revenues or expenses from this activity are expected to contribute to the Company's future results.

The Company follows the five-step revenue recognition model:

1. Identify the Contract with a Customer

A contract exists when:

● The agreement creates enforceable rights and obligations;

● It has commercial substance;

● Payment terms are defined and consideration is determinable;

● Collection is probable

Customer credit risk is assessed at contract inception and updated periodically.

For Robotics-as-a-Service ("RaaS") contracts, agreements are non-cancellable for an initial 36-month term (except for breach), and automatically renew for one-year periods unless terminated. Management accounts for renewals as new contracts.

For Hospitality Operations, contracts with customers are typically short-term in nature. Individual room bookings, restaurant transactions, and event bookings constitute distinct contracts with clearly defined payment terms. Deposits received in advance of stays or events represent contract liabilities until performance obligations are satisfied.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

2. Identify the Performance Obligations

Foodservice Packaging – Each order represents a single performance obligation: shipment or delivery of the ordered goods.

Robotics-as-a-Service (RaaS) – Robotics-as-a-Service (RaaS) – Each contract contains a single bundled performance obligation, representing the continuous provision of robotic equipment and related services, including installation, integration, training, maintenance, and technical support. Installation and training are not distinct, as customers cannot benefit from the robots without integration. One-time implementation activities, when billed, are included in the overall service obligation and recognized over the contract term.

Hospitality Operations – Each guest contract contains one or more distinct performance obligations, depending on the nature of the service:

● Room revenue: each night of occupancy represents a distinct performance obligation satisfied over time.

● Food and beverage: each sale represents a distinct performance obligation satisfied at the point in time when the good or service is provided.

● Event or banquet services: represent a single performance obligation satisfied when the event occurs.

● Other ancillary services (e.g., parking, resort fees): represent distinct performance obligations satisfied when the service is rendered.

Snacks and Beverages (Discontinued) – Historically, each sale represented a single performance obligation for delivery of products. These activities were discontinued as of June 30, 2025, and results are presented as discontinued operations.

3. Determine the Transaction Price

Foodservice Packaging – Transaction price consists primarily of fixed consideration based on contract or list pricing.

RaaS – Transaction price consists of fixed monthly service fees over the 36-month initial term. Invoices are issued monthly, and payments are generally due as services are provided.

Contracts do not include material variable consideration, and the Company historically has not collected consideration prior to performance. As a result, contract liabilities (deferred revenue) are not significant.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Hospitality Operations – Transaction price consists primarily of fixed consideration stated in room rates, menu prices, or event contracts. Room and restaurant sales are typically settled at the point of sale, while deposits for group or event bookings are collected in advance and recorded as deferred revenue until the related service is provided. Variable consideration, such as discounts or promotional rates, is reflected in the transaction price when known. Taxes collected on behalf of governmental authorities (e.g., sales or occupancy taxes) are excluded from revenue.

Snacks and Beverages (Discontinued) – Transaction price included fixed consideration plus variable consideration such as slotting fees, promotions, and rebates.

4. Allocate the Transaction Price

Contracts generally contain only a single performance obligation (product delivery for Packaging, continuous monthly service for RaaS, or a single stay, sale, or event for Hospitality). Accordingly, the entire transaction price is allocated to that performance obligation.

5. Recognize Revenue When (or As) Performance Obligations Are Satisfied

Foodservice Packaging – Revenue is recognized at a point in time when control of the goods transfers to the customer (generally upon shipment or delivery).

RaaS – Revenue is recognized over time, ratably each month, as customers simultaneously receive and consume the benefits of the continuous service.

Hospitality Operations –

● Room revenue: recognized over time on a daily basis as each night of occupancy occurs.

● Food and beverage: recognized at a point in time when goods or services are provided.

● Event, banquet, and ancillary services: recognized when the event occurs or the service is rendered.

Advance deposits for rooms or events are recorded as deferred revenue until performance obligations are satisfied.

Snacks and Beverages (Discontinued) – Revenue was historically recognized at a point in time upon shipment or delivery.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Principal vs. Agent Considerations

In accordance with ASC 606-10-55-36 through 55-40, the Company evaluated whether it acts as principal or agent in each of its revenue streams. The assessment considers whether the Company (i) obtains control of goods or services before transfer to the customer, (ii) has discretion in establishing pricing, (iii) is primarily responsible for fulfillment, and (iv) is exposed to inventory or service-level risks.

Based on this analysis, the Company reached the following conclusions:

1. Foodservice Packaging Distribution

The Company acts as a principal in foodservice packaging sales.

● The Company designs, sources, and controls products prior to transfer.

● The Company has discretion in pricing.

● The Company is responsible for fulfillment, including warehousing and logistics.

● The Company bears inventory risk prior to transfer.

Revenue is recognized on a gross basis for foodservice packaging sales.

2. Robotics-as-a-Service (RaaS)

The Company acts as a principal in RaaS arrangements.

● The Company provides customers with continuous access to robotic equipment and related services.

● The Company controls the equipment and services before and during the transfer period.

● The Company has discretion over pricing and contract terms.

● The Company is responsible for providing and maintaining the service throughout the contract term.

Revenue is recognized on a gross basis for RaaS service contracts.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

3. Hospitality Operations

The Company acts as a principal in all hospitality operations.

● The Company owns and operates all hotels and controls the goods and services prior to transfer.

● The Company sets room rates, menu prices, and event charges at its discretion.

● The Company is responsible for providing accommodations, food and beverage, and related services directly to guests.

● The Company bears the risks and rewards associated with hotel operations, including occupancy, cost, and service delivery risks.

Revenue is recognized on a gross basis for all hospitality activities.

4. Snacks and Beverages (Discontinued Operations)

Prior to discontinuation, the Company acted as a principal in snack and beverage sales.

● The Company controlled inventory prior to transfer.

● The Company set pricing at its discretion.

● The Company was responsible for fulfillment of its performance obligations.

● The Company bore inventory risk until sale.

Revenue was recognized on a gross basis for snack and beverage sales, prior to classification as discontinued operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Summary of Compliance with ASC 606 and ASU Updates

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Revenue Stream** | **Entity** | **Performance Obligation** | **Recognition Timing** | **Consideration Type** |
| Foodservice Packaging | SWC | Shipment of goods to customer | Point in time - revenue is recognized when control transfers upon shipment | Fixed price (wholesale contracts); excludes sales tax |
| Robotics as a Service (RaaS) | Skytech and FHVH | Provision of robotics equipment access, remote monitoring software, and related support services over the contract term | Over time - revenue is recognized ratably over the 36-month contract term, as the Company has a contractual right to payment for services rendered to date. | Fixed monthly consideration, billed in advance Non-cancellable 36-month contracts with auto renewals |
| Hotel Operations | Victorville/Rancho Mirage | Provision of lodging and related guest services (rooms, food, beverage, and other ancillary services) | Point in time – revenue is recognized when the performance obligation is satisfied, typically upon guest occupancy (for rooms) or at the time goods/services are provided (for food, beverage, and ancillary services). | Fixed transaction price, generally settled at check-out. Prices exclude sales tax. |

---

**Contract Liabilities (Deferred Revenue)**

Contract liabilities represent amounts received in advance of performance obligations being satisfied. These primarily relate to deposits for future hotel stays, events, or banquet services, which are recognized as revenue when the related lodging or services are provided.

For the Company's Robotics-as-a-Service ("RaaS") and foodservice packaging operations, invoicing and payment generally occur as performance obligations are satisfied; therefore, deferred revenue balances in these segments are not material.

As of December 31, 2025 and June 30, 2025, the Company had deferred revenue of $548,398 and $557,725, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

The following represents the Company's disaggregation of revenues for the six months ended December 31, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2025** | **2025** | **2024** | **2024** |
|  | **Revenue** | **% of Revenues** | **Revenue** | **% of Revenues** |
| Foodservice Packaging | $734826 | 24.72% | $&nbsp;&nbsp;&nbsp;&nbsp;- | 0.00% |
| Robotics as a Service (RaaS) | 67118 | 2.26% |  | 0.00% |
| Hotels | 2170112 | 73.02% | - | 0.00% |
| Total revenues - net | $2972056 | 100.00% | $- | 0.00% |

---

Revenue is disaggregated by primary revenue stream, consistent with the Company's reportable segments and the nature, timing, and uncertainty of revenue recognition described herein.

The Company did not generate revenues from continuing operations during the six months ended December 31, 2024.

Revenues from discontinued snack and beverage operations are presented separately in Note 14.

**Cost of Sales**

**1. Continuing Operations – Cost of Sales**

**Foodservice Packaging**

Cost of sales for foodservice packaging consists of direct costs incurred to source, warehouse, and distribute packaging products. These costs are recognized in the same period as the related revenue.

Cost components primarily include:

● Purchased Materials – Packaging products sourced from third-party manufacturers and suppliers.

● Freight and Distribution – Outbound shipping costs, warehouse handling, and fuel surcharges.

● Warehousing and Logistics – Facility, labor, and utilities associated with storage and inventory management.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**Robotics-as-a-Service (RaaS)**

Cost of sales for RaaS consists of direct costs incurred to provide robotic services under multi-year service contracts. These costs are recognized in the same period as the related revenue.

Cost components primarily include:

● Equipment Depreciation – Depreciation of robotic units deployed to customer sites.

● Installation and Training Costs – Initial setup, integration, and training services provided to
customers.

● Maintenance and Support – Ongoing technical support,
repair, and software updates.

● Hosting and Connectivity – Cloud infrastructure and communication
costs to enable remote monitoring and performance of robots.

These costs are recognized ratably over the contract term, consistent with the recognition of RaaS revenue.

**Hotel Operations**

Cost of sales for hotel operations consists of direct costs incurred to provide lodging, food and beverage, and related guest services. These costs are recognized in the same period as the related revenue.

Cost components primarily include:

● Room Operations – Housekeeping, front office, maintenance, laundry, and utilities directly related to guest accommodations.

● Food and Beverage – Cost of food, beverages, and related consumables used in restaurant, bar, and banquet operations.

● Labor and Benefits – Wages, benefits, and payroll taxes for personnel directly involved in providing guest services.

● Operating Supplies and Guest Amenities – Costs of linens, toiletries, and other consumables provided to guests.

● Other Direct Costs – Contract services, credit card commissions, and minor operating equipment.

Depreciation of hotel buildings, furnishings, and equipment is not included in cost of sales and is presented separately as Depreciation and Amortization within operating expenses.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**2. Discontinued Operations – Cost of Sales**

Cost of sales related to the Company's legacy Snacks and Beverages business is presented within discontinued operations and excluded from the amounts above.

**Income Taxes**

The Company accounts for income taxes using the asset and liability method prescribed by FASB ASC 740, *Income Taxes*. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. These deferred amounts are measured using enacted tax rates expected to apply in the periods when the temporary differences are expected to reverse.

The effect of a change in tax law or tax rates on deferred tax balances is recognized in the period in which the change is enacted.

All deferred tax assets and liabilities are presented as noncurrent in the Company's consolidated balance sheet, regardless of the classification of the related asset or liability for financial reporting purposes.

Uncertain Tax Positions

The Company evaluates uncertain tax positions, which requires that a tax position be recognized in the financial statements only if it is more likely than not (greater than 50% likelihood) to be sustained upon examination by tax authorities.

As of December 31, 2025 and June 30, 2025, respectively, the Company had no uncertain tax positions that qualified for recognition or disclosure in the financial.

The Company also recognizes interest and penalties related to uncertain tax positions in other expense in the consolidated statement of operations. No interest and penalties were recorded for the six months ended December 31, 2025 and 2024, respectively.

**Valuation of Deferred Tax Assets**

The Company's deferred tax assets include certain future tax benefits, such as net operating losses (NOLs), tax credits, and deductible temporary differences. A valuation allowance is required if it is more likely than not that some portion, or all, of the deferred tax assets will not be realized.

The Company reviews the realizability of deferred tax assets on a quarterly basis, or more frequently if circumstances warrant, considering both positive and negative.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Factors Considered in Valuation Allowance Assessment

The Company evaluates multiple factors in determining whether a valuation allowance is necessary, including:

● Historical earnings trends (cumulative pre-tax income or losses in the most recent three-year period)

● Future financial projections, including expected taxable income based on long-term estimates of business performance and market conditions

● Statutory carryforward periods for net operating losses and other deferred tax assets

● Prudent and feasible tax planning strategies that could impact the realization of deferred tax assets

● Nature and predictability of temporary differences and the timing of their reversal

● Sensitivity of financial forecasts to external factors such as commodity prices, market demand, and operational risks

While cumulative three-year losses are a strong indicator that a valuation allowance may be needed, a valuation allowance determination is not solely based on past losses—all available positive and negative evidence must be considered.

Valuation Allowance Determination

At December 31, 2025 and June 30, 2025, respectively, the Company recorded a full valuation allowance against its deferred tax assets, resulting in a net carrying amount of $0. This determination was based on cumulative losses in recent years and the lack of sufficient positive evidence to support the realization of deferred tax assets in the near term.

The Company will continue to evaluate its valuation allowance each reporting period and will recognize deferred tax assets in the future if sufficient positive evidence emerges to support their realization.

**Advertising Costs**

Advertising costs are expensed as incurred, "Advertising Costs." These costs are recognized as operating expenses in the period in which they are incurred and are classified within general and administrative expenses in the consolidated statements of operations.

Advertising expense related to the discontinued Snack and Beverages business, has been presented within discontinued operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

The Company recognized marketing and advertising costs during the three and six months ended December 31, 2025 and 2024, respectively as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $60022 | $- |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $90052 | $- |

---

**Stock-Based Compensation**

The Company accounts for stock-based compensation in accordance with ASC 718, "Compensation – Stock Compensation," using the fair value-based method. Under this guidance, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the requisite service period, typically the vesting period.

ASC 718 establishes accounting standards for transactions in which an entity exchanges its equity instruments for goods or services. It also applies to transactions where an entity incurs liabilities based on the fair value of its equity instruments or liabilities that may be settled using equity instruments.

The Company applies the fair value method for equity instruments granted to both employees and non-employees, aligning non-employee share-based payment accounting with that of employees. The fair value of stock-based compensation is determined as of the grant date or the measurement date (i.e., when the performance obligation is completed) and is recognized over the vesting period.

The Company determines the fair value of stock options using the Black-Scholes option pricing model, considering the following key assumptions:

● Exercise price – The agreed-upon price at which the option can be exercised.

● Expected dividends – The anticipated dividend yield over the expected life of the option.

● Expected volatility – Based on historical stock price fluctuations.

● Risk-free interest rate – Derived from U.S. Treasury securities with similar maturities.

● Expected life of the option – Estimated based on historical exercise patterns and contractual terms.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Additionally, the Company follows the guidance under ASU 2016-09, which introduced amendments to simplify certain accounting aspects of share-based compensation, including:

● The treatment of tax benefits and tax deficiencies in income tax reporting.

● The option to recognize forfeitures as they occur rather than estimating them upfront.

● Cash flow classification for certain tax-related transactions.

The Company continues to evaluate and apply the latest Accounting Standards Updates (ASUs) and interpretive releases related to stock-based compensation to ensure compliance with evolving financial reporting requirements.

**Stock Warrants**

In connection with certain financing transactions (debt or equity), consulting arrangements, or strategic partnerships, the Company may issue warrants to purchase shares of its common stock. These standalone warrants are not puttable or mandatorily redeemable by the holder and are classified as equity instruments in accordance with ASC 480, "Distinguishing Liabilities from Equity."

The fair value of warrants issued for compensation purposes is measured using the Black-Scholes option pricing model.

Accounting Treatment of Warrants

● Warrants issued in conjunction with common stock issuance are initially recorded at fair value as a reduction in Additional Paid-In Capital (APIC),

● Warrants issued for services are recorded at fair value and expensed over the requisite service period or immediately upon issuance if no service period exists; and

● Warrants classified as liabilities due to settlement features or pricing adjustments are remeasured at fair value each reporting period, with changes recognized in earnings.

**Basic and Diluted Earnings Net Loss per Share** 

The Company computes net loss per share in accordance with ASC 260, *Earnings Per Share*. Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period.

During all periods presented, the Company reported a net loss. Accordingly, all potentially dilutive common stock equivalents were excluded from the computation of diluted net loss per share because their inclusion would have been anti-dilutive. As a result, diluted net loss per share is equal to basic net loss per share for all periods presented.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

*Anti-Dilutive Securities*

The following potentially dilutive securities were excluded from the computation of diluted net loss per share for the six months ended December 31, 2025 and 2024 because their effect would have been anti-dilutive:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2024** |
| Convertible debt | 161793499 | 123682424 |
| Series B, convertible preferred stock (8,366:1) |  | 9750000 |
| Series C, convertible preferred stock (6,000:1) | 256380000 | 579996000 |
| Series D, convertible preferred stock (6,000:1) | 11004000 | 20004000 |
| Warrants | 193651646 | 192038743 |
| Total common stock equivalents | 622829145 | 925471167 |

---

All financial instruments listed above included as common stock equivalents represent those that are fully vested and exercisable.

 

*Series C Convertible Preferred Stock — Lock-Up Provisions*

 

Certain shares of Series C Convertible Preferred Stock issued as compensation and as acquisition consideration are subject to contractual lock-up provisions that restrict conversion into common stock for a specified period following issuance.

As of December 31, 2025, the Company had 559,489 shares of Series C Convertible Preferred Stock issued and outstanding, convertible into 3,356,934,000 shares of common stock on an as-converted basis at a conversion ratio of 6,000 shares of common stock for each share of Series C Convertible Preferred Stock. Of the total outstanding, 516,759 shares, representing 3,100,554,000 common share equivalents, are subject to contractual lock-up provisions and are not currently eligible for conversion. The lock-up provisions restrict conversion until the Company has completed an uplisting to a senior national stock exchange and effected a reverse stock split such that the Company's authorized common shares are sufficient to accommodate conversion of all outstanding convertible securities. The remaining 42,730 shares, convertible into 256,380,000 shares of common stock, are currently eligible for conversion.

Because these shares are not currently convertible, they have been excluded from both the anti-dilutive securities table above and the authorized share sufficiency analysis below for all periods in which the lock-up restrictions remain in effect. Upon expiration of the applicable lock-up periods, such shares will be included in the anti-dilutive securities table to the extent the Company continues to report a net loss, or in diluted net loss per share if the Company reports net income.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**Convertible Preferred Stock Classification and Authorized Share Sufficiency**

 

*Temporary Equity Classification at June 30, 2025*

As of June 30, 2025, the Company had 200,000,000 shares of common stock authorized. The total potential common stock equivalents issuable upon conversion or exercise of the Company's outstanding Series B, Series C, and Series D Convertible Preferred Stock, warrants, and convertible notes payable exceeded the Company's authorized common shares, resulting in an insufficiency of authorized shares to settle all potential conversions and exercises.

Because certain instruments could not be settled solely in shares, they were not entirely within the Company's control for share settlement. In accordance with ASC 480-10-S99-3A and ASC 815-40-25, the Company classified its Series B, Series C, and Series D Convertible Preferred Stock as temporary equity (mezzanine equity) in the consolidated balance sheet as of June 30, 2025. These instruments are not redeemable; the temporary equity classification was based solely on the insufficiency of authorized shares to permit full conversion. The Company's convertible debt was classified as a liability, and its warrants were classified within equity, each in accordance with the relevant accounting guidance.

*Increase in Authorized Shares*

 

On October 7, 2025, the Company's majority voting stockholder approved an increase in the Company's authorized common stock from 200,000,000 to 900,000,000 shares. The Board of Directors approved the change on the same date. In accordance with SEC Rule 14c-2, the amendment became effective 20 days after the Company mailed a definitive information statement on Schedule 14C to stockholders. The amendment to the Company's Articles of Incorporation was filed with the Nevada Secretary of State and became effective on November 19, 2025. This change increased only the number of authorized shares and had no impact on the number of shares outstanding or on the rights of existing stockholders.

 

*Resolution of Authorized Share Insufficiency and Reclassification to Permanent Equity*

 

Following the increase in authorized common stock to 900,000,000 shares effective November 19, 2025, management reassessed whether sufficient authorized shares existed to settle all currently convertible or exercisable instruments. Excluding 516,759 shares of Series C Convertible Preferred Stock (convertible into 3,100,554,000 shares of common stock) that are contractually prohibited from conversion under the lock-up provisions described above, the Company's remaining potential common stock equivalents did not exceed the 900,000,000 authorized shares as of the effective date of the amendment.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Because the condition that gave rise to the temporary equity classification — the insufficiency of authorized common shares — was resolved, the Company reclassified its Series B, Series C, and Series D Convertible Preferred Stock from temporary equity to permanent stockholders' equity effective November 19, 2025. The reclassification was recorded at the then-existing carrying values, with no gain or loss recognized. The aggregate carrying value reclassified was $106,298,927, which included $11,925,000 attributable to a contingent consideration arrangement payable in Series C Convertible Preferred Stock. Any shares of Series C Convertible Preferred Stock issued or issuable upon resolution of the contingent consideration arrangement are subject to the same contractual lock-up provisions applicable to the outstanding Series C Convertible Preferred Stock and are not eligible for conversion until the Company has completed an uplisting to a senior national stock exchange and effected a reverse stock split such that the Company's authorized common shares are sufficient to accommodate conversion of all outstanding convertible securities.

 

*Contingent Consideration — Series C Convertible Preferred Stock*

In connection with the acquisitions of the Victorville and Rancho Mirage hotel properties, the Company agreed to issue additional shares of Series C Convertible Preferred Stock upon the achievement of certain post-acquisition milestones As of December 31, 2025, the contingencies had not been resolved and no shares had been issued under these arrangements.

In connection with the acquisitions of the Victorville and Rancho Mirage hotel properties, the Company agreed to issue additional shares of Series C Convertible Preferred Stock upon the achievement of certain post-acquisition milestones. The contingent consideration provides for the issuance of up to 41,667 shares related to the Victorville acquisition and up to 20,000 shares related to the Rancho Mirage acquisition, for a combined total of up to 61,667 shares, representing 370,002,000 shares of common stock on an as-converted basis. As of December 31, 2025, no milestones have been achieved and no shares have been issued under these arrangements. Accordingly, the contingent shares have not been included in the authorized share sufficiency analysis. In the event the milestones are achieved and the contingent shares are issued, the Company will reassess authorized share sufficiency at that time, as the 370,002,000 equivalent shares would exceed the Company's remaining available authorized shares of approximately 63,803,000 as of December 31, 2025.

