# EDGAR Filing Document

**Accession Number:** 0001923780
**File Stem:** 0001575872-26-000245
**Filing Date:** 2026-4
**Character Count:** 399709
**Document Hash:** b19fab90453f8d614d1c3c86ef9fc427
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001575872-26-000245.hdr.sgml**: 20260414

**ACCESSION NUMBER**: 0001575872-26-000245

**CONFORMED SUBMISSION TYPE**: 10-K

**PUBLIC DOCUMENT COUNT**: 99

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260414

**DATE AS OF CHANGE**: 20260413

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Northann Corp.
- **CENTRAL INDEX KEY:** 0001923780
- **STANDARD INDUSTRIAL CLASSIFICATION:** PLASTICS PRODUCTS, NEC [3089]
- **ORGANIZATION NAME:** 08 Industrial Applications and Services
- **EIN:** 881513509
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41816
- **FILM NUMBER:** 26858997

**BUSINESS ADDRESS:**
- **STREET 1:** 2251 CATAWBA RIVER RD
- **CITY:** FORT LAWN
- **STATE:** SC
- **ZIP:** 29714
- **BUSINESS PHONE:** 916-573-3803

**MAIL ADDRESS:**
- **STREET 1:** 2251 CATAWBA RIVER RD
- **CITY:** FORT LAWN
- **STATE:** SC
- **ZIP:** 29714

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

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

(Mark One)

⌧

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

For the fiscal year 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: 001-41816

NORTHANN CORP.

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| Nevada | 88-1513509 |
| (State or other jurisdiction of incorporation or<br>organization) | (I.R.S. Employer Identification No.) |
| 2251 Catawba River Rd<br>Fort Lawn, SC  | 29714 |
| (Address of principal executive offices) | (Zip Code) |

---

Registrant's telephone number, including area code:

(916) 573 3803

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

---

| | |
|:---|:---|
| Title of Each Class | Name of Each Exchange on Which<br>Registered<br>|
| Common Stock, with par value of $0.001<br> NCL | NYSE American |

---

Securities registered pursuant to Section 12(g) of the Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes 

&nbsp;&nbsp;&nbsp;&nbsp;No 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes 

&nbsp;&nbsp;&nbsp;&nbsp;No ⌧

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧

&nbsp;&nbsp;&nbsp;&nbsp;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 ⌧

&nbsp;&nbsp;&nbsp;&nbsp;No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," "emerging growth company" and "smaller reporting 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 has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ◻

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.&nbsp;&nbsp;&nbsp;&nbsp;◻

Indicate by check mark whether any of those error corrections are restatements that require a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D(b). ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ◻

&nbsp;&nbsp;&nbsp;&nbsp;No ⌧

The aggregate market value of the voting and non-voting stock held by non-affiliates of the registrant as of June 30, 2025, the last business day of the registrant's most recently completed second fiscal quarter, was $12,943,219.68 based upon the closing price reported for such date on the NYSE American.

On April 10, 2026, the registrant had

53,733,083 shares of common stock and 625,000 shares of Series A Preferred Stock outstanding.

NORTHANN CORP.

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  | [CONVENTIONS THAT APPLY TO THIS ANNUAL REPORT](#a_001_conventionsthat) | [ii](#a_001_conventionsthat) |
| [PART I](#a_002_parti) |  |  |
| [ITEM 1.](#a_003_item1) | [BUSINESS](#a_003_item1) | [2](#a_003_item1) |
| [ITEM 1A.](#a_004_item1a) | [RISK FACTORS](#a_004_item1a) | [23](#a_004_item1a) |
| [ITEM 1B.](#a_005_item1b) | [UNRESOLVED STAFF COMMENTS](#a_005_item1b) | [45](#a_005_item1b) |
| [ITEM 1C.](#a_006_item1c) | [CYBERSECURITY](#a_006_item1c) | [45](#a_006_item1c) |
| [ITEM 2.](#a_007_item2) | [PROPERTIES](#a_007_item2) | [45](#a_007_item2) |
| [ITEM 3.](#a_008_item3) | [LEGAL PROCEEDINGS](#a_008_item3) | [46](#a_008_item3) |
| [ITEM 4.](#a_009_item4) | [MINE SAFETY DISCLOSURES](#a_009_item4) | [46](#a_009_item4) |
| [PART II](#a_010_partii) |  |  |
| [ITEM 5.](#a_011_item5) | [MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES](#a_011_item5) | [47](#a_011_item5) |
| [ITEM 6.](#a_012_item6) | [\[RESERVED\]](#a_012_item6) | [47](#a_012_item6) |
| [ITEM 7.](#a_013_item7) | [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#a_013_item7) | [48](#a_013_item7) |
| [ITEM 7A.](#a_014_item7a) | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#a_014_item7a) | [54](#a_014_item7a) |
| [ITEM 8.](#a_015_item8) | [FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA](#a_015_item8) | [54](#a_015_item8) |
| [ITEM 9.](#a_016_item9) | [CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE](#a_016_item9) | [54](#a_016_item9) |
| [ITEM 9A.](#a_017_item9a) | [CONTROLS AND PROCEDURES](#a_017_item9a) | [54](#a_017_item9a) |
| [ITEM 9B.](#a_018_item9b) | [OTHER INFORMATION](#a_018_item9b) | [55](#a_018_item9b) |
| [ITEM 9C.](#a_019_item9c) | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#a_019_item9c) | [55](#a_019_item9c) |
| [PART III](#a_020_partiii) |  |  |
| [ITEM 10.](#a_021_item10) | [DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE](#a_021_item10) | [56](#a_021_item10) |
| [ITEM 11.](#a_022_item11) | [EXECUTIVE COMPENSATION](#a_022_item11) | [59](#a_022_item11) |
| [ITEM 12.](#a_023_item12) | [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS](#a_023_item12) | [64](#a_023_item12) |
| [ITEM 13.](#a_024_item13) | [CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE](#a_024_item13) | [65](#a_024_item13) |
| [ITEM 14.](#a_025_item14) | [PRINCIPAL ACCOUNTANT FEES AND SERVICES](#a_025_item14) | [66](#a_025_item14) |
| [PART IV](#a_026_partiv) |  |  |
| [ITEM 15.](#a_027_item15) | [EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES](#a_027_item15) | [67](#a_027_item15) |
| [INDEX TO FINANCIAL STATEMENTS](#test1_002_indextofinancia) | [INDEX TO FINANCIAL STATEMENTS](#test1_002_indextofinancia) | [F-1](#test1_002_indextofinancia) |
| [ITEM 16.](#a_028_item16) | [FORM 10-K SUMMARY](#a_028_item16) | [69](#a_028_item16) |

---

CONVENTIONS THAT APPLY TO THIS ANNUAL REPORT

All share figures and per share price figures in this Annual Report on Form 10-K of Northann Corp. (the "Company") for the fiscal year ended December 31, 2025, that are effective prior to October 7, 2025, have been updated retroactively to reflect the one-for-eight (1:8) reverse stock split of the shares of common stock of the Company, conducted by the Company on October 7, 2025, unless otherwise stated.

Unless otherwise indicated or the context requires otherwise, references in this Annual Report to:

<u></u> <u>"3D PRINTING" are to 3D PRINTING DEV, LLC, a Delaware limited liability company organized on September 5, 2024, and a wholly-owned subsidiary of the Company;</u>

<u></u> <u>"Benchwick LLC" are to Benchwick LLC, a Delaware limited liability company organized on May 31, 2022, and a wholly-owned subsidiary of the Company;</u>

<u></u> <u>"Benchwick" are to Benchwick Construction Products Co., Limited, a company established in the special administrative regions of Hong Kong on March 21, 2014 and a wholly-owned subsidiary of the Company;</u>

<u></u> <u>"China" or the "PRC" are to the People's Republic of China;</u>

<u></u> <u>"Company" are to Northann Corp. a Nevada corporation incorporated on March 29, 2022;</u>

<u></u> <u>"Crazy Industry" are to Crazy Industry (Changzhou) Industry Technology Co., Ltd., a company established in the PRC on September 4, 2018 and a wholly-owned subsidiary of Benchwick;</u>

<u></u> <u>"Dotfloor" are to Dotfloor, Inc., a corporation incorporated in California on June 26, 2020 and a wholly-owned subsidiary of NDC;</u>

<u></u> <u>"HKD" are to the official currency of Hong Kong;</u>

---

| | |
|:---|:---|
|  | "Marco" are to Changzhou Marco Merit International Trading Co., Ltd., a company established in the PRC on April 23, 2014 and a 51%-owned subsidiary of Benchwick; |

---

<u></u> <u>"NBS" are to Northann Building Solutions LLC., a limited liability company formed in Delaware on August 15, 2013 and a wholly-owned subsidiary of the Company;</u>

<u></u> <u>"NCP" are to Northann (Changzhou) Construction Products Co., Ltd., a company established in the PRC on December 4, 2013 and a wholly-owned subsidiary of the Company;</u>

<u></u> <u>"NDC" are to Northann Distribution Center Inc, a corporation incorporated in California on February 10, 2016 and a wholly-owned subsidiary of NBS;</u>

<u></u> <u>"Ringold" are to Changzhou Ringold International Trading Co., Ltd., a company established in the PRC on September 28, 2017 and a wholly-owned subsidiary of Benchwick;</u>

<u></u> <u>"RMB" or "Chinese Yuan" are to the legal currency of China;</u>

---

| | |
|:---|:---|
|  | "U.S. dollars," "dollars," "USD," "US$" or "$" are to the legal currency of the United States; and |

---

<u></u> <u>"we", "us", "our" are to Northann Corp. and its subsidiaries.</u>

ii

PART I

This Annual Report on Form 10-K ("Annual Report") contains forward-looking statements within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), or the Securities Exchange Act of 1934, as amended ("Exchange Act"), or the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management and involve risks and uncertainties. Forward-looking statements include statements regarding our plans, strategies, objectives, expectations and intentions, which are subject to change at any time at our discretion. Forward-looking statements include our assessment, from time to time of our competitive position, the industry environment, potential growth opportunities, the effects of regulation and events outside of our control, such as natural disasters, wars or health epidemics. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as "anticipates," "believes," "could," "estimates," "expects," "hopes," "intends," "may," "plans," "potential," "predicts," "projects," "should," "will," "would" or similar expressions.

Forward-looking statements are merely predictions and therefore inherently subject to uncertainties and other factors which could cause the actual results to differ materially from the forward-looking statement. These uncertainties and other factors include, among other things:

---

| |
|:---|
| expectations of future results of operations or financial performance; |
| introduction of new products or compensation strategies; |
| our operations of the business; |
| plans for growth, future operations, and potential acquisitions; |
| the size and growth potential of possible markets for our product candidates and our ability to serve those markets; |
| the rate and degree of market acceptance of our business model; |
| the accuracy of our estimates regarding expenses, future revenues, capital requirements and needs for additional financing and our ability to obtain additional financing; |
| our ability to attract strategic partners with development, regulatory and commercialization expertise; and |
| the development of our marketing capabilities. |

---

Set forth below in Item 1A, "Risk Factors," are additional significant uncertainties and other factors affecting forward-looking statements. The reader should understand that the uncertainties and other factors identified in this Annual Report are not a comprehensive list of all the uncertainties and other factors that may affect forward-looking statements. We do not undertake any obligation to update or revise any forward-looking statements or the list of uncertainties and other factors that could affect those statements.

ITEM 1. BUSINESS

Overview

Overview

Our vision is to become a world class one-stop decorating solutions provider.

Our mission is to timely deliver high-quality and affordable products and to continue to actively participate in the further development of the additive manufacturing industry.

We

bring additive manufacturing, commonly known as 3D printing, and the volume production of innovative building solutions, to your home or business. Our robust portfolio of manufacturing solutions relies upon the use of ink, coating, resin, sound padding, glue and other raw materials to create a wide variety of flooring, decking and other products for customers throughout North America, Europe and other regions under the brand name "Benchwick." We believe that additive manufacturing is one of the most exciting and eco-friendly technologies in the market today. Additive manufacturing contributes to greenhouse gas reduction through several interrelated mechanisms. Material efficiency is realised through additive manufacturing's ability to reduce material waste by up to 40% and lower production energy consumption by more than 50% compared to traditional manufacturing methods.

<sup>1</sup> According to the recently published Wohlers Report 2024, additive manufacturing of metal components recorded growth of 24.4% in 2023.<sup>2</sup> An estimated 3,793 metal systems were shipped in total, compared to 3,049 units in 2022. <sup>3</sup>

Innovation has always been our core value. Our commitment to new approaches in designing and manufacturing drives us to create new ways to improve how our core customers live and work. Crazy Industry invests substantial resources in research and product development and is committed to rapidly building new products and customizable and functional solutions to delight our customers. Crazy Industry's product development team is committed to product design and development, and they focus their efforts on enhancing function, use, performance and flexibility of our products. Our subsidiaries, NBS, NCP and Crazy Industry, own a portfolio of

granted, pending or published patents. The products reflect the evolving needs of the core customer's home and business needs. We strive to make the products customizable, functional and affordable. Presently, NCP manufactures four proprietary solutions in vinyl flooring using innovative 3D printing technology: Infinite Glass, DSE, TruBevel and MattMaster. Each solution offers distinct functionalities and aesthetic finishes. In addition, the Company has developed and launched its SuperOak product line, which leverages 3D printing technology to produce premium flooring products. SuperOak has gained significant traction in the U.S. market and is now carried by major retail supermarkets, reflecting growing consumer demand for differentiated, high-quality flooring alternatives amid the commoditization of conventional vinyl flooring. With the establishment of our South Carolina manufacturing facility, we have transitioned from an OEM-dependent model to a fully integrated, end-to-end operation encompassing product design, manufacturing, and distribution. This vertical integration significantly accelerates our innovation-to-customer cycle, reduces costs, and enables us to bring more innovative products and greater value to our customers and consumers. In addition, we are actively integrating artificial intelligence into our operations, including product design, production optimization, quality control, supply chain management and administrative functions. We believe the broad adoption of AI across our business will have a profound impact on our industry and has the potential to significantly reduce our operating and management costs over time, further strengthening our competitive position. Traditionally, flooring customers have faced a complex selection process that often requires the assistance of professional designers to match products to their specific needs and preferences. As AI technology rapidly matures, we plan to leverage advanced AI-driven tools to simplify and personalize the customer experience, enabling consumers to effortlessly discover and customize products that best suit their spaces and lifestyles, ultimately delivering a more satisfying and seamless end-to-end experience from product selection to installation.

Our revenue mainly consists of wholesale and retail of vinyl flooring and 3D printed flooring products, including our flagship SuperOak line, which are primarily marketed and sold in the United States and Canada. Our customer base has expanded to include major retail supermarkets and local building contractors in addition to large-sized wholesale distributors. During the fiscal year ended December 31, 2025, approximately 38% of our revenue came from vinyl flooring products, 40% from decorative boards, and 22% from our premium SuperOak product line.

Our products are distributed through multiple channels. During the fiscal year ended December 31, 2025, we generated 92.91% of our revenue from wholesale distribution and 7.09% from retail sales, compared to 98.79% and 0.19%, respectively, for the fiscal year 2024. The significant increase in retail revenue reflects our expanding presence through major retail partners. We sell our products primarily under the brand name Benchwick and the premium brand SuperOak. Our sales are made through purchase orders from distributors and retailers. We have recently expanded our retail distribution footprint by entering vendor agreements with several of the largest home improvement retail chains in North America, which we expect to significantly increase our retail channel revenue beginning in fiscal year 2026.

NBS has also licensed some of its patents to i4F Licensing N.V. ("i4F") with the goal to promote the technologies covered by those patents in the flooring industry. We believe that a wider market acceptance of 3D printed flooring will help to establish the "Benchwick" brand further and penetrate the markets and encourages innovation and changes to an already developed and static industry.

We serve customers in North America (mainly the United States and Canada), Europe and other regions. During the fiscal year ended December 31, 2025, 99.22% of our revenue came from customers in the United States and 0.78% came from customers in Canada. During the fiscal year ended December 31, 2024, 94.8% of our revenue came from customers in the United States and 5.0% came from customers in Canada. During the fiscal years ended December 31, 2025 and 2024, less than 1% of the revenue came from customers in Europe.

Additive Manufacturing as a Catalyst for Low-Carbon Production and the Renewable Energy Transition in Electric Vehicles, https://www.mdpi.com/2227-7080/13/10/428#B49-technologies-13-00428

.

<sup>2</sup>

<u>https://www.3printr.com/wohlers-report-2024-3d-printing-market-grew-by-11-1-percent-in-2023-1470305/</u>

<sup>3</sup>

<u>https://www.3printr.com/wohlers-report-2024-3d-printing-market-grew-by-11-1-percent-in-2023-1470305/</u>

Recent Developments

New Factory and Financing

On July 26, 2024, the Company entered into a lease agreement (as amended on August 5, 2024, the "Lease Agreement") with SKY SC LLC (the "Landlord"), with a commencement date of August 20, 2024 (the "Commencement Date"). The Lease Agreement premises (the "Premises") includes approximately 106,610 square feet that is a portion of a 221,000 square feet building located at 2251 Catawba River Rd., Fort Lawn, South Carolina, USA. The Premises includes 4,560 square feet of office space and 98,400 square feet of industrial space. The Lease Agreement has a term of five years. The rent of the Lease Agreement will increase annually, from $33,315.63 per month in the first year to $37,497.03 per month in the fifth year. The Company is obligated to pay a security deposit of $97,370.47 in the form of immediately available funds. The Company has a first right of refusal to purchase the entire property for $12,000,000 in the first year of the term. The decision to purchase must be exercised with 10 days of notice from the Landlord and the closing must occur within 90 days.