The contingent consideration was initially measured at fair value in accordance with ASC 805, *Business Combinations*, and classified as temporary equity due to the authorized share insufficiency described above. The fair value of the contingent consideration as of December 31, 2025 was $11,925,000, comprised of $7,125,000 related to the Victorville acquisition and $4,800,000 related to the Rancho Mirage acquisition. The contingent consideration was reclassified to permanent stockholders' equity along with the issued preferred stock effective November 19, 2025, as described above.

Contingent consideration classified in stockholders' equity is not subsequently remeasured; adjustments are recognized only upon resolution of the contingency.

 

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

 

*Ongoing Monitoring*

 

The Company will continue to monitor its authorized share capacity relative to total potential common stock equivalents, including upon expiration of the Series C lock-up provisions, the resolution of the contingent consideration arrangements, the issuance of additional convertible instruments, and any changes to outstanding warrants or conversion terms. If at any future date the Company's total potential common stock equivalents (including previously locked-up Series C shares and any Series C shares issued upon resolution of contingent consideration) exceed its authorized shares, the Company will reassess the equity classification of its convertible preferred stock at that time.

See Note 8.

**Related Parties**

The Company defines related parties in accordance with ASC 850, "Related Party Disclosures," and SEC Regulation S-X, Rule 4-08(k). Related parties include entities and individuals that, directly or indirectly, through one or more intermediaries, control, are controlled by, or are under common control with the Company.

Related parties include, but are not limited to:

● Principal owners of the Company.

● Members of management (including directors, executive officers, and key employees).

● Immediate family members of principal owners and members of management.

● Entities affiliated with principal owners or management through direct or indirect ownership.

● Entities with which the Company has significant transactions, where one party has the ability to exercise control or significant influence over the management or operating policies of the other.

A party is considered related if it has the ability to control or significantly influence the management or operating policies of the Company in a manner that could prevent either party from fully pursuing its own separate economic interests.

The Company discloses all material related party transactions, including:

● The nature of the relationship between the parties.

● A description of the transaction(s), including terms and amounts involved.

● Any amounts due to or from related parties as of the reporting date.

● Any other elements necessary for a clear understanding of the transactions' effects on the financial statements.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Related party disclosures are presented in accordance with ASC 850-10-50-1 through 50-6, which require disclosure of the nature, terms, and financial effects of material related party transactions. The Company also complies with SEC Regulation S-X, Rule 4-08(k), which requires disclosure of material related party balances and transactions, including their effect on the Company's consolidated financial position and results of operations

**Recent Accounting Standards** 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances disclosures related to income tax rate reconciliation and income taxes paid.

The Company adopted ASU 2023-09 effective July 1, 2025 (fiscal 2026). Adoption did not have a material impact on the Company's consolidated financial statements.

**Accounting Standards Not Yet Adopted**

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires expanded disclosure of certain expense categories.

The standard is effective for fiscal years beginning after December 15, 2026. The Company is currently evaluating the impact of the standard, which is not expected to be material.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides a practical expedient for estimating expected credit losses.

The standard is effective for fiscal years beginning after December 15, 2025. The Company plans to adopt ASU 2025-05 for its fiscal year beginning July 1, 2026, and does not expect a material impact.

Other Accounting Standards Updates

The FASB has issued other technical corrections and narrow-scope amendments across various accounting topics. These updates are not expected to have a material impact on the Company's consolidated financial statements.

**Reclassifications**

Certain amounts in the prior year's financial statements have been reclassified to conform to the current year presentation. These reclassifications had no material impact on the Company's consolidated results of operations, stockholders' equity (deficit), or cash flows.

As a result of the classification of the Company's Snacks and Beverages segment as discontinued operations, the related results of operations, cash flows, and disclosures have been reclassified and presented separately from continuing operations for all periods presented.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

**<u>Note 3 – Property and Equipment</u>**

Property and equipment consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  |<br>**December 31, 2025** |<br>**June 30, 2025** | **Estimated Useful**<br>**Lives (Years)** |
| Building and Improvements | $17650000 |  | 4 - 30 |
| Land | 3550000 |  | N/A |
| Furniture, fixtures and equipment | 3627751 | 27751 | 1 - 5 |
| Machinery and equipment | 262950 | 209650 | 5 |
| Vehicles | 20936 | 20936 | 1.5 - 5 |
| Accumulated Depreciation | (995740) | (17513) |  |
| Total property and equipment - net | $24115897 | $240824 |  |

---

Assets Acquired in Business Combinations

During fiscal years 2025 and 2026, the Company completed several acquisitions in connection with its expansion into robotics and hospitality operations. See Note 9.

*Fiscal Year Ended June 30, 2026*

On August 27, 2025, and September 30, 2025, the Company acquired Victorville and Rancho Mirage, respectively, obtaining land, buildings and improvements, and furniture and equipment with an aggregate fair value of approximately $24,800,000 as of the respective acquisition dates.

*Fiscal Year Ended June 30, 2025*

On March 31, 2025, the Company acquired SWC and Skytech, obtaining property and equipment with an aggregate fair value of approximately $59,000 as of the acquisition date.

The Company measured all acquired property and equipment at fair value as of each acquisition date. Fair values were determined using a combination of market comparable and replacement cost approaches, depending on asset type. Any difference between the fair value of the assets acquired and their historical carrying amounts was recognized as part of the purchase price allocation, and the excess of purchase consideration over the fair value of net identifiable assets was recorded as goodwill.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025**

Depreciation and amortization expense for the three and six months ended December 31, 2025 and 2024 were as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $799014 |  |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $1184019 | $- |

---

**<u>Note 4 – Accounts Payable and Accrued Liabilities including Related Parties</u>**

Accounts payable and accrued liabilities consist of amounts due to vendors, service providers, and related parties for goods and services received but not yet paid as of the balance sheet date. These obligations are typically settled within normal operating cycles.

Accrued liabilities include payroll and related benefits, professional fees, interest, taxes, and other routine operating accruals. The Company also records accruals for expenses incurred but not yet invoiced at period end, based on management's estimates.

Balances due to related parties primarily represent amounts payable for shared services, management fees, and reimbursements of operating expenses. Such transactions are conducted in the ordinary course of business and settled in cash.

Management believes that all accounts payable and accrued liabilities are current and that recorded amounts approximate fair value due to their short-term maturities.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Accounts payable and accrued liabilities were as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| Accounts payable | $4077271 | $1941068 |
| Accrued liabilities | 569725 |  |
| Accrued interest payable | 430186 | 1215190 |
| Total accounts payable and accrued liabilities | $5077182 | $3156258 |

---

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| Accrued liabilities | $2185113 | $95750 |
| Accrued director fees | 106650 | 117150 |
| Accrued bonuses | 37715 | 110000 |
| Total accounts payable and accrued liabilities - related parties | $2329478 | $322900 |

---

**<u>Note 5 – Debt</u>**

The following table summarizes the Company's outstanding debt obligations as of December 31, 2025 and June 30, 2025:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Issue Date** | **Maturity Date** | **Interest Rate** | **Default Interest Rate** | **Collateral** | **Related Party** | **Conversion Price** | **Debt Type** |
| Loan #1 | September 22, 2022 | February 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #2 | September 22, 2022 | February 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #3 | February 28, 2023 | February 28, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #4 | March 24, 2023 | March 24, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #5 | April 17, 2023 | April 17, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #6 | June 1, 2023 | June 1, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #7 | October 5, 2023 | October 5, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #8 | November 17, 2023 | November 17, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #9 | December 6, 2023 | December 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #10 | January 24, 2024 | January 24, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #11 | March 13, 2024 | March 13, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #12 | May 5, 2024 | May 5, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #13 | September 24, 2024 | September 24, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #14 | February 19, 2025 | February 19, 2026 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #15 | March 13, 2025 | March 13, 2027 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Notes Payable |
| Loan #16 | June 29, 2023 | November 1, 2025 | 15.00% | 16.00% | Unsecured | No | $0.0330 | Convertible Notes Payable |
| Loan #17 | August 28, 2023 | November 1, 2025 | 15.00% | 16.00% | Unsecured | No | $0.0330 | Convertible Notes Payable |
| Loan #18 | January 23, 2025 | August 31, 2025 | 17.50% | 4.5%/month | Unsecured | No | $- | Notes Payable |
| Loan #19 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | Yes | $0.0325 | Convertible Notes Payable - Related Party |
| Loan #20 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #21 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #22 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #23 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #24 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #25 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0325 | Convertible Notes Payable |
| Loan #26 | September 10, 2021 | September 10, 2026 | 8.99% | 20.00% | Vehicles | No | $- | Notes Payable - Vehicles |
| Loan #27 | September 10, 2021 | September 10, 2026 | 8.99% | 20.00% | Vehicles | No | $- | Notes Payable - Vehicles |
| Loan #28 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | Yes | $0.0325 | Convertible Notes Payable - Related Party |
| Loan #29 | June 15, 2018 | June 21, 2024 | 18.00% | 18.00% | Unsecured | No | $- | Notes Payable |
| Loan #30 | April 18, 2025 | April 18, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Notes Payable |
| Loan #31 | June 15, 2025 | June 15, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Notes Payable |
| Loan #32 | July 14, 2025 | July 14, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Notes Payable |
| Loan #33 | August 25, 2025 | August 25, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Notes Payable |
| Loan #34 | June 6, 2022 | June 6, 2029 | 5.00% | 0.00% | Building/Hotel | No | $- | Mortgage Notes Payable |
| Loan #35 | June 6, 2022 | June 6, 2029 | 5.00% | 0.00% | Building/Hotel | No | $- | Mortgage Notes Payable |
| Loan #36 | November 15, 2023 | October 1, 2025 | 1.00% | 1.00% | Building/Hotel | No | $- | Notes Payable |
| Loan #37 | April 15, 2025 | April 15, 2026 | 15.00% | 15.00% | All Assets | No | $- | Notes Payable |
| Loan #38 | May 22, 2025 | May 22, 2026 | 15.00% | 15.00% | All Assets | No | $- | Notes Payable |
| Loan #39 | October 8, 2025 | October 8, 2026 | 15.00% | 24.00% | All Assets | No | $0.0412 | Convertible Notes Payable |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Loans #1-#13, and #20 are in default.

**Convertible Notes Payable**

The following represents a summary of the Company's convertible notes payable at December 31, 2025 and June 30, 2025:

---

| | |
|:---|:---|
| June 30, 2024 | $3442987 |
| Advances | 1104000 |
| Debt Discount | (674922) |
| Amortization of debt discount | 278382 |
| Conversions of debt to equity | (36425) |
| Non-cash increase of principal | 73750 |
| Debt acquired in acquisition - SWC | 530572 |
| June 30, 2025 | 4718344 |
| Advances | 2270000 |
| Debt Discount | (2270000) |
| Amortization of debt discount | 722937 |
| Conversions of debt to equity | (443454) |
| December 31, 2025 | $4997827 |

---

The following represents a detail of the Company's convertible notes payable at December 31, 2025 and June 30, 2025:

 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Lender #1**<br>**Notes #1 - #15 and #39** | **Lender #2**<br>**Notes #16 - #17** | **Various**<br>**Notes #20 - #25** |<br>**Total** |
| Date of Note | Sep 22, 2022 - Oct 8, 2025 | June 29, 2023 - August 28, 2023 | September 4, 2024 |  |
| Maturity Date of Note | Sep 22, 2023 - Mar 13, 2027 | November 1, 2025 | September 4, 2027 |  |
| Interest Rate | 15% | 15% | 15% |  |
| Default Interest Rate | 24% | 16% | 15% |  |
| Conversion Rate | $0.033 - $0.041 | $0.033 | $0.0325 \* |  |
| Equivalent Shares | 143179316 |  | 4969477 | 148148793 |
| In-Default | $3661643 | $- | $- | $3661643 |
| Collateral | All Assets | Unsecured | Unsecured |  |
| June 30, 2025 | $4489683 | $174825 | $53836 | $4718344 |
| Proceeds | 2270000 |  |  | 2270000 |
| Debt discount | (2270000) |  |  | (2270000) |
| Conversion to common stock | (268629) | (174825) |  | (443454) |
| Amortization of debt discount | 615266 | - | 107671 | 722937 |
| December 31, 2025 | 4836320 |  | 161507 | 4997827 |
| Less: short term | 4422515 | - | - | 4422515 |
| Long term | $413805 | $- | $161507 | $575312 |
| June 30, 2024 | $3305487 | $137500 | $- | $3442987 |
| Proceeds | 1104000 |  |  | 1104000 |
| Debt acquired - SWC |  |  | 530572 | 530572 |
| Debt discount | (144350) |  | (530572) | (674922) |
| Amortization of debt discount | 224546 |  | 53836 | 278382 |
| Non-cash increase of debt |  | 73750 |  | 73750 |
| Conversion to common stock | - | (36425) | - | (36425) |
| June 30, 2025 | 4489683 | 174825 | 53836 | 4718344 |
| Less: short term | 4096278 | 174825 | - | 4271103 |
| Long term | $393405 | $- | $53836 | $447241 |

---

\* These convertible notes convert at a 35% discount to the lowest market price during the prior 20 days. Due to this variable conversion feature, the notes are classified as derivative liabilities under ASC 815-40.

 

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**Six Months Ended December 31, 2025**

*Convertible Note Payable*

On October 8, 2025, the Company entered into a Securities Purchase Agreement and issued a senior secured convertible note with a principal amount of $2,270,000 for net proceeds of $1,929,500, reflecting an original issue discount of $340,500. The note bears interest at 15% per annum (24% upon default), matures on October 8, 2026, and is secured by a first-priority lien on substantially all assets of the Company. The interest rate decreases to 5% per annum during periods when the Company's common stock is listed for trading on a national securities exchange. The original issue discount increases by 3% of the total outstanding balance on each anniversary of the issuance date until the note is no longer outstanding.

The note is convertible into shares of the Company's common stock at the lower of (i) a fixed conversion price of $0.033 per share or (ii) 80% of the lowest volume-weighted average price during the five trading days prior to conversion. Because the conversion price contains a variable component that can result in settlement in a variable number of shares, the Company determined that the embedded conversion feature requires bifurcation from the host debt instrument as a derivative liability.

At the issuance date, the Company measured the bifurcated conversion feature at a fair value of $2,825,257. The resulting debt discount, together with the original issue discount of $340,500, was limited to the face amount of the note of $2,270,000. The excess of the derivative fair value over the net proceeds of $895,757 was recognized as a charge to derivative expense during the six months ended December 31, 2025. The aggregate debt discount of $2,270,000 is being amortized to interest expense over the one-year term of the note using the effective interest method.

The derivative liability is remeasured at fair value at each reporting date, with changes recognized in the consolidated statements of operations as a component of other income (expense) — net.

See Notes 11 and 12.

**Fiscal Year Ended June 30, 2025**

 

*Convertible Notes Payable — Settlement of SWC Vendor Obligations*

In connection with the acquisition of SWC Group Inc. on March 31, 2025, the Company entered into settlement agreements with certain former vendors and creditors of SWC. Under these agreements, SWC's outstanding trade payable obligations were extinguished and replaced with new convertible promissory notes issued by the Company to the respective creditors.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The notes have an aggregate face value of $759,777, of which $530,572 was issued to third parties and $229,205 was issued to related parties (see related party convertible notes discussion below). The notes bear interest at 15% per annum (15% default rate), mature on September 4, 2027, and are unsecured.

Each note contained a conversion feature, conditional upon completion of the SWC merger, permitting the holder to convert outstanding principal and accrued interest into shares of the Company's common stock at a conversion price equal to 65% of the lowest trading price during the 20 trading days preceding the conversion date. The conversion features became exercisable upon the closing of the acquisition on March 31, 2025. Because the conversion price is variable and can result in settlement in a variable number of shares, the Company determined that the embedded conversion features require bifurcation from the host debt instruments as derivative liabilities.

At the issuance date, the Company measured the bifurcated conversion features at an aggregate fair value of $1,413,568, of which $987,131 related to third-party notes and $426,437 related to related party notes.

The resulting debt discounts were limited to the face amounts of the respective notes, resulting in aggregate debt discounts of $759,777. The excess of the derivative fair value over the aggregate face amounts of $653,791, consisting of $456,559 attributable to third-party notes and $197,232 attributable to related party notes, was recognized as a charge to derivative expense during the year ended June 30, 2025.

The debt discounts are being amortized to interest expense over the remaining terms of the notes.

The derivative liabilities are remeasured at fair value at each reporting date, with changes recognized in the consolidated statements of operations as a component of other income (expense) - net.

See Notes 11 and 12.

Loans #16/#17 – Amendments

On July 23, 2024, the Company amended the terms of these notes to remove the right to adjust the conversion price. In exchange, the Company increased the amount due under the notes by 10%, and issue 1,667 shares of Series D, convertible preferred stock.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Upon amendment of terms, the Company evaluated the changes under ASC 470-50-40, *Debt Modifications and Extinguishments*, and determined the modification constituted a substantial change, resulting in a loss on debt extinguishment as follows:

In connection with this transaction, the Company recorded a loss on debt extinguishment as follows:

---

| | |
|:---|:---|
| Fair value of debt (10% increase) and Series D, preferred stock on extinguishment date | $113955 |
| Loss on debt extinguishment | $113955 |

---

See Note 8 for additional information regarding the issuance of the Series D, convertible preferred stock in connection with these debt extinguishments.

In April 2025, the maturity date of the notes was extended from April 2025 to November 1, 2025. No additional consideration was paid in connection with the extensions.

The Company evaluated the terms of the modification and concluded that the changes did not result in a substantially different instrument. As a result, the modification was accounted for as a continuation of the existing debt arrangement, with no gain or loss recognized and no impact on the consolidated financial statements.

Debt Conversions

**Six Months Ended December 31, 2025**

Loan #1

In July 2025, the Company issued 6,600,000 shares of common stock in connection with the settlement of outstanding default interest of $216,050, respectively, plus additional fees of $1,750, on loan #1, for a total conversion of $217,800. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

In September 2025, the Company issued 6,000,000 shares of common stock in connection with the partial settlement of principal and related outstanding accrued interest on loan #1 of $49,397 and $34,748, respectively, plus default interest of $112,105 and additional fees of $1,750 for a total conversion of $198,000. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

In September 2025, the Company issued 7,000,000 shares of common stock in connection with the partial settlement of principal and related outstanding accrued interest on loan #1 of $219,231 and $10,019, respectively, and additional fees of $1,750 for a total conversion of $231,000. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

Loan #16

In August 2025, the Company issued 1,002,339 shares of common stock in connection with the partial settlement of principal and related outstanding accrued interest on loan #16 of $28,750 and $2,577, respectively, plus additional fees of $1,750 for a total conversion of $33,077. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

In August 2025, the Company issued 1,378,562 shares of common stock in connection with the full settlement of principal and related outstanding accrued interest on loan #16 of $43,475 and $268, respectively, plus additional fees of $1,750 for a total conversion of $45,493. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

This note was fully settled upon completion of these conversions.

Loan #17

In October 2025, the Company issued 4,285,994 shares of common stock in connection with the settlement of outstanding amounts due to a single lender under loan #17, consisting of principal of $102,600, accrued interest of $33,587, and fees of $5,250, for a total conversion amount of $141,437. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033 per share. Accordingly, no gain or loss was recorded upon debt conversion, and the note was fully settled upon completion of these conversions.

**Fiscal Year Ended June 30, 2025**

Loan #2

In April 2025, the Company issued 6,000,000 shares of common stock in connection with the settlement of outstanding accrued interest of $20,963 and default interest of $175,287, respectively, plus additional fees of $1,750, on loan #2, for a total conversion of $198,000. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

Loan #16

In April 2025, the Company issued 1,000,170 shares of common stock in connection with the partial settlement of principal and related outstanding accrued interest on loan #16 of $7,425 and $23,831, respectively, plus additional fees of $1,750 for a total conversion of $33,006. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

In May 2025, the Company issued 1,003,444 shares of common stock in connection with the partial settlement of principal and related outstanding accrued interest on loan #16 of $29,000 and $2,364, respectively, plus additional fees of $1,750 for a total conversion of $33,114. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033/share. Accordingly, no gain or loss was recorded upon debt conversion.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Debt Extinguishments

The Company accounted for these debt conversions as debt extinguishments. As the fair value of the equity issued equaled the carrying value of the extinguished debt, no gain or loss was recognized upon conversion.

**Notes Payable** 

The following represents a summary of the Company's notes payable at December 31, 2025 and June 30, 2025:

---

| | |
|:---|:---|
| June 30, 2024 | $- |
| Proceeds | 1547000 |
| Repayments | (23988) |
| Debt acquired in acquisition | 67262 |
| June 30, 2025 | 1590274 |
| Repayments | (15722) |
| Debt acquired in acquisition - net - Victorville | 3224000 |
| Debt acquired in acquisition - net - Rancho Mirage | 1700000 |
| Settlement of pre-existing debt of target acquisition | (1547000) |
| Amortization of debt discount | 144666 |
| December 31, 2025 | $5096218 |

---

The following represents a detail of the Company's notes payable at December 31, 2025 and June 30, 2025:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Loans #26 and #27** | **Various Loans#18, #29, #30 and #31** | **Acquired Debt Loan #36** | **Acquired Debt Loan #37** | **Acquired Debt Loan #38** | **Total** |
| Date of Note | September 10, 2021 | June 15, 2018 - June 15, 2025 | November 15, 2023 | April 15, 2025 | May 22, 2025 |  |
| Maturity Date of Note | September 10, 2026 | June 21, 2024 - June 15, 2026 | Demand | April 15, 2026 | May 22, 2026 |  |
| Interest Rate | 8.99% | 15.00% - 18.00% | 1.00% | 15.00% | 15.00% |  |
| Default Interest Rate | 20.00% | 15.00% - 18.00%\* | 1.00% | 15.00% | 15.00% |  |
| In-Default | $- | $20000 | $- | $- | $- | $20000 |
| Collateral | Vehicle | Unsecured | Building/Hotel | All Assets | All Assets |  |
| June 30, 2025 | $14024 | $1576250 | $- | $- | $- | $1590274 |
| Settlement of pre-existing debt of target acquisition |  | (1547000) |  |  |  | (1547000) |
| Debt acquired in acquisition - Victorville |  |  |  | 1140000 | 2335000 | 3475000 |
| Debt discount |  |  |  | (66500) | (184784) | (251284) |
| Debt acquired in acquisition - Rancho Mirage |  |  | 1700000 |  |  | 1700000 |
| Amortization of debt discount |  |  |  | 47500 | 97290 | 144790 |
| Repayments | (6312) | (9250) | - | - | - | (15562) |
| December 31, 2025 | 7712 | 20000 | 1700000 | 1121000 | 2247506 | 5096218 |
| Less: short term | 7712 | 20000 | 1700000 | 1121000 | 2247506 | 5096218 |
| Long term | $- | $- | $- | $- | $- | $- |
| June 30, 2024 | $- | $- | $- | $- | $- | $- |
| Proceeds |  | 1547000 |  |  |  | 1547000 |
| Debt acquired in acquisition - SWC | 17262 | 50000 |  |  |  | 67262 |
| Repayments | (3238) | (20750) | - | - | - | (23988) |
| June 30, 2025 | 14024 | 1576250 | - | - | - | 1590274 |
| Less: short term |  | 1576250 |  |  |  | 1576250 |
| Long term | $14024 | $- | $- | $- | $- | $14024 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Loans #30/#31

**Notes Payable – Victorville Hotel Acquisition**

During April and June 2025, the Company entered into two loan agreements with the seller of the Victorville hotel property. Under these agreements, the seller advanced the Company an aggregate of $1,547,000 for working capital purposes. The loans were unsecured and bore interest at 15% per annum. Pursuant to the loan terms, if the acquisition did not close, the loans would have become payable one year from their respective commitment dates. If the acquisition closed, the outstanding principal and accrued interest would be forgiven in full.

The Victorville acquisition closed on August 27, 2025, and the aggregate balance of $1,547,000, together with accrued interest, was eliminated in consolidation as an intercompany amount upon the seller becoming a wholly owned subsidiary of the Company. Accordingly, these balances are not reflected in the notes payable schedule as of December 31, 2025.

**Convertible Notes Payable – Related Parties**

The following represents a summary of the Company's convertible notes payable – related parties at December 31, 2025 and June 30, 2025:

---

| | |
|:---|:---|
|  | $- |
| Debt acquired in acquisition - SWC | 229204 |
| Debt Discount | (229204) |
| Amortization of debt discount | 53639 |
| Repayments | (33490) |
| June 30, 2025 | 20149 |
| Amortization of debt discount | 39513 |
| December 31, 2025 | $59662 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The following represents a detail of the Company's convertible notes payable – related parties at December 31, 2025 and June 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
|  | **Loan #19** | **Loan #28** | **Total** |
| Holder | Chief Executive Officer | Chief Revenue Officer |  |
|  |  | Board Director |  |
| Date of Note | September 4, 2024 | September 4, 2024 |  |
| Maturity Date of Note | September 4, 2027 | September 4, 2027 |  |
| Interest Rate | 15.00% | 15.00% |  |
| Conversion Rate | $0.0325 \* | $0.0325 \* |  |
| Equivalent Shares | 1376338 | 459415 | 1835754 |
| In-Default | $- | $- | $- |
| Collateral | Unsecured | Unsecured |  |

---

\* These convertible notes are convertible at a discount, equal to 65% of the lowest market price over the preceding 20 days.

---

| | | | |
|:---|:---|:---|:---|
| June 30, 2025 | $15172 | $4977 | $20149 |
| Amortization of debt discount | 29559 | 9954 | 39513 |
| December 31, 2025 | 44731 | 14931 | 59662 |
| Less: short term | - | - | - |
| Long term | $44731 | $14931 | $59662 |
| June 30, 2024 | $- | $- | $- |
| Debt acquired in acquisition - SWC | 180154 | 49050 | 229204 |
| Debt discount | (180154) | (49050) | (229204) |
| Amortization of debt discount | 48662 | 4977 | 53639 |
| Repayments | (33490) | - | (33490) |
| June 30, 2025 | 15172 | 4977 | 20149 |
| Less: short term | - | - | - |
| Long term | $15172 | $4977 | $20149 |

---

The following represents a summary of the Company's mortgage notes payable at December 31, 2025 and June 30, 2025:

---

| | |
|:---|:---|
| June 30, 2025 | $- |
| Debt acquired in acquisition - Victorville | 9492000 |
| Debt acquired in acquisition - Rancho Mirage | 9992000 |
| Repayments | (92527) |
| December 31, 2025 | $19391473 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

During the fiscal year ended June 30, 2026, the Company completed the acquisitions of two hotel properties located in Victorville, California and Rancho Mirage, California. In connection with these acquisitions, the Company assumed existing mortgage indebtedness secured by the respective properties.

The assumed mortgage notes were recorded at their estimated fair values as of the respective acquisition dates in accordance with ASC 805. The fair value measurements reflected market-based assumptions regarding interest rates and credit spreads for comparable debt instruments at the time of each acquisition.

The Victorville acquisition resulted in the recognition of an assumed mortgage note with an acquisition-date fair value of $9,492,000, and the Rancho Mirage acquisition resulted in the recognition of an assumed mortgage note with an acquisition-date fair value of $9,992,000.

The assumed mortgage notes are secured by the respective hotel properties and contain customary covenants and repayment terms.

See Note 9.

The following table presents a detail of the Company's mortgage notes payable at December 31, 2025 and June 30, 2025:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Loan #34** |  | **Loan #35** |  | **Total** |
| Property Name | Victorville |  | Rancho Mirage |  |  |
| Date of Note | June 6, 2022 |  | June 6, 2022 |  |  |
| Maturity Date of Note | June 6, 2029 |  | June 6, 2029 |  |  |
| Interest Rate | 7.50 | %\* | 7.50 | %\* |  |
| In-Default | $- |  | $- |  | $- |
| Collateral | Property |  | Property |  |  |

---

\* The interest rate was fixed at 5% for the period June 2022 - June 2025. Subsequently, the interest rate is variable, equal to Wall Street Journal prime rate plus 0.25%

---

| | | | |
|:---|:---|:---|:---|
| June 30, 2025 | $- |  | $- |
| Debt acquired in acquisition | 9492000 | 9992000 | 19484000 |
| Repayments | (45692) | (46835) | (92527) |
| December 31, 2025 | 9446308 | 9945165 | 19391473 |
| Less: short term | 203337 | 182055 | 385392 |
| Long term | $9242971 | $9763110 | $19006081 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**<u>Debt Maturities</u>**

The following represents future maturities of the Company's various debt arrangements as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **For the Year Ended June 30,** | **Convertible Notes Payable** | **Convertible Notes Payable - Related Parties** | **Notes<br> Payable** | **Mortgage Notes Payable** | **Total** |
| 2026 (6 months) | $3862789 | $- | $5088506 | $194972 | $9146267 |
| 2027 | 973530 |  | 7712 | 399430 | 1380672 |
| 2028 | 161508 | 59662 |  | 425532 | 646702 |
| 2029 | - | - | - | 18371539 | 18371539 |
| Total | $4997827 | $59662 | $5096218 | $19391473 | $29545180 |

---

**<u>Note 6 – Fair Value of Financial Instruments</u>**

The Company's fair value measurement policies, including the three-level hierarchy framework under ASC 820, are described in Note 2. The Company's mortgage notes payable were recorded at estimated fair value upon acquisition in accordance with ASC 805 and are subsequently carried at amortized cost. The Company believes the carrying amounts approximate fair value as of December 31, 2025 based on the variable interest rate terms of the underlying instruments. See Note 12 for the Company's recurring fair value measurements of derivative liabilities.

**<u>Note 7 – Commitments and Contingencies</u>**

**<u>Contingencies – Legal Matters</u>**

The Company is subject to litigation claims arising in the ordinary course of business. The Company records litigation accruals for legal matters which are both probable and estimable and for related legal costs as incurred. The Company does not reduce these liabilities for potential insurance or third-party recoveries.

As of December 31, 2025, the Company is not aware of any litigation, pending litigation, or other transactions that require accrual or disclosure.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**<u>Note 8 – Temporary Equity and Stockholders' Equity (Deficit)</u>**

As of December 31, 2025, the Company had six (6) classes of stock, detailed as follows:

With respect to Series B, C and D convertible preferred stock, see policy above in Note 1 regarding classification as temporary equity.

**Preferred Stock**

The Company's preferred stock is as follows.

● Authorized Shares: 1,000,000

● Par Value: $0.001 per share

The Board of Directors has the authority to issue preferred stock in one or more series and determine the rights, privileges, and restrictions of each series without further stockholder approval.

**Series A, Preferred Stock – Related Party**

● Designated Shares: 1,000

● Issued & Outstanding: 1,000 shares as of December 31, 2025 and June 30, 2025, respectively. All shares are owned by the Company's Chief Executive Officer.

● Par Value: $0.001 per share

● Stated Value: None

● Conversion Terms: None

● Dividend Provisions: None

● Voting Rights: Equal to the number of votes on an as converted basis of all other classes of securities plus one (1)

● Liquidation Preference: None

● Redemption Rights: None

**Series B, Convertible Preferred Stock**

● Designated Shares: 5,000

● Issued & Outstanding: 0 and 1,950 shares as of December 31, 2025 and June 30, 2025, respectively

● Par Value: $0.001 per share

● Stated Value: None

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

● Conversion Terms: convertible into 5,000 shares of common stock and 5,000 warrants with an exercise price of $0.033 /share.

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

● Derivative Liability Assessment:

○ Evaluated under ASC 815 ("Derivatives and Hedging")

○ The Series B Convertible Preferred Stock and the related warrants do not meet the definition of derivative liabilities because they contain fixed conversion terms and do not include any variable equity conversion features or other contingent provisions requiring derivative accounting.

Deemed Dividends – Series B Convertible Preferred Stock

In connection with the issuance of Series B Convertible Preferred Stock, the Company recognizes deemed dividends due to periodic reductions in the conversion price, which increased the intrinsic value of the shares issuable upon conversion. These adjustments effectively conveyed additional value to the preferred stockholders and were accounted for as deemed dividends.

The deemed dividends were recorded as a reclassification from additional paid-in capital to accumulated deficit. This treatment did not affect total stockholders' deficit but did reduce income available to common shareholders for purposes of earnings per share.

During the six months ended December 31, 2025 and the year ended June 30, 2025, the Company recorded additional deemed dividends of $0 and $11,566, respectively.

Conversion of Series B, Convertible Preferred Stock

Effective October 28, 2025, the Company amended the conversion ratio applicable to its Series B Convertible Preferred Stock from 5,000:1 to 8,366:1, eliminating the previously issuable cashless-exercise warrants. Using the revised conversion ratio, the Company converted all 1,950 outstanding shares of Series B Preferred Stock into 16,313,700 shares of common stock on November 12, 2025.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The Company evaluated the modification under ASC 470-20-40 and ASC 260-10-S99-2 by comparing the fair value of the securities issued under the modified terms to the fair value of the securities that would have been issuable under the original terms, measured at the conversion date. The fair value of the warrants foregone was estimated using the Black-Scholes option pricing model. Based on this analysis, the fair value of the consideration under the modified terms did not exceed the fair value under the original terms, and accordingly, no deemed dividend was recognized.

As the Series B Preferred Stock was equity-classified, the conversion was accounted for as a reclassification within stockholders' equity with no income statement impact. Following the conversion, no shares of Series B Preferred Stock remain outstanding.

**Series C, Convertible Preferred Stock**

● Designated Shares: 800,000

● Issued & Outstanding: 559,489 and 145,966 shares as of December 31, 2025 and June 30, 2025, respectively

● Par Value: $0.001 per share

● Stated Value: None

● Conversion Terms: convertible into 6,000 shares of common stock

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

● Rank junior to Series B, convertible preferred stock

● Derivative Liability Assessment:

○ Evaluated under ASC 815 ("Derivatives and Hedging")

○ The Series C Convertible Preferred Stock does not meet the definition of a derivative liability because it does not contain any variable equity conversion features or other contingent provisions that would require derivative accounting.

*Increase in Authorized Shares for Designation*

The original Certificate of Designation authorized 500,000 shares. On December 3, 2025, the Company filed a Certificate of Amendment to Designation with the Nevada Secretary of State increasing the number of designated shares from 500,000 to 800,000 to accommodate the issuance of additional shares as acquisition consideration and compensation.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

*Lock-Up Provisions*

Certain shares of Series C Convertible Preferred Stock issued as compensation and as acquisition consideration are subject to contractual lock-up provisions that restrict conversion into common stock for a specified period following issuance.

As of December 31, 2025, of the 559,489 shares of Series C Convertible Preferred Stock issued and outstanding, 516,759 shares are subject to contractual lock-up provisions and are not currently eligible for conversion, representing 3,100,554,000 restricted common share equivalents. Only 42,730 shares, convertible into 256,380,000 shares of common stock, are currently eligible for conversion.

Because the locked-up shares cannot currently be converted, they have been excluded from the Company's authorized share sufficiency analysis. See Note 2 (Basic and Diluted Net Loss Per Share — Convertible Preferred Stock Classification) for the Company's assessment of authorized share sufficiency and the reclassification from temporary equity to permanent stockholders' equity effective November 19, 2025.

**Preferred Stock Transactions for the Year Ended June 30, 2026**

Shares Issued in Acquisitions

On August 27, 2025 and September 30, 2025, the Company completed the acquisitions of the Victorville ("VV") and Rancho Mirage ("RM") hotel properties, respectively. As part of the purchase consideration for these business combinations, the Company issued 216,667 shares and 176,167 shares of Series C Convertible Preferred Stock.

In accordance with ASC 805, Business Combinations, the Series C shares issued in connection with the VV and RM acquisitions were measured at their estimated fair values of $39,000,000, (excluding potential contingent consideration of an additional $7,125,000) and $42,280,000 (excluding potential contingent consideration of an additional $4,800,000), respectively, as of the applicable acquisition dates. These fair value amounts have been included in the preliminary purchase price allocations and will be updated, if necessary, during the measurement period as additional information becomes available.

See Note 9.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Stock Issued for Services

On October 22, 2025, the Company issued 589 shares of Series C Convertible Preferred Stock to a consultant for services rendered. The fair value of the Series C shares was based on the quoted closing trading price of $0.08/share. Applying the 6,000:1 conversion ratio, the grant equates to 3,534,000 common shares on an as-converted basis, resulting in a total fair value of $282,720.

**Preferred Stock Transactions for the Year Ended June 30, 2025**

Series C, Convertible Preferred Shares Issued for Services

On February 17, 2025, the Company issued 2,000 shares of Series C, convertible preferred stock to a consultant for services rendered. The fair value of the Series C shares was based on the quoted closing trading price of $0.0081/share. Applying the 6,000:1 conversion ratio, the grant equates to 12,000,000 common shares on an as-converted basis, resulting in a total fair value of $97,200.

On March 25, 2025, the Company granted 94,250 shares of Series C, convertible preferred stock to several service providers as compensation. The fair value of the Series C shares was based on the quoted closing trading price of $0.0068/share. Applying the 6,000:1 conversion ratio, the grant equates to 565,500,000 common shares on an as-converted basis, resulting in a total fair value of $3,845,400.

Pursuant to the applicable service agreements, vesting is contingent upon the achievement of the following milestones:

&nbsp;&nbsp;&nbsp;&nbsp;1. Closing
 of the acquisitions of both SWC and Skytech – 1/3 vested on March 31, 2025.

2. Successful
 uplisting of the Company's common stock to a national securities exchange (e.g., NYSE
 or Nasdaq) – 1/3 to vest upon such uplisting.

3. Achievement
 of total stockholders' equity of $40 million — one-third vests upon reaching
 this milestone, as evidenced in the first Form 10-Q or Form 10-K in which the balance sheet
 reflects this level of equity.

In the event that one or more of the remaining milestones are not achieved, the unvested portion of the award will vest ratably over a 20-month period (April 2025 – November 2026).

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Unvested Series C, Convertible Preferred Stock – Compensation

---

| | | |
|:---|:---|:---|
| <br>**Non-Vested Shares** |<br>**Number of**<br>**Shares** | **Weighted Average**<br>**Gant Date**<br>**Fair Value** |
| June 30, 2024 |  | $- |
| Granted | 94250 | 0.0068 |
| Vested | (37300) | 0.0068 |
| Cancelled/Forfeited | - |  |
| June 30, 2025 | 56950 | $0.0068 |
| Granted |  |  |
| Vested | (20100) |  |
| Cancelled/Forfeited | - |  |
| December 31, 2025 | 36850 | $0.0068 |
| Unrecognized compensation | $1503480 |  |
| Weighted average remaining period (years) | 0.92 |  |

---

During the three and six months ended December 31, 2025 and 2024, respectively, the Company recognized $410,040 and $820,080 of compensation expense related to vesting.

Shares Issued in Acquisitions

On March 31, 2025, the Company completed the acquisitions of SWC and TechForce. In connection with these transactions, the Company issued 83,333 and 10,000 shares of Series C Convertible Preferred Stock, respectively, as part of the purchase consideration.

See Note 9 for additional information regarding these acquisitions.

Contingent Performance-Based Equity Awards — TechForce Acquisition

In connection with the TechForce acquisition, certain additional shares of Series C Convertible Preferred Stock may be issued to the sellers contingent upon achieving specified revenue and EBITDA milestones.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

These awards are structured as compensation for post-combination services and are not part of the purchase consideration under ASC 805, *Business Combinations*. Accordingly, related expense will be recognized in the Company's consolidated statement of operations in accordance with ASC 718, *Compensation — Stock Compensation*, based on the probability of achieving the specified performance conditions.

Each award is to be granted once upon achievement, is independent and cumulative, and is to be measured based on a 30-day volume-weighted average price of the Company's common stock as of the applicable measurement date.

Contingent Compensation Related to the Skytech Acquisition

In connection with the Skytech acquisition, certain additional equity awards may be issued to the sellers contingent upon achieving specified revenue and/or EBITDA milestones. These awards are structured as compensation for post-combination services and are not considered part of the purchase price under ASC 805, *Business Combinations*. Accordingly, any related expense will be recognized in the Company's consolidated statement of operations in accordance with ASC 718, *Compensation – Stock Compensation*, based on the probability of achieving the specified performance conditions.

Each award is to be granted once upon achievement, is independent and cumulative, and is to be measured based on a 30-day volume-weighted average price of the Company's common stock as of the applicable measurement date

Revenue-Based Equity Awards

The sellers are eligible to receive shares of Series C Convertible Preferred Stock with an aggregate maximum value of $35,000,000 based on the following Company revenue milestones:

---

| | |
|:---|:---|
| Company Revenue | Restricted Stock Award (% of equity) |
| $50000000 | 3.0% |
| $100000000 | 3.5% |
| $150000000 | 4.0% |
| $200000000 | 4.5% |
| $300000000 | 5.0% |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

EBITDA-Based Equity Awards

The sellers are eligible to receive additional shares of Series C Convertible Preferred Stock with an aggregate maximum value of $18,110,000 based on the following Company EBITDA milestones:

---

| | |
|:---|:---|
| Company EBITDA | Restricted Stock Award (% of equity) |
| $1000000 | 2% |
| $3000000 | 3% |
| $5000000 | 4% |
| $10000000 | 5% |
| $20000000 | 6% |
| $30000000 | 7% |
| $50000000 | 8% |
| $100000000 | 10% |

---

Awards are allocated pro rata among eligible recipients and are subject to continued service through each measurement date. The Series C shares issued upon achievement of milestones are subject to the same lock-up restrictions described below. As of December 31, 2025, none of the revenue or EBITDA milestones have been achieved and no awards have been issued.

Lock-Up Restrictions

Pursuant to the TechForce acquisition agreement, each seller is subject to a lock-up period restricting the sale, transfer, pledge, or other disposition of any equity securities received in connection with the transaction for a period of six months (6) following the closing date. During this period, sellers are prohibited from transferring or encumbering such securities, except in limited circumstances where transferees agree to be bound by the same restrictions. The lock-up may be terminated earlier at the sole discretion of the Company.

Seniority of Series B Convertible Preferred Stock

Under the original Certificate of Designation, the Series C Convertible Preferred Stock ranked junior to the Company's Series B Convertible Preferred Stock with respect to liquidation preference. In October 2025, all outstanding shares of Series B Preferred Stock were converted into common stock (see Series B Convertible Preferred Stock above), and the subordination is no longer applicable.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**Series D, Convertible Preferred Stock**

● Designated Shares: 100,000

● Issued & Outstanding: 1,834 and 3,334 shares as of December 31, 2025 and June 30, 2025, respectively

● Par Value: $0.001 per share

● Stated Value: None

● Conversion Terms: convertible into 6,000 shares of common stock

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

Under the original Certificate of Designation, the Series D Convertible Preferred Stock ranked junior to the Company's Series B Convertible Preferred Stock with respect to liquidation preference. In October 2025, all outstanding shares of Series B Preferred Stock were converted into common stock (see Series B Convertible Preferred Stock above), and the subordination is no longer applicable.

**Series D, Convertible Preferred Stock Transactions for the Year Ended June 30, 2026**

In December 2025, the Company issued 9,000,000 shares of common stock upon the conversion of 1,500 shares of Series D Convertible Preferred Stock at the 6,000:1 conversion ratio. The transaction was accounted for as a reclassification within stockholders' equity at the par value of the shares issued and received, with no impact to the total stockholders' equity.

**Series D, Convertible Preferred Stock Transactions for the Year Ended June 30, 2025**

On July 22, 2024, the Company issued an additional 1,667 shares of Series D, Convertible Preferred Stock in connection with the modification of an existing debt arrangement. In accordance with ASC 470-50, the transaction was evaluated to determine whether it represented a modification or an extinguishment of debt. Based on the terms and quantitative assessment, the transaction qualified as an extinguishment, and a loss was recognized accordingly.

The fair value of the equity issued was estimated to be $113,955, based on the as-converted value of the underlying common stock, adjusted for a restricted stock discount to reflect lack of marketability and transfer restrictions. This valuation was conducted pursuant to guidance in ASC 718-10-30, and supported by an independent third-party valuation report.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

See Note 5 for additional discussion regarding debt and related calculation of loss on debt extinguishment.