On November 19, 2024, the Company entered into a First Amendment of Lease with the Landlord (the "Amendment"). Under the Amendment, the Commencement Date has been amended from August 20, 2024 to November 1, 2024. Under the Amendment, the Landlord acknowledges that the Company has paid the first full month's installment of the Base Rent (as defined in the Lease Agreement), and the Company shall pay the first full month's estimated cost of the Company's pro rata share of Taxes, Insurance, and Common Area Maintenance charges (all as defined under the Lease Agreement). The Landlord and Company acknowledges that each other party is not in default of the Lease Agreement, and that there are no conditions that, with the passage of time or giving of notice, would be deemed to be a default on the part of either the Company or the Landlord. The Landlord also acknowledges and agrees that 3D Printing Dev, LLC, a wholly owned subsidiary of the Company, subject to a separate assignment and assumption agreement, assumes the Lease Agreement starting from the execution of the Amendment.

On January 21, 2025, 3D PRINTING entered into an EB-5 loan agreement (the "Loan Agreement") with 3DFLOR OPPORTUNITY, LP, a Delaware limited partnership and a related party controlled by the Company's CEO, Chairman and controlling shareholder, Lin Li ("3DFLOR"), pursuant to which 3DFLOR agreed to provide 3D PRINTING a loan, with an initial maximum principal amount of $24,000,000 at an interest rate of 1.00% per year.

In connection with the Loan Agreement, 3D PRINTING issued a promissory note to 3DFLOR in an amount of $24,000,000, dated January 27, 2025 (the "Promissory Note"). The Promissory Note bears the interest of one percent (1%) per year and the interest shall be non-compounding and calculated on the basis of a 366-day year, payable on the basis of the actual number of days elapsed. Pursuant to the Loan Agreement, the principal is due and is repayable in full on the third (3rd) anniversary of the closing date of the Loan Agreement.

In connection with the Loan Agreement, on January 27, 2025, Benchwick LLC, a Delaware limited liability company and a fully-owned subsidiary of the Company ("Benchwick"), entered into a membership interest pledge agreement with 3DFLOR and 3D PRINTING, in favor of 3DFLOR (the "Pledge Agreement"), to pledge to 3DFLOR (i) all 49 million Class A Units of 3D PRINTING it owns (the "Pledged Units") and (ii) all proceeds and products of the Pledged Units (collectively with the Pledged Units, "Collateral"), as security for the performance of 3D PRINTING's obligations under the Loan Agreement.

On February 27, 2025, 3D PRINTING filed a UCC-1 Financing Statement securing 3DFLOR's security interests in the Collateral with Delaware. The Company's audit committee approved and ratified the above mentioned transactions.

As of the date of this Annual Report, the South Carolina facility has commenced partial production on a phased basis, currently operating at approximately 10% of planned capacity, and has begun delivering products to customers, including major retail supermarkets and local building contractors. The facility primarily manufactures the Company's SuperOak product line and certain ancillary products using proprietary 3D printing technology. The Company expects to reach full production capacity by mid-2027 and continues to ramp up operations.

Registration of Shares Issued In Certain Transactions

On December 23, 2024, the Company filed a registration statement on form S-1 (File No.: 333-284033) registering up to 3,760,550 shares of common stock held by certain selling stockholders of the Company for offer and resale (collectively, the "Registered Shares", and the registration statement, the "2024 Registration Statement"). The Registered Shares offered for resale consists of the following:

  <u></u> <u>up to 560,550 shares of common stock issued to the Cedar Modern Seller in the Cedar Modern Transaction pursuant to Cedar Modern SPA; </u>

  <u></u> <u>up to 562,500 shares of common stock issued to the Raleigh Seller in the Raleigh Transaction pursuant to the Raleigh SPA; </u>

  <u></u> <u>up to 375,000 shares of common stock issued pursuant to Linkun Investment Consulting Agreement, as consideration for Linkun Investment's strategic planning advisory services in connection with the Company's business development activities;</u>

  <u>·</u> <u>up to 562,500 shares of common stock issued pursuant to the CAKL Consulting Agreement, as consideration for CAKL's supply chain related consulting services; </u>

  <u></u> <u>up to 575,000 shares of common stock issued pursuant to the San River Consulting Agreement, as consideration relating to San River's technical support, business support and related consulting services in connection with the Company's business development; and </u>

  <u></u> <u>up to 1,125,000 shares of common stock issued to the Caitlin Purchasers in the Caitlin Private Placement.</u>

The 2024 Registration Statement, as amended, was declared effective on February 6, 2025.

Oneflow Private Placement

On December 6, 2024, the Company entered into a securities purchase agreement with Oneflow LLC as the lead investor and four other passive investors (the "Oneflow SPA"), pursuant to which the Company agreed to sell common stock to various purchasers (the "Oneflow Purchasers") in a private placement transaction (the "Oneflow Private Placement"). Pursuant to the Oneflow SPA, the Company agreed to transfer, assign, set over and deliver to the Oneflow Purchasers and the Oneflow Purchasers agreed, severally and not jointly, to acquire from the Company in the aggregate 5,000,000 shares of common stock of the Company (the "Oneflow Shares") at the average of the closing prices for the five trading days immediately prior to the Closing per share.

The closing of the Oneflow Private Placement is subject to certain closing conditions, including but not limited to the approval of the Company's stockholders and sixty calendar days after the approval of NYSE American.

On December 31, 2024, the Company's stockholders approved the share issuance at the Company's Annual General Meeting. On January 13, 2025, NYSE approved the share issuance. As of March 28, 2025, each Oneflow Purchaser wired $1,626,600 to the Company as the payment for the Oneflow Private Placement. Pursuant to the Oneflow SPA, the closing price was $1.6264 per share, calculated from the average of the closing price of the Company's shares of common stock on the five trading days immediately prior to the closing of the Oneflow Private Placement, from March 24, 2025 to March 28, 2025. On March 31, 2025, the Company issued 1,000,000 shares of common stock to each Oneflow Purchaser, or an aggregate of 5,000,000 shares of common stock to the Oneflow Purchasers, and closed the Oneflow Private Placement.

As a result of the issuance of the 5,000,000 shares of common stock to the Oneflow Purchasers, the voting power of Mr. Lin Li, the Company's Chairman of the Board, Chief Executive Officer, President, Secretary and Treasurer, has reduced from a majority to 44.3% as immediately after such issuance. Therefore, from March 31, 2025, the Company ceased qualifying as a "controlled company" under the rules of the NYSE American Company Guide.

Pursuant to the Oneflow SPA, the Company also entered into a registration rights agreement (the "Oneflow RRA") with Oneflow Purchasers on December 6, 2024, pursuant to which the Company is obligated to file a registration statement on Form S-3 or S-1 with the SEC to register for resale by Oneflow Purchasers of the Oneflow Shares by the 60th calendar day following the closing of the Oneflow SPA.

X29 Private Placement

On December 6, 2024, the Company entered into a securities purchase agreement with X29 LLC as the lead investor and four other passive investors (the "X29 SPA"), pursuant to which the Company agreed to sell common stock to various purchasers (the "X29 Purchasers") in a private placement transaction (the "X29 Private Placement").

Pursuant to the X29 SPA, the Company agreed to transfer, assign, set over and deliver to the X29 Purchasers and the X29 Purchasers agreed, severally and not jointly, to acquire from the Company in the aggregate 10,000,000 shares of common stock of the Company (such shares, the "X29 Shares") at the average of the closing prices for the five trading days immediately prior to the Closing per share.

The closing of the X29 Private Placement is subject to certain closing conditions, including but not limited to the approval of the Company's stockholders and one hundred and twenty calendar days after the approval of NYSE American.

On December 31, 2024, the Company's stockholders approved the share issuance. On January 13, 2025, NYSE approved the share issuance. As of September 3, 2025, each X29 Purchaser wired $2,285,440 to the Company as the payment for the X29 Private Placement. Pursuant to the X29 SPA, the closing price was $1.14272 per share, calculated from the average of the closing price of the Company's shares of common stock on the five trading days immediately prior to the closing of the X29 Private Placement, from August 26, 2025 to September 2, 2025. On September 3, 2025, the Company issued 16,000,000 shares of common stock to each X29 Purchaser, or an aggregate of 80,000,000 shares of common stock to the X29 Purchasers, and closed the X29 Private Placement.

Pursuant to the X29 SPA, the Company also entered into a registration rights agreement (the "X29 RRA") with X29 Purchasers on December 6, 2024, pursuant to which the Company is obligated to file a registration statement on Form S-3 or S-1 with the SEC to register for resale by X29 Purchasers of the X29 Shares by the 60th calendar day following the closing of the X29 SPA.

Changes in the Company's Certifying Accountant

On May 24, 2025, approved by its audit committee of the board of directors, the Company dismissed WWC from its position as the independent registered public accounting firm for the Company.

During the Company's fiscal year ended December 31, 2024, and the subsequent interim period through May 23, 2025, the date of dismissal, there were no "disagreements" (within the meaning of Item 304(a)(1)(iv) of Regulation S-K and the related instructions under the Exchange Act) between the Company and WWC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of WWC, would have caused WWC to make reference to the subject matter of the disagreements in connection with its reports on financial statements of the Company for such years. During this same period, there were no "reportable events" (within the meaning of Item 304(a)(1)(v) of Regulation S-K and the related instructions under the Exchange Act).

WWC's audit report on the consolidated financial statements as of and for the fiscal year ended December 31, 2024 had not yet been issued at the time of dismissal. Neither of WWC's audit reports for the two preceding fiscal years ended December 31, 2023 or December 31, 2022 contained an adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles.

On May 29, 2025, LAO Professionals ("LAO") was appointed by the Company's Audit Committee as the Company's independent registered public accounting firm, to audit the Company's consolidated financial statements as of and for the fiscal year ended December 31, 2024 and the fiscal year ending December 31, 2025, subject to customary client acceptance procedures.

During the two most recent fiscal years and through the date of this annual report, neither the Company, nor anyone on its behalf, consulted LAO regarding either: (i) the application of accounting principles to a specified transaction, either completed or proposed; or the type of audit opinion that might be rendered on the Company's financial statements; or (ii) any matter that was the subject of a "disagreement" (as that term is defined in Item 304(a)(1)(iv) of Regulation S-K) or "reportable event" (as that term is defined in Item 304(a)(1)(v) of Regulation S-K).

Reverse Stock Split

On October 3, 2025, the Company filed a Certificate of Amendment to its Articles of Incorporation, as amended to date, and a Certificate of Amendment to Designation, with the Nevada Secretary of State as corrected on October 7, 2025, effecting a 1-for-8 reverse stock split (the "Reverse Stock Split") of the Company's common stock, par value $0.001 per share (the "Common Stock") and the Company's series A preferred stock, par value $0.001 per share (the "Preferred Stock"). The Reverse Stock Split was approved by the Board of the Directors of the Company (the "Board") and became effective at 16:30 pm ET on October 7, 2025.

As a result of the Reverse Stock Split, every eight (8) shares of the Company's issued and outstanding Common Stock have been converted into one (1) share of issued and outstanding Common Stock and every eight (8) shares of the Company's issued and outstanding Preferred Stock have been converted into one (1) share of Preferred Stock. The Reverse Stock Split affects all of the Company's stockholders uniformly and does not affect any stockholder's percentage ownership interests in the Company, except to the extent that the Reverse Stock Split results in any of the Company's stockholders owning a fractional share. Each stockholder will receive such additional fractions of a share to round up to a full share. The Reverse Stock Split has no impact on stockholders' proportionate equity interests or voting rights in the Company or the par value of the Company's Common Stock and Preferred Stock, which remains unchanged.

The Company's Common Stock began trading on a split-adjusted basis on the NYSE American at the commencement of trading on October 8, 2025 under the Company's existing symbol "NCL." The Company's Common Stock has been assigned a new CUSIP number of 66373M 408 in connection with the Reverse Stock Split.

Registration of Shares Issued In Certain Transactions

On September 26, 2025, the Company filed a registration statement on form S-1 (File No.: 333-290562) registering up to 15,000,000 shares of common stock held by certain selling stockholders of the Company for offer and resale (collectively, the "Registered Shares", and the registration statement, the "2025 Registration Statement"). The Registered Shares offered for resale consists of the following:

  <u></u> <u>Up to 5,000,000 shares of common stock issued to each of the following investors on March 31, 2025, pursuant to the share purchase agreement entered into between the Company and such investors, on December 6, 2024 (the "Oneflow SPA"):</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 1,000,000 shares of common stock issued to Oneflow LLC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 1,000,000 shares of common stock issued to Ye Mo;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 1,000,000 shares of common stock issued to Wenjue Wang;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 1,000,000 shares of common stock issued to Lizaqueen Acquisition Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 1,000,000 shares of common stock issued to Gageone LLC; and

  <u></u> <u>Up to 10,000,000 shares of common stock issued to each of the following investors on September 3, 2025, pursuant to the share purchase agreement entered into between the Company and such investors, on December 6, 2024 (the "X29 SPA"):</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 2,000,000 shares of common stock issued to X29 LLC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 2,000,000 shares of common stock issued to Thilta Impact Funding LLC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 2,000,000 shares of common stock issued to Qianyun Zhu;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 2,000,000 shares of common stock issued to Keqin Li;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Up to 2,000,000 shares of common stock issued to Zhiyun Xia.

The 2025 Registration Statement, as amended, was effective on November 13, 2025.

Asset Purchase Agreement with Kingsford Consultancy Ltd.

On November 23, 2025, the Company entered into an asset purchase agreement with Kingsford Consultancy Ltd. ("Kingsford", and such agreement, the "Asset Purchase Agreement").

Pursuant to the Asset Purchase Agreement, Kingsford agreed to provide to the Company certain proprietary software assets relating to a supply chain management system, including all related intellectual property rights therein (the "Software"), pursuant to the terms of the Asset Purchase Agreement.

As consideration for the Software, the Company agreed to pay $5,000,000 as the purchase price, by issuing 12,500,000 shares of the Company's common stock, par value $0.001 per share (the "Common Stock") (the "Kingsford Shares"), i.e. $0.40 per share, to a designee to be designated by Kingsford.

The closing of the Asset Purchase Agreement is required to occur no later than three business days after all closing conditions are satisfied or waived, or at such other times as the parties may agree. The closing conditions include but not limited to, the approval of the issuance of the Kingsford Shares by the Company's stockholders and the NYSE American. Kingsford represented and warranted, amongst others, that neither Kingsford nor its designee is an affiliate of the Company, and that the Kingsford Shares are being acquired for investment purposes only, without a view to distribution, and in compliance with all applicable securities laws.

The Kingsford Shares shall be issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended. The Kingsford Shares shall constitute restricted securities and will bear a restrictive legend as set out under the Asset Purchase Agreement.

Development Agreement with Asia Resource Holdings Limited

On November 23, 2025, the Company entered into a development agreement with Asia Resource Holdings Limited ("Asia Resource", and such agreement, the "Development Agreement").

Pursuant to the Development Agreement, Asia Resource agreed to develop and provide to the Company the NCL Customized Intelligent Decoration Platform, a customized software, including all intellectual property rights therein (the "Platform").

As the consideration for the Platform, the Company agreed to pay $6,000,000, by issuing a total of 15,000,000 shares of the Company's Common Stock (the "Asia Resource Shares"), i.e. $0.40 per share, in two separate tranches of 8,000,000 shares and 7,000,000 shares, respectively, to a designee to be designated by Asia Resource.

The first tranche of the Asia Resource Shares (i.e., 8,000,000 shares) shall be delivered by the Company within five business days after both of the Company's stockholders and NYSE American approve the issuance of the Asia Resource Shares. Asia Resource should deliver the Platform within three business days after certain conditions set forth in the Development Agreement are satisfied, including but not limited to the issuance of the first tranche of the Asia Resource Shares. The second tranche of the Asia Resource Shares (i.e., 7,000,000 shares) shall be delivered by the Company within five business days after delivery of the Platform. Asia Resource represented and warranted, amongst others, that neither Asia Resource nor its designee is an affiliate of the Company, and that the Asia Resource Shares are being acquired for investment purposes only, without a view to distribution, and in compliance with all applicable securities laws.

The Asia Resource Shares shall be issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended. The Asia Resource Shares shall constitute restricted securities and will bear a restrictive legend as set out under the Development Agreement.

Financing and Strategic Planning Advisory Agreement with Linkun Investment LLC

On December 18, 2025, the Company entered into a Financing and Strategic Planning Advisory Agreement with Linkun Investment LLC ("Linkun Investment", and such agreement, the "Linkun Investment Consulting Agreement").

Pursuant to the Linkun Investment Consulting Agreement, Linkun Investment has agreed to provide certain strategic planning advisory services in connection with the Company's business development during the term of the agreement, which is six months from the date of execution of the Linkun Investment Consulting Agreement, unless otherwise earlier terminated by mutual agreement of the parties.

In

consideration for agreeing to provide such strategic planning advisory services under the Linkun Investment Consulting Agreement, the Company issued 1,800,000 shares of the Company's Common Stock (the "Linkun Investment Compensation Shares") to two individuals designed by Linkun Investment. Pursuant to the Linkun Investment Consulting Agreement, the Linkun Investment Compensation Shares shall only be issued after the NYSE American approves the issuance and the NYSE American approved the issuance in February 2026. The issuance of the Linkun Investment Compensation Shares was subject to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as

amended.

Operation and Strategic Planning Advisory Agreement with Lu Wang

On December 19, 2025, the Company entered into an Operation and Strategic Planning Advisory Agreement with Lu Wang (such agreement, the "Lu Wang Consulting Agreement").

Pursuant to the Lu Wang Consulting Agreement, Lu Wang has agreed to provide certain strategic planning consulting services in connection with the Company's business development during the term of the agreement, which is from July 1, 2025 to June 30, 2026, unless otherwise earlier terminated by mutual agreement of the parties.