**Common Stock**

● Authorized Shares: 900,000,000

● Issued & Outstanding:

○ 213,367,889 shares as of December 31, 2025

○ 136,961,021 shares as of June 30, 2025

● Par Value: $0.001 per share

● Voting Rights: 1 vote per share

**<u>Equity Transactions for the Year Ended June 30, 2026</u>**

**Stock Issued for Cash**

The Company issued 22,360,575 shares of common stock in several private placements for $894,423 ($0.04/share).

**Common Stock Issued in connection with Conversion of Convertible Notes Payable and Related Accrued Interest Payable**

The Company issued an aggregate of 26,266,895 shares of common stock to certain convertible debt holders upon conversion of their outstanding notes and related accrued interest payable. The shares had a total fair value of $866,807 (approximately $0.033 per share), determined in accordance with the conversion terms set forth in the underlying note agreement. See Note 5 for additional information.

**<u>Equity Transactions for the Year Ended June 30, 2025</u>**

**Stock Issued for Services** 

The Company issued 50,000 shares of common stock to consultants for services rendered, having a fair value of $995 ($0.0199/share), based upon the quoted closing trading price.

**Common Stock Issued in connection with Conversion of Convertible Notes Payable and Related Accrued Interest Payable**

The Company issued an aggregate of 8,003,164 shares of common stock to certain convertible debt holders upon conversion of their outstanding notes and related accrued interest payable. The shares had a total fair value of $264,120 (approximately $0.033 per share), determined in accordance with the conversion terms set forth in the underlying note agreement. See Note 5 for additional information.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**Warrants**

Warrant activity for the six months ended December 31, 2025 and the year ended June 30, 2025 are summarized as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Warrants** |<br><br>**Number of**<br>**Warrants** |<br>**Weighted**<br>**Average**<br>**Exercise Price** | **Weighted**<br>**Average**<br>**Remaining**<br>**Contractual**<br>**Term (Years)** |<br>**Aggregate**<br>**Intrinsic**<br>**Value** |
| Outstanding - June 30, 2024 | 191799274 | $0.24 | 3.21 | $6140000 |
| Exercisable - June 30, 2024 | 191799274 | $0.24 | 3.21 | $6140000 |
| Granted | 2068869 | $0.10 |  |  |
| Exercised |  |  |  |  |
| Cancelled/Forfeited | (1871800) | $0.16 |  |  |
| Outstanding - June 30, 2025 | 191996343 | $0.05 | 2.21 | $- |
| Exercisable - June 30, 2025 | 191996343 | $0.05 | 2.21 | $- |
| Granted | 6000000 | $0.10 |  |  |
| Exercised | (3844697) | $0.03 |  |  |
| Cancelled/Forfeited | (500000) | $0.50 |  |  |
| Outstanding - December 31, 2025 | 193651646 | $0.05 | 1.80 | $2570156 |
| Exercisable - December 31, 2025 | 193651646 | $0.05 | 1.80 | $2570156 |

---

Common Stock Issued Upon Cashless Exercise of Warrants

During the six months ended December 31, 2025, holders exercised 3,844,697 warrants on a cashless basis, resulting in the issuance of 2,465,698 shares of common stock. The transaction was accounted for as a reclassification within stockholders' equity at par value, with no impact to total stockholders' equity.

Warrants Issued as Deferred Offering Costs

On October 8, 2025, the Company entered into an Equity Purchase Agreement with a material debt lender, allowing the Company to sell up to $25,000,000 of common stock at its discretion over a 24-month period. In connection with the agreement, the Company issued a warrant to purchase 6,000,000 shares of common stock at an exercise price of $0.10 per share. The warrant is immediately exercisable and expires five years from the date of issuance.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The fair value of the warrant was estimated at $258,723 using the Black-Scholes option pricing model with the following assumptions:

---

| | |
|:---|:---|
| Stock price | $0.05 |
| Exercise price | $0.1 |
| Expected term (years) | 5.0 |
| Expected volatility | 183.0% |
| Expected dividends | 0.0% |
| Risk free interest rate | 3.72% |

---

The fair value was recorded as a deferred offering cost and is included in prepaid expenses and other current assets in the consolidated balance sheets. The deferred offering cost will be charged against the proceeds of future equity sales under the agreement on a pro rata basis. As of December 31, 2025, no sales had been made under the agreement and the deferred offering cost of $258,723 remained unamortized.

**<u>Note 9 – Acquisitions and Unaudited Pro-Forma Financial Information</u>**

**Fiscal Year Ended June 30, 2026**

**<u>Acquisition of Victorville</u>**

Overview and Date of Acquisition

On August 27, 2025, the Company completed the acquisition of Victorville Treasure Holdings, LLC ("Victorville"), a California limited liability company that owns and operates a 155-room hotel located at 15494 Palmdale Road, Victorville, California (the "Property"). Under the transaction, the Company acquired 100% of the issued and outstanding equity interests, and Victorville became a wholly owned subsidiary of the Company upon closing.

Purchase Consideration

As consideration, the Company issued 216,667 shares of its Series C Convertible Preferred Stock, having an estimated fair value of $39,000,000, based on the as-converted value of the underlying common shares using the $0.03 closing stock price on the acquisition date.

Primary Reasons for the Acquisition

The Victorville acquisition represents a strategic expansion of the Company's hospitality portfolio. The Company believes the acquisition will provide several benefits, including:

● Strengthening its presence
 in key hospitality markets;

● Operational synergies with
 the Company's existing hotel platform;

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

● Immediate revenue contribution
 from ongoing hotel operations;

● Enhanced scale to support
 an integrated lodging and guest-services strategy; and

● Access to franchise-branding
 opportunities following planned renovations.

The acquisition was accounted for in accordance with ASC 805, *Business Combinations*. The Company has provisionally allocated the purchase price to the estimated fair value of assets acquired and liabilities assumed based on currently available information. The purchase price allocation ("PPA") is subject to revision as the Company finalizes its valuation analyses and post-closing adjustments. Any such revisions could result in changes to the values assigned to the acquired tangible and intangible assets, liabilities assumed, and the resulting goodwill.

Contingent Consideration - Victorville

In connection with the acquisition, the Agreement provides for additional contingent consideration payable to the Sellers. Under the terms of the Agreement, the Sellers may earn up to 41,667 additional shares of Series C Convertible Preferred Stock (the "Earnout Shares") upon achieving specified post-closing operational and property-level milestones, including: (i) completion and build-out of a gym facility; (ii) enrollment of at least 50 active gym members; (iii) completion of all remaining renovations required to meet prospective franchise brand standards; and (iv) operation of the property under a major franchise brand for a minimum of 30 days.

Consistent with the valuation methodology applied to the equity consideration issued at closing, the Earnout Shares and any additional shares issuable under the purchase price adjustment provisions were measured at fair value ($7,125,000) based on the as-converted value of the underlying common stock using the $0.03 closing stock price on the August 27, 2025 acquisition date.

In accordance with ASC 805, the contingent consideration was classified in stockholders' equity at its estimated fair value as part of the preliminary purchase price allocation. Contingent consideration classified in stockholders' equity is not subsequently remeasured; adjustments are recognized only upon resolution of the contingency.

Acquisition-Related Costs

In connection with the acquisition of Victorville, the Company incurred an insignificant amount of transaction costs related to the acquisition. Such costs were expensed as incurred and are included in general and administrative expenses in the consolidated statements of operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Forgiveness of Pre-Existing Relationship

In connection with the acquisition of VV, the Company and VV had a pre-existing intercompany note receivable/payable balance. As part of the closing of the transaction, the Company forgave the outstanding intercompany obligation, which resulted in the elimination of the related note payable and note receivable between the entities. In accordance with ASC 805, *Business Combinations*, the settlement of the pre-existing relationship was accounted for as a capital transaction rather than as an element of consideration transferred or as a gain or loss in the statement of operations.

The forgiveness of the intercompany balance resulted in a $2,652,671 increase to additional paid-in capital during the period

Preliminary Purchase Price Allocation

The following table summarizes the preliminary estimate of the fair value of the identifiable assets acquired and liabilities assumed as of the acquisition date. Amounts have been rounded for purposes of the preliminary purchase price allocation ("PPA"). The estimated fair values were derived from an independent third-party valuation report, as follows:

---

| | |
|:---|:---|
| Consideration |  |
| &nbsp;&nbsp;&nbsp;Series C - convertible preferred stock - 216,667 shares | $39000000 |
| &nbsp;&nbsp;&nbsp;Series C - contingent consideration - 41,667 shares | 7125000 |
| Fair value of consideration transferred | $46125000 |
| Recognized amounts of identifiable assets acquired and liabilities assumed: |  |
| Cash | 301000 |
| Accounts receivable | 73000 |
| Prepaids and other | 165000 |
| Inventory | 40000 |
| Land | 750000 |
| Property and equipment - net | 9250000 |
| &nbsp;&nbsp;&nbsp;Total assets acquired | 10579000 |
| Accounts payable and accrued expenses | 1943000 |
| Notes payable | 3224000 |
| Mortgage note payable | 9492000 |
| &nbsp;&nbsp;&nbsp;Total liabilities assumed | 14659000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total identifiable net liabilities assumed | (4080000) |
| Allocation required for identifiable intangible assets and goodwill | 50205000 |
| Intangible asset (liquor license) | 20000 |
| Intangible asset (franchise agreement) | 3200000 |
| &nbsp;&nbsp;&nbsp;Total identifiable intangible assets | 3220000 |
| Goodwill (including assembled workforce) | $46985000 |

---

Measurement Period

The Company expects to finalize the purchase price allocation no later than August 27, 2026, which represents the end of the one-year measurement period permitted under ASC 805. During this period, provisional amounts may be adjusted retrospectively if new information becomes available about facts and circumstances that existed at the acquisition date.

The Company expects to recognize goodwill primarily attributable to anticipated synergies, enhanced automation capabilities, and future economic benefits that do not qualify for separate recognition. The goodwill is expected to be non-deductible for tax purposes.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Supplemental Pro-Forma Information (Unaudited)

The following unaudited pro forma information gives effect to the acquisition as though it had occurred on July 1, 2024, the beginning of the comparable prior annual reporting period. This information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the acquisition been consummated as of that date. The unaudited pro forma financial results do not reflect potential cost savings, integration synergies, or non-recurring charges that may result from the acquisition.

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended**<br>**December 31, 2025** | **Six Months Ended**<br>**December 31, 2024** |
| Revenues - net | $2000102 | $1836724 |
| Net loss | $(7425692) | $(2150950) |
| Loss per share - basic | $(0.05) | $(0.02) |
| Loss per share - diluted | $(0.05) | $(0.02) |
| Weighted average number of shares - basic | 162793612 | 128939201 |
| Weighted average number of shares - diluted | 162793612 | 128939201 |

---

**<u>Acquisition of Rancho Mirage</u>**

Overview and Date of Acquisition

On September 30, 2025, the Company completed the acquisition of Mountain Treasure Holdings, LLC ("Rancho Mirage"), a Delaware limited liability company that owns and operates the Hilton Garden Inn Palm Springs – Ranch Mirage, a 120-room hotel located at 71700 Highway 111, Ranch Mirage, California (the "Property"). Under the transaction, the Company acquired 100% of the issued and outstanding membership interests, and Ranch Mirage became a wholly owned subsidiary of the Company upon closing.

Purchase Consideration

As consideration, the Company issued 176,167 shares of its Series C Convertible Preferred Stock, having an estimated fair value of $42,280,000, based on the as-converted value of the underlying common shares using the $0.04 closing stock price on the acquisition date.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Primary Reasons for the Acquisition

The Ranch Mirage acquisition represents a strategic expansion of the Company's hospitality portfolio. The Company believes the acquisition will provide several benefits, including:

● Strengthening its presence
 in key hospitality markets;

● Operational synergies with
 the Company's existing hotel platform;

● Immediate revenue contribution
 from ongoing hotel operations;

● Enhanced scale to support
 an integrated lodging and guest-services strategy; and

● Access to franchise-branding
 opportunities following planned renovations.

The acquisition was accounted for in accordance with ASC 805, Business Combinations. The Company has provisionally allocated the purchase price to the estimated fair value of assets acquired and liabilities assumed based on currently available information. The purchase price allocation ("PPA") is subject to revision as the Company finalizes its valuation analyses and post-closing adjustments. Any such revisions could result in changes to the values assigned to the acquired tangible and intangible assets, liabilities assumed, and the resulting goodwill.

Contingent Consideration – Rancho Mirage

In connection with the acquisition, the Agreement provides for additional contingent consideration payable to the Sellers. Under the terms of the Agreement, the Sellers may earn up to 20,000 additional shares of Series C Convertible Preferred Stock (the "Earnout Shares") upon achievement of specified post-closing milestones, including: (i) the completion and build-out of five new guestrooms; and (ii) receipt of a certificate of occupancy and all required permits or approvals for such guestrooms, on or before December 31, 2027.

Consistent with the valuation methodology applied to the equity consideration issued at closing, the Earnout Shares and any additional shares issuable under the purchase price adjustment provisions were measured at fair value ($4,800,000), based on the as-converted value of the underlying common stock using the $0.04 closing stock price on the September 30, 2025 acquisition date.

In accordance with ASC 805, the contingent consideration was classified in stockholders' equity at its estimated fair value as part of the preliminary purchase price allocation. Contingent consideration classified in stockholders' equity is not subsequently remeasured; adjustments are recognized only upon resolution of the contingency.

Acquisition-Related Costs

In connection with the acquisition of Rancho Mirage, the Company incurred an insignificant amount of transaction costs related to the acquisition. Such costs were expensed as incurred and are included in general and administrative expenses in the consolidated statements of operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Preliminary Purchase Price Allocation

The following table summarizes the preliminary estimate of the fair value of the identifiable assets acquired and liabilities assumed as of the acquisition date. Amounts have been rounded for purposes of the preliminary purchase price allocation ("PPA"). The estimated fair values were derived from an independent third-party valuation report, as follows:

---

| | |
|:---|:---|
| Consideration |  |
| &nbsp;&nbsp;&nbsp;Series C - convertible preferred stock - 176,167 shares | $42280000 |
| &nbsp;&nbsp;&nbsp;Series C - contingent consideration - 20,000 shares | 4800000 |
| Fair value of consideration transferred | $47080000 |
| Recognized amounts of identifiable assets acquired and liabilities assumed: |  |
| &nbsp;&nbsp;&nbsp;Cash | 968000 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 11000 |
| &nbsp;&nbsp;&nbsp;Prepaids and other | 7000 |
| &nbsp;&nbsp;&nbsp;Inventory | 7000 |
| &nbsp;&nbsp;&nbsp;Land | 2800000 |
| &nbsp;&nbsp;&nbsp;Property and equipment - net | 12000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets acquired | 15793000 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | 2386000 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses - related party | 240000 |
| &nbsp;&nbsp;&nbsp;Deferred revenue/customer deposits | 12000 |
| &nbsp;&nbsp;&nbsp;Notes payable | 1700000 |
| &nbsp;&nbsp;&nbsp;Mortgage note payable | 9992000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities assumed | 14330000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total identifiable net assets assumed | 1463000 |
| &nbsp;&nbsp;&nbsp;Allocation required for identifiable intangible assets and goodwill | 45617000 |
| &nbsp;&nbsp;&nbsp;Intangible asset (liquor license) | 20000 |
| &nbsp;&nbsp;&nbsp;Intangible asset (franchise agreement) | 1400000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total identifiable intangible assets | 1420000 |
| &nbsp;&nbsp;&nbsp;Goodwill (including assembled workforce) | $44197000 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Measurement Period

The Company expects to finalize the purchase price allocation no later than September 30, 2026, which represents the end of the one-year measurement period permitted under ASC 805. During this period, provisional amounts may be adjusted retrospectively if new information becomes available about facts and circumstances that existed at the acquisition date.

The Company expects to recognize goodwill primarily attributable to anticipated operational synergies, future economic benefits, and other advantages that do not qualify for separate recognition. The goodwill is expected to be non-deductible for tax purposes.

Supplemental Pro-Forma Information (Unaudited)

The unaudited pro-forma information for the periods set forth below gives effect to the acquisition had the transaction occurred on July 1, 2024. This pro-forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the transactions been consummated as of that time. The unaudited pro forma financial results do not reflect potential cost savings, integration synergies, or non-recurring charges that may result from the transactions.

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended**<br>**December 31, 2025** | **Six Months Ended**<br>**December 31, 2024** |
| Revenues - net | $1773902 | $1602219 |
| Net loss | $(6841001) | $(1726912) |
| Loss per share - basic | $(0.04) | $(0.01) |
| Loss per share - diluted | $(0.04) | $(0.01) |
| Weighted average number of shares - basic | 162793612 | 128939201 |
| Weighted average number of shares - diluted | 162793612 | 128939201 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Goodwill Summary

---

| | |
|:---|:---|
| Balance - June 30, 2024 | $897542 |
| Acquisition of SWC | 3714027 |
| Acquisition of Skytech | 790150 |
| Impairment charge - FHVH | (897542) |
| Balance - June 30, 2025 | 4504177 |
| Acquisition of Victorville | 46985000 |
| Acquisition of Rancho Mirage | 44197000 |
| Balance - December 31, 2025 | $95686177 |

---

**<u>Note 10 – Intangible Assets</u>**

Intangibles consisted of the following at December 31, 2025 and June 30, 2025, respectively:

---

| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Classification** |<br>**December 31, 2025** |<br>**June 30,<br> 2025** | **Estimated**<br>**Useful Lives (Years)** | **Weighted Average**<br>**Remaining Life (Years)** |
| Tradenames/trademarks | $786800 | $786800 | N/A | N/A |
| Customer relationships | 1041300 | 1041300 | 10 | 9.25 |
| Franchise agreements | 4600000 |  | 10 | 9.67 - 9.75 |
| Liquor licenses | 40000 |  | N/A |  |
| Less: accumulated amortization | (219764) | (26033) |  |  |
| Intangibles - net | $6248336 | $1802067 |  |  |

---

Amortization expense for the three months and six months December 31, 2025 and 2024 was as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $141033 | $- |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $193731 | $- |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

There were no impairment losses for the three and six months ended December 31, 2025 and 2024, respectively.

Estimated amortization expense for each of the five (5) succeeding years and thereafter is as follows:

---

| | |
|:---|:---|
| For the Years Ended June 30, |  |
| 2026 (6 Months) | $282065 |
| 2027 | $564130 |
| 2028 | $564130 |
| 2029 | $564130 |
| 2030 | $564130 |
| Thereafter | $2882951 |
| Total | $5421536 |

---

**<u>Note 11- Derivative Liabilities</u>**

The convertible notes acquired in connection with the SWC acquisition on March 31, 2025, and certain notes issued during the six months ended December 31, 2025 (see Note 5), contain embedded conversion features with variable pricing terms. Because these features allow conversion into an indeterminate number of common shares based on the trading price of the Company's common stock, they are not considered indexed to the Company's own stock and therefore require bifurcation from the host debt instrument in accordance with ASC 815.

The Company accounts for the bifurcated embedded derivatives as derivative liabilities, measured at fair value with subsequent remeasurement at each reporting period. The derivative liabilities are classified within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs.

Valuation Methodology

The Company used the Black-Scholes option pricing model to estimate the fair value of the embedded conversion option liabilities at both initial recognition and subsequent remeasurement dates.

The initial day-1 fair value of the derivative liabilities during the year ended June 30, 2025 was $1,413,568. These liabilities were remeasured to $1,102,992 at June 30, 2025 and to $3,190,262 at December 31, 2025.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The model utilized the following key assumptions:

 

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| Expected term (years) | 0.77 – 1.68 | 2.18 - 2.43 |
| Expected volatility | 232.20% – 256.20% | 207.70% - 233.30% |
| Expected dividends | 0.00% – 0.00% | 0.00% - 0.00% |
| Risk free interest rate | 3.48% – 3.66% | 3.72% - 3.89% |

---

 

Derivative Liability Activity

Changes in the fair value of derivative liabilities are recognized in other income (expense) in the consolidated statements of operations.

For the three and six months ended December 31, 2025 and 2024, the Company recorded a change in fair value gain (loss) of its derivative liabilities as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $1688040 | $- |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $737987 | $- |

---

A reconciliation of the beginning and ending balances of derivative liabilities measured at fair value on a recurring basis using Level 3 inputs is presented below as of December 31, 2025 and June 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
|  | **Third Party** | **Related Party** | **Total** |
| Derivative liabilities – June 30, 2024 | $- | $- | $- |
| Fair value at commitment date | 987131 | 426437 | 1413568 |
| Gain on debt extinguishment |  | (500678) | (500678) |
| Fair value mark to market adjustment | (181366) | 371468 | 190102 |
| Derivative liabilities – June 30, 2025 | 805765 | 297227 | 1102992 |
| Fair value at commitment date | 2825257 |  | 2825257 |
| Fair value mark to market adjustment | (711370) | (26617) | (737987) |
| Derivative liabilities – December 31, 2025 | $2919652 | $270610 | $3190262 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Related Party Component

A portion of the derivative liability relates to convertible notes held by the Company's Chief Executive Officer and Chief Revenue Officer, who is also a member of the Board of Directors.

Debt Extinguishment and Related Impacts

During the year ended June 30, 2025, in connection with the conversion of principal on a convertible note (Loan #17), and consistent with ASC 470-50, the Company allocated a proportionate adjustment and remeasurement to the related derivative liability. This resulted in the recognition of a $500,678 gain on debt extinguishment, which is presented in other income (expense) in the consolidated statements of operations for that period.

During initial measurement in the prior fiscal year (year ended June 30, 2025), the Company determined that the fair value of the embedded derivative liabilities exceeded the proceeds allocated to the convertible note host instrument. Accordingly, the Company recorded a debt discount equal to the face amount of the note, and the excess — totaling $653,792 — was recognized as derivative expense in the consolidated statements of operations for that period.

For the three and six months ended December 31, 2025 and 2024, the Company recognized derivative expense as follows:

---

| | |
|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** |
| **2025** | **2024** |
| $895757 | $- |

---

---

| | |
|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** |
| **2025** | **2024** |
| $895757 | $- |

---

The derivative liabilities recognized during the six months ended December 31, 2025 arose from the issuance of convertible notes with an aggregate face value of $2,270,000. The fair value of the derivative liabilities at the commitment date of $2,825,257 exceeded the net proceeds of the notes, resulting in derivative expense of $895,757 recognized in the consolidated statement of operations. See Note 5 for additional information regarding the convertible notes and related debt discount.