In

consideration for agreeing to provide such strategic planning consulting services under the Lu Wang Consulting Agreement, the Company issued 1,500,000 shares of the Company's Common Stock (the "Lu Wang Compensation Shares") to an entity designated by Lu Wang. Pursuant to the Lu Wang Consulting Agreement, the Lu Wang Compensation Shares shall only be issued after the NYSE American approves the issuance and the NYSE American approved the issuance in February 2026. The issuance of the Lu Wang Compensation Shares was subject to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as

amended.

2025 Annual General Meeting

On December 31, 2025, the Company held its annual general meeting of stockholders which approved the following matters: (i) the election of five directors to hold office until the next annual meeting of stockholders or until their successors are duly elected and qualified; (ii) the ratification of LAO Professionals as the Company's independent registered public accounting firm for the year ending December 31, 2025; (iii) the adoption of the proposal to authorize the Board of Directors of the Company (the "Board"), in its discretion, a reverse stock split of all of the Company's issued and outstanding common stock, par value $0.0001 per share (with no change to the authorized capital stock of the Company), at a specific ratio, ranging from one-for-three (1:3) to one-for-twenty (1:20), with the timing and ratio to be determined by the Board if effected; (iv) the adoption of the proposal to amend the terms of the Company's 2023 Equity Incentive Plan, as amended, to provide for an additional 2,000,000 shares to be issued in connection with awards granted thereunder (the "Amendment to Plan Proposal"); (v) the adoption of the proposal to approve for purposes of complying with Section 712(b) of the NYSE Company Guide, the issuance of 12,500,000 shares of common stock to the designee of Kingsford Consultancy Ltd. ("Kingsford"), pursuant to the asset purchase agreement between Kingsford and the Company, dated November 23, 2025, which would result in an increase in the Company's outstanding common stock of over 20%; (vi) the adoption of the proposal to approve for purposes of complying with Section 713(a) of the NYSE Company Guide, the issuance of 15,000,000 shares of common stock to the designee of Asia Resource Holdings Limited ("Asia Resource"), pursuant to the development agreement between Asia Resource and the Company, dated November 23, 2025, which exceed 20% of the Company's presently outstanding common stock.

Notice of Failure to Satisfy a Continued Listing Rule

The Company received a written notice of non-compliance (the "Notice") from the NYSE American LLC indicating that the Company was not in compliance with the NYSE American continued listing standards set forth in Section 1003(a)(i) of the NYSE American Company Guide (the "Company Guide"). The Company was required to submit a plan by January 7, 2026, advising of actions taken or will be taken to regain compliance with the continued listings standards of the Company Guide by June 8, 2027 (the "Plan"). The Company submitted the Plan as required in the Notice.

On February 24, 2026, the Company received a notification (the "Acceptance Letter") from the NYSE American that the Plan was accepted. In the Acceptance Letter, the NYSE American granted the Company until June 8, 2027 (the "Plan Period") to regain compliance with the continued listing standards.

During the Plan Period, the Company is subject to periodic review by the NYSE American on its progress with the goals and initiatives outlined in the Plan. The Company intends to take all reasonable measures available to regain compliance with Sections 1003(a)(i) of the Company Guide during the Plan Period. If the Company does not regain compliance with the NYSE American listing standards by June 8, 2027, or if the Company does not make sufficient progress consistent with the Plan during the Plan Period, then NYSE American may initiate delisting proceedings.

The Acceptance Letter has no immediate impact on the listing of the Company's Common Stock, which will continue to be listed and traded on the NYSE American during the Plan Period, subject to the Company's compliance with the other listing requirements of the NYSE American. The Common Stock will continue to trade under the symbol "NCL". The Acceptance Letter does not affect the Company's ongoing business operations or its reporting requirements with the Securities and Exchange Commission.

3D Printing Technology

3D printers work similarly to traditional printers. The printing materials include ink and coating in liquid or powder forms, and are superimposed layer by layer onto the substrate. Our 3D printing devices use technologies including Fused Deposition Modeling (FDM) system and LED/electron beam-curing 3D printing technology. The characteristics are as follows:

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|  | FDM systems and related technologies are currently the most accessible and widely used from consumer level to industrial level. 3D printers based on FDM technology print parts layer by layer from bottom to top by heating and extruding thermoplastic fibers (the most commonly used is ABS plastic). Production grade systems use a variety of standard, engineering and high performance thermoplastics with specific properties such as toughness, electrostatic dissipation, translucency, biocompatibility, ultraviolet resistance and high thermal flexure. |

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|:---|:---|
|  | LED-curing 3D printing technology is the earliest 3D printing technology and it is also a relatively developed 3D printing technology at present. The basic principle of this technology is to utilize the cumulative molding of materials, namely, to divide the shape of a three-dimensional target part into several planar layers, and scan the liquid photosensitive resin with a light beam of a certain wavelength, so that the scanned part can be cured, while the place not irradiated is still liquid, and finally each layer accumulates into the required target part, and the material utilization rate can reach 100%. |

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Our Products

Our 3D printed vinyl flooring panels consist of three layers, (i) the substrate, which is the main body of the plank, (ii) the decorative layer, which shows the color and patterns, and (iii) the surface layer, which can provide different textures and functionalities. We manufacture the substrate, and use 3D printing technologies to add the decorative layer and the surface layer. We have a "digital inventory" of part designs and printing instructions and a physical inventory of raw materials. Our production is on demand. We manufacture products in small batches and do not keep large physical inventory of the products. All of our products are phthalate-free, customizable, durable, heat resistant, corrosion resistant, UV resistant and water resistant.

Our subsidiaries, NBS, NCP and Crazy Industry, own four proprietary 3D printing technologies for the production and manufacture of vinyl flooring, offering different functionalities and aesthetic finishes: Infinite Glass, DSE, TruBevel, and MattMaster. NBS, NCP and Crazy Industry own a portfolio of over 80 granted, pending or published patents on these technologies. In addition, we have launched SuperOak, our flagship 3D printed flooring product line that is designed to replicate the natural appearance of hardwood while delivering the durability and water resistance of engineered flooring. SuperOak has been well received in the market and is currently available at major retail supermarkets across the United States. The rapid adoption of SuperOak reflects a broader market trend as consumers seek differentiated, premium alternatives amid the oversaturation of conventional vinyl flooring products. Our transition to end-to-end manufacturing at our South Carolina facility enables us to control the full product lifecycle from design through production to distribution, which significantly shortens our innovation-to-customer cycle and allows us to bring more innovative products and value to the market at lower cost.

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Infinite Glass

Infinite Glass is a decorative panel with a transparent protective layer that deflects harmful UV rays away from the decorative layer underneath it. The protective layer is comprised of a polyurethane composition which is the reaction product of a polyester polyol, a polyether polyol and an isocyanate. Without such protective layer, UV rays can penetrate the material and overtime damage the floor and cause discoloration. Infinite Glass greatly increases durability and reduces discoloration.

DSE

DSE (Digital Synchronized Effect) is a revolutionary technology that generates defined and synchronized textures to mimic real wood or real tile haptic. It can generate a multi-layered embossing structure which is comprised of (i) at least one partially or fully cured base layer provided with a plurality of indentations, and (ii) at least one partially or fully cured elevated pattern layer formed by a plurality of elevations printed on top of said base layer.

TruBevel

TruBevel Technology can produce planks with pressed bevel effect, realistic grout designs and rustic edges, which provide more customization options.

ArmorDual

ArmorDual is a technology to infuse anti-microbial coatings as the top layer of planks. The ArmorDual coating is resistant to staining, mold and mildew that may cause unpleasant odor.

MattMaster-Electron Beam

The MattMaster is an electron beam curing technology to cure protective coatings for flooring and other interior surfaces. The conventional curing process of coatings for flooring and other interior surfaces requires a lot of energy to develop sufficient heat and curing time. The MattMaster curing process relies on the high energy of accelerated electrons that creates a bridging density in resin molecules, and therefore saves energy and reduces environmental impact. Regardless of whether the flooring is rigid core, wood, laminate, we can produce a super low gloss with high product performance that is durable, anti-stain, anti-bacterial, color fading resistance for over 10 years. This technology can be used to create superior water-resistant dimensional stability to flooring and eliminate curling and cracking.

Blue Eleven

Blue Eleven is our sustainability initiative. The substrate layers of Blue Eleven products are made with 80% recycled ocean plastic, sanitized and processed for safe reuse.

Envision

Envision is a patent-approved artificial intelligence learning system, comprising processors and non-transitory program storage devices (NPSDs) capable of reading instructions executable by processors to generate decorative patterns, such as decorative floor panels, wall panels or ceiling panels. The algorithm can recognize the characteristics in a sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup. We plan to build a database of patterns that we already own and patterns generated by the algorithm, so that when a sample pattern is input into the system, the algorithm can recognize the characteristics in the sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup. With the assistance of such algorithm, we can save time and money on finding designs and offer more options to our customers. We believe we can also apply the algorithm to help customers find their desired products. By uploading pictures of desired products to the algorithm, we can find existing product in our lineup that fits the samples the most or generate a new design that combines all the features the customer desires.

Competition and Competitive Advantages

The floorcovering industry is highly competitive. We believe the principal competitive factors in our primary floorcovering markets are product design, quality and service. We compete with wood flooring and conventional vinyl flooring manufacturers and some of these manufacturers have greater financial resources than we do. Nevertheless, we believe we have competitive advantages in several areas. 3D printing offers customers limitless design with low labor and inventory cost. Our products are made to have a long and economically sustainable life cycle. In addition, our experience management team has led our business to a global success with sales in North America (mainly the United States and Canada), Europe and other regions.

Commitment to Innovation

Innovation has always been our core value. Our commitment to new approaches in designing and manufacturing drives us to create new ways to improve how our core customers live and work. We invest substantial resources in research and product development and are committed to rapidly building new products and customizable and functional solutions to delight our customers. Our product development team is committed to product design and development, and they focus their efforts on enhancing function, use, performance and flexibility of our products. As of the date of this Annual Report, our subsidiaries, NBS, NCP and Crazy Industry own a portfolio of over 80 granted, pending or published patents on 3D printing technology for the production and manufacture of decorative products. We strive to make our products customizable, functional and affordable. We offer products of all sizes, styles and materials in accordance with the customers' needs, regardless of the order quantity. These advanced technologies also make our products natural, realistic, outstanding in wear resistance, scratch resistance, bacterium resistance and sound-proof effect. Our automated production lines provide short production cycle and great efficiency and minimize scrap rate and labor cost. We believe our technologies enhance our product performance and improve our flexibility and responsiveness to surging demand, supply chain fluctuations and labor shortages.

Advanced and Competitive Technologies

Traditional vinyl flooring is generally labor intensive and requires a large space and layout. Traditional vinyl flooring production usually requires 5 to 8 people per production line. During the production from raw materials to packages, the products need to be moved at least four times. 3D printing technology allows us to automate the production process and to lower labor costs. Our machinery can print multiple functional layers in one setting, and therefore requires less space to accommodate different machines. In addition, traditional vinyl flooring has a low barrier to entry with simple machinery. The 3D printed vinyl flooring market is much less competitive as we do not know of other manufacturers in the industry that use 3D printing technology to manufacture vinyl flooring. Moreover, because traditional vinyl flooring production usually has longer production cycle, traditional manufacturers usually manufacture in large quantities, which requires them to have large amount of inventory storage that includes films, wear layers and rigid cores. 3D printing, because it is automated with less labor requirement, can reduce the production time. As a result, we can produce 3D printed parts on demand, in single or small batches, to eliminate the need to hold physical inventory of spare and low volume parts. Furthermore, 3D printing allows us to provide more flexibility in design, pattern, shape and color, where traditional manufacturers are limited to the molds they have.

Limitless Customization

Conventional vinyl flooring manufacturers use molds, physical paper pressing or roller to generate three-dimensional pattern and texture on planks. Such methods are labor-intensive, and the design is limited by the number of molds. With 3D printing, we can achieve any combination of colors, patterns and finishes with a high degree of accuracy. We can tailor our products in accordance with specific requirements of our customers with no additional costs other than raw materials. We provide value to our customers with customization, affordability and short production cycle.

Low Labor and Inventory Cost

We usually start production after receiving an order from a customer because we have a short production cycle and can meet customers' demand without pre-producing and keeping a large inventory. This allows greater flexibility without incurring unnecessary cost on material, labor and inventory.

Rigorous Quality Control

Our quality management system conforms to the FloorScore, ISO 14001:2014 and ISO 9001:2015 quality management systems. We thrive to provide our customers with reliable and high-quality products.

Professionally recognized sustainable practices

Our sustainability goal is to minimize carbon emissions and offer products that have a long and economically sustainable life cycle. We follow the evaluation process as well as hazard screening and risk assessment of FloorScore Products Innovation Institute, a non-profit that promotes the highest standard of sustainable product design, for all new raw materials. We assess the chemicals present in a product and any risks of exposure to hazardous chemicals during the intended use and end-of-use phases of a product's lifecycle. Northann Corp's subsidiary, Benchwick, has been nominated for the Greenstep 2023 International Award for its 3D printing ecosystem and ocean-reclaimed plastic Blue11 core innovation.<sup>4</sup>

<sup>4</sup> Source: FCW, Floor Covering Weekly, May 8th 2023 Green Step Sustainability Awards Program (2023), Page 20, International 'Benchwick LLC', available at: <u>https://bt.e-ditionsbyfry.com/publication/?i=791262&p=20&view=issueViewer</u>

Diversified Market Reach

We market and sell products in North America (mainly the United States and Canada), Europe and other regions. The diversified market reach mitigates any impact of changes in economic and political environment, regional industry trends and consumer preference. We continued to explore new markets and areas.

Experienced Management Team

Lin Li, our Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer, has over 10 years of leadership experience in the flooring and furniture industry. Kurtis W. Winn, our Chief Operating Officer and one of our directors, has over 30 years of experience in sales and management. Bradley C. Lalonde, one of our independent directors, is a partner and co-founder of Vietnam Partners, an investment banking serving the Vietnamese government and businesses in Vietnam, and has a 25-year career in investment and corporate banking and over 15 years of experience in general management. Umesh Patel, one of our independent directors, also has extensive experience in capital markets, and apart from being one of our independent directors, he also sits on the board and presently serves as the chairman of the Audit Committee and member of the Compensation Committee and Nominating and Governance Committee of Nova Lifestyle, Inc. (NASDAQ: NVFY). Jing Zhang, one of our independent directors, is a seasoned professional with expertise in finance, marketing, and e-commerce. We rely on our management team to provide helpful guidance in advancing our strategic and growth goals.

Growth Strategies

Our primary objective is to create value through the sustaining growth in profits and cash flows from operating activities over various economic cycles. In order to achieve this objective, we strive to improve our cost structure, provide high quality services and products, expand our product range and increase our market share.

To achieve these objectives, the Company is pursuing the following strategic initiatives:

*Tier-1 Retail Expansion*

— The Company has entered vendor agreements to supply its core Benchwick 3D-printed flooring products to several major North American home improvement retailers. Initial product rollout and inventory stocking commenced in Q1 2026. In February 2026, the Company received an initial purchase order of approximately $2.0 million from a leading Midwest home improvement retailer for Benchwick flooring products. The Company believes these agreements represent its pivotal transition from primarily wholesale distribution to mass-market retail presence, and expects these channels to become a significant source of revenue growth in fiscal year 2026.

*U.S. Manufacturing Expansion*

— The Company has been installing equipment in its new factory in Fort Lawn, South Carolina, and expects to commence commercial production in Q2 2026. The South Carolina facility is designed to complement the Company's existing manufacturing operations in China by providing domestically produced products that avoid import tariffs currently totalling approximately 65% on goods imported from China.

*Cost Optimization through Technology*

— The Company's 3D printing ecosystem, deployed since Q4 2025, eliminates the need for traditional decorative paper and wear layers used in conventional vinyl flooring production. Additionally, the Company expects to complete the R&D of its proprietary Blue Eleven and DSE technologies in Q2 2026, which may further reduce the Company's production costs.

*Strategic Asset Acquisitions*

— The Company has entered into agreements with Kingsford and Asia Resource, which are expected to enhance the Company's operational capabilities and strengthen stockholders' equity.

Made in the United States

Since the beginning of 2020, the COVID-19 pandemic has disrupted global supply chain and increased shipping costs. Because our primary markets are the United States and Canada, we believe production in the United States will reduce our logistics costs and environmental footprint. On April 2, 2025, President Donald Trump issued an executive order that imposes reciprocal tariffs on imports from China and many other nations, in addition to all existing tariffs. As a result, beginning April 9, 2025, the applicable reciprocal tariff rate on imports from China is 34%, plus the existing 25% tariff and 6% import tax, which total 65%. President Donald Trump's order also imposes 49%, 46% and 32% reciprocal tariffs on imports from Cambodia,Vietnam and Indonesia, respectively, from which we import products for sale in the United States from time to time. Previously U.S. did not impose tariffs on imports from these countries, besides the 6% import tax. Manufacturing and selling in the United States reduces costs on tariffs and import tax. We also plan to source more raw materials from suppliers in Europe or North America, where there is no or a low tariff and import tax. Our production is automated and has low labor cost. We believe having our products made in the United States improves our overall cost structure and our brand recognition. In December 2024, we moved our headquarters from California to 2251 Catawba River Rd, Fort Lawn, SC 29714 and commenced renovations of our leased manufacturing facility. We have purchased equipment for manufacturing and pollution control, and have hired local labor to support operations. The facility began partial production in 2025 and is currently operating at approximately 10% of planned capacity, with full capacity targeted by mid-2027. This transition marks a strategic shift from our previous OEM-dependent manufacturing model to a fully integrated, end-to-end operation, significantly accelerating our innovation-to-customer cycle and reducing costs. The cost to set up manufacturing capabilities in the United States is expected to be approximately $24 million. Through our indirect subsidiary 3D PRINTING, we may borrow up to $24 million from 3DFLOR OPPORTUNITY, LP, a related party, under a promissory note signed in February 2025, and plan to use such funds to finance the development and expansion of a 3D printing manufacturing facility located at our headquarter in South Carolina. We expect to start manufacturing products in the United States in June 2025. If the plan is successfully executed, we plan to maintain manufacturing in the United States and China in the short term. We plan to gradually shift manufacturing from China to the United States in the long term and eventually close the manufacturing sites in China. However, there is no assurance that such plans will be commercially successful or that the actual outcome of the plans will match our expectations.

Our reliance on imports from China has been declining, and we have begun diversifying our sourcing to include suppliers in Vietnam, Thailand, Malaysia and Indonesia. We believe 3D printing technology has the potential to fundamentally reshape the flooring industry by significantly reducing dependence on imported raw materials from Southeast Asia. By combining advanced U.S.-based manufacturing technology with domestic suppliers and direct access to the large North American market, we aim to establish a more resilient and cost-effective supply chain while delivering innovative products at scale. Furthermore, we are actively deploying artificial intelligence across our operations, from product design and production scheduling to quality assurance and business administration. We expect AI integration to profoundly impact the industry and significantly reduce our operating and management costs, enhancing our ability to compete and innovate. In addition, we intend to apply AI to transform the customer experience. Historically, selecting flooring products has been a complex process requiring professional design assistance. By deploying AI-powered tools, we aim to enable customers and consumers to easily personalize and select products tailored to their specific spaces and preferences, delivering a more intuitive and satisfying experience while reducing friction in the purchasing process.

Vertical integration

Currently, some of our products' patterns are designed in-house and some are sourced from third parties. NCP did not purchase any patterns during the fiscal years 2025 and 2024. Patterns purchased from third-party designers prior to fiscal year 2024 accounts for about 68% of all the patterns we have. As the third-party designers are our upstream suppliers, we wanted to bring the designing step in-house and replacing the third-party designers with our proprietary technologies. NBS has developed an artificial intelligence learning system, Envision, comprising processors and non-transitory program storage devices (NPSDs) capable of reading instructions executable by processors to generate decorative patterns, such as decorative floor panels, wall panels or ceiling panels. NBS has been granted a patent for this invention. The algorithm can recognize the characteristics in a sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup. We have built a database of patterns that we already own and patterns generated by the algorithm, so that when a sample pattern is input into the system, the algorithm can recognize the characteristics in the sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup. With the assistance of such algorithm, we can save time and money on finding designs and offer more options to our customers. We believe we can also apply the algorithm to help customers find their desired products. By uploading pictures of desired products to the algorithm, we can find existing product in our lineup that fits the samples the most or generate a new design that combines all the features the customer desires.

Expand Market Share

Our management team has always focused on expanding market share. We believe our "made in the United States" and "vertical integration" strategies will help expand our product lineups, build our brand recognition and reach more end consumers in the United States, which is our biggest market. With additional marketing efforts, we believe we will increase customer penetration and expand the geographical coverage of products, and therefore expand market share.

Manufacturing and Logistics

NCP manufactures the products in its factory in Changzhou, China. NCP has 88 units of 3D printing equipment in NCP's factory in China and has the capacity to produce more than 19,800 square meters of vinyl flooring per day.

Our sales are primarily made to large-sized wholesale distributors, major retail supermarkets and local building contractors, with a small portion to individual consumers for home renovation. We generated

92.91 % and 98.79% of our revenue from wholesale and

7.09 % and 0.19% from retail for the fiscal years ended December 31, 2025 and 2024, respectively.

Products sold to distributors were transported to the airport or seaport by our own transportation team and were picked up by the customers or their contractors for air or sea transportation.

With the commencement of production at our South Carolina facility, an increasing portion of products are manufactured domestically and shipped directly to U.S. customers, reducing logistics costs and lead times.

Retail sales were generated through Dotfloor.com, our online store that offers our vinyl flooring products to retail customers in the United States. Dotfloor works with third-party logistic service providers for the delivery of our products.

We have also renovated a 3D printing manufacturing facility located at our headquarter, 2251 Catawba River Road, Fort Lawn, South Carolina. As of the date of this Annual Report, the facility has commenced partial production on a phased basis at approximately 10% of planned capacity. The facility primarily produces our SuperOak product line and has begun delivering products to major retail supermarkets and local building contractors. While we have made significant progress in establishing domestic manufacturing, reaching full capacity by our target of mid-2027 remains subject to risks including equipment procurement, workforce training, and supply chain readiness.

Customers and Suppliers

Our Customers

During the fiscal years ended December 31, 2025 and 2024, we had revenue from the following countries:

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| | | |
|:---|:---|:---|
|  | **For the Fiscal** <br>**Year Ended** <br>**December 31,**<br>**2025** | **For the Fiscal**<br>**Year Ended** <br>**December 31,**<br>**2024** |
| **North America**<br>|  |  |
| United States<br>| 99.22%<br>| 94.78%<br>|
| Canada<br>| 0.78%<br>| 5.01%<br>|
| **Europe**<br>|  |  |
| United Kingdom<br>| \*%<br>| \*%<br>|
| Netherlands<br>| -%<br>| -%<br>|
| Croatia<br>| -%<br>| -%<br>|
| **Other**<br>| -%<br>| -%<br>|

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\* less than 1%

We consider major customers to be those that accounted for more than 10% of sales revenue. During the fiscal year ended December 31, 2025, two major customers accounted for a total of 69.7% of our total revenues. During the fiscal year ended December 31, 2024, two major customers accounted for a total of 77.0% of our total revenues.

Our Suppliers and Raw Materials

Our raw materials mainly include ink, coating, resin, sound padding, and glue. 3D substrate boards are mainly produced with resins from local suppliers. The final effect and quality of products mainly depend on the quality of raw materials. At present, the types of ink on the market are water-based ink, UV ink and oil ink. The ink we use is a kind of UV ink with the advantages of being more environmentally friendly, unscented, formaldehyde-free, dosage-saving and easily solidified. The coatings used include 3D varnish, hot melt paint, prima and paint, which have the advantages of wear resistance, pollution resistance, ultra-violet resistance, corrosion resistance and color stability. Based on customers' needs, we will purchase specific types of raw materials and apply our unique technology to process the raw materials into finished products meeting the customer's requirements.

We carefully select our suppliers to only work with those that comply with all applicable laws, including laws and regulations on labor, employment, environment, human rights, payroll, working hours, health and safety, and give priority to suppliers that can demonstrate their commitment to sustainable development performance. We purchase the raw materials from different suppliers, for example, the powder and coating for making the base board are primarily purchased from suppliers in China and the ink is imported from Japan. We usually review and evaluate suppliers in accordance with raw material price, demand and customer feedback, and maintain good relationships with high-quality suppliers. At the same time, we maintain close contact with different suppliers to ensure sufficient and timely supply of raw materials.

We order raw materials from suppliers based on our needs, instead of entering into long-term supply agreements with the suppliers. We are able to ensure consistent delivery and competitive pricing because of our long-term business relationships with these suppliers.

We consider major suppliers to be those that accounted for more than 10% of our total cost. For the fiscal year ended December 31, 2025,

two

major suppliers accounted for a total of

% of our total cost of revenues. For the fiscal year ended December 31, 2024, three major suppliers accounted for a total of

% of our total cost of revenues.

Intellectual Property

Patent

Our subsidiaries, NBS, NCP and Crazy Industry, own a total of 84 granted, pending or published patents on 3D printing technology for the production and manufacture of decorative products. We rely on the patents to protect our business interests and ensure our competitive position in the industry. As of the date of this Annual Report, NBS, NCP and Crazy Industry have 7 pending patents, 34 published patents and 43 granted patents. The 43 granted patents include 13 granted patents in the United States and Netherlands. We have 4 pending or published patents under the PCT (Patent Cooperation Treaty).

The granted patents are listed as follows:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Owner | Country | Patent Code | Patent Name | Authorization<br>Date<br>(YYYY/MM/DD)<br>| Expiry Date<br>(YYYY/MM/DD)<br>|
| NBS | Netherlands | 2022925 | Decorative panel, panel covering, and method of producing such a decorative panel | 2020/10/20 | 2039/04/11 |
| NBS | United States | 10895079 | Decorative panel, panel covering, and method of producing such a decorative panel | 2021/01/19 | 2039/04/24 |
| NBS | United States | 11414874 | Decorative panel, panel covering, and method of producing such a decorative panel | 2021/08/16 | 2039/04/24 |
| NBS | European Patent Convention | 3953540 | Decorative panel, panel covering, and method of producing such a decorative panel | 2023/03/01 | 2040/04/14 |
| NBS | Netherlands | 2024631 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2021/09/07 | 2040/01/09 |
| NBS | Australia | 2021205306 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2023/03/09 | 2041/01/11 |
| NBS | European Patent Convention | 4087989 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2023/11/01 | 2041/01/11 |
| NBS | Netherlands | 2024632 | Panel, in particular a floor panel, ceiling panel or wall panel, and use of an additional layer in a laminated multi-layer structure of a panel. | 2021/09/07 | 2040/01/09 |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| NBS | Australia | 2021206145 | Panel, in particular a floor panel, ceiling panel or wall panel, and use of an additional layer in a laminated multi-layer structure of a panel. | 2023/12/14 | 2041/01/11 |
| NBS | Netherlands | 2025115 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2021/10/19 | 2040/03/12 |
| NBS | United States | 11421424 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2022/08/23 | 2040/04/30 |
| NBS | United States | 11643822 | Decorative surface covering element, surface covering element covering, and method of producing such a decorative surface covering element | 2023/05/09 | 2040/04/30 |
| NBS | Netherlands | 2030694 | DECORATIVE PANEL, DECORATIVE COVERING, METHOD AND SYSTEM FOR PRODUCING SUCH A PANEL | 2023/08/04 | 2042/01/25 |
| NBS | Netherlands | 2032705 | COMPUTER-IMPLEMENTED METHOD FOR GENERATING A DECORATIVE PATTERN FOR DECORATIVE PANELS, AND MANUFACTURING METHOD OF SUCH PANELS | 2024/02/16 | 2042/08/09 |
| NBS | United States | 11861243 | COMPUTER-IMPLEMENTED METHOD FOR GENERATING A DECORATIVE PATTERN FOR DECORATIVE PANELS, AND MANUFACTURING METHOD OF SUCH PANELS | 2024/01/02 | 2040/08/18 |
| NBS | Netherlands | 2032744 | COMPUTER-IMPLEMENTED METHOD AND SYSTEM FOR ORDERING AND MANUFACTURING A SET OF DECORATIVE PANELS | 2024/02/16 | 2042/08/12 |
| NCP | China | <br>208615268U<br>| PVC sheet extrusion molding unit for veneer | 2019/03/19 | 2028/07/06 |
| NCP | China | <br>208812587U<br>| Convenient production of PVC board for decorative board and its manufacturing device | 2019/05/03 | 2028/07/06 |

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| | | | |
|:---|:---|:---|:---|
| NCP<br>China<br>208681722U<br>| Special piping device for special PVC decorative board | 2019/04/02 | 2028/07/06 |
| NCP<br> China<br>208744942U<br>| Low-dust edge trimming device for PVC board for decorative board | 2019/04/16 | 2028/07/06 |
| NCP<br> China<br>208844834U<br>| PVC board components for long-term sealing of decorative panels | 2019/05/10 | 2028/07/06 |
| NCP<br> China<br>208759201U<br>| Convenient maintenance synchronous hemming device for PVC board for decorative board | 2019/04/19 | 2028/07/06 |
| NCP<br> China<br>208840044U<br>| Dust removal device for PVC decorative board hemming equipment | 2019/05/10 | 2028/08/16 |
| NCP<br> China<br>208800306U<br>| 3D effect PVC board bottom coating device for decorative board | 2019/04/30 | 2028/08/29 |
| NCP<br> China<br>208801619U<br>| 3D printing PVC board manufacturing device for decorative board | 2019/04/30 | 2028/08/29 |
| NCP<br> China<br>208683848U<br>| Special coating PVC decorative board turning device | 2019/04/02 | 2028/08/29 |
| NCP<br> China<br>208930566U<br>| PVC decorative board edge coating deburring device | 2019/06/04 | 2028/08/30 |
| NCP<br> China<br>209022321U<br>| PVC decorative board edge coating removal device | 2019/06/25 | 2028/08/30 |
| NCP<br> China<br>209307035U<br>| PVC decorative board compression molding device | 2019/06/28 | 2028/08/30 |
| NCP<br> China<br>208745344U<br>| 3D pattern PVC decorative board multilayer embossing device | 2019/04/16 | 2028/09/04 |
| NCP<br> China<br>208745351U<br>| PVC decorative board lamination work platform | 2019/04/16 | 2028/09/04 |
| NCP<br> China<br>209780111U<br>| A 3D effect PVC decorative board and its production line | 2019/12/13 | 2028/12/28 |
| NCP<br> China<br>211229055U<br>| An easy-to-install prefabricated sheet of magnesia material | 2020/08/11 | 2029/09/26 |
| NCP<br> China<br>211229368U<br>| An ultra-high wear-resistant 3D textured sheet | 2020/08/11 | 2029/09/26 |
| NCP<br> China<br>211229054U<br>| A magnesium oxide material sheet suitable for digital printing and 3D synchronization effect | 2020/08/11 | 2029/09/26 |

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| | | | |
|:---|:---|:---|:---|
| NCP<br>China<br>211229369U<br>| A 3D effect sheet based on wear-resistant film | 2020/08/11 | 2029/09/26 |
| NCP<br> China<br>217454945U<br>| 3D printing decorative sheet production line that can be used for 3D printing wear layer | 2022/09/20 | 2032/01/05 |
| Crazy Industry<br> China<br>211768125U<br>| Conveyor roller drive structure for decorative sheet production line | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211760590U<br>| Decorative sheet anti-springboard drawing unit | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211760591U<br>| Universal sheet drawing production line | 2020/10/27 | 20129/12/23 |
| Crazy Industry<br> China<br>211768126U<br>| Quarter Turn Modules for Panel Production Lines | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211764304U<br>| Sheet pattern printing line unit in front of the alignment mechanism | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211768127U<br>| Three-way selection turning module for decorative panel production line | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211768640U<br>| Panel alignment unit for decorative panel production lines | 2020/10/27 | 2029/12/23 |
| Crazy Industry<br> China<br>211917105U<br>| Universal 3D printing patterned decorative sheet production line | 2020/11/13 | 2029/12/23 |
| Crazy Industry<br> China<br>216708776U<br>| Flatbed printing anti-collision mechanism for plates | 2022/06/10 | 2031/10/18 |
| Crazy Industry<br> China<br>216735921U<br>| Plate 3D printing temporary storage device | 2022/06/14 | 2031/10/18 |
| Crazy Industry<br> China<br>216733349U<br>| Easy splicing 3D printing sheet | 2022/06/14 | 2031/09/12 |
| Crazy Industry<br> China<br>216740521U<br>| A highly wear-resistant and non-slip 3D printed floor | 2022/06/14 | 2031/09/12 |
| Crazy Industry<br> China<br>216708381U<br>| Drying mechanism for 3D printing plate | 2022/06/10 | 2031/09/12 |

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NBS has licensed some of its patents to i4F Licensing N.V. with the goal to promote our technologies in the flooring industry. We believe that a wider market acceptance of 3D printed flooring helps establish our brand further and to penetrate the markets and encourages innovation and changes to the rather developed and static industry.

NBS has also granted a sublicensing company the exclusive and worldwide right to sublicense certain other patents and enter into sublicensing agreement with sublicensees, pursuant to a license agreement dated May 1, 2019, as amended. The licensee agreed to develop a focused market approach to sublicense the patents. Net proceeds of all sublicense fees or other forms of royalty from the patents, subject to any definitive sublicensing agreement, after deduction of certain expenses, shall be shared equally between NBS and the licensee. The licensee shall report to NBS before entering into any sublicense agreement. NBS shall have 5 days from receiving such notice to authorize the sublicensing agreement. Authorization is considered provided if no answer is received within such 5 days. NBS shall report to the licensee if NBS licenses the patents to its affiliate within 4 weeks after such licensing to the affiliate. NBS also agreed not to sell, assign or otherwise transfer the patents to any third party or affiliate unless such third party or affiliate has agreed in writing to be subject to the agreement. The agreement will terminate upon expiration of the patents. Either party can terminate the agreement if the other party fails to make payment and fails to remedy within one month, if the other party breaches the confidentiality clause of the agreement, or if the other party fails to perform the obligations and fails to remedy within three months. NBS did not enter into any sublicense agreement during the fiscal years ended December 31, 2025 and 2024.

Trademark

NCP and NDC own a variety of trademarks under which the products are marketed. As of the date of this Annual Report, NCP and NDC have registered eleven trademarks in the United States, four trademarks in the European Union and sixteen trademarks in China. Among such trademarks, the names "Benchwick", "Northann" and "Dotfloor" are of great importance to our business. We believe that we have taken adequate steps to protect our interest in all trademarks.

Domain

NDC maintains websites at <u>www.northann.com</u>

,

 <u>www.benchwick.com</u>

and <u>www.dotfloor.com</u>

. The information contained on these websites is not intended to form a part of, or be incorporated by reference into, this Annual Report.