See Notes 6 and 12 for additional fair value disclosures.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**<u>Note 12 – Fair Value of Financial Instruments</u>**

The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. This determination requires significant judgments to be made.

Liabilities measured at fair value on a recurring basis consisted of the following at December 31, 2025 and June 30, 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
| Liabilities |  |  |  |  |
| Derivative liabilities | $- | $- | $3190262 | $3190262 |
| Total | $- | $- | $3190262 | $3190262 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
| Liabilities |  |  |  |  |
| Derivative liabilities | $- | $- | $1102992 | $1102992 |
| Total | $- | $- | $1102992 | $1102992 |

---

**<u>Note 13 – Segment Information</u>**

General

Operating segments are components of the Company for which discrete financial information is available and whose operating results are regularly reviewed by the chief operating decision maker ("CODM") to allocate resources and assess performance.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Reportable Segments

Beginning in fiscal 2026, the Company has three (3) reportable segments:

&nbsp;&nbsp;&nbsp;&nbsp;1. Foodservice
 Packaging Distribution - distribution of foodservice packaging products, established through
 the acquisition of SWC on March 31, 2025.

2. Robotics-as-a-Service
 (RaaS) - development and deployment of robotics solutions, operated through TechForce

3. Hotel
 Operations - ownership and operation of hotel properties, including lodging, food and beverage,
 and related hospitality services. This segment was established following the acquisitions
 of the Victorville and Rancho Mirage hotel properties during the first quarter of fiscal
 2026.

Other Corporate Overhead represents corporate-level activities and shared services, including public company compliance, executive management, finance, legal, and other centralized functions. These costs are not included in the CODM's evaluation of segment performance and are not considered a reportable operating segment. Corporate overhead is presented for reconciliation to the consolidated financial statements.

Basis of Measurement

The CODM evaluates segment performance primarily based on revenue and operating income (loss). The CODM also reviews total assets and total liabilities by segment to assess resource allocation. Segment information is prepared on the same basis as the consolidated financial statements. There were no material intersegment transactions during the periods presented.

Continuing vs. Discontinued Operations

The Company's legacy Snacks and Beverages operations are presented as discontinued operations and excluded from reportable segments. For comparability, the segment tables separately identify discontinued operations. See Note 14 – Discontinued Operations for further detail.

Reconciliations

The following tables present financial information for the Company's reportable segments and include reconciling items — such as Other Corporate Overhead, non-operating items, and discontinued operations — so that the totals reconcile directly to the consolidated statements of operations.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Six Months Ended December 31,** | **For the Six Months Ended December 31,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenues** |  |  |  |  |
| Foodservice Packaging | $337782 | $- | $734826 | $- |
| RaaS | 17318 |  | 67118 |  |
| Hotel | 1855929 |  | 2170112 |  |
| Other Corporate Overhead | - | - | - | - |
| Revenues - continuing operations | 2211029 |  | 2972056 |  |
| Revenues - discontinued operations | - | 15141 | - | 39595 |
| Total | $2211029 | $15141 | $2972056 | $39595 |
| **Costs and expenses** |  |  |  |  |
| Foodservice Packaging | $747337 | $- | $1391737 | $- |
| RaaS | 803179 | 15769 | 1243466 | 48337 |
| Hotel | 2539091 |  | 3144016 |  |
| Other Corporate Overhead | 1646290 | 176080 | 2883834 | 361974 |
| Costs and expenses - continuing operations | 5735897 | 191849 | 8663053 | 410311 |
| Costs and expenses - discontinued operations | 1110 | 59816 | 2562 | 178115 |
| **Total** | $5737007 | $251665 | $8665615 | $588426 |
| **Income (loss) from operations** |  |  |  |  |
| Foodservice Packaging | $(409555) | $- | $(656911) | $- |
| RaaS | (785861) | (15769) | (1176348) | (48337) |
| Hotel | (683162) |  | (973903) |  |
| Other Corporate Overhead | (1646290) | (176080) | (2883834) | (361974) |
| Loss from continuing operations | (3524868) | (191849) | (5690997) | (410311) |
| Loss from discontinued operations | (1110) | (44675) | (2562) | (138520) |
| **Total** | $(3525978) | $(236524) | $(5693559) | $(548831) |
| **Other income (expense) - net** |  |  |  |  |
| Foodservice Packaging | $(22818) | $- | $(19412) | $- |
| RaaS | 4786 | 29643 | 9712 | 45629 |
| Hotel | (593845) |  | (727114) |  |
| Other Corporate Overhead | (150465) | (270951) | (1553482) | (737261) |
| Other expense - continuing operations | (762342) | (241308) | (2290296) | (691632) |
| Other expense - discontinued operations | - | (1773) | - | (3754) |
| **Total** | $(762342) | $(243081) | $(2290296) | $(695386) |
| **Net loss** |  |  |  |  |
| Foodservice Packaging | $(432373) | $- | $(676323) | $- |
| RaaS | (781075) | 13874 | (1166636) | (2708) |
| Hotel | (1277007) |  | (1701018) |  |
| Other Corporate Overhead | (1796755) | (447031) | (4437316) | (1099235) |
| Net loss from continuing operations | (4287210) | (433157) | (7981293) | (1101943) |
| Net loss from discontinued operations | (1110) | (46448) | (2562) | (142274) |
| Total | $(4288320) | $(479605) | $(7983855) | $(1244217) |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| **Total Assets** |  |  |
| Foodservice Packaging | $7859290 | $5986956 |
| RaaS | 1343579 | 1299198 |
| Hotel | 119735719 |  |
| Other Corporate Overhead | 679445 | 38380 |
| Assets - continuing operations | 129618033 | 7324534 |
| Assets - discontinued operations | - | - |
| Total | $129618033 | $7324534 |
| **Total Liabilities** |  |  |
| Foodservice Packaging | $3874146 | $1642420 |
| RaaS | 377168 | 275801 |
| Hotel | 28496777 |  |
| Other Corporate Overhead | 10089741 | 9550421 |
| Liabilities - continuing operations | 42837832 | 11468642 |
| Liabilities - discontinued operations | 406605 | 479005 |
| Total | $43244437 | $11947647 |

---

**<u>Note 14 – Discontinued Operations</u>**

On June 30, 2025, management committed to a plan to discontinue the Company's legacy Snacks and Beverages business, which historically involved the sale of packaged snack products through wholesale and distribution channels. This decision was made in connection with the Company's strategic shift toward foodservice packaging distribution, Robotics-as-a-Service, and hotel operations. Management determined that the discontinuation represents a strategic shift that has a major effect on the Company's operations and financial results, and accordingly, the Snacks and Beverages business has been classified as discontinued operations.

The results of the Snacks and Beverages business have been presented as discontinued operations for all periods presented. Accordingly, revenues, expenses, assets, and liabilities associated with this business have been segregated from continuing operations in the consolidated financial statements, and prior-period amounts have been reclassified to conform to the current-period presentation.

As of December 31, 2025 and June 30, 2025, the Company had no remaining assets associated with the discontinued operations. Liabilities related to discontinued operations totaled $406,605 and $479,005 as of December 31, 2025 and June 30, 2025, respectively, and are included in the consolidated balance sheets. These liabilities consist primarily of accounts payable and accrued liabilities.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Results of Discontinued Operations

The following table presents the financial results of discontinued operations for the three and six months ended December 31, 2025 and 2024:

Schedule of Discontinued Operations

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Six Months Ended December 31,** | **For the Six Months Ended December 31,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenues - net** | $- | $15141 | $- | $39595 |
| Costs and expenses |  | 9591 |  | 23460 |
| General and administrative expenses | 1110 | 51998 | 2562 | 158409 |
| Total costs and expenses | 1110 | 61589 | 2562 | 181869 |
| **Net loss from discontinued operations** | $(1110) | $(46448) | $(2562) | $(142274) |

---

Liabilities of Discontinued Operations

The carrying amounts of the liabilities of discontinued operations as of December 31, 2025 and June 30, 2025 were as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| **Current liabilities** |  |  |
| Accounts payable and accrued expenses | $406605 | $479005 |
| **Total liabilities** | $406605 | $479005 |

---

**<u>Note 15 – Right-of-Use Operating Lease</u>**

On September 1, 2025, the Company's subsidiary, SWC Group, Inc., executed a five-year triple-net lease for 23,437 square feet of warehouse and distribution space at 13501 S. Main Street, Los Angeles, California 90061.

The landlord, 13501 S. Main Holdings, LLC, is a material lender to the Company.

● Lease term: 60 months (five years), September 1, 2025 through August 31, 2030

● Monthly lease payments:

○ Months 1–4: $0 per month (free rent)

○ Month 5: $22,800

○ Months 6–16: $39,680 per month

○ Months 17–28: $45,480 per month

○ Months 29–40: $47,080 per month

○ Months 41–51: $51,280 per month

○ Months 52–60: $52,880 per month

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

● Total lease obligation: $2,610,000

● Renewal option: None

● Lease classification: Operating lease under ASC 842, recorded as a right-of-use asset and lease liability based on the present value of lease payments ($2,091,012) at lease commencement, discounted at the Company's incremental borrowing rate of 8 %

● Lease incentives: Months 1 – 4 free rent

● Guarantee: The Company

● Security deposit: $15,000

The Company recognizes lease expense on a straight-line basis over the lease term.

At December 31, 2025 and June 30, 2025, the Company has no financing leases as defined in ASC 842, "Leases."

The tables below present information regarding the Company's operating lease assets and liabilities at December 31, 2025 and June 30, 2025.

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **June 30, 2025** |
| **<u>Assets</u>** |  |  |
| Operating lease - right-of-use asset - non-current | $1917012 | $- |
| **<u>Liabilities</u>** |  |  |
| Operating lease liability | $2147332 | $- |
| Weighted-average remaining lease term (years) | 4.67 | - |
| Weighted-average discount rate | 8% | 0% |

---

The components of lease expense were as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2024** |
| **<u>Operating lease costs</u>** |  |  |
| Amortization of right-of-use operating lease asset | $174000 | $- |
| Lease liability expense in connection with obligation repayment | $56320 | - |
| Total operating lease costs | $230320 | $- |
| Supplemental cash flow information related to operating leases was as follows: |  |  |
| Operating cash outflows from operating lease (obligation payment) | $- | $- |
| Right-of-use asset obtained in exchange for new operating lease liability | $2091012 | $- |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

Future minimum lease payments required under leases that have initial or remaining non-cancelable lease terms in excess of one year at December 31,:

---

| | |
|:---|:---|
| 2026 (6 months) | $221200 |
| 2027 | 510960 |
| 2028 | 555360 |
| 2029 | 590160 |
| 2030 | 626560 |
| Thereafter | 105760 |
| Total undiscounted cash flows | 2610000 |
| Less: amount representing interest | 462668 |
| Present value of operating lease liability | 2147332 |
| Less: current portion of operating lease liability | 297626 |
| Long-term operating lease liability | $1849706 |

---

**<u>Note 16 – Subsequent Events</u>**

Subsequent to December 31, 2025, the Company had the following transactions:

**Manufacturing and R&D Advisory Agreement and Common Stock Issuance**

*Overview*

On February 1, 2026 the Company entered into a Manufacturing and R&D Advisory Agreement (the "Advisory Agreement") with a nonemployee advisor possessing extensive experience in global technology manufacturing. The Advisory Agreement engages the advisor in a nonexecutive, advisory capacity to provide strategic counsel and technical guidance in support of the development, advancement, and commercialization of the Company's artificial intelligence robotic technologies. The advisor does not have authority to act for or bind the Company in any manner, and the Advisory Agreement does not create an employment relationship, partnership, joint venture, or fiduciary obligation between the parties.

The Advisory Agreement has no fixed term and may be terminated by either party upon 30 days' prior written notice, with or without cause. All intellectual property developed through the collaboration is the sole and exclusive property of the Company.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

*Compensation*

**Onboarding Equity Bonus**

Upon execution of the Advisory Agreement, the Company issued 2,000,000 shares of common stock to the advisor as a one-time onboarding equity bonus. The shares vested immediately upon issuance with no service or performance conditions.

In accordance with ASC 718, *Compensation—Stock Compensation*, the Company measured the fair value of the shares at the closing price of the Company's common stock on the grant date of $0.042 per share, resulting in stock-based compensation expense of $84,000, which was recognized in full on February 1, 2026.

**Performance-Based Stock Warrants**

The Advisory Agreement provides for the issuance of cashless-exercise stock warrants as performance-based incentive compensation, contingent upon the achievement of specified milestones. Each warrant, if and when earned, entitles the advisor to acquire one share of the Company's common stock at an exercise price of $0.10 per share, has a term of five years from the date of issuance, and is exercisable solely on a cashless basis. The warrants contain standard anti-dilution adjustments for stock splits, reverse stock splits, stock dividends, recapitalizations, and similar corporate transactions.

The performance-based warrants fall into two categories:

*Product Commercialization Milestones.* The advisor is eligible to receive warrants upon the successful commercialization of new product SKUs developed under the Company's development and manufacturing models, as summarized in the following table:

---

| | | |
|:---|:---|:---|
| **Product Launch Type** | **Warrants per SKU** | **Exercise Price** |
| JDM/ODM SKU | 1000000 | $0.10 |
| CM SKU | 500000 | $0.10 |

---

Commercialization is defined as having commenced commercial launch with confirmed production. The number of warrants issuable under this category is not subject to a maximum cap and is dependent on the number of SKUs successfully commercialized.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

*Revenue-Based Earn-Out Milestones.* The advisor is eligible to earn warrants upon the Company's achievement of specified trailing twelve-month ("TTM") revenue thresholds, as summarized in the following table:

---

| | | |
|:---|:---|:---|
| **TTM Revenue Milestone** | **Cumulative Warrants Earned** | **Exercise Price** |
| $50000000 | 10000000 | $0.10 |
| $100000000 | 20000000 | $0.10 |
| $150000000 | 30000000 | $0.10 |
| $200000000 | 40000000 | $0.10 |
| $250000000 | 50000000 | $0.10 |
| $300000000 | 60000000 | $0.10 |
| $350000000 | 70000000 | $0.10 |
| $400000000 | 80000000 | $0.10 |
| $450000000 | 90000000 | $0.10 |
| $500000000 | 100000000 | $0.10 |

---

The warrants earned at each revenue milestone are cumulative, such that achievement of a higher milestone does not result in additional warrants beyond the cumulative total indicated. The maximum number of warrants issuable under the revenue-based milestones is 100,000,000.

*Accounting Treatment*

The Company accounts for the performance-based warrants in accordance with ASC 718, which, following the adoption of ASU 2018-07, *Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting*, requires that share-based payment transactions with nonemployees be measured and recognized using substantially the same framework as employee awards.

The performance-based warrants are subject to performance conditions under ASC 718-10-25. Compensation expense for performance-condition awards is recognized when, and to the extent that, it is probable that the performance condition will be achieved. As of the grant date and through the current reporting period, the Company has assessed the probability of achieving any of the product commercialization milestones or revenue-based earn-out milestones to be zero. Accordingly, no compensation expense has been recognized with respect to the performance-based warrants, and no warrants have been issued or are outstanding under these provisions.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

The Company will reassess the probability of achieving each performance milestone at the end of each reporting period. If and when achievement of a milestone becomes probable, the Company will recognize a cumulative catch-up adjustment for compensation expense based on the grant date fair value of the applicable warrants, with the remaining unrecognized expense recognized over the estimated remaining service period through the expected milestone achievement date.

*Warrant Classification*

The Company evaluated the classification of the performance-based warrants under ASC 815-40, *Derivatives and Hedging—Contracts in Entity's Own Equity*, and ASC 480, *Distinguishing Liabilities from Equity*. The Company concluded that the warrants are indexed to the Company's own stock and meet the conditions for equity classification under ASC 815-40-25.

The cashless exercise feature results in a fixed-for-fixed settlement in the Company's own shares, and the anti-dilution provisions are limited to standard adjustments that do not preclude equity classification. Accordingly, the warrants, if and when issued, will be classified within stockholders' equity.

*Potential Dilution*

In connection with the Advisory Agreement, 2,000,000 shares of common stock were issued on February 1, 2026 as the onboarding equity bonus. No performance-based warrants have been earned or issued. If all performance milestones were to be achieved, including the maximum revenue-based earn-out, the advisor would be eligible to receive warrants to purchase up to 100,000,000 shares under the revenue milestones, plus additional warrants for each product SKU successfully commercialized (1,000,000 per JDM/ODM SKU and 500,000 per CM SKU), with no cap on the number of eligible SKUs. The issuance of common stock and any future warrant exercises may have a dilutive effect on earnings per share in subsequent periods.

Convertible Note Payable

On January 10, 2026, the Company entered into a Securities Purchase Agreement with a material lender and issued a senior secured convertible note with a principal amount of $1,175,000 for net proceeds of $998,750, reflecting an original issue discount of $176,250. The note bears interest at 15% per annum (24% upon default), matures on January 10, 2027, and is secured by a first-priority lien on substantially all assets of the Company. The interest rate decreases to 5% per annum during periods when the Company's common stock is listed for trading on a national securities exchange. The original issue discount increases by 3% of the total outstanding balance on each anniversary of the issuance date until the note is no longer outstanding.

The note is convertible into shares of the Company's common stock at the lower of (i) a fixed conversion price of $0.033 per share or (ii) 80% of the lowest volume-weighted average price during the five trading days prior to conversion. Because the conversion price contains a variable component that can result in settlement in a variable number of shares, the Company determined that the embedded conversion feature requires bifurcation from the host debt instrument as a derivative liability.

At the issuance date, the Company measured the bifurcated conversion feature at a fair value of $1,238,092. The resulting debt discount, together with the original issue discount of $176,250, was limited to the face amount of the note of $1,175,000. The excess of the aggregate discount over the face amount of the note of $63,092 was recognized as a charge to derivative expense. The aggregate debt discount of $1,175,000 is being amortized to interest expense over the one-year term of the note using the effective interest method.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**Acquisition Of Bim-E Intellectual Property And Technology Assets**

**1. Overview of Transaction**

On February 17, 2026 (the "Effective Date"), the Company completed the acquisition (the "Acquisition") of certain intellectual property and technology assets (the "BIM-E Assets") from an individual seller (the "Seller") pursuant to an Asset Purchase and IP Assignment Agreement (the "Asset Purchase Agreement"). The BIM-E Assets relate to an autonomous beverage dispensing robotics platform historically known as "Beer Bot" and its evolved platform "BIM-E," encompassing patents, copyrights, software, firmware, trade secrets, know-how, trademarks, and related digital infrastructure developed or owned by the Seller prior to the Effective Date.

Concurrently with the Acquisition, the Company entered into an Employment Agreement with the Seller engaging the individual as Chief Mechatronics Architect, and the Company entered into an Incentive Award Agreement providing for performance-based equity incentives tied to revenue milestones generated by the BIM-E technology platform.

**2. Nature of Transaction; Basis of Accounting**

**A. Asset Acquisition Determination**

The Company evaluated the Acquisition under ASC 805, Business Combinations. The Company has determined that the transaction does not constitute a business combination. The BIM-E Assets represent pre-commercialization intellectual property with no revenue-generating activities, no organized workforce performing substantive operating processes, no customer base, and no outputs at the time of acquisition. The acquired set fails the "business" definition under ASC 805-10-55 and the optional concentration test under ASC 805-10-55-5A, as substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset group (developed technology IP). Accordingly, the transaction has been evaluated and accounted for as a single transaction consistent with its substance.

**B. Acquired Assets**

The BIM-E Assets acquired consist of the following classes of intellectual property, transferred free and clear of any assumed liabilities:

&nbsp;&nbsp;&nbsp;&nbsp;(a) Patents
 and patent applications, including provisionals, continuations, continuations-in-part, divisionals, reissues, and priority rights;

(b) Copyrights
 and works of authorship, including software source code, object code, firmware, embedded control software, technical drawings, diagrams,
 and documentation;

(c) Artificial
 intelligence and machine learning assets, including model weights, training pipelines, datasets, simulation environments, and related
 tooling;

(d) Trade
 secrets and confidential know-how, including engineering designs, prototypes, bills of materials, vendor specifications, manufacturing
 processes, and calibration procedures;

(e) Trademarks
 and branding, including the "BIM-E" and "Beer Bot" names and associated goodwill, to the extent owned by
 the Seller; and

(f) Domain
 names, source code repositories, cloud project accounts, and related digital infrastructure primarily used for the BIM-E technology
 platform.

No liabilities of the Seller were assumed by the Company in connection with the Acquisition.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**DECEMBER 31, 2025** 

**3. Consideration Transferred and Accounting Treatment**

**A. Consideration Transferred**

The aggregate consideration for the BIM-E Assets consisted of 7,000,000 fully vested, non-forfeitable shares of the Company's common stock (the "Consideration Shares"), issued to the Seller as of the Effective Date at a fair value of $0.0362 per share (the closing market price of the Company's common stock on February 17, 2026), resulting in total consideration of approximately $253,400. The Consideration Shares are not subject to any vesting schedule, continued service requirement, or repurchase right based on termination of service.

**B. Expensing as Research and Development** 

The BIM-E Assets acquired consist entirely of pre-commercialization intellectual property and in-process research and development technology for which no alternative future use has been established at the time of acquisition. The Company initially considered whether the acquired technology should be capitalized as a finite-lived intangible asset under ASC 350-30. However, given the pre-commercial, unproven nature of the BIM-E platform and the absence of demonstrated technological feasibility or alternative future use, the Company has determined that the cost of the acquired assets is more appropriately characterized as in-process research and development.

The Company will expense the entire amount in the period of acquisition as research and development expense within consulting and professional fees.

**C. Separation of Purchase Price from Employment Compensation**

The Asset Purchase Agreement expressly provides that the Purchase Price constitutes consideration solely for the sale of the BIM-E Assets and not wages, salary, or compensation for post-closing services. The Company has concluded that no portion of the Consideration Shares should be attributed to the Seller's concurrent engagement as an employee of the Company, based on the arm's-length terms of the Asset Purchase Agreement, the Board's determination that the consideration is commensurate with the fair value of the assets received, and the explicit contractual separation of the asset purchase consideration from employment compensation.