Research and Development

In 2018, we established our subsidiary Crazy Industry in China to focus on 3D printing research and development. Crazy Industry has a research and development team of four people. The Company's total R&D investment increased to $2.1 million in fiscal year 2025 from $0.7 million in fiscal year 2024, reflecting the accelerated development of these technologies and the expansion of R&D capabilities at the South Carolina facility. Members of our R&D team frequently participate in industry conferences and engage with industry experts. As of the date of this Annual Report, our subsidiaries, NBS, NCP and Crazy Industry, have a portfolio of over 80 granted, pending or published patents worldwide.

NBS has developed an artificial intelligence learning system,

Envision,

comprising of processors and non-transitory program storage devices (NPSDs) capable of reading instructions executable by processors to generate decorative patterns, such as decorative floor panels, wall panels or ceiling panels. NBS is in the process of registering a patent of this invention. The algorithm can recognize the characteristics in a sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup. We plan to build a database of patterns that we already own and patterns generated by the algorithm, so that when a sample pattern is input into the system, the algorithm can recognize the characteristics in the sample image, search our pattern database to find similar products that are already in our products lineup or generate a similar but distinctive pattern to be added to our products lineup.

The Company's R&D efforts are currently focused on two key proprietary technology platforms. The Blue Eleven technology platform is designed to enhance the durability and aesthetic quality of 3D-printed flooring products through advanced UV curing and surface treatment processes. The R&D phase is expected to be completed in Q2 2026, when the Company plans to integrate the technology into commercial production lines. The DSE (Digital Surface Engineering) platform enables precise digital control of surface textures and functional coatings, allowing the Company to produce flooring with enhanced slip resistance, waterproofing, and wear properties without traditional manufacturing steps. Combined with the Blue Eleven technology, DSE is expected by the Company to significantly improve the Company's gross margin profile.

Seasonality

We typically see a decrease in market activity in the first quarter of the year. Working capital requirements are distributed equally among the quarters.

Employees

As of December 31, 2025, the Company and our subsidiaries have a total of 63 employees, working in the following departments:

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| | |
|:---|:---|
|  | Number of<br>employees |
| United States<br>|  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management<br>| 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administration<br>| 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warehouse<br>| 2 |
| China<br>|  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Production<br>| 26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Quality control<br>| 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;R&D<br>| 5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management<br>| 3 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Procurement<br>| 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounting and Finance<br>| 4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administration and Human Resource<br>| 2 |
| Total<br>| 49 |

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We provide our employees with social security benefits in accordance with all applicable regulations and internal policies.

We fulfill our legal responsibility to protect the health and safety of our employees by providing a safe workplace that meets the applicable labor and sanitation standards, controlling risks to health, and ensuring that their plants and machinery are safe and that work safety systems and guidelines are both established and adhered to. We also make sure that all materials and machineries are transported, stored, and used safely, provide adequate welfare facilities, provide employees the information, instruction, training, and supervision necessary to preserve their health and safety, and consult with employees on health and safety matters.

In general, we consider our relationship with our employees to be good.

Environmental

Our manufacturing operations in China are subject to various national and local laws and regulations relating to the generation, storage, handling, emission, transportation and discharge of materials into the environment. The costs of complying with environmental protection laws and regulations have not had a material adverse impact on our financial condition or results of operations in the past.

Insurance

We have purchased insurance for quality assurance, transportation and warehousing of our products. We have not made any material insurance claims for our business.

Where You Can Find Additional Information

The Company is subject to the reporting requirements under the Exchange Act. The Company files with, or furnishes to, the SEC quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports and will furnish its proxy statement. These filings are available free of charge on the Company's website, <u>www.northann.com</u>

, shortly after they are filed with, or furnished to, the SEC. The SEC maintains an Internet website,

<u>www.sec.gov</u>, which contains reports and information statements and other information regarding issuers.

ITEM 1A. RISK FACTORS

Our business and financial performance are subject to various risks and uncertainties, some of which are beyond our control. We discuss in this section some of the risk factors that, if they actually occurred, could materially and adversely affect our business, financial condition and results of operations. In that event, the trading price of our common stock could decline, and our shareholders may lose part or all of their investment. You should consider these risk factors in connection with evaluating the forward-looking statements contained in this Annual Report on Form 10-K because these factors could cause our actual results and financial condition to differ materially from those projected in forward-looking statements. We undertake no obligation to revise or update any forward-looking statements contained herein to reflect subsequent events or circumstances or the occurrence of unanticipated events.

Summary of Risk Factors

We have in the past been adversely affected by certain of, and may in the future be materially and adversely affected by, the following risks:

&nbsp;&nbsp;&nbsp;&nbsp;· The Company is a holding company and will rely on dividends paid by its subsidiaries for its cash needs. Any limitation on the ability of its subsidiaries to make dividend payments to the Company, or any tax implications of making dividend payments to the Company, could limit the Company's ability to pay its expenses or pay dividends to holders of its common stock.

&nbsp;&nbsp;&nbsp;&nbsp;· Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment.

&nbsp;&nbsp;&nbsp;&nbsp;· Recent changes in U.S. trade policies are likely to significantly reduce the volume of imported goods into the United States from China, which is likely to materially reduce our sales in one of our primary markets.

&nbsp;&nbsp;&nbsp;&nbsp;· If the availability of direct materials (raw materials, packaging, sourced products, energy) decreases, or these costs increase, and we are unable to either offset or pass along increased costs to our customers, our financial condition, liquidity or results of operations have been and could continue to be adversely affected.

&nbsp;&nbsp;&nbsp;&nbsp;· Disruption to suppliers of raw materials could have a material adverse effect on us.

&nbsp;&nbsp;&nbsp;&nbsp;· We have significant levels of sales in certain channels of distribution and reduction in sales through these channels could adversely affect our business.

&nbsp;&nbsp;&nbsp;&nbsp;· Our patent applications may not be granted, which may have a material adverse effect on our ability to prevent others from commercially exploiting products similar to ours.

&nbsp;&nbsp;&nbsp;&nbsp;· Our financial statements contain an explanatory paragraph regarding uncertainty as our ability to raise capital and therefore cast substantial doubt about our ability to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;· We may not be able to successfully implement our business strategies and future plans.

Risks Related to Our

Corporate Structure

The Company is a holding company and will rely on dividends paid by its subsidiaries for its cash needs. Any limitation on the ability of its subsidiaries to make dividend payments to the Company, or any tax implications of making dividend payments to the Company, could limit the Company's ability to pay its expenses or pay dividends to holders of its common stock.

Because the Company is a holding company, we conduct substantially all of our business through our subsidiaries in the United States, Hong Kong and China. The Company may rely on dividends to be paid by its subsidiaries to fund our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our stockholders, to service any debt we may incur and to pay its operating expenses. If any of the subsidiaries incurs debt on its behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to the Company.

There are no restrictions in our Articles of Incorporation or Bylaws that prevent the Company from declaring dividends. The Nevada Revised Statutes, however, prohibit the Company from declaring dividends where, after giving effect to the distribution of the dividend:

 the Company would not be able to pay its debts as they become due in the usual course of business; or

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| | |
|:---|:---|
|  | the total assets of the Company would be less than the sum of the total liabilities of the Company plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution, unless otherwise permitted under our Articles of Incorporation. |

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According to the Limited Liability Company Act of Delaware, in general, NBS and Benchwick LLC may make a distribution to the Company to the extent, after giving effect to the distribution, all liabilities of NBS and Benchwick LLC, other than liabilities to the Company on account of the Company's membership interests in NBS and Benchwick LLC, do not exceed the fair value of the assets of NBS and Benchwick LLC. 3D PRINTING may make a distribution to Benchwick LLC to the extent, after giving effect to the distribution, all liabilities of 3D PRINTING, other than liabilities to Benchwick LLC on account of Benchwick LLC's membership interests in 3D PRINTING, do not exceed the fair value of the assets of 3D PRINTING.

According to the California General Corporation Law, Dotfloor and NDC may make a distribution to their stockholders if the retained earnings of each of Dotfloor and NDC equal at least the amount of the proposed distribution. The California General Corporation Law also provides that, in the event that sufficient retained earnings are not available for the proposed distribution, a corporation may nevertheless make a distribution to its stockholders if it meets two conditions, which generally stated are as follows: (i) the corporation's assets equal at least 1 and 1/4 times its liabilities, and (ii) the corporation's current assets equal at least its current liabilities or, if the average of the corporation's earnings before taxes on income and before interest expenses for the two preceding fiscal years were less than the average of the corporation's interest expenses for such fiscal years, then the corporation's current assets must equal at least 1 and 1/4 times its current liabilities.

Benchwick, Cedar Modern Limited, and Raleigh Industries Limited, our Hong Kong subsidiaries, are permitted, under the laws of Hong Kong, to provide funding to the Company through dividend distribution out of its profits. Under the current practices of the Hong Kong Inland Revenue Department, no tax is payable in Hong Kong in respect of dividends paid to the Company as a Nevada corporation.

According to the PRC Company Law and the Foreign Investment Law, each of Crazy Industry, Marco, Ringold and NCP, as a foreign invested enterprise, or FIE, is required to draw 10% of its after-tax profits each year, if any, to fund a common reserve, which may stop drawing its after-tax profits if the aggregate balance of the common reserve has already accounted for over 50% of its registered capital. These reserves are not distributable as cash dividends. Furthermore, under the EIT Law, which became effective in January 2008, the maximum tax rate for the withholding tax imposed on dividend payments from PRC foreign invested companies to their overseas investors that are not regarded as a "resident" for tax purposes is 20%. The rate was reduced to 10% under the Implementing Regulations for the EIT Law issued by the State Council. However, a lower withholding tax rate might be applied if there is a tax treaty between China and the jurisdiction of a foreign holding company. Mainland China and the Hong Kong Special Administrative Region entered into a tax arrangement to avoid double taxation and prevent fiscal evasion with respect to income tax. The tax arrangement applies where a Hong Kong resident enterprise which is considered a non-PRC tax resident enterprise, directly holds at least 25% of equity interests in a PRC enterprise. In that case the withholding tax rate in respect to the payment of dividends by such PRC enterprise to such Hong Kong resident enterprise is reduced to 5% from a standard rate of 10%, subject to approval of the PRC local tax authority. Accordingly, Benchwick, our Hong Kong subsidiary, is able to enjoy the 5% withholding tax rate for the dividends it receives from its PRC subsidiaries (Crazy Industry, Ringold and Marco if Benchwick) satisfies the conditions prescribed in relevant tax rules and regulations and obtains the required approvals. However, if Benchwick is considered a non-beneficial owner for purposes of the tax arrangement, any dividends paid to it by its PRC subsidiaries directly would not qualify for the preferential dividend withholding tax rate of 5%, but rather would be subject to a rate of 10%.

In addition, in response to the persistent capital outflow and the Renminbi's depreciation against the U.S. dollar in the fourth quarter of 2016, the People's Bank of China ("PBOC") and the State Administration of Foreign Exchange, or SAFE, have implemented a series of capital control measures, including stricter vetting procedures for China-based companies to remit foreign currency for overseas acquisitions, dividend payments and shareholder loan repayments. The PRC government may continue to strengthen its capital controls and our PRC subsidiaries' dividends and other distributions may be subjected to tighter scrutiny in the future.

Risks Related to Doing Business in China

Changes in China's political, economic or social conditions could have a material adverse effect on our business and operations.

Most of our products are manufactured through NCP in China and as a result, our business, financial condition, results of operations, and prospects may be influenced to a significant degree by political, economic and social conditions in China generally. The Chinese government plays a significant role in regulating industry development by imposing industrial policies. The Chinese government also exercises significant control over China's economic growth by allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.

While the Chinese economy has experienced significant growth over the past decades, growth has been uneven, both geographically and among various sectors of the economy. Any adverse changes of economic conditions in China, in the policies of the Chinese government, or in the laws and regulations in China could have a material adverse effect on the overall economic growth of China. Such developments could adversely affect our business and operating results, reduce production and weaken our competitive position. The Chinese government has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures may benefit the overall Chinese economy, but may have a negative effect on us. For example, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations. In addition, in the past the Chinese government has implemented certain measures, including interest rate adjustments, to control the pace of economic growth. These measures may cause decreased economic activities in China, which may adversely affect our business and operating results.

Uncertainties in the interpretation and enforcement of PRC laws and regulations and changes in policies, rules, and regulations in China, which may be quick with little advance notice, could limit the legal protection available to you and us.

Our PRC subsidiaries are subject to various PRC laws and regulations generally applicable to companies in China. Since these laws and regulations are relatively new and the PRC legal system continues to rapidly evolve, however, the interpretations of many laws, regulations, and rules are not always uniform and enforcement of these laws, regulations, and rules involve uncertainties.

From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights. Since PRC administrative and court authorities have significant discretion in interpreting and implementing statutory and contractual terms, however, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy in the PRC legal system than in more developed legal systems. Furthermore, the PRC legal system is based in part on government policies, internal rules, and regulations that may have retroactive effects and may change quickly with little advance notice. As a result, we may not be aware of our violation of these policies and rules until sometime after the violation. Such uncertainties, including uncertainties over the scope and effect of our contractual, property (including intellectual property), and procedural rights, and any failure to respond to changes in the regulatory environment in China could materially and adversely affect our business and impede our ability to continue our operations.

PRC regulation of parent/subsidiary loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the proceeds of offshore offerings to make loans or additional capital contributions to the PRC subsidiaries, which could materially and adversely affect their liquidity and their ability to fund and expand their business.

We are an offshore holding company conducting our operations in the U.S. and Hong Kong through offshore subsidiaries and in China through the PRC subsidiaries, to which we can make loans and make additional capital contributions. Most of these loans or contributions to our PRC subsidiaries are subject to PRC regulations and approvals or registration. For example, any loans to the PRC subsidiaries, which are treated as foreign-invested enterprises under PRC law, are subject to PRC regulations and foreign exchange loan registrations. Furthermore, loans made by us to the PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of SAFE, or filed with SAFE in its information system. Pursuant to relevant PRC regulations, we may provide loans to the PRC subsidiaries up to the larger amount of (i) the balance between the registered total investment amount and registered capital of these entities, or (ii) twice the amount of the net assets of these entities calculated in accordance with the Circular on Full-Coverage Macro-Prudent Management of Cross-Border Financing, or the "PBOC Circular 9." Moreover, any medium or long-term loan to be provided by us to the PRC subsidiaries, or other domestic PRC entities must also be filed and registered with the National Development and Reform Commission (the "NDRC"). We may also decide to finance the PRC subsidiaries by means of capital contributions. These capital contributions are subject to registration with the SAMR or its local branch, reporting of foreign investment information with the Ministry of Commerce of the PRC (the "MOFCOM"), or registration with other governmental authorities in China.

On March 30, 2015, SAFE issued the Notice of the State Administration of Foreign Exchange on Reforming the Administrative Approach Regarding the Settlement of the Foreign Exchange Capital of Foreign-invested Enterprises, or "SAFE Circular 19," which took effect and replaced previous regulations effective on June 1, 2015, and was amended on December 30, 2019. Pursuant to SAFE Circular 19, up to 100% of foreign currency capital of a foreign-invested enterprise may be converted into RMB capital according to the actual operation, and within the business scope, of the enterprise at its will. Although SAFE Circular 19 allows for the use of RMB converted from the foreign currency-denominated capital for equity investments in the PRC, the restrictions continue to apply as to foreign-invested enterprises' use of the converted RMB for purposes beyond their business scope, for entrusted loans or for inter-company RMB loans. On June 9, 2016, SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Foreign Exchange Settlement Management Policy of Capital Account, or "SAFE Circular 16," effective on June 9, 2016, which reiterates some rules set forth in SAFE Circular 19, but changes the prohibition against using RMB capital converted from foreign currency-denominated registered capital of a foreign-invested company to issue RMB entrusted loans to a prohibition against using such capital to issue loans to non-affiliated enterprises. SAFE Circular 19 and SAFE Circular 16 may significantly limit our ability to transfer any foreign currency we hold, including the net proceeds from our offshore offerings, to the PRC subsidiaries, which may adversely affect our liquidity and our ability to fund and expand our business in China. On October 23, 2019, SAFE issued the Notice of the State Administration of Foreign Exchange on Further Facilitating Cross-border Trade and Investment, or "SAFE Circular 28," which, among other things, expanded the use of foreign exchange capital to domestic equity investment area. Non-investment foreign-funded enterprises are allowed to lawfully make domestic equity investments by using their capital on the premise without violation to prevailing Special Administrative Measures for Access of Foreign Investments (Edition 2021), or the "Negative List," and the authenticity and compliance with the regulations of domestic investment projects. However, since SAFE Circular 28 is newly promulgated, it is unclear how SAFE and competent banks will carry it out in practice.

In light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies, including SAFE Circular 19, SAFE Circular 16, and other relevant rules and regulations, we cannot assure you that we will be able to complete the necessary registrations or obtain the necessary government approvals on a timely basis, if at all, with respect to future loans or capital contributions to the PRC subsidiaries. As a result, uncertainties exist as to our ability to provide prompt financial support to the PRC subsidiaries when needed. If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we received or expect to receive from our offshore offerings and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect the PRC subsidiaries' business, including their liquidity and their ability to fund and expand their business.

You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against us or our PRC subsidiaries based on foreign laws. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China.

Our subsidiaries conduct a substantial amount of operations (including the manufacturing of most of our products) in China and most of our assets and equipment are located in China. As a result, it may be difficult for you to effect service of process upon us or our PRC subsidiaries inside China. In addition, there is uncertainty as to whether the PRC would recognize or enforce judgments of U.S. courts against us or our PRC subsidiaries predicated upon the civil liability provisions of U.S. securities laws or those of any U.S. state.

The recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. China does not have any treaties or other forms of written arrangement with the U.S. that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment violates the basic principles of PRC laws or national sovereignty, security, or public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the United States.

It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. For example, in China, there are significant legal and other obstacles to obtaining information needed for stockholder investigations or litigation outside China or otherwise with respect to foreign entities. Although the authorities in China may establish a regulatory cooperation mechanism with its counterparts of another country or region to monitor and oversee cross-border securities activities, such regulatory cooperation with the securities regulatory authorities in the U.S. may not be efficient in the absence of a practical cooperation mechanism. Furthermore, according to Article 177 of the PRC Securities Law, or "Article 177," which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigations or evidence collection activities within the territory of the PRC. Article 177 further provides that Chinese entities and individuals are not allowed to provide documents or materials related to a company's securities and business activities to foreign agencies without prior consent from the securities regulatory authority of the PRC State Council and the competent departments of the PRC State Council. While detailed interpretation of or implementing rules under Article 177 have yet to be promulgated, the inability of an overseas securities regulator to directly conduct an investigation or evidence collection activities within China may further increase the difficulties faced by you in protecting your interests. See "Enforceability of Civil Liabilities."

The PRC government exerts substantial influence over the manner in which our PRC subsidiaries conduct their business activities. The PRC government may also intervene or influence our operations at any time and may exert more control over foreign investment in China-based issuers, which could result in a material change in our PRC subsidiaries' operations.

The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, environmental regulations, land use rights, property and other matters. The central or local governments of these jurisdictions may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations. Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof, and could require us to divest ourselves of any interest we then hold in our operations in China.

For example, the Chinese cybersecurity regulator announced on July 2, 2021, that it began investigating Didi Global Inc. (NYSE: DIDI) and two days later ordered that the company's smartphone application be removed from smartphone application stores. Similarly, our business segments may be subject to various government and regulatory interference in the regions in which we operate. We could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply.

Although we believe that we are in compliance with existing and newly adopted laws and regulations of the PRC, we cannot assure you that PRC regulatory agencies would take the same view as we do, and there is no assurance that we can fully or timely comply with such laws. In the event that we are subject to any mandatory review and other specific actions required by any Chinese regulator, we face uncertainty as to whether any clearance or other required actions can be timely completed, or at all. Given such uncertainty, we may be further required to suspend our relevant business, shut down our website, or face other penalties, which could materially and adversely affect our business, financial condition, and results of operations. Any future action by the PRC government could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.

If the Chinese government chooses to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, such action could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless.

We face risks arising from China including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance notice. The Chinese government may intervene or influence the operations of our subsidiaries in PRC and Hong Kong at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations of our subsidiaries in PRC and Hong Kong and/or the value of our common stock.

The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China through our subsidiaries in PRC and Hong Kong may be harmed by changes in laws and regulations in China, including those relating to securities regulation, data protection, cybersecurity and mergers and acquisitions and other matters. The PRC central or local governments may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our and our subsidiaries' compliance with such regulations or interpretations.

Government actions in the future could significantly affect economic conditions in China or particular regions thereof, and could require our subsidiaries in PRC and Hong Kong to materially change their operating activities or divest ourselves of any interests we hold in Chinese assets. Our subsidiaries in PRC and Hong Kong may be subject to various government and regulatory interference. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. Such subsidiaries' operations could be adversely affected, directly or indirectly, by changes to existing laws or implementation of future laws and regulations relating to their business or industry.

As of the date of this prospectus, we and our subsidiaries in the Mainland China and Hong Kong (1) are not required to obtain permissions from any PRC authorities to operate or issue our common stock to foreign investors, (2) are not subject to permission requirements from the CSRC, CAC or any other entity that is required to approve their operations in the Mainland China and Hong Kong, and (3) have not received or were denied such permissions by any PRC authorities. Nevertheless, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the "Opinions on Severely Cracking Down on Illegal Securities Activities According to Law," which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. The regulatory agencies like CSRC or CAC may impose fines and penalties on our operations in the Mainland China or Hong Kong, limit our ability to pay dividends outside of the Mainland China or Hong Kong, limit our operations in the Mainland China or Hong Kong, delay or restrict the repatriation of the proceeds from this offering into the Mainland China or Hong Kong or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities. The CSRC, the CAC, or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of our common stock. Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for this offering, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities.

Any actions by the Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or complete hinder our ability to offer or continue to offer our securities and cause the value of such securities to significantly decline or be worthless.

Recent greater oversight by the Cyberspace Administration of China (the "CAC") over data security could adversely impact our business.

On December 28, 2021, the CAC, together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review Measures, which took effect on February 15, 2022. The Cybersecurity Review Measures provide that, in addition to critical information infrastructure operators ("CIIOs") that intend to purchase Internet products and services, data processing operators engaging in data processing activities that affect or may affect national security must be subject to cybersecurity review by the Cybersecurity Review Office of the PRC. According to the Cybersecurity Review Measures, a cybersecurity review assesses potential national security risks that may be brought about by any procurement, data processing, or overseas listing. The Cybersecurity Review Measures further require that CIIOs and data processing operators that possess personal data of at least one million users must apply for a review by the Cybersecurity Review Office of the PRC before conducting listings in foreign countries.

On November 14, 2021, the CAC published the Security Administration Draft, which provides that data processing operators engaging in data processing activities that affect or may affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC. According to the Security Administration Draft, data processing operators who possess personal data of at least one million users or collect data that affects or may affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC. The deadline for public comments on the Security Administration Draft was December 13, 2021.

As of the date of this Annual Report, we have not received any notice from any authorities identifying our PRC subsidiaries as CIIOs or requiring us to go through cybersecurity review or network data security review by the CAC. We believe that the operations of our PRC subsidiaries and our listing will not be affected and that we will not be subject to cybersecurity review and network data security review by the CAC, given that: (i) because our companies mainly manufacture and sell vinyl flooring products, our PRC subsidiaries are unlikely to be classified as CIIOs by the PRC regulatory agencies; (ii) our PRC subsidiaries make all of their sales through distributors and do not collect or have access to personal data of the end customers and as a result, we possess personal data of fewer than one million individual clients in our business operations as of the date of this Annual Report; and (iii) since our PRC subsidiaries are in the vinyl flooring manufacture and wholesale industry, data processed in our business is unlikely to have a bearing on national security and therefore is unlikely to be classified as core or important data by the authorities. There remains uncertainty, however, as to how the Cybersecurity Review Measures and the Security Administration Draft will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures and the Security Administration Draft. If any such new laws, regulations, rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us. We cannot guarantee, however, that we will not be subject to cybersecurity review and network data security review in the future. During such reviews, we may be required to suspend our operations or experience other disruptions to our operations. Cybersecurity review and network data security review could also result in negative publicity with respect to our Company and a diversion of our managerial and financial resources, which could materially and adversely affect our business, financial conditions, and results of operations.

If we and/or our subsidiaries were to be required to obtain any permission or approval from or complete any filing procedure with the China Securities Regulatory Commission (the "CSRC"), the CAC, or other PRC governmental authorities in connection with future follow-on offerings under PRC laws, we and/or our subsidiaries may be fined or subject to other sanctions, and our subsidiaries' business and our reputation, financial condition, and results of operations may be materially and adversely affected.

On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (the "Trial Measures") and five supporting guidelines, which took effect on March 31, 2023. The Trial Measures requires companies in mainland China that seek to offer and list securities overseas, both directly and indirectly, to fulfill the filing procedures with the CSRC. According to the Trial Measures, the determination of the "indirect overseas offering and listing by companies in mainland China" shall comply with the principle of "substance over form" and particularly, an issuer will be required to go through the filing procedures under the Trial Measures if the following criteria are met at the same time: (i) 50% or more of the issuer's operating revenue, total profits, total assets or net assets as documented in its audited consolidated financial statements for the most recent accounting year are accounted for by companies in mainland China; and (ii) the main parts of the issuer's business activities are conducted in mainland China, or its main places of business are located in mainland China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in mainland China. On the same day, the CSRC held a press conference for the release of the Trial Measures and issued the Notice on Administration for the Filing of Overseas Offering and Listing by Domestic Companies, which clarifies that (i) on or prior to the effective date of the Trial Measures, companies in mainland China that have already submitted valid applications for overseas offering and listing but have not obtained approval from overseas regulatory authorities or stock exchanges shall complete the filing before the completion of their overseas offering and listing; and (ii) companies in mainland China which, prior to the effective date of the Trial Measures, have already obtained the approval from overseas regulatory authorities or stock exchanges and are not required to re-perform the regulatory procedures with the relevant overseas regulatory authority or stock exchange, but have not completed the indirect overseas listing, shall complete the overseas offering and listing before September 30, 2023, and failure to complete the overseas listing within such six-month period will subject such companies to the filing requirements with the CSRC.

Based on the assessment conducted by the management, we are not subject to the Trial Measures, because our main business are not conducted within China, our main premises are not located in China, and the majority of our senior management personnel are not Chinese citizens or reside in China on a regular basis.. However, as the Trial Measures and the supporting guidelines are newly published, there exists uncertainty with respect to the implementation and interpretation of the principle of "substance over form". As of the date of this Annual Report, there was no material change to these regulations and policies since our IPO. If our future follow-on offerings were later deemed as "indirect overseas offering and listing by companies in mainland China" under the Trial Measures, we may need to complete the filing procedures for our offering. If we are subject to the filing requirements, we cannot assure you that we will be able to complete such filings in a timely manner or even at all.

Since these statements and regulatory actions are new, it is also highly uncertain in the interpretation and the enforcement of the above cybersecurity and overseas listing laws and regulation. There is no assurance that the relevant PRC governmental authorities would reach the same conclusion as us. If we and/or our subsidiaries are required to obtain approval or fillings from any governmental authorities, including the CSRC, in connection with the listing or continued listing of our securities on a stock exchange outside of Hong Kong or mainland China, it is uncertain how long it will take for us and/or our subsidiaries to obtain such approval or complete such filing, and, even if we and our subsidiaries obtain such approval or complete such filing, the approval or filing could be rescinded. Any failure to obtain or a delay in obtaining the necessary permissions from or complete the necessary filing procedure with the PRC governmental authorities to conduct offerings or list outside of Hong Kong or mainland China may subject us and/or our subsidiaries to sanctions imposed by the PRC governmental authorities, which could include fines and penalties, suspension of business, proceedings against us and/or our subsidiaries, and even fines on the controlling shareholder and other responsible persons, and our subsidiaries' ability to conduct our business, our ability to invest into mainland China as foreign investments or accept foreign investments, or our ability to list on a U.S. or other overseas exchange may be restricted, and our subsidiaries' business, and our reputation, financial condition, and results of operations may be materially and adversely affected. Additionally, any failure to obtain or a delay in obtaining the necessary permissions from or completing the necessary filing procedures with the PRC governmental authorities to conduct offerings outside of Hong Kong or mainland China, which could cause the value of our shares of common stock to significantly decline or be worthless.

PRC regulations relating to offshore investment activities by PRC residents may subject our PRC resident beneficial owners or our PRC subsidiaries to liability or penalties, limit our ability to inject capital into our PRC subsidiary, limit our PRC subsidiary's ability to increase its registered capital or distribute profits to us, or may otherwise adversely affect us.

In July 2014, SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents' Offshore Investment and Financing and Roundtrip Investment Through Special Purpose Vehicles, or SAFE Circular 37, to replace the Notice on Relevant Issues Concerning Foreign Exchange Administration for Domestic Residents' Financing and Roundtrip Investment Through Offshore Special Purpose Vehicles, or SAFE Circular 75, which ceased to be effective upon the promulgation of SAFE Circular 37. SAFE Circular 37 requires PRC residents (including PRC individuals and PRC corporate entities) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities. SAFE Circular 37 is applicable to our stockholders who are PRC residents and may be applicable to any offshore acquisitions that we make in the future.

Under SAFE Circular 37, PRC residents who make, or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore special purpose vehicles, or SPVs, will be required to register such investments with SAFE or its local branches. In addition, any PRC resident who is a direct or indirect stockholder of an SPV is required to update its filed registration with the local branch of SAFE with respect to that SPV, to reflect any material change. Moreover, any subsidiary of such SPV in China is required to urge the PRC resident stockholders to update their registration with the local branch of SAFE. If any PRC stockholder of such SPV fails to make the required registration or to update the previously filed registration, the subsidiary of such SPV in China may be prohibited from distributing its profits or the proceeds from any capital reduction, share transfer or liquidation to the SPV, and the SPV may also be prohibited from making additional capital contributions into its subsidiary in China. On February 13, 2015, SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June 1, 2015. Under SAFE Notice 13, applications for foreign exchange registration of inbound foreign direct investments and outbound overseas direct investments, including those required under SAFE Circular 37, will be filed with qualified banks instead of SAFE. The qualified banks will directly examine the applications and accept registrations under the supervision of SAFE.

We are aware that some of our stockholders are subject to SAFE regulations, and expect all of these stockholders will have completed all necessary registrations with the local SAFE branch or qualified banks as required by SAFE Circular 37. We cannot assure you, however, that all of these stockholders may continue to make required filings or updates in a timely manner, or at all. We can provide no assurance that we are, or will in the future continue to be informed of the identities of all PRC residents holding a direct or indirect interest in our common stock. Any failure or inability by such stockholders to comply with SAFE regulations may subject us to fines or legal sanctions, such as restrictions on our cross-border investment activities or our PRC subsidiaries' ability to distribute dividends to, or obtain foreign exchange-denominated loans from, our company or prevent us from making distributions or paying dividends. As a result, our business operations and our ability to make distributions to you could be materially and adversely affected.

Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment.

The value of the Chinese Yuan (RMB) against the U.S. dollar and other major currencies continues to experience fluctuations influenced by political and economic conditions in China, as well as the country's foreign exchange policies. Over the past decade, the RMB has shifted from a fixed exchange rate to a managed floating exchange rate regime, with significant periods of volatility. For example, in 2023, the RMB faced depreciation pressures due to slower-than-expected economic recovery in China and a strengthening U.S. dollar, prompting intervention from the People's Bank of China (PBOC) to stabilize the currency. The exchange rate fluctuated within a range of approximately 1 USD = 7.0105 RMB to 1 USD = 7.2968 RMB during this period.

The depreciation trend observed in 2023 was partly attributed to ongoing geopolitical tensions, persistent trade uncertainties, and capital outflows from China. In 2024, the RMB's value has shown further volatility, driven by evolving trade policies, shifts in global interest rates, and China's efforts to support export competitiveness. The PRC government has demonstrated its willingness to adjust foreign exchange policies to address external challenges, but such measures may exacerbate risks like inflation, increased import costs, and further outflows of foreign capital.

Given the interconnected nature of global markets, it is difficult to predict how the RMB will perform against the U.S. dollar in the near future. A weaker RMB reduces the value of revenues earned in China when converted to U.S. dollars, while a stronger RMB increases operational costs within China. As we operate in both China and the United States, these exchange rate fluctuations can significantly affect our financial results, operational costs, and strategic planning. Businesses must remain adaptable to changes in the foreign exchange market and prepare for potential impacts on profitability and liquidity as exchange rate volatility persists.

Under the EIT Law, we may be classified as a PRC "resident enterprise" for PRC enterprise income tax purposes. Such classification would likely result in unfavorable tax consequences to us and our non-PRC stockholders and have a material adverse effect on our results of operations and the value of your investment.

Under the EIT Law that became effective in January 2008, an enterprise established outside the PRC with "de facto management bodies" within the PRC is considered a "resident enterprise" for PRC enterprise income tax purposes and is generally subject to a uniform 25% enterprise income tax rate on its worldwide income. Under the implementation rules of the EIT Law, a "de facto management body" is defined as a body that has material and overall management and control over the manufacturing and business operations, personnel and human resources, finances, and properties of an enterprise. In addition, a circular, known as "SAT Circular 82," issued in April 2009 by the State Administration of Taxation, or the "SAT," and partially amended by People's Bank of China Circular 9 promulgated in January 2014, specifies that certain offshore incorporated enterprises controlled by PRC enterprises or PRC enterprise groups will be classified as PRC resident enterprises if the following are located or resident in the PRC: senior management personnel and departments that are responsible for daily production, operation and management; financial and personnel decision making bodies; key properties, accounting books, company seal, and minutes of board meetings and stockholders' meetings; and half or more of the senior management or directors having voting rights. Further to SAT Circular 82, SAT issued a bulletin, known as "SAT Bulletin 45," which took effect in September 2011 and was amended on June 1, 2015 and October 1, 2016 to provide more guidance on the implementation of SAT Circular 82 and clarify the reporting and filing obligations of Chinese controlled offshore incorporated resident enterprises, to provide more guidance on the implementation of SAT Circular 82 and clarify the reporting and filing obligations of such "Chinese-controlled offshore incorporated resident enterprises." SAT Bulletin 45 provides procedures and administrative details for the determination of resident status and administration on post-determination matters. Although both SAT Circular 82 and SAT Bulletin 45 only apply to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not those controlled by PRC individuals or foreign individuals, the determining criteria set forth in SAT Circular 82 and SAT Bulletin 45 may reflect SAT's general position on how the "de facto management body" test should be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises, PRC enterprise groups, or by PRC or foreign individuals.

If the PRC tax authorities determine that the Company's actual management operations is within the territory of China, we may be deemed to be a PRC resident enterprise for PRC enterprise income tax purposes and a number of unfavorable PRC tax consequences could follow. First, we would be subject to the uniform 25% enterprise income tax on our world-wide income, which could materially reduce our net income. In addition, we will also be subject to PRC enterprise income tax reporting obligations. Finally, dividends payable by us to our investors and gains on the sale of our shares may become subject to PRC withholding tax, at a rate of 10% in the case of non-PRC enterprises or 20% in the case of non-PRC individuals (in each case, subject to the provisions of any applicable tax treaty), if such gains are deemed to be from PRC sources. It is unclear whether non-PRC stockholders of our Company would be able to claim the benefits of any tax treaties between their country of tax residence and the PRC in the event that we are treated as a PRC resident enterprise. Any such tax may reduce the returns on your investment in our shares. Although up to the date of this Annual Report, the Company has not been notified or informed by the PRC tax authorities that it has been deemed to be a PRC resident enterprise for the purpose of the EIT Law, we cannot assure you that it will not be deemed to be a PRC resident enterprise in the future.