**4. Employment Agreement and Performance-Based Equity Awards**

**A. Employment Agreement**

Concurrently with the Acquisition, the Company entered into an Employment Agreement with the Seller effective February 17, 2026, engaging the individual as Chief Mechatronics Architect at an annual base salary of $100,000.

**B. Performance-Based Earn-Out Warrants**

The Employment Agreement provides for additional performance-based equity compensation in the form of cashless warrants (the "Earn-Out Warrants") exercisable at $0.04 per share, with an aggregate maximum of 100,000,000 warrants issuable upon achievement of trailing-twelve-month ("TTM") revenue milestones attributable to the BIM-E technology platform. Warrants are earned in tranches of 10,000,000 upon each incremental $5,000,000 TTM revenue milestone achieved, up to a total cumulative TTM revenue of $50,000,000. The Earn-Out Warrants expire five (5) years from the date of employment.

The earn-out milestone schedule is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **TTM Revenue<br> Milestone** | **Cumulative<br> Revenue** | **Warrants<br> Earned (Total)** | **Strike<br> Price** | **Vesting Condition** |
| $5000000 | $5000000 | 10000000 | $0.04 | Upon achieving $5M TTM revenue |
| $10000000 | $10000000 | 20000000 | $0.04 | Upon achieving $10M TTM revenue |
| $15000000 | $15000000 | 30000000 | $0.04 | Upon achieving $15M TTM revenue |
| $20000000 | $20000000 | 40000000 | $0.04 | Upon achieving $20M TTM revenue |
| $25000000 | $25000000 | 50000000 | $0.04 | Upon achieving $25M TTM revenue |
| $30000000 | $30000000 | 60000000 | $0.04 | Upon achieving $30M TTM revenue |
| $35000000 | $35000000 | 70000000 | $0.04 | Upon achieving $35M TTM revenue |
| $40000000 | $40000000 | 80000000 | $0.04 | Upon achieving $40M TTM revenue |
| $45000000 | $45000000 | 90000000 | $0.04 | Upon achieving $45M TTM revenue |
| $50000000 | $50000000 | 100000000 | $0.04 | Upon achieving $50M TTM revenue |

---

The Earn-Out Warrants are accounted for as equity-classified, performance-based stock compensation under ASC 718. Compensation cost will be recognized when, and to the extent that, it is probable that the applicable TTM revenue performance condition will be achieved. No TTM revenue milestones have been achieved and no Earn-Out Warrants have vested; accordingly, no compensation cost has been recognized in connection with the Earn-Out Warrants.

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2025 AND 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended<br> December 31,** | **Three Months Ended<br> December 31,** | **Period Change** | **Period Change** |
|  | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
|  | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Revenues - net | $2211029 | $- | $2211029 | N/M **A** |
| Cost of sales | 774490 |  | 774490 | N/M **B** |
| Depreciation and amortization | 973014 |  | 973014 | N/M **C** |
| General and administrative expenses | 3988393 | 191849 | 3796544 | 1979% **D** |
| Loss from operations | (3524868) | (191849) | 3333019 | 1737% |
| Other income (expense) - net | (762342) | (241308) | 521034 | 216% **E** |
| Net Loss | $(4287210) | $(433157) | $3854053 | 890% |

---

**A. Revenues — net**

Revenues were $2,211,029 for the three months ended December 31, 2025, compared to no revenues from continuing operations in the three months ended December 31, 2024.

The increase reflects the Company's first full quarter of consolidated operations from its hotel properties and other revenue-generating activities acquired during the quarter ended September 30, 2025, including:

● **Hotel operations —** The Company operated its 155-room Holiday Inn in Victorville, California (acquired August 27, 2025) and 120-room Hilton Garden Inn in Rancho Mirage, California (acquired September 30, 2025) for the full quarter. Hotel revenues include room revenues, food and beverage revenues, and other ancillary income. The December quarter represents the first period in which both properties contributed a full three months of operations, driving a significant increase over the prior quarter's partial-period revenues of $782,027.

● **Foodservice packaging distribution and related services —** Revenues were also generated from the sale and distribution of foodservice packaging and related supplies to commercial customers.

● **Robotics-as-a-Service ("RaaS") and technology-enabled services —** To a lesser extent, revenues include service billings from deployments of robotics and automation solutions. During the quarter, the Company expanded its robotic live pilot programs beyond hospitality into casinos, shopping malls, stadiums, convention centers, public schools, and assisted living facilities.

No comparable revenue-generating operations existed in the 2024 quarter; therefore, the entire increase in revenues is attributable to these new and acquired operating activities.

**B. Cost of Sales**

Cost of sales was $774,490 in the three months ended December 31, 2025, compared to $0 in the prior-year quarter.

Cost of sales in 2025 primarily consists of:

● Hotel property-level operating costs, including payroll and benefits for front-desk, housekeeping, and food-and-beverage staff; utilities; guest supplies; franchise, management and reservation fees where applicable; and other direct property costs.

● Product and distribution costs associated with the foodservice packaging business, such as purchasing, inbound freight, warehousing, and delivery expenses.

● Direct costs related to RaaS deployments, including installation and servicing of robotic units in the field.

Because the Company had not yet commenced these operations during the 2024 quarter, there were no comparable cost of sales in that period. The sequential increase from $475,565 in the prior quarter reflects the impact of a full quarter of hotel operations at both properties versus a partial period in the September quarter.

**C. Depreciation and Amortization**

Depreciation and amortization expense was $973,014 for the three months ended December 31, 2025, compared to none in the same period of 2024.

The increase is driven by:

● Depreciation of hotel buildings, land improvements, and furniture, fixtures and equipment acquired in connection with the Company's hotel acquisitions, now recognized for a full quarter.

● Depreciation of warehouse, distribution, and robotics equipment used in the foodservice packaging and RaaS operations.

● Amortization of intangible assets, including franchise rights, management agreements, customer relationships, and other acquired intangibles.

● Amortization of right-of-use assets related to operating leases entered into in connection with hotel and other operations.

These assets were placed in service after the 2024 quarter, so there was no depreciation or amortization recorded in that earlier period. The sequential increase from $378,109 in the prior quarter reflects the first full quarter of depreciation on all acquired assets, particularly the Hilton Garden Inn Rancho Mirage, which was acquired on the last day of the September quarter.

**D. General and Administrative Expenses**

General and administrative ("G&A") expenses were $3,988,393 in the three months ended December 31, 2025, compared to $191,849 in the three months ended December 31, 2024, an increase of $3,796,544, or 1,979%.

Key drivers of the increase include:

● Hotel-related corporate overhead, such as regional management salaries, property-level oversight, revenue management, accounting, and centralized purchasing and IT support required to operate the acquired hotels for a full quarter.

● Corporate infrastructure and compliance costs associated with operating as a public company, including SEC reporting, audit and tax services, legal fees, stock-based compensation (including non-cash vesting of Series C preferred stock issued as compensation and common stock issued for services), director and officer insurance, and internal control and governance enhancements.

● Integration and start-up expenses related to combining the hotel operations, foodservice packaging distribution, and RaaS activities into a unified platform, including consulting, professional services, and one-time systems and branding costs.

● Increased bad debt expense reflecting higher allowances on receivables from new operations.

● Inflationary impacts on compensation, insurance, professional services and other overhead expenses.

The Company expects G&A to remain elevated in the near term as hotel operations are stabilized, systems are integrated and additional regulatory requirements—such as evolving SEC guidance on cybersecurity, climate-related and other risk disclosures—are incorporated into the Company's compliance framework.

**Loss from Operations**

Loss from operations was $(3,524,868) for the three months ended December 31, 2025, compared to $(191,849) in the prior-year quarter, an increase of $3,333,019, or 1,737%.

The higher operating loss is attributable to:

● The ramp-up of hotel operations, which, while contributing revenues of $2,211,029, also added significant property-level operating costs, depreciation, and amortization.

● Newly acquired or repositioned hotels often operate below targeted occupancy and rate levels during the initial stabilization period, resulting in lower margins.

● The addition of cost of sales and depreciation in the foodservice packaging and RaaS businesses.

● Substantially higher G&A expenses as described under item D above.

These factors more than offset the benefit of current-year revenues.

**E. Other Income (Expense) — net**

Other expense, net, was $(762,342) in the three months ended December 31, 2025, compared to $(241,308) in the prior-year quarter, an increase of $521,034, or 216%.

The components of this change are discussed in detail in the "Other Income (Expense) — Net" section below (items A–E for the three-month period), but primarily reflect:

● Significantly increased interest expense (including amortization of debt discount) over the prior period totaling $1,586,825 as compared to $270,951, on notes payable, convertible notes and mortgage debt used to finance hotel acquisitions and working capital;

● A new non-cash derivative expense of $895,757 associated with certain convertible debt with a material debt lender; partially offset by

● A non-cash gain of $1,688,040 on the change in fair value of derivative liabilities, reflecting favorable remeasurement of derivative features at quarter-end.

● A net negligible increase of $2,557 related to interest and other income.

**Net Loss**

---

| | | | |
|:---|:---|:---|:---|
| **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Period Change** | **Period Change** |
| **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| **Amount** | **Amount** | **$ Amount** | **% Change** |
| $(4287210) | $(433157) | $3854053 | 890% |

---

Net loss was $(4,287,210) for the three months ended December 31, 2025, compared to $(433,157) in the prior-year quarter, an increase of $3,854,053, or 890%.

The increase in net loss was driven by:

&nbsp;&nbsp;&nbsp;&nbsp;1. **Expansion of operations and acquisitions —** The Company incurred significant new operating expenses related to its first full quarter
 of hotel operations, foodservice packaging distribution, and RaaS, along with substantially higher depreciation and amortization
 and integration costs, which exceeded revenues during this early period.

2. **Higher non-operating expenses —** Increased interest expense on new and existing debt, the recognition of a non-cash derivative
 expense, and higher amortization of debt discounts contributed to the year-over-year increase in other expense, net (item E), partially
 offset by a non-cash gain on the change in fair value of derivative liabilities.

3. **Partially offsetting factors —** The increase in net loss was partially offset by the Company's second quarter of revenues from
 hotel operations and other continuing businesses (item A), which totaled $2,211,029 and represented approximately 183% growth over
 the prior quarter's revenues of $782,027.

**OTHER INCOME (EXPENSE) — NET**

**Three Months Ended December 31, 2025 and 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended<br> December 31,** | **Three Months Ended<br> December 31,** | **Period Change** | **Period Change** |
| | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| <br>**Other income (expense) - net** | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Interest income | $5023 | $29643 | $(24620) | -83% **A** |
| Other income | 27177 |  | 27177 | N/M **B** |
| Derivative expense | (895757) |  | 895757 | N/M **C** |
| Interest expense (including amortization of debt discount) | (1586825) | (270951) | 1315874 | 486% **D** |
| Change in fair value of derivative liabilities | 1688040 | - | 1688040 | N/M **E** |
| **Total other income (expense) - net** | $(762342) | $(241308) | $(521034) | 216% |

---

***A — Interest Income***

Interest income decreased $(24,620), or 83%, to $5,023 in the 2025 quarter from $29,643 in the 2024 quarter. The decrease primarily reflects lower average balances of interest-bearing cash accounts.

***B — Other Income***

Other income was $27,177 in the three months ended December 31, 2025, compared to none in the prior-year quarter. The increase is attributable to miscellaneous non-recurring items, including incidental income from hotel and packaging operations, which did not exist in 2024.

***C — Derivative Expense***

In the 2025 quarter, the Company recognized a non-cash derivative expense of $895,757 related to derivative liabilities associated with a convertible note from a material debt lender. No comparable expense was recorded in the 2024 quarter as no such instruments with derivative features existed at that time.

The derivative expense represents charges related to the bifurcation and measurement of embedded derivative features under ASC 815, using assumptions for the Company's stock price, volatility, risk-free rate, and other valuation inputs.

***D — Interest Expense (including amortization of debt discount)***

Interest expense, including amortization of debt discounts, increased $1,315,874, or 486%, to $1,586,825 in the 2025 quarter from $270,951 in the 2024 quarter.

The increase reflects:

● Higher average outstanding notes payable and mortgage debt, including loans associated with the acquisition and operation of hotel properties.

● New convertible notes payable issued during the three months ended December 31, 2025, totaling $1,929,500 in proceeds, which carry stated interest and were issued with substantial original issue discounts.

● Significantly higher amortization of debt discounts and deferred financing costs related to these instruments, particularly convertible notes with variable conversion features that gave rise to large debt discounts at issuance.

***E — Change in Fair Value of Derivative Liabilities***

In the 2025 quarter, the Company recognized a non-cash gain of $1,688,040 related to the change in fair value of derivative liabilities associated with certain convertible notes. No comparable fair value adjustments were recorded in the 2024 quarter as no such instruments existed.

The gain reflects favorable remeasurement of derivative features at the December 31, 2025 reporting date under applicable accounting guidance, primarily driven by changes in the Company's stock price, expected volatility, and other valuation inputs since the prior measurement date. This contrasts with the $(950,053) loss recorded in the September 30, 2025 quarter, illustrating the inherent volatility of mark-to-market accounting for these instruments.

***Total Other Income (Expense) — net***

As a result of the items described above, total other expense, net, increased to $(762,342) in the 2025 quarter from $(241,308) in the 2024 quarter, an increase of $(521,034), or 216%.

The increase is primarily attributable to substantially higher interest expense (D) and the new non-cash derivative expense (C), partially offset by the non-cash gain on the change in fair value of derivative liabilities (E) and other income (B).

**RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Six Months Ended<br> December 31,** | **Six Months Ended<br> December 31,** | **Period Change** | **Period Change** |
|  | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
|  | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Revenues - net | $2972056 | $- | $2972056 | N/M **A** |
| Cost of sales | 1250055 |  | 1250055 | N/M **B** |
| Depreciation and amortization | 1358019 |  | 1358019 | N/M **C** |
| General and administrative expenses | 6054979 | 410311 | 5644668 | 1377% **D** |
| Loss from operations | (5690997) | (410311) | 5280686 | 1287% **E** |
| Other income (expense) - net | (2290296) | (691632) | 1598664 | 231% **F** |
| Loss from continuing operations | (7981293) | (1101943) | 6879350 | 624% **G** |
| Loss from discontinued operations | (2562) | (142274) | (139712) | -98% **H** |
| Net Loss | $(7983855) | $(1244217) | $6739638 | 542% **I** |

---

**A. Revenues — net**

Revenues were $2,972,056 for the six months ended December 31, 2025, compared to no revenues from continuing operations in the six months ended December 31, 2024.

The increase reflects the Company's transition from a pre-revenue development-stage entity to an operating company with multiple revenue-generating activities, including:

● **Hotel operations —** The Company acquired two hotel properties during the first quarter: a 155-room Holiday Inn in Victorville, California (closed August 27, 2025) and a 120-room Hilton Garden Inn in Rancho Mirage, California (closed September 30, 2025). Hotel revenues include room revenues, food and beverage revenues, and other ancillary income. Operations from these activities reflect results only since each respective acquisition date.

● **Foodservice packaging distribution and related services —** Revenues were also generated from the sale and distribution of foodservice packaging and related supplies to commercial customers.

● **Robotics-as-a-Service ("RaaS") and technology-enabled services —** To a lesser extent, revenues include service billings from deployments of robotics and automation solutions. During the period, the Company expanded its robotic pilot programs into multiple verticals beyond hospitality, including casinos, shopping malls, stadiums, and assisted living facilities, and unveiled a proprietary Beverage Bot platform designed for high-volume venue applications.

No comparable revenue-generating operations existed in the 2024 period; therefore, the entire increase in revenues is attributable to these new and acquired operating activities.

**B. Cost of Sales**

Cost of sales was $1,250,055 in the six months ended December 31, 2025, compared to $0 in the prior-year period. Cost of sales in 2025 primarily consists of hotel property-level operating costs (payroll and benefits, utilities, guest supplies, franchise and management fees, and other direct property costs), product and distribution costs associated with the foodservice packaging business, and direct costs related to RaaS deployments. Because the Company had not yet commenced these operations during the 2024 period, there were no comparable cost of sales.

**C. Depreciation and Amortization**

Depreciation and amortization expense was $1,358,019 for the six months ended December 31, 2025, compared to none in the same period of 2024. The increase is driven by depreciation of hotel buildings, land improvements, furniture, fixtures and equipment, and robotics equipment, as well as amortization of intangible assets (franchise rights, management agreements, customer relationships) and right-of-use assets related to operating leases. These assets were placed in service after the 2024 period in connection with the Company's hotel and business acquisitions.

**D. General and Administrative Expenses**

G&A expenses were 6,054,979 in the six months ended December 31, 2025, compared to $410,311 in the six months ended December 31, 2024, an increase of $5,644,668, or 1,376%.

Key drivers of the increase include:

● Hotel-related corporate overhead for the acquired properties, including regional management, revenue management, accounting, IT support and centralized purchasing.

● Corporate infrastructure and compliance costs, including SEC reporting, audit and tax services, legal fees, non-cash stock-based compensation ($820,080 in non-cash vesting of Series C preferred stock and $282,720 in common stock issued for services), director and officer insurance, and governance enhancements.

● Integration and start-up expenses related to combining hotel operations, foodservice packaging, and RaaS into a unified operating platform.

● Higher bad debt expense of $66,177 in 2025 versus $48,610 in 2024, reflecting increased allowances on receivables from new operations.

**E. Loss from Operations**

Loss from operations was $(5,690,996) for the six months ended December 31, 2025, compared to $(410,311) in the prior-year period, an increase of $5,280,686, or 1,287%.

The higher operating loss is attributable to the ramp-up of hotel operations (with both properties acquired during the first quarter), the addition of cost of sales and depreciation in the foodservice packaging and RaaS businesses, and substantially higher G&A expenses as described under item D above.

These factors more than offset the benefit of $2,972,056 in current-year revenues from new and acquired operating activities. Newly acquired hotels often operate below targeted occupancy and rate levels during the initial stabilization period, resulting in lower margins.

**F. Other Income (Expense) — net**

Other expense, net, was $(2,290,296) in the six months ended December 31, 2025, compared to $(691,632) in the prior-year period, an increase of $1,598,664, or 231%.

The components of this change are discussed in detail in the "Other Income (Expense) — Net" section below (items A–F for the six-month period), but primarily reflect significantly increased interest expense, a new non-cash derivative expense, partially offset by a net non-cash gain on the change in fair value of derivative liabilities and the absence of a current-period loss on debt extinguishment.

**G. Net Loss from Continuing Operations**

---

| | | | |
|:---|:---|:---|:---|
| **Six Months Ended December 31,** | **Six Months Ended December 31,** | **Period Change** | **Period Change** |
| **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| **Amount** | **Amount** | **$ Amount** | **% Change** |
| $(7981293) | $(1101943) | $6879350 | 624% |

---

Net loss from continuing operations increased to $(7,981,293) in the six months ended December 31, 2025, from $(1,101,943) in the six months ended December 31, 2024, an increase of $6,879,350, or 624%.

The increase primarily reflects the higher operating loss from hotel operations, foodservice packaging, and RaaS (items A–E) and the increased non-operating expense discussed under item F. These factors were only partially offset by the benefit of current-year revenues.

**H. Net Loss from Discontinued Operations**

Net loss from discontinued operations, which relates to the wind-down of the legacy Snacks and Beverages business (Nightfood, Inc.), was $(2,562) for the six months ended December 31, 2025, compared to $(142,274) in the prior-year period, a decrease of $(139,712), or 98%.

The improvement reflects the near completion of exit and wind-down activities, resulting in minimal residual expenses in the 2025 period.

**I. Net Loss**

Net loss was $(7,983,855) for the six months ended December 31, 2025, compared to $(1,244,217) in the prior-year period, an increase of $6,739,638, or 542%.

The increase in net loss was driven by:

&nbsp;&nbsp;&nbsp;&nbsp;1. **Expansion of operations and acquisitions —** The Company incurred significant new operating expenses related to hotel operations, foodservice
 packaging distribution, and RaaS, along with associated depreciation and integration costs, which exceeded revenues during the early
 operating phase.

2. **Higher non-operating expenses —** Increased interest expense on new and existing debt, recognition of non-cash derivative expense,
 and higher amortization of debt discounts contributed to the year-over-year increase in other expense, net (item F), partially offset
 by a net non-cash gain on the change in fair value of derivative liabilities.

3. **Partially offsetting factors —** The increase in net loss was partially offset by (i) the Company's first revenues from hotel
 operations and other continuing businesses totaling $2,972,056 (item A), (ii) a substantial reduction in loss from discontinued operations
 (item H), and (iii) the absence of a loss on debt extinguishment that was recognized in the prior-year period.

**OTHER INCOME (EXPENSE) — NET**

**Six Months Ended December 31, 2025 and 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Six Months Ended<br> December 31,** | **Six Months Ended<br> December 31,** | **Period Change** | **Period Change** |
| | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| <br>**Other income (expense) - net** | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Interest income | $9949 | $45629 | $(35680) | -78% **A** |
| Other income | 32423 |  | $32423 | N/M **B** |
| Loss on debt extinguishment |  | (127705) | (127705) | -100% **C** |
| Derivative expense | (895757) |  | 895757 | N/M **D** |
| Interest expense (including amortization of debt discount) | (2174898) | (609556) | 1565342 | 257% **E** |
| Change in fair value of derivative liabilities | 737987 | - | $737987 | N/M **F** |
| **Total other income (expense) - net** | $(2290296) | $(691632) | $1598664 | 231% |

---

***A — Interest Income***

Interest income decreased $(35,680), or 78%, to $9,949 in the 2025 period from $45,629 in the 2024 period. The decrease primarily reflects lower average balances of interest-bearing cash accounts.

***B — Other Income***

Other income was $32,423 in the six months ended December 31, 2025, compared to none in the prior-year period. The increase is attributable to miscellaneous non-recurring items, including incidental income from hotel and packaging operations, which did not exist in 2024.

***C — Loss on Debt Extinguishment***

No loss on debt extinguishment was recognized in the 2025 period, compared to a $(127,705) loss in the 2024 period, a decrease of $(127,705), or 100%. The prior-year loss related to one-time non-cash charges on the modification or settlement of certain debt instruments. There were no comparable transactions in the current-year period.