We face uncertainty with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies.

In February 2015, SAT issued a

Public Notice Regarding Certain Corporate Income Tax Matters on Indirect Transfer of Properties by Non-Tax Resident Enterprises

, or "SAT Circular 7." SAT Circular 7 provides comprehensive guidelines relating to indirect transfers of PRC taxable assets (including equity interests and real properties of a PRC resident enterprise) by a non-resident enterprise. In addition, in October 2017, SAT issued an

Announcement on Issues Relating to Withholding at Source of Income Tax of Non-resident Enterprises

, or "SAT Circular 37," effective in December 2017, which, among others, amended certain provisions in SAT Circular 7 and further clarify the tax payable declaration obligation by non-resident enterprise. Indirect transfer of equity interest and/or real properties in a PRC resident enterprise by their non-PRC holding companies are subject to SAT Circular 7 and SAT Circular 37. SAT Circular 7 provides clear criteria for an assessment of reasonable commercial purposes and has introduced safe harbors for internal group restructurings and the purchase and sale of equity through a public securities market. As stipulated in SAT Circular 7, indirect transfers of PRC taxable assets are considered as reasonable commercial purposes if the shareholding structure of both transaction parties falls within the following situations: i) the transferor directly or indirectly owns 80% or above equity interest of the transferee, or vice versa; ii) the transferor and the transferee are both 80% or above directly or indirectly owned by the same party; iii) the percentages in bullet points i) and ii) shall be 100% if over 50% the share value of a foreign enterprise is directly or indirectly derived from PRC real properties. Furthermore, SAT Circular 7 also brings challenges to both foreign transferor and transferee (or other person who is obligated to pay for the transfer) of taxable assets. Where a non-resident enterprise transfers PRC taxable assets indirectly by disposing of the equity interests of an overseas holding company, which is an indirect transfer, the non-resident enterprise as either transferor or transferee, or the PRC entity that directly owns the taxable assets, may report such indirect transfer to the relevant tax authority and the PRC tax authority may disregard the existence of the overseas holding company if it lacks a reasonable commercial purpose and was established for the purpose of reducing, avoiding, or deferring PRC tax. As a result, gains derived from such indirect transfer may be subject to PRC enterprise income tax, and the transferee or other person who is obligated to pay for the transfer is obligated to withhold the applicable taxes, currently at a rate of 10% for the transfer of equity interests in a PRC resident enterprise.

According to SAT Circular 37, where the non-resident enterprise fails to declare the tax payable pursuant to Article 39 of the EIT Law, the tax authority may order it to pay the tax due within the required time limits, and the non-resident enterprise shall declare and pay the tax payable within such time limits specified by the tax authority. If the non-resident enterprise, however, voluntarily declares and pays the tax payable before the tax authority orders it to do so within the required time limits, it shall be deemed that such enterprise has paid the tax in time.

We face uncertainties as to the reporting and assessment of reasonable commercial purposes and future transactions where PRC taxable assets are involved, such as offshore restructuring, selling shares of our offshore subsidiaries, and investments. In the event of being assessed as having no reasonable commercial purposes in an indirect transfer transaction, we may be subject to filing obligations or taxed if we are a transferor in such transactions, and may be subject to withholding obligations (to be specific, a 10% withholding tax for the transfer of equity interests) if we are a transferee in such transactions, under SAT Circular 7 and SAT Circular 37. Our PRC subsidiary may be requested to assist in the filing under the SAT circulars for share transfer by investors who are non-PRC resident enterprises. As a result, we may be required to expend valuable resources to comply with the SAT circulars or to request the relevant transferors from whom we purchase taxable assets to comply with these circulars, or to establish that we should not be taxed under these circulars, which may have a material adverse effect on our financial condition and results of operations.

The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China.

The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors

, or the "M&A Rules," and recently adopted regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex. For example, the M&A Rules require that the Ministry of Commerce of the PRC ("MOFCOM") be notified in advance of any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise, if (i) any important industry is concerned, (ii) such transaction involves factors that have or may have impact on the national economic security, or (iii) such transaction will lead to a change in control of a domestic enterprise which holds a famous trademark or PRC time-honored brand. MOFCOM must also be notified in advance of mergers or acquisitions that allow one market player to take control of or to exert a decisive impact on another market player when the threshold under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings, or the "Prior Notification Rules," issued by the State Council in August 2008 are triggered. In addition, the security review rules issued by MOFCOM that became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise "national defense and security" concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise "national security" concerns are subject to strict review by MOFCOM. The rules further prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement. In the future, we may grow our business by acquiring complementary businesses. Complying with the requirements of the above-mentioned regulations and other relevant rules to complete such transactions could be time consuming, and any required approval processes, including obtaining approval from MOFCOM or its local counterparts may delay or inhibit our ability to complete such transactions. It is clear that our business would not be deemed to be in an industry that raises "national defense and security" or "national security" concerns. MOFCOM or other government agencies, however, may publish explanations in the future determining that our business is in an industry subject to the security review, in which case our future acquisitions in the PRC, including those by way of entering into contractual control arrangements with target entities, may be closely scrutinized or prohibited. Our ability to expand our business or maintain or expand our market share through future acquisitions would as such be materially and adversely affected.

Risks Related to Our Business and Industry

Recent changes in U.S. trade policies are likely to significantly reduce the volume of imported goods into the United States from China, which is likely to materially reduce our sales in one of our primary markets.

On April 2, 2025, President Trump signed an executive order imposing reciprocal tariffs on most of the United States' trading partners under the International Emergency Economic Powers Act of 1977, including a baseline tariff of 10% and, in the case of certain trading partners with large trade surpluses, higher rates that became effective on April 9, 2025. As a result, beginning April 9, 2025, the applicable reciprocal tariff rate on imports from China is 34%, plus the existing 25% tariff and 6% import tax, which total 65%. President Donald Trump's order also imposes 49%, 46% and 32% reciprocal tariffs on imports from Cambodia,Vietnam and Indonesia, respectively, from which we import products for sale in the United States from time to time. Previously U.S. did not impose tariffs on imports from these countries, besides the 6% import tax.

These changes in U.S. trade policy are likely to trigger retaliatory actions by affected countries, resulting in "trade wars," in increased costs for goods imported into the United States, which may reduce customer demand for these products if the parties having to pay those tariffs increase their prices, or in trading partners limiting their trade with the United States. If these consequences are realized, the volume of goods that we are likely to sell in the United States may be materially reduced, potentially for the duration of such "trade wars." Such a reduction may materially and adversely affect our sales and our business. While it is too early as of the filing of this Annual Report on Form 10-K to predict how the recently enacted reciprocal tariffs will impact our business, the imposition of tariffs on products we import from China could require us to increase prices to our customers or, if unable to do so, result in lowering our gross margin on products sold, with a resulting material adverse effect on our business and results of operations.

We may be subject to tax and related penalties owed to the PRC government.

We may be subject to taxes and related penalties owed to the PRC government. This risk arises from our collection of proceeds from the sales of our products in the normal course of business, by the Company, or via its subsidiaries located in the United States or Hong Kong, and whereby the remittance made to the Company's PRC subsidiaries may not be in the exact amounts reported to the PRC customs authority in connection with the application for export credit refunds which have already been refunded to the Company by the PRC government on the assumption that Company will fully remit the amounts indicated in its application. We are unable to estimate the amount due to the PRC government or determine if it is probable that the PRC government will make efforts to recover the tax credit refunds already paid to the Company and if there would be any related penalties. However, if the PRC government were to take actions to recover such export tax credit refunds, we may be required to pay additional tax and related penalties and our business and results of operations may be materially adversely affected.

We compete with numerous flooring manufacturers in highly competitive markets. Competition can affect customer preferences, reduce demand for our products, negatively affect our product sales mix, leverage greater financial resources, or cause us to lower prices, any or all of which could adversely affect our financial condition, liquidity or results of operation

.

Our markets are highly competitive. We compete for sales of flooring products with many manufacturers and large-sized wholesale distributors of vinyl flooring as well as with manufacturers who also produce other types of flooring products. Some of our competitors have greater financial resources than we do. Competition can reduce demand for our products, negatively affect our product sales mix or cause us to lower prices. Our customers consider our products' performance, content and styling, as well as customer service and price when deciding whether to purchase our products. Shifting consumer preference in our highly competitive markets whether for performance, product content, styling preferences, or our inability to develop and offer new competitive performance features, could have an adverse effect on our sales. Regulatory action or new product standards could also steer consumers away from our products.

In addition, excess industry capacity for certain products in several geographic markets could lead to industry consolidation and/or increased price competition. We are also subject to potential increased price competition from overseas competitors, which may have lower cost structures.

Our failure to compete effectively through the management of our product portfolio, by meeting consumer preferences and gaining market leadership could have a material adverse effect on our financial condition, liquidity or results of operations.

If we are unable to anticipate consumer preferences and successfully develop and introduce new, innovative and updated products, we may not be able to maintain or increase our net revenues and profitability.

Our success depends on our ability to identify and originate product trends as well as to anticipate and react to changing consumer demands in a timely manner. All of our products are subject to changing consumer preferences that cannot be predicted with certainty. New products may not receive consumer acceptance as consumer preferences could shift rapidly to different types of flooring products or away from these types of products altogether, and our future success depends in part on our ability to anticipate and respond to these changes. Failure to anticipate and respond in a timely manner to changing consumer preferences could lead to, among other things, lower sales and excess inventory levels, which could have a material adverse effect on our financial condition.

If the availability of direct materials (raw materials, packaging, sourced products, energy) decreases, or these costs increase, and we are unable to either offset or pass along increased costs to our customers, our financial condition, liquidity or results of operations have been and could continue to be adversely affected.

The availability and cost of direct materials, including raw materials, packaging materials, energy and sourced products are critical to our operations. For example, we use substantial quantities of petrochemical-based raw materials in our manufacturing operations. The cost of some of these items has been volatile in recent years and availability has been limited at times. Ringold sources some materials from a limited number of suppliers, which, among other things, increases the risk of unavailability. In the fiscal years ended December 31, 2025 and 2024, 10.65% and 8.7% of the cost of revenue were for purchasing raw materials sourced from within China; 82.8% and 81.2% of the cost of revenue were for purchasing other supplies from suppliers in China that processed raw materials from out of China; and 6.55% and 10.1% of the cost of revenue were for purchasing raw materials sourced directly from Germany, the U.S., Japan, South Korea and other countries, respectively. The prices of raw materials sourced from outside China may be affected by international trade costs such as tariffs, transportation and foreign exchange rates, or international pandemics including but not limited to the COVID-19 pandemic, as well as geopolitical issues and the war in Ukraine. As part of our ongoing supply chain diversification strategy, we have expanded our sourcing to include suppliers in Vietnam, Thailand, Malaysia and Indonesia. This geographic diversification reduces our concentration risk on Chinese suppliers and mitigates the impact of tariffs on our cost structure. Looking ahead, we believe 3D printing technology will fundamentally reduce the industry's reliance on raw material imports from Southeast Asia. By leveraging advanced manufacturing technology domestically and partnering with local suppliers in the United States, we aim to build a supply chain that is both shorter and more responsive to market demand.

This dependency and any limited availability could cause us to reformulate products or limit our production. Decreased access to direct materials and energy or significant increased cost to purchase these items, as well as increased transportation and trade costs, delays due to government-mandated initiatives in response to COVID-19 and any corresponding inability to pass along such costs through price increases or meet demand requirements, as applicable, have had and could continue to have a material adverse effect on our financial condition, liquidity or results of operations.

Disruption to suppliers of raw materials could have a material adverse effect on us.

Ink, coating, resin, sound padding, and glue are the principal raw materials used in our floorcovering products. We consider major suppliers to be those that accounted for more than 10% of the cost of revenues. During the fiscal year ended December 31, 2025, we had two suppliers who collectively accounted for 44% of the total cost. During the fiscal year ended December 31, 2024, we had three suppliers who collectively accounted for 39% of the total cost. An interruption in the supply of these or other raw materials or sourced products used in our business or in the supply of suitable substitute materials or products would disrupt our operations, which could have a material adverse effect on our business. We continually evaluate sources of our principal raw materials for competitive costs, performance characteristics, brand value, and diversity of supply.

We have significant levels of sales in certain channels of distribution and reduction in sales through these channels could adversely affect our business.

A significant amount of our sales is generated through a few key customers, including large-sized wholesale distributors. We consider major customers to be those that accounted for more than 10% of sales revenues. For the fiscal year ended December 31, 2025, two major customers accounted for 69.7% of our total revenues. For the fiscal year ended December 31, 2024, two major customers accounted for a total of 77.0% of our total revenues. A change in strategy by these customers to emphasize products at a lower price point than we currently offer will limit future sales opportunities with these customers. The reductions of sales through this channel could adversely affect our business if we are not able to replace the volume through other sales outlets and product offerings.

Our business is sensitive to changes in general economic conditions. Downturns in commercial and residential construction, remodeling and refurbishing activities could adversely affect our financial condition, liquidity or results of operations.

Our business has greater sales opportunities when construction is strong and, conversely, has fewer opportunities when such activity declines. The cyclical nature of commercial and residential construction and remodeling and refurbishing activities tends to be influenced by prevailing economic conditions, including the rate of growth in GDP, prevailing interest rates, government spending patterns, business, investor and consumer confidence and other factors beyond our control. Prolonged downturns in construction activity could have a material adverse effect on our financial condition, liquidity or results of operations.

We are subject to various environmental, safety and health regulations that may subject us to costs, liabilities and other obligations, which could have a material adverse effect on our business, results of operations and financial condition.

The production in our PRC facility is subject to various environmental, safety and health and other regulations that may subject us to costs, liabilities and other obligations which could have a material adverse effect on our business. The applicable requirements under these laws are subject to amendment, to the imposition of new or additional requirements and to changing interpretations of agencies or courts. We could incur material expenditures to comply with new or existing regulations, including fines and penalties and increased costs of our operations. Additionally, future laws, ordinances, regulations or regulatory guidelines could give rise to additional compliance or remediation costs that could have a material adverse effect on our business, results of operations and financial condition.

Various PRC environmental laws govern the use of our facilities. These laws govern such matters as:

  <u></u> <u>Discharge to air and water;</u>

  <u></u> <u>Handling and disposal of solid and hazardous substances and waste, and</u>

  <u></u> <u>Remediation of contamination from releases of hazardous substances in our facilities and off-site disposal locations.</u>

The production in our PRC facility is also governed by PRC laws relating to workplace safety and worker health, which, among other things, establish noise standards and regulate the use of hazardous materials and chemicals in the workplace. We have taken, and will continue to take, steps to comply with these laws. If we fail to comply with present or future environmental or safety regulations, we could be subject to future liabilities. However, we cannot ensure that complying with these environmental or health and safety laws and requirements will not adversely affect our business, results of operations and financial condition.

We may be exposed to litigation, claims and other legal proceedings in the ordinary course of business relating to our products or business, which could have a material adverse effect on our business, results of operations and financial condition.

In the ordinary course of business, we may be subject to a variety of work-related and product-related claims, lawsuits and legal proceedings, including those relating to product liability, product warranty, product recall, personal injury, and other matters that are inherently subject to many uncertainties regarding the possibility of a loss to our business. Such matters could have a material adverse effect on our business, results of operations and financial condition if we are unable to successfully defend against or resolve these matters or if our insurance coverage is insufficient to satisfy any judgments against us or settlements relating to these matters. Although we have product liability insurance, the policies may not provide coverage for certain claims against us or may not be sufficient to cover all possible liabilities. Further, we may not be able to maintain insurance at commercially acceptable premium levels. Additionally, adverse publicity arising from claims made against us, even if the claims are not successful, could adversely affect our reputation or the reputation and sales of our products.

Our business operations could suffer significant losses from natural disasters, catastrophes, fires, or other unexpected events.

Our business involves substantial investments in manufacturing facilities in our facility in China. The facility could be materially damaged by natural disasters, such as floods, tornadoes, hurricanes and earthquakes, or by fire or other unexpected events such as adverse weather conditions or other disruptions to our facilities, supply chain or our customer's facilities. We could incur uninsured losses and liabilities arising from such events, including damage to our reputation, and/or suffer material losses in operational capacity, which could have a material adverse impact on our business, financial condition and results of operations.

We may need to defend ourselves against patent or trademark infringement, or other intellectual property claims, which may be time-consuming and cause us to incur substantial costs.

Companies, organizations or individuals, including our competitors, may own or obtain patents, trademarks or other proprietary rights that would prevent or limit our ability to make, use, develop or sell our vehicles or components, which could make it more difficult for us to operate our business. We may receive inquiries from patent or trademark owners inquiring whether we infringe on their proprietary rights. Companies owning patents or other intellectual property rights relating to battery packs, electric motors, fuel cells or electronic power management systems may allege infringement of such rights. In response to a determination that we have infringed upon a third party's intellectual property rights, we may be required to do one or more of the following:

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| | |
|:---|:---|
|  | cease development, sales, or use of vehicles that incorporate the asserted intellectual property; |
|  | pay substantial damages; |
|  | obtain a license from the owner of the asserted intellectual property right, which license may not be available on reasonable terms or at all; |
|  | or redesign one or more aspects or systems of our trucks |

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A successful claim of infringement against us could materially adversely affect our business, prospects, operating results and financial condition. Any litigation or claims, whether valid or invalid, could result in substantial costs and diversion of resources.