***D — Derivative Expense***

In the 2025 period, the Company recognized a non-cash derivative expense of $895,757 related to derivative liabilities associated with certain convertible debt incurred with a material lender. No comparable expense was recorded in the 2024 period as no such instruments with derivative features existed at that time.

The derivative expense represents charges related to the bifurcation and measurement of embedded derivative features under ASC 815, including variable conversion features and other provisions that did not meet the criteria for equity classification under ASC 815-40.

 ****

***E — Interest Expense (including amortization of debt discount)***

Interest expense, including amortization of debt discounts, increased $1,565,342, or 257%, to $2,174,898 in the 2025 period from $609,556 in the 2024 period.

The increase reflects:

● Higher average outstanding notes payable and mortgage debt, including loans associated with the acquisition and operation of hotel properties.

● New convertible note payable issued during the period, totaling $1,929,500 in proceeds, which carry stated interest and were issued with substantial original issue discounts. The face amount of this note was $2,270,000 and had an original issue discount of $340,500.

● Significantly higher amortization of debt discounts ($907,116 in 2025 versus $109,867 in 2024) and deferred financing costs related to these instruments.

***F — Change in Fair Value of Derivative Liabilities***

In the 2025 period, the Company recognized a net non-cash gain of $737,987 related to the change in fair value of derivative liabilities associated with certain convertible notes. No comparable fair value adjustments were recorded in the 2024 period as no such instruments existed.

The net gain for the six-month period reflects the cumulative effect of quarterly remeasurements: a $(950,053) loss recognized in the September quarter followed by a $1,688,040 gain in the December quarter. The favorable remeasurement in the December quarter was primarily driven by changes in the Company's stock price, expected volatility, and other valuation inputs. The inherent volatility of these derivative instruments is expected to result in potentially significant period-to-period fluctuations in reported gains and losses.

***Total Other Income (Expense) — net***

As a result of the items described above, total other expense, net, increased to $(2,290,296) in the 2025 period from $(691,632) in the 2024 period, an increase of $1,598,664, or 231%. The increase is primarily attributable to substantially higher interest expense (E) and the new non-cash derivative expense (D), partially offset by the net gain on the change in fair value of derivative liabilities (F) and the absence of a current-period loss on debt extinguishment (C).

**HOTEL OPERATIONS DISCUSSION**

During the six months ended December 31, 2025, the Company completed two hotel acquisitions that transformed Nightfood Holdings into an owner and operator of lodging properties in addition to its existing packaging and RaaS businesses:

● **Holiday Inn — Victorville, California:** A 155-room property acquired on August 27, 2025 in a share exchange transaction valued at approximately $46.1 million. The Company issued 216,667 shares of Series C Preferred Stock to the sellers, with a potential issuance of an additional 41,667 shares of Series C Preferred Stock related to contingent consideration. This property is being established as a Company AI Hospitality Innovation Hub for robotics deployment, testing, and operational benchmarking.

● **Hilton Garden Inn — Rancho Mirage, California:** A 120-room property acquired on September 30, 2025 in a share exchange transaction valued at approximately $47.1 million. The Company issued 176,167 shares of Series C Preferred Stock to the sellers, with a potential issuance of an additional 20,000 shares of Series C Preferred Stock related to contingent consideration. This property is strategically located adjacent to Cotino™, a Storyliving by Disney community, and serves as a flagship property for the Company's expanding RaaS platform.

These acquisitions had a significant impact on the consolidated financial statements for the three and six months ended December 31, 2025:

● **Revenue mix —** A substantial portion of current-year revenues was generated by hotel room nights, food and beverage outlets, and other property-level services. The December quarter represented the first full quarter of operations for both properties. The Company is implementing revenue-management strategies, updated reservation systems and targeted marketing efforts intended to grow occupancy and average daily rate over time.

● **Cost structure —** Hotel operations added significant property-level operating expenses (captured in cost of sales) and depreciation on hotel buildings and equipment, contributing to the increase in total costs and expenses compared to 2024.

● **Financing and liquidity —** The acquisition of hotel properties introduced mortgage debt and related financing costs, reflected in higher interest expense and repayments on mortgage notes payable. The Company is focused on optimizing capital structure and property-level performance to improve cash flows from these assets.

● **Integration and brand strategy —** Management is actively integrating hotel operations with the Company's broader strategic objectives, including the deployment of TechForce Robotics' AI-powered service robots for housekeeping, food service, and guest management functions, as well as cross-marketing initiatives that leverage the lodging footprint.

During the quarter, the Company was accepted into the NVIDIA Connect Program, providing access to cutting-edge AI tools and collaboration opportunities to further advance its RaaS platform.

Hotel properties often experience a stabilization period after acquisition or repositioning, during which occupancy and rate levels may be below long-term expectations while operating costs and capital requirements remain high. Management expects hotel-level performance and cash flows to improve as integration progresses, revenue-management initiatives take hold and capital improvements are completed. However, there can be no assurance that these efforts will be successful or that the hotels will achieve targeted returns.

**LIQUIDITY AND CAPITAL RESOURCES**

**Liquidity and Going Concern**

As reflected in the accompanying consolidated financial statements, for the six months ended December 31, 2025, the Company had:

● Net loss of $(7,983,855); and

● Net cash used in operating activities of $(3,922,206);

Additionally, at December 31, 2025, the Company reflected:

● Accumulated deficit of $(54,737,699);

● Working capital deficit of $(20,103,065);

● Positive stockholders' equity of $86,373,596; and

● Cash on hand of $347,338

These factors: recurring losses from continuing operations, limited operating cash flows, and dependence on debt and equity financing—continue to raise substantial doubt about the Company's ability to continue as a going concern within one year after the date the accompanying financial statements are issued. The financial statements do not include any adjustments that might result from the outcome of this uncertainty and have been prepared assuming the Company will continue as a going concern.

Management's plans to address these conditions include:

● Increasing revenue and improving profitability of hotel operations, including through revenue-management initiatives, cost controls, and selective capital investments intended to enhance property performance.

● Scaling foodservice packaging and RaaS revenues, including cross-selling into the Company's hotel customer base and expanding robotic deployments into new verticals such as casinos, stadiums, convention centers, and assisted living facilities.

● Seeking additional debt and/or equity financing, including mortgage refinancings, working capital facilities and potential equity issuances, to support operations, fund capital projects and pursue strategic opportunities.

● Advancing the Company's planned uplisting to a national exchange to broaden institutional investor access and improve capital markets positioning.

● Commercializing proprietary robotics technologies, including the Beverage Bot platform unveiled in December 2025, with initial deployments targeted toward enterprise operators, large venues, and multi-location hospitality partners.

● Maintaining a disciplined approach to capital allocation and operating expenses, including reviewing underperforming assets or business lines and considering asset sales, restructurings or partnership arrangements where appropriate.

There can be no assurance that these plans will be successful or that additional financing will be available on acceptable terms or in sufficient amounts, if at all. If the Company is unable to obtain the necessary financing or improve cash flows from operations, it may be required to delay or curtail expansion plans, sell assets, restructure obligations or pursue other strategic alternatives.

**Cash**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | | **Period Change** | **Period Change** |
|  | | | **Increase (Decrease)** | **Increase (Decrease)** |
|  |<br>**December 31, 2025** |<br>**June 30, 2025** | **$ Amount** | **% Change** |
| Cash | $347338 | $350231 | $(2893) | -1% |

---

Cash decreased $(2,893), or approximately 1%, to $347,338 at December 31, 2025 from $350,231 at June 30, 2025. The slight decrease reflects the near-offset of significant cash used in operating activities by proceeds from equity and convertible debt financings and cash acquired in business acquisitions, as discussed below.

The Company does not have any cash equivalents.

**Summary of Cash Flow Activities**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Six Months Ended<br> December 31,** | **Six Months Ended<br> December 31,** | | |
| | **2025** | **2024** | **Period Change** | **Period Change** |
| <br>**Net Cash Provided by (Used in)** | **Amount** | **Amount** | **Increase (Decrease)<br> $ Amount** | **% Change** |
| Operating activities | $(3922206) | $(270240) | $3651966 | 1351% |
| Investing activities | 1203639 | (262763) | $(1466402) | -558% |
| Financing activities | 2715674 | 402050 | $(2313624) | -575% |
| Net change in cash | $(2893) | $(130953) | $(128060) | -98% |

---

The following discussion describes the Company's cash flow activities during the six months ended December 31, 2025 and 2024. Because the statement of cash flows presents activity during each respective period (not a comparison of ending balances), the amounts represent cash generated or consumed by operating, investing, and financing activities from July 1 through December 31 of each year. The working capital changes in the operating activities reconciliation similarly represent changes in asset and liability balances that occurred during each respective six-month period.

During the six months ended December 31, 2025: operating activities used $(3,922,206) of cash; investing activities provided $1,203,639; and financing activities provided $2,715,674, resulting in a net decrease of $(2,893). During the comparable 2024 period: operating activities used $(270,240); investing activities used $(262,763); and financing activities provided $402,050, resulting in a net decrease of $(130,953).

**Cash Flow from Operating Activities**

---

| | | | |
|:---|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |  |
|  | **2025** | **2024** |  |
| **Operating activities** |  |  |  |
| Net loss | $(7983855) | $(1244217) |  |
| Less: net loss - discontinued operations | (2562) | (142274) |  |
| Net loss - continuing operations | (7981293) | (1101943) |  |
| Adjustments to reconcile net loss to net cash used in operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Non-cash financing cost under contingent liability |  | 92000 | **A** |
| &nbsp;&nbsp;&nbsp;Interest income under acquisition note |  | (45629) | **B** |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 1184019 |  | **C** |
| &nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 174000 |  | **D** |
| &nbsp;&nbsp;&nbsp;Loss on debt extinguishment |  | 127705 | **E** |
| &nbsp;&nbsp;&nbsp;Derivative expense | 895757 |  | **F** |
| &nbsp;&nbsp;&nbsp;Change in fair value of derivative liabilities | (737987) |  | **G** |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount | 907116 | 109867 | **H** |
| &nbsp;&nbsp;&nbsp;Bad debt expense | 66177 | 48610 | **I** |
| &nbsp;&nbsp;&nbsp;Stock issued for services | 282720 | 995 | **J** |
| &nbsp;&nbsp;&nbsp;Vesting of Series C - preferred stock - issued as compensation | 820080 |  | **K** |
| Changes in operating assets and liabilities |  |  |  |
| &nbsp;&nbsp;&nbsp;(Increase) decrease in |  |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivable | (97053) | (20372) | **L** |
| &nbsp;&nbsp;&nbsp;Inventory | (71232) | (287) | **M** |
| &nbsp;&nbsp;&nbsp;Prepaids and other | (212207) | (34195) | **N** |
| Increase (decrease) in |  |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | (878912) | 446063 | **O** |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses - related party | 1766578 | 113214 | **P** |
| &nbsp;&nbsp;&nbsp;Deferred revenues | (21327) |  | **Q** |
| &nbsp;&nbsp;&nbsp;Operating lease liability | 56320 | - | **R** |
| Net cash used in operating activities - continuing operations | (3847244) | (263972) |  |
| Net cash used in operating activities - discontinued operations | (74962) | (6268) | **S** |
| Net cash used in operating activities | (3922206) | (270240) |  |

---

**Six months ended December 31, 2025:** Operating activities used $(3,922,206) of cash during the period, compared to $(270,240) used during the six months ended December 31, 2024, an increase of $3,651,966, or 1,351%.

Starting from a net loss from continuing operations of $(7,981,293), the following non-cash items and working capital changes explain the reconciliation to net cash used in operating activities during the 2025 period:

***Non-Cash Adjustments***

● **Non-cash financing cost under contingent liability (A) —** No contingent liability financing costs were recorded during the 2025 period, compared to $92,000 recorded during the 2024 period.

● **Interest income under acquisition note (B) —** No comparable non-cash interest income was recorded during the 2025 period, compared to $(45,629) during the 2024 period.

● **Depreciation and amortization (C) —** $1,184,019 was recorded during the 2025 period related to depreciation of hotel buildings, equipment, and amortization of acquired intangible assets. No comparable amount was recorded in 2024. Note: this amount differs from the income statement line item due to the separate presentation of right-of-use asset amortization.

● **Amortization of right-of-use asset (D) —** $174,000 was recorded during the 2025 period related to entering into a new operating lease right-of-use asset in connection with overall corporate operations. No comparable amount existed in 2024.

● **Loss on debt extinguishment (E) —** No loss on debt extinguishment was recorded during the 2025 period, compared to $127,705 during the 2024 period.

● **Derivative expense (F) —** $895,757 in non-cash derivative expense was recorded during the 2025 period related to a convertible debt executed with a material lender. No comparable amount existed in 2024.

● **Change in fair value of derivative liabilities (G) —** A net non-cash gain of $(737,987) was recorded during the 2025 period related to favorable remeasurement of derivative liabilities, presented as a reduction to the reconciliation. No comparable amount existed in 2024.

● **Amortization of debt discount (H) —** $907,116 was recorded during the 2025 period, compared to $109,867 during the 2024 period, reflecting a significantly higher balance of discounted debt, particularly convertible notes with substantial original issue discounts.

● **Bad debt expense (I) —** $66,177 was recorded during the 2025 period, compared to $48,610 during the 2024 period, reflecting higher allowances on receivables from new hotel and packaging operations.

● **Stock issued for services (J) —** $282,720 in non-cash compensation expense was recorded during the 2025 period for services rendered by consultants and other service providers, compared to $995 during the 2024 period.

● **Vesting of Series C preferred stock — issued as compensation (K) —** $820,080 in non-cash compensation was recorded during the 2025 period related to the vesting of previously issued Series C preferred shares. No comparable amount existed in 2024.

***Changes in Operating Assets and Liabilities***

The following changes in operating assets and liabilities occurred during each respective six-month period:

● **Accounts receivable (L) —** Increased $(97,053) during the 2025 period (using cash) versus an increase of $(20,372) during the 2024 period, reflecting growth in hotel, packaging, and RaaS receivables.

● **Inventory (M) —** Increased $(71,232) during the 2025 period versus a minimal increase of $(287) during the 2024 period, as the Company built inventory to support packaging and hotel operations (primarily food and beverage).

● **Prepaids and other (N) —** Increased $(212,207) during the 2025 period versus an increase of $(34,195) during the 2024 period, primarily due to prepaid insurance, franchise fees, property taxes and other costs associated with hotel and corporate operations. The Company also recorded deferred warrant offering costs in connections with commitment warrants issued to a material debt lender related to a currently unused equity line of credit.

● **Accounts payable and accrued expenses (O) —** Decreased $(878,912) during the 2025 period (using cash) versus an increase of $446,063 during the 2024 period (providing cash), reflecting the timing of vendor and professional-fee payments, including settlement of acquisition-related payables.

● **Accounts payable and accrued expenses — related party (P) —** Increased $1,766,578 during the 2025 period (providing cash) versus an increase of $113,214 during the 2024 period, primarily due to additional advances and accrued amounts owed to related-party lenders and affiliates in connection with hotel operations and working capital needs. Additional amounts related to accrued bonuses and director fees.

● **Deferred revenues (Q) —** Decreased $(21,327) during the 2025 period, reflecting the recognition of previously deferred advance billings. No comparable balance existed in 2024.

● **Operating lease liability (R) —** Increased $56,320 during the 2025 period, reflecting the net change in operating lease obligations recorded in connection with hotel and other operations. No comparable lease liabilities existed in 2024.

● **Net cash from discontinued operations (S) —** Discontinued operations used $(74,962) of cash during the 2025 period, compared to $(6,268) during the 2024 period, reflecting the timing of final wind-down expenditures for the legacy Snacks and Beverages business.

Collectively, these non-cash items partially offset the net loss, while unfavorable working capital changes—particularly the decrease in accounts payable and accrued expenses and increases in prepaids, receivables, and inventory—contributed to the significant increase in cash used in operating activities compared to the prior-year period. The substantial increase in related-party payables partially offset these unfavorable working capital items.

**Cash Flow from Investing Activities**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2025** | **2024** |
| **Investing activities** |  |  |
| Cash acquired in acquisitions | $1269000 | $- **A** |
| Acquisition of property and equipment | (65361) | (39700) **B** |
| Acquisition costs secured by debt | - | (223063) **C** |
| **Net cash used in investing activities** | $1203639 | $(262763) |

---

**Six months ended December 31, 2025:** Investing activities provided $1,203,639 of cash during the period, compared to cash used of $(262,763) during the six months ended December 31, 2024.

● **Cash acquired in acquisitions (A) —** $1,269,000 in cash was acquired during the 2025 period in connection with the hotel property acquisitions (Holiday Inn Victorville and Hilton Garden Inn Rancho Mirage). There was no comparable inflow during the 2024 period.

● **Acquisition of property and equipment (B) —** $(65,361) was used during the 2025 period, primarily for new robots, related trays/bins, and other machinery and equipment, compared to $(39,700) during the 2024 period.

● **Acquisition costs secured by debt (C) —** During the 2024 period, $(223,063) of acquisition costs were financed directly with debt. No such amounts were recorded during the 2025 period.

**Cash Flow from Financing Activities**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended December 31,** | **Six Months Ended December 31,** |
|  | **2025** | **2024** |
| **Financing activities** |  |  |
| Proceeds from common stock issued for cash | $894423 | $- **A** |
| Proceeds from notes payable |  | 402050 **B** |
| Repayments on notes payable | (15722) | - **C** |
| Proceeds from convertible notes payable | 1929500 | - **D** |
| Repayments on mortgage notes payable | (92527) | - **E** |
| **Net cash provided by financing activities** | $2715674 | $402050 |

---

**Six months ended December 31, 2025:** Financing activities provided $2,715,674 of cash during the period, compared to $402,050 provided during the six months ended December 31, 2024.

● **Proceeds from common stock issued for cash (A) —** $894,423 was received during the 2025 period from the issuance of common stock to third party investors. No comparable equity issuances occurred during the 2024 period.

● **Proceeds from notes payable (B) —** No new cash proceeds from notes payable were received during the 2025 period, compared to $402,050 during the 2024 period.

● **Repayments on notes payable (C) —** $(15,722) in principal repayments were made during the 2025 period. No comparable repayments occurred during the 2024 period.

● **Proceeds from convertible notes payable (D) —** $1,929,500 was received during the 2025 period from the issuance of convertible notes. No comparable convertible note issuances occurred during the 2024 period. These instruments contain variable conversion features that require derivative liability accounting under ASC 815.

● **Repayments on mortgage notes payable (E) —** $(92,527) of principal was repaid on mortgage notes payable during the 2025 period in connection with hotel properties. No such repayments occurred during the 2024 period.

The shift in financing activities from $402,050 during the 2024 period to $2,715,674 during the 2025 period reflects the Company's transition to a more diversified capital structure, utilizing both equity issuances and convertible debt to fund hotel operations, integration costs, capital investments, and working capital needs. The Company also commenced principal payments on both notes payable and mortgage notes payable, reflecting the ongoing servicing of acquisition-related and operational debt.

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**FORWARD LOOKING STATEMENT INFORMATION**

Certain statements made in this Quarterly Report on Form 10-Q involve known and unknown risks, uncertainties and other 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 such forward-looking statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts, and use words such as "anticipate," "believe," "estimate," "expect," "forecast," "may," "should," "plan," "project," "will" and other words of similar meaning. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Our plans and objectives are based, in part, on assumptions involving judgments with respect to, among other things, future economic, competitive and market conditions, technological developments related to business support services and outsourced business processes, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control.

Although we believe that our assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Quarterly Report on Form 10-Q will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein particularly in view of the current state of our operations, the inclusion of such information should not be regarded as a statement by us or any other person that our objectives and plans will be achieved. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, the factors set forth under the headings "Business" and "Risk Factors" within our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 as filed with the Securities and Exchange Commission (the "SEC") on October 14, 2025, as well as the other information set forth herein.

**OVERVIEW**

**Business Overview**

Nightfood Holdings, Inc., dba TechForce Robotics ("Nightfood," "NGTF," "TechForce Robotics," or the "Company"), operates through five wholly owned subsidiaries that collectively position us to capitalize on the accelerating demand for automation and efficiency in the hospitality and foodservice industries: TechForce Robotics, Inc. (formerly Skytech Automated Solutions Inc.), Future Hospitality Ventures Holdings Inc. (d/b/a RoboOp365), SWC Group, Inc. (d/b/a CarryOutSupplies.com), Victorville Treasure Holdings, LLC and Treasure Mountain Holdings, LLC.

TechForce Robotics, Inc., or TechForce or Skytech, a Delaware corporation which we acquired on March 31, 2025, serves as the Company's operational backbone, supported by a team with deep expertise in hospitality operations and a proven track record of building, managing, and scaling hotel and foodservice platforms. This operational strength enables TechForce to lead to the deployment of robotic and AI-enhanced automation solutions, ensuring seamless integration into daily operations. Management believes Skytech's depth of experience is a key differentiator that positions the Company to execute where many robotics competitors may struggle.

Future Hospitality Ventures Holdings Inc., or FHVH, Ventures Holdings or Future Hospitality, a Nevada corporation which we acquired on February 2, 2024, enhances this foundation by delivering advanced AI-enabled robotic systems designed to reduce labor costs, increase efficiency, and improve consumer experience. Launched in California shortly before the state's 2025 minimum wage increase in foodservice and hospitality, Ventures Holdings has benefited from heightened industry awareness and urgency around automation. Its plug-and-play solutions are designed to integrate easily into restaurants, hotels, healthcare facilities, school cafeterias, and other foodservice environments, with exponential benefits for operators managing multiple locations is our initial strategic focus.

SWC Group, Inc., or SWC, a California corporation which we acquired on March 31, 2025, further complements the Company's ecosystem, having served more than 6,000 foodservice operators across the United States. As a recognized leader in custom-printed foodservice packaging, SWC generates recurring revenue while also providing a ready-made distribution and marketing channel for cross-selling our robotic solutions to an established base of industry decision-makers.

On August 27, 2025, the Company completed the acquisition of the Holiday Inn Victorville, a 155-room hotel property, through an all-equity transaction valued at approximately $39.0 million (excluding contingent consideration of $7.13 million), consisting of the issuance of 216,667 shares of the Company's Series C Convertible Preferred Stock. This property is one of two hotel assets recently acquired by the Company and is intended to support the Company's operational presence in the hospitality sector and facilitate evaluation of its robotic solutions within an operating hotel environment.

On September 30, 2025, the Company completed the acquisition of Rancho Mirage Hilton LLC, the owner of the Hilton Garden Inn Palm Springs - Rancho Mirage, for total consideration of approximately $42.28 million (excluding contingent consideration of $4.8 million), which was satisfied through the issuance of 176,167 shares of Series C Convertible Preferred Stock.

**Our Products and Services**

The Company offers a comprehensive suite of products and services designed to meet the evolving needs of the hospitality and food service industries. Through TechForce, we deploy AI-enhanced robotic systems and automation services that handle repetitive, labor-intensive tasks such as food delivery, bussing, cleaning, and back-of-house operations. Future Hospitality provides plug-and-play robotic solutions integrated with proprietary AI software, enabling customers to improve efficiency, reduce labor costs, and enhance guest experiences across restaurants, hotels, healthcare facilities, and institutional foodservice environments. SWC complement these technological offerings with custom-printed packaging products, including cups, containers, and other foodservice supplies, giving operators both brand-enhancing packaging and a direct channel to adopt robotic solutions. Together, these subsidiaries allow the Company to provide end-to-end solutions, combining automation hardware, AI-enhanced software, service and maintenance, and consumable packaging products, creating a vertically integrated platform that drives operational efficiency and customer value.

*TechForce's Products and Services*

The Company believes TechForce is uniquely positioned as the operational backbone of its robotics platform, leveraging decades of hands-on hospitality and food service expertise to ensure the successful deployment of AI-enhanced automation solutions. Unlike many robotics companies that focus solely on hardware, TechForce combines robotics with deep operational know-how, enabling seamless integration of automation into real-world environments.

TechForce offers a suite of robotics and automation solutions under the Robots-as-a-Service (RaaS) model, designed to address repetitive, labor-intensive, and injury-prone tasks that are increasingly difficult for staff to manage. These solutions support both guest-facing and back-of-house operations, helping operators achieve cost savings, efficiency improvements, and enhanced service consistency.

**Products and Solutions**

TechForce Robotics offers a portfolio of AI-enhanced robotic systems designed to support operational, logistics, and service functions in hospitality, foodservice, and other commercial environments.

**(a) BIM-E - Beverage and Inventory Management Engine**

BIM-E is an AI-enhanced robotic system designed to automate beverage preparation and dispensing in high-volume service environments, including hotels, resorts, stadiums, and event venues. The system is designed to support standardized beverage preparation, inventory monitoring, and operational data capture. BIM-E may integrate with point-of-sale and other operational systems, subject to configuration, and is intended to reduce manual labor requirements and improve operational consistency.

**(b) TIM-E - Task and Intelligent Mobility Engine**

TIM-E is an AI-enhanced autonomous mobile robotics platform designed to perform configurable logistics and service tasks within hospitality and commercial facilities. The platform supports autonomous navigation and integration with elevators and access systems, subject to site configuration. TIM-E is designed to accommodate modular payloads, enabling deployment across multiple operational use cases, including internal delivery and facility support functions.

**(c) Concierge - Autonomous Delivery System**

Concierge is an autonomous robotic delivery system designed for use in hotel and resort environments. The system is intended to support the transport of items such as meals, beverages, and guest supplies within a facility. Concierge supports autonomous navigation and secure compartmentalization and is designed to operate in conjunction with existing building infrastructure, subject to site configuration.

**(d) LIN-E - Laundry and Housekeeping Support System**

LIN-E is an AI-enhanced robotic system designed to support housekeeping and back-of-house logistics operations. The system is intended to transport laundry, linens, and waste materials within large facilities, including hotels, convention centers, and stadiums. LIN-E supports autonomous navigation and building access integration, subject to site configuration, and is designed to reduce manual handling requirements.

**(e) Matradee - Food Service Support System**

Matradee is a robotic system designed to assist front-of-house foodservice operations by transporting prepared food items within dining environments. The system is intended to operate alongside human staff and support service flow efficiency in high-volume foodservice settings.

**(f) Dustee - Autonomous Cleaning System**

Dustee is an autonomous robotic system designed to perform routine sweeping and basic floor-cleaning tasks in hospitality and commercial environments. The system is intended to support daily cleaning operations and reduce reliance on manual labor for repetitive cleaning functions.

TechForce's management has an established track record of building and managing more than 130 hotels and developing over 50 properties from the ground up. This operational background provides the Company with a unique advantage: the ability to test, refine, and implement robotic solutions in live hospitality environments with confidence and precision.

In recent months, TechForce's team has begun positioning its solutions for deployment across hotels, convention centers, healthcare facilities, and shopping malls. The Company is also using its owned hotel assets-including the recently acquired Holiday Inn Victorville-as innovation hubs to validate and showcase real-world use cases for robotics and AI-enhanced automation.

*Future Hospitality's Products and Services*

 

The Company believes it is revolutionizing the hospitality industry with plug-and-play robotics and automation solutions designed to enhance service efficiency and consistency.

Future Hospitality offers two key robotics solutions through the RaaS business model, which can transform both front-end and back-end operations within the hospitality industry.

 

Future Hospitality offers the following products and solutions:

(a) Front-End Solutions

The serving robot, an advanced front-end solution, works alongside wait staff to ensure faster and more reliable service. These server robots help streamline service delivery, enhancing guest experiences by minimizing wait times and reducing human errors.

(b) Back-End Solutions

Smart cooking bots provide game-changing back-end solutions to support chefs in high-volume environments. The advanced kitchen assistant ensures consistent food quality and enables even inexperienced staff to prepare delicious meals quickly, addressing critical challenges in busy kitchens.

In recent months, Future Hospitality has been actively showcasing the capabilities of its service robots and automated systems to various regional restaurant franchises, assisted living facilities, hotels, and hospital operators. These demonstrations have sparked significant interest among industry leaders seeking to solve service inconsistency, labor shortages, and ongoing staffing replacement costs.

Future Hospitality is in active discussions with several organizations interested in implementing these automation solutions at scale in their day-to-day operations.

SWC's *Products and Services*

 

The Company believes that SWC (and its commercial used name CarryOutSupplies.com) is one of the most recognized names in the custom-printed foodservice packaging industry, serving as both a revenue-generating subsidiary and a strategic channel for introducing our robotics and automation solutions to the market. With over 6,000 customers served across the United States since inception, SWC has established a strong reputation for quality, reliability, and service.

SWC provides a wide range of foodservice packaging products, specializing in custom printing that helps operators strengthen their brand identity while meeting day-to-day operational needs.

SWC offers the following products and solutions:

(a) Custom-Printed Cups

Disposable paper and plastic cups available in multiple sizes, with high-quality custom printing to promote brand visibility and enhance customer experience

(b) Takeout Containers and Boxes

Eco-friendly and durable packaging for restaurants, caterers, and foodservice operators, designed to keep food fresh during transport while showcasing custom branding.

(c) Utensils and Accessories

Branded or generic foodservice accessories, including straws, cutlery, napkins, and lids, to provide operators with a one-stop shop for all consumable needs.

(d) Eco-Friendly Packaging Solutions

Compostable and recyclable packaging options are designed to meet increasing consumer and regulatory demand for sustainable products, helping operators align with ESG and green initiatives.

In addition to providing consumables, SWC serves as a strategic sales and distribution channel for the Company's robotics offerings. Its established relationships with thousands of foodservice operators give the Company immediate access to decision-makers who are increasingly seeking automation solutions to reduce costs and improve efficiency.

By offering consumable products alongside its robotic solutions, SWC seeks to generate recurring revenue and support adoption of the Company's automation technologies in hospitality and foodservice environments. The integrated offering is intended to support operational efficiencies through standardized supplies and coordinated logistics.

**Critical Accounting Policies and Estimates**

Our discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities. On an on-going basis, we evaluate past judgments and our estimates, including those related to allowance for doubtful accounts, allowance for inventory write-downs and write offs, deferred income taxes, provision for contractual obligations and our ability to continue as a going concern. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Note 2 to the consolidated financial statements, presented in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, describe the significant accounting estimates and policies used in preparation of our consolidated financial statements. There were no significant changes in our critical accounting estimates during the six months ended December 31, 2025.

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

Smaller reporting companies are not required to provide this information.

**ITEM 4. CONTROLS AND PROCEDURES**

*Evaluation of Disclosure Controls and Procedures*

 

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Disclosure and control procedures are also designed to ensure that such information is accumulated and communicated to management, including the chief executive officer and chief financial officer, to allow timely decisions regarding required disclosures.

We carried out an evaluation, under the supervision and with the participation of management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, 2025. In designing and evaluating the disclosure controls and procedures, management recognizes that there are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their desired control objectives. Additionally, in evaluating and implementing possible controls and procedures, management is required to apply its reasonable judgment. Based on that evaluation, our chief executive officer concluded that our disclosure controls and procedures were not effective at December 31, 2025 due to the lack of full-time accounting and management personnel. We will consider hiring additional employees when we obtain sufficient capital.

As funds become available to us, we expect to implement additional measures to improve disclosure controls and procedures such as implementing and documenting our internal controls procedures.

*Changes in internal controls over financial reporting*

 

There was no change in our internal controls over financial reporting that occurred during the period covered by this report, which has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

*Limitations on the Effectiveness of Controls*

 

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. The Company's management, including its Principal Executive Officer and its Principal Financial Officer, do not expect that the Company's disclosure controls will prevent or detect all errors and all fraud. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

**PART II - OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS.**

We are not engaged in any litigation at the present time, and management is unaware of any claims or complaints that could result in future litigation. Management will seek to minimize disputes with its customers but recognizes the inevitability of legal action in today's business environment as an unfortunate price of conducting business.

**ITEM 1A. RISK FACTORS.**

Not required for smaller reporting companies.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.**

During the three months ended December 31, 2025, the Company issued unregistered equity securities as described below.

**<u>Cash</u>**

In December 2025, the Company issued an aggregate of 22,360,575 shares of common stock to seven (7) accredited investors in several private placement transactions for aggregate gross proceeds of $894,423 ($0.04 per share). The proceeds were used for general corporate purposes and working capital. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**<u>Stock Issued for Services</u>**

On October 22, 2025, the Company issued 589 shares of Series C Convertible Preferred Stock (convertible into 3,534,000 shares of common stock at a 6,000:1 conversion ratio) to a consultant in consideration for services rendered. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**<u>Common Stock Issued Upon Cashless Exercise of Warrants</u>**

During the three months ended December 31, 2025, holders exercised 3,844,697 warrants on a cashless basis, resulting in the issuance of 2,465,698 shares of common stock. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**<u>Conversion of Convertible Debt to Common Stock</u>**

During the three months ended December 31, 2025, certain convertible debt holders converted an aggregate of $372,437 of principal and accrued interest into 11,285,994 shares of common stock (average conversion price of approximately $0.033 per share). The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**<u>Conversion of Series B Convertible Preferred Stock</u>**

During the three months ended December 31, 2025, the Company issued 16,313,700 shares of common stock upon the conversion of 1,950 shares of Series B Preferred Stock at the 8,366:1 conversion ratio. Following these conversions, no shares of Series B Preferred Stock remain outstanding. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**<u>Conversion of Series D Convertible Preferred Stock</u>**

In December 2025, the Company issued 9,000,000 shares of common stock upon the conversion of 1,500 shares of Series D Convertible Preferred Stock at the 6,000:1 conversion ratio. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended for transactions not involving a public offering.

**<u>Stock Issued for Services</u>**

On February 1, 2026, the Company issued 2,000,000 shares of common stock to a consultant in consideration for services rendered. The shares were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, for transactions not involving a public offering.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES.**

Not applicable.

**ITEM 4. MINE SAFETY DISCLOSURES.**

Not applicable.

**ITEM 5. OTHER INFORMATION.**

Not Applicable.

**ITEM 6. EXHIBITS.**

---

| | |
|:---|:---|
| **Exhibit** | **Exhibit Description** |
| 3.1 | [Articles of Incorporation (Incorporated by reference to Exhibit 3.1 to the Registrant's Registration Statement on Form S-1 (333-193347) filed with the Commission on January 13, 2014)](https://www.sec.gov/Archives/edgar/data/1593001/000146970914000003/ex3_1apg.htm) |
| 3.2 | [Articles of Amendment (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on September 20, 2017)](https://www.sec.gov/Archives/edgar/data/1593001/000121390017009851/f8k091317ex3-1_nightfoodhold.htm) |
| 3.3 | [Articles of Amendment (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on November 20, 2025)](https://www.sec.gov/Archives/edgar/data/1593001/000149315225024361/ex3-1.htm) |
| 3.4 | [Bylaws (Incorporated by reference to Exhibit 3.2 to the Registrant's Registration Statement on Form S-1 (333-193347) filed with the Commission on January 13, 2014)](https://www.sec.gov/Archives/edgar/data/1593001/000146970914000003/ex3_2apg.htm) |
| 3.5 | [Certificate of Designation - Series A Preferred Stock (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on July 17, 2018)](https://www.sec.gov/Archives/edgar/data/1593001/000121390018009309/f8k071118ex3-1_nightfood.htm) |
| 3.6 | [Amendment to Certificate of Designation - Series B Preferred Stock (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on October 31, 2025)](https://www.sec.gov/Archives/edgar/data/1593001/000149315225020458/ex3-1.htm) |
| 3.7 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series A Super Voting Preferred Stock (incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K/A filed with the Commission on January 31, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024008435/ea192564ex3-1_nightfood.htm) |
| 3.8 | [Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock (incorporated by reference to Exhibit 3.2 on the Registrant's Current Report on Form 8-K/A filed with the Commission on January 31, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024008435/ea192564ex3-2_nightfood.htm) |
| 3.9 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock(incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K/A filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex3-1_nightfood.htm) |
| 3.10 | [Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock(incorporated by reference to Exhibit 3.2 on the Registrant's Current Report on Form 8-K/A filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex3-2_nightfood.htm) |
| 3.11 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series B Preferred Stock (incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K filed with the Commission on October 31, 2025)](https://www.sec.gov/Archives/edgar/data/1593001/000149315225020458/ex3-1.htm) |
| 3.12 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock (incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K filed with the Commission on December 5, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225026351/ex3-1.htm) |
| 4.1 | [Common Stock Purchase Warrant issued to Fourth Man, LLC dated as of June 29, 2023 (Incorporated by reference to Exhibit 10.47 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-47_nightfood.htm) |
| 4.2 | [Common Stock Purchase Warrant issued to Fourth Man, LLC dated as of August 28, 2023 (Incorporated by reference to Exhibit 10.52 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-52_nightfood.htm) |
| 4.3 | [Warrants issued to J.H. Darbie & Co., Inc. dated as of June 29, 2023 (incorporated by reference to Exhibit 4.3 on the Registrant's Quarterly Report on Form10-Q filed with the Commission on December 29, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023099837/f10q0923ex4-3_nightfood.htm) |
| 4.4 | [Warrants issued to J.H. Darbie & Co., Inc. dated as of August 28, 2023 (incorporated by reference to Exhibit 4.6 on the Registrant's Quarterly Report on Form10-Q filed with the Commission on December 29, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023099837/f10q0923ex4-6_nightfood.htm) |
| 4.5 | [Common Stock Purchase Warrant dated October 8, 2025 (incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018737/ex4-1.htm) |
| 10.1 | [Promissory Note issued to Fourth Man, LLC dated as of June 29, 2023 (Incorporated by reference to Exhibit 10.46 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-46_nightfood.htm) |

---

---

| | |
|:---|:---|
| 10.2 | [Promissory Note issued to Fourth Man, LLC dated as of August 28, 2023 (Incorporated by reference to Exhibit 10.51 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-51_nightfood.htm) |
| 10.3 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the Commission on November 20, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023088732/ea188739ex10-1_nightfood.htm) |
| 10.4 | [Promissory Note dated with Mast Hill Fund, L.P. (Incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed with the Commission on November 20, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023088732/ea188739ex10-2_nightfood.htm) |
| 10.5 | [Securities Purchase Agreement dated as of June 29, 2023 between the Company and Fourth Man, LLC (Incorporated by reference to Exhibit 10.45 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-45_nightfood.htm) |
| 10.6 | [Securities Purchase Agreement dated as of August 28, 2023 between the Company and Fourth Man, LLC (Incorporated by reference to Exhibit 10.50 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-50_nightfood.htm) |
| 10.7 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on December 12, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023095171/ea189938ex10-1_nightfood.htm) |
| 10.8 | [Promissory Note with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on December 12, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023095171/ea189938ex10-2_nightfood.htm) |
| 10.9 | [Share Exchange Agreement by and among Nightfood Holdings, Inc., Future Hospitality Ventures Holdings Inc., Sean Folkson as the holder of the Series A Preferred Stock of NGTF and the sole shareholder of FHVH dated January 22, 2024. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on January 26, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007066/ea192227ex10-1_nightfood.htm) |
| 10.10 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on January 29, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007190/ea192344ex10-1_nightfood.htm) |
| 10.11 | [Promissory Note dated January 24, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on January 29, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007190/ea192344ex10-2_nightfood.htm) |
| 10.12++ | [Consulting Agreement between Nightfood Holdings, Inc. and Sean Folkson, dated February 2, 2024. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on February 2, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024009701/ea192651ex10-1_nightfood.htm) |
| 10.13++ | [Employment Agreement between Nightfood Holdings, Inc. and Lei Sonny Wang, dated February 2, 2024. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on February 2, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024009701/ea192651ex10-2_nightfood.htm) |
| 10.14 | [Letter Agreement between Fourth Man, LLC and Nightfood Holdings, Inc. dated February 1, 2024 (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex10-1_nightfood.htm) |
| 10.15 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on March 20, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024334/ea020218401ex10-1_night.htm) |
| 10.16 | [Promissory Note dated March 12, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on March 20, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024334/ea020218401ex10-2_night.htm) |
| 10.17 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on May 15, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024043534/ea020625801ex10-1_nightfo.htm) |
| 10.18 | [Promissory Note dated May 5, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on May 15, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024043534/ea020625801ex10-2_nightfo.htm) |
| 10.19 | [Letter Agreement dated July 22, 2024 with Fourth Man, LLC amending the right to adjustment of the conversion price of certain promissory notes (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-19_nightfood.htm) |
| 10.20 | [Share Exchange Agreement dated September 4, 2024 with Nightfood Holdings, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc. and Sugarmade, Inc. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on September 10, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024077127/ea021385301ex2-1_nightfood.htm) |
| 10.21 | [Promissory Note dated September 23, 2024 with Mast Hill Fund, L.P (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-21_nightfood.htm) |

---

---

| | |
|:---|:---|
| 10.22 | [Securities Purchase agreement dated September 23, 2024 with Mast Hill Fund LP (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-22_nightfood.htm) |
| 10.23 | [First Amendment to the Share Exchange Agreement dated December 10, 2024. (incorporated by reference to the Registrant's Current Report on Form 8-K/A filed with the Commission on December 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024110563/ea022531001ex10-1_nightfood.htm) |
| 10.24 | [Securities Purchase Agreement, dated October 8, 2025, by and between Nightfood Holdings, Inc. and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-1.htm) |
| 10.25 | [Senior Secured Promissory Note, dated October 8, 2025, issued by Nightfood Holdings, Inc. in favor of Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-2.htm) |
| 10.26 | [Tenth Amendment to Security Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Nightfood, Inc., MJ Munchies, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc., TechForce Robotics, Inc., Victorville Treasure Holdings, LLC, Treasure Mountain Holdings, LLC and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-3.htm) |
| 10.27 | [Tenth Amendment to Pledge Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Jimmy Chan, and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-4.htm) |
| 10.28 | [Tenth Amendment to Guarantee Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Nightfood, Inc., MJ Munchies, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc., TechForce Robotics, Inc., Victorville Treasure Holdings, LLC, Treasure Mountain Holdings, LLC and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-5.htm) |
| 10.29 | [Equity Purchase Agreement dated October 8, 2025 between Nightfood Holdings, Inc., and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018737/ex10-1.htm) |
| 10.30 | [Registration Rights Agreement dated October 8, 2025 between Nightfood Holdings, Inc., and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018737/ex10-2.htm) |
| 10.31 | [Share Exchange Agreement dated September 30, 2025. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 6, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225017045/ex2-1.htm) |
| 31.1\* | [Certification of the Chief Executive and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex31-1.htm) |
| 32.1\* | [Certification of the Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)](ex32-1.htm) |
| 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 (formatted as Inline XBRL and contained in Exhibit 101) |

---

\* Filed herewith <br> ++ Indicates a management contract or compensatory plan.

**SIGNATURES**

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **Nightfood Holdings, Inc.** | **Nightfood Holdings, Inc.** |
| Dated: February 23, 2026 | By: | */s/ Jimmy Chan* |
|  |  | Jimmy Chan |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive, Financial and Accounting Officer) |

---

## Exhibit 31.1

**Exhibit 31.1**

**Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended**

I, Jimmy Chan (Principal Executive Officer and Principal Financial and Accounting Officer), certify that:

1. I
 have reviewed this quarterly report on Form 10-Q of Nightfood Holdings, Inc.;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. As
 the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as
 defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
 Rules 13a-15(f) and 15-d-15 (f) for the registrant and I have:

&nbsp;&nbsp;&nbsp;&nbsp;a) designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d) disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the period covered
 by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control
 over financial reporting.

5. As
 the registrant's certifying officer, I have disclosed, based on my most recent evaluation of internal control over financial
 reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing
 the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;a) all
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| Date: February 23, 2026 | By: | */s/ Jimmy Chan* |
|  |  | Jimmy Chan |
|  |  | Chief Executive Officer and Chief Financial Officer<br> (Principal Executive Officer and Principal Financial and Accounting Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

The undersigned, Jimmy Chan, Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial and Accounting Officer) of Nightfood Holdings, Inc. (the "Company"), certifies, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350) that, to his knowledge, the Company's Quarterly Report on Form 10-Q for the quarter ended December 31, 2025 (the "Report"):

&nbsp;&nbsp;&nbsp;&nbsp;(1) fully
 complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the
 information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of
 the Company.

---

| |
|:---|
| */s/ Jimmy Chan* |
| Jimmy Chan |
| Chief Executive Officer and Chief Financial Officer<br> (Principal Executive Officer and Principal Financial and Accounting Officer) |
| Date: February 23, 2026 |

---