Our business may be adversely affected if we are unable to protect our intellectual property rights from unauthorized use by third parties.

Failure to adequately protect our intellectual property rights could result in our competitors offering similar products, potentially resulting in the loss of some of our competitive advantage, and a decrease in our revenue which would adversely affect our business, prospects, financial condition and operating results. Our success depends, at least in part, on our ability to protect our core technology and intellectual property. To accomplish this, we will rely on a combination of patents, trade secrets (including know-how), employee and third-party nondisclosure agreements, copyright, trademarks, intellectual property licenses and other contractual rights to establish and protect our rights in our technology. We cannot guarantee that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary information, including our technology and processes. In connection with our collaboration, partnership and license agreements, our rights to use licensed or jointly owned technology and intellectual property under such agreements may be subject to the continuation of and compliance with the terms of those agreements. In some cases, we may not control the prosecution, maintenance or filing of licensed or jointly owned patent rights, or the enforcement of such patents against third parties.

The protection of our intellectual property rights will be important to our future business opportunities. However, the measures we take to protect our intellectual property from unauthorized use by others may not be effective for various reasons, including the following:

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| | |
|:---|:---|
|  | any patent applications we submit may not result in the issuance of patents; the scope of our issued patents may not be broad enough to protect our proprietary rights; our issued patents may be challenged and/or invalidated by our competitors; |
|  | the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make aggressive enforcement impracticable; |
|  | current and future competitors may circumvent our patents; |
|  | and our in-licensed patents may be invalidated, or the owners of these patents may breach our license arrangements. |

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Patent, trademark, and trade secret laws vary significantly throughout the world. Some foreign countries do not protect intellectual property rights to the same extent as do the laws of the United States. Further, policing the unauthorized use of our intellectual property in foreign jurisdictions may be difficult. Therefore, our intellectual property rights may not be as strong or as easily enforced outside of the United States.

Our patent applications may not be granted, which may have a material adverse effect on our ability to prevent others from commercially exploiting products similar to ours.

We cannot be certain that we are the first inventor of the subject matter to which we have filed a particular patent application, or if we are the first party to file such a patent application. If another party has filed a patent application for the same subject matter as we have, we may not be entitled to the protection sought by the patent application. Further, the scope of protection of issued patent claims is often difficult to determine. As a result, we cannot be certain that the patent applications that we file will result in the issuance of patents, or that our issued patents will afford protection against competitors with similar technology. In addition, our competitors may design around our issued patents, which may adversely affect our business, prospects, financial condition or operating results.

Our financial statements contain an explanatory paragraph regarding uncertainty as our ability to raise capital and therefore cast substantial doubt about our ability to continue as a going concern.

Our audited financial statements for the fiscal year ended December 31, 2024 contain an explanatory paragraph regarding substantial doubt that the Company would continue as a going concern. As of and for the fiscal year ended December 31, 2025, the Company had a working capital of $4,965,652 and net cash used in operating activities of $5,681,238. As of and for the fiscal year ended December 31, 2024, the Company had a working capital deficit of $5,781,202 and net cash provided by operating activities of only $243,506. The Company may not have adequate liquidity to remain solvent and settle its obligations when payment become due. This going concern opinion could materially limit our ability to raise additional funds through the issuance of equity or debt securities or otherwise. Future financial statements may include an explanatory paragraph with respect to our ability to continue as a going concern. Until we generate significant recurring revenues, we expect to satisfy our future cash needs through debt or equity financing. We cannot be certain that additional funding will be available to us on acceptable terms, if at all. If funds are not available, we may be required to delay, reduce the scope of, or eliminate our development plans. This may raise substantial doubts about our ability to continue as a going

concern.

Cybersecurity risks and cyber incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information, misappropriation of assets and damage to our business relationships, all of which could negatively impact our business and results of operations.

Cyber incidents may result in disrupted operations, misstated or unreliable financial data, liability for stolen assets or information, increased cybersecurity protection and insurance costs and litigation and damage to our tenants. As our reliance on technology has increased, so have the risks posed to our information systems, both internal and those we have outsourced. Any processes, procedures and internal controls that we implement, as well as our increased awareness of the nature and extent of a risk of a cyber-incident, do not guarantee that our financial results, operations, business relationships, confidential information or price of the common stock will not be negatively impacted by such an incident.

Insider or employee cyber and security threats are increasingly a concern for all companies, including us. In addition, social engineering and phishing are a particular concern for companies with employees. We are continuously working to deploy information technology systems and to provide employee awareness training around phishing, malware and other cyber risks to ensure that we are protected against cyber risks and security breaches. Such technology and training, however, may not be sufficient to protect us and our tenants from all risks.

As a smaller company, we use third-party vendors to assist us with our network and information technology requirements. While we carefully select these third-party vendors, we cannot control their actions. Any problems caused by these third parties, including those resulting from breakdowns or other disruptions in communication services provided by a vendor, failure of a vendor to handle current or higher volumes, cyber-attacks and security breaches at a vendor could adversely affect our business and results of operations.

We may not be able to adequately address these additional risks. If we were unable to do so, our operations might suffer, which may adversely impact our results of operations and financial condition.

We may not be able to successfully implement our business strategies and future plans.

As part of our business strategies and future plans, we intend to expand our business and have some of our products manufactured to the United States. The plan involves the following steps: (1) find a potential location, (2) conduct title searches and due diligence to the facility, (3) apply for a mortgage unless the facility is leased, (4) complete the purchase or sign the lease, (5) start renovations and improvements, if necessary, (6) purchase new equipment for manufacturing and pollution control, and (7) hire local labor to begin operations. As of the date of this Annual Report, we have completed steps 1 to 5. In December 2024, we moved our headquarters from California to 2251 Catawba River Rd, Fort Lawn, SC 29714 and started renovating the factory we rented there. We are currently looking into purchasing new equipment for manufacturing and pollution control, and hiring local labor to begin operations locally. If the plans are successfully executed, we intend to maintain manufacturing in the United States and China in the short term. We plan to gradually shift manufacturing from China to the United States in the long term and eventually close the manufacturing sites in China.

See "Business – Growth Strategies – Made in the United States" on page 14.

While we have planned such expansion based on our outlook regarding our business prospects, there is no assurance that such plans will be commercially successful or that the actual outcome of the plans will match our expectations. The success and viability of our plans are dependent upon our ability to successfully carry out our business strategies and future plans and implement strategic business development and marketing plans effectively and upon an increase in demand for our products and services by existing and new customers in the future.

Further, the implementation of our business strategies and future plans may require substantial capital expenditure and additional financial resources and commitments. There is no assurance that these business strategies and future plans will achieve the expected results or outcome such as an increase in revenue that will be commensurate with our investment costs or the ability to generate any cost savings, increased operational efficiency and productivity improvements to our operations. There is also no assurance that we will be able to obtain financing on terms that are favorable, if at all. If the results or outcome of our future plans do not meet our expectations, if we fail to achieve a sufficient level of revenue or if we fail to manage our costs efficiently, we may not be able to recover our investment costs and our business, financial condition, results of operation and prospects may be adversely affected.

We have been granting share-based awards. Exercise of the share options or restricted shares granted will increase the number of common stock in circulation, which may adversely affect the market price of our common stock.

On May 30, 2023, the Company adopted the 2023 Equity Incentive Plan, or the 2023 Plan, for the purpose of granting share based compensation awards to current or prospective employees, directors, officers, advisors or consultants of the Company or its affiliates and align their interests with ours. The maximum aggregate number of shares of common stock we are authorized to issue pursuant to all awards under the 2023 Plan was 500,000. On December 31, 2024, the Company authorized an additional 1,000,000 shares of common stock under the 2023 Plan, bringing the total number of shares authorized under the 2023 Plan to 1,500,000. On December 31, 2025, the Company authorized an additional 2,000,000 shares of common stock under the 2023 Plan, bringing the total number of shares authorized under the 2023 Plan to 3,500,000 As of the date of this Annual Report, 1,500,000 shares of common stock were granted under the 2023 Plan. We may adopt other share incentive plans in the future that permits granting of share-based compensation awards to employees and directors, which will result in significant share-based compensation expenses to us.

Competition for highly skilled personnel is often intense and we may incur significant costs or not be successful in attracting, integrating, or retaining qualified personnel to fulfill our current or future needs. We have, from time to time, experienced, and we expect to continue to experience, difficulty in hiring and retaining highly skilled employees with appropriate qualifications. Our ability to attract or retain highly skilled employees may be adversely affected by declines in the perceived value of our equity or equity awards. Furthermore, there are no assurances that the number of shares reserved for issuance under our share incentive plans will be sufficient to grant equity awards adequate to recruit new employees and to compensate existing employees.

Risks Related to Ownership of Our Common Stock, Preferred Stock and Our Status as a Public Company

Our common stock may be delisted or prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act (the "HFCA Act") and the Consolidated Appropriations Act, 2023, if the Public Company Accounting Oversight Board (the "PCAOB") is unable to inspect our auditors for two consecutive years. The delisting of our common stock, or the threat of their being delisted, may materially and adversely affect the value of your investment.

On May 20, 2020, the U.S. Senate passed the HFCA Act requiring a foreign company to certify it is not owned or controlled by a foreign government if the PCAOB is unable to audit specified reports because the company uses a foreign auditor not subject to PCAOB inspection. If the PCAOB is unable to inspect the company's auditors for three consecutive years, the issuer's securities are prohibited to trade on a national exchange. On December 2, 2020, the U.S. House of Representatives approved the HFCA Act. On December 18, 2020, the HFCA Act was signed into law.

On March 24, 2021, the SEC announced the adoption of interim final amendments to implement the submission and disclosure requirements of the HFCA Act. In the announcement, the SEC clarifies that before any issuer will have to comply with the interim final amendments, the SEC must implement a process for identifying covered issuers. The announcement also states that the SEC staff is actively assessing how best to implement the other requirements of the HFCA Act, including the identification process and the trading prohibition requirements.

On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act and on December 29, 2022, legislation entitled "Consolidated Appropriations Act, 2023" (the "Consolidated Appropriations Act") was signed into law by President Biden, which contained, among other things, an identical provision to the Accelerating Holding Foreign Companies Accountable Act and amended the HFCA Act by requiring the SEC to prohibit an issuer's securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time period for triggering the prohibition on trading.

On September 22, 2021, the PCAOB adopted a final rule implementing the HFCA Act, which provides a framework for the PCAOB to use when determining, as contemplated under the HFCA Act, whether the board of directors of a company is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.

On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act, which became effective on January 10, 2022. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions.

On December 16, 2021, the PCAOB issued a report on its determinations that it was unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in Mainland China and in Hong Kong because of positions taken by PRC and Hong Kong authorities in those jurisdictions.

On August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the "Statement of Protocol") with the CSRC and the Ministry of Finance of China. The terms of the Statement of Protocol would grant the PCAOB complete access to audit work papers and other information so that it may inspect and investigate PCAOB-registered accounting firms headquartered in China and Hong Kong. On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong completely in 2022. The PCAOB vacated its previous 2021 determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong.

Our auditor, WWC, P.C., the independent registered public accounting firm that issued the audit report included elsewhere in this Annual Report, as an auditor of companies that are traded publicly in the United States and a U.S.-based accounting firm registered with the PCAOB, is headquartered in Mateo, CA and is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. WWC, P.C., is not headquartered in China or Hong Kong. Notwithstanding the foregoing, if the PCAOB determines that it cannot inspect or fully investigate our auditor at such future time, trading in our common stock will be prohibited under the HFCA Act and NYSE American may determine to delist our common stock.

Moreover, the recent developments would add uncertainties to the listing of our common stock, and we cannot assure you whether SEC, NYSE American or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor's audit procedures and quality control procedures, adequacy of personnel and training, or the sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements.

The purchase price for our common stock may not be indicative of prices that will prevail in the trading market and such market prices may be volatile.

The purchase price for our common stock does not bear any relationship to our earnings, book value or any other indicia of value. We cannot assure you that the market price of our common stock will not decline significantly below the purchase price. The financial markets in the United States and other countries have experienced significant price and volume fluctuations in the last few years. Volatility in the price of our common stock may be caused by factors outside of our control and may be unrelated or disproportionate to changes in our results of operations.

You may experience extreme stock price volatility, including any stock-run up, unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common stock.

Our common stock may be subject to extreme volatility that is seemingly unrelated to the underlying performance of our business. In particular, our common stock may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices, given that we have relatively small public floats. Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance, financial condition or prospects.

Holders of our common stock may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our common stock. As a result of this volatility, shareholders may experience losses on their investment in our common stock. Furthermore, the potential extreme volatility may confuse the public shareholders of the value of our stock, distort the market perception of our stock price, our company's financial performance, public image, and negatively affect the long-term liquidity of our common stock, regardless of our actual or expected operating performance. If we encounter such volatility, including any rapid stock price increases and declines seemingly unrelated to our actual or expected operating performance and financial condition or prospects, it will likely make it difficult and confusing for prospective shareholders to assess the rapidly changing value of our common stock and understand the value thereof.

Raising additional capital by issuing securities may cause dilution to existing shareholders and/or have other adverse effects on our operations.

We may need to raise future capital to implement our business strategies. We may seek additional capital through a combination of public and private equity offerings, debt financings, strategic partnerships and alliances and licensing arrangements. To the extent that we raise additional capital through the sale of equity, convertible debt securities or other equity-based derivative securities, the existing shareholders' ownership interest will be diluted and the terms may include liquidation or other preferences that adversely affect the existing shareholders' rights as shareholders. Any additional indebtedness we incur would result in increased fixed payment obligations and could involve restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. Furthermore, the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our Common Shares to decline and existing shareholders may not agree with our financing plans or the terms of such financings. If we raise additional funds through strategic partnerships and alliances and licensing arrangements with third parties, we may have to relinquish valuable rights to our technologies, or our products, or grant licenses on terms unfavorable to us. Adequate additional financing may not be available to us on acceptable terms, or at all.

We do not intend to pay dividends for the foreseeable future.

We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future. As a result, you may only receive a return on your investment in our common stock if the market price of our common stock increases.

If securities or industry analysts do not publish research or reports about our business, or if they publish a negative report regarding our shares of common stock, the price of our common stock and trading volume could decline.

The trading market for our common stock may depend in part on the research and reports that industry or securities analysts publish about us or our business. We do not have any control over these analysts. If one or more of the analysts who cover us downgrade us, the price of our common stock would likely decline. If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause the price of our common stock and the trading volume to decline.

The market price of our common stock may be volatile or may decline regardless of our operating performance, and you may not be able to resell your shares at or above the purchase price.

The purchase price for our common stock may vary from the market price of our common stock. If you purchase our common stock, you may not be able to resell those shares at or above the purchase price. The market price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including:

  <u></u> <u>actual or anticipated fluctuations in our revenue and other operating results;</u>

  <u></u> <u>the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;</u>

  <u></u> <u>actions of securities analysts who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors;</u>

  <u></u> <u>announcements by us or our competitors of significant products or features, technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;</u>

  <u></u> <u>price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;</u>

  <u></u> <u>lawsuits threatened or filed against us; and</u>

  <u></u> <u>other events or factors, including those resulting from war or incidents of terrorism, or responses to these events.</u>

In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies. Stock prices of many companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. Our common stock closed as high as $10.96 and as low as $0.1713 per share between January 1, 2025 and December 31, 2025 on NYSE American. In the past, stockholders have filed securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and adversely affect our business.

NYSE American may apply additional and more stringent criteria for our continued listing because insiders hold a large portion of the company's listed securities.

NYSE American Company Guide Section 101 provides NYSE American with broad discretionary authority over the continued listing of securities in NYSE American and NYSE American may use such discretion to apply additional or more stringent criteria for the continued listing of particular securities, or suspend or delist particular securities based on any event, condition, or circumstance that exists or occurs that makes continued listing of the securities on NYSE American inadvisable or unwarranted in the opinion of NYSE American, even though the securities meet all enumerated criteria for continued listing on NYSE American. In addition, NYSE American has used its discretion to deny continued listing or to apply additional and more stringent criteria in the instances, including but not limited to: where the company engaged an auditor that has not been subject to an inspection by the PCAOB, an auditor that PCAOB cannot inspect, or an auditor that has not demonstrated sufficient resources, geographic reach, or experience to adequately perform the company's audit. The insiders of our Company hold a large portion of the Company's listed securities. NYSE American might apply additional and more stringent criteria for our continued listing.

Anti-takeover provisions in our charter documents and Nevada law could discourage, delay or prevent a change in control of our company and may affect the trading price of our common stock.

We are a Nevada corporation and the anti-takeover provisions of the Nevada Revised Statutes may discourage, delay, or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change in control would be beneficial to our existing stockholders. An interested stockholder is a person who, together with the affiliates and associates, beneficially owns (or within the prior two years, did beneficially own) ten percent or more of the Company's capital stock entitled to vote.

In addition, our Articles of Incorporation and Bylaws may have the effect of deterring unsolicited takeovers or delaying or preventing a change in control of our company or changes in our management, including transactions in which our stockholders might otherwise receive a premium for their shares over then current market prices. In addition, these provisions may limit the ability of stockholders to approve transactions that they may deem to be in their best interests. These provisions include:

  <u></u> <u>the inability of stockholders to call special meetings;</u>

  <u></u> <u>the "business combinations" and "control share acquisitions" provisions of Nevada law, to the extent applicable, could discourage attempts to acquire our stockholders stock even on terms above the prevailing market price; and</u>

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|:---|:---|
|  | the ability of our board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could include the right to approve an acquisition or other change in our control or could be used to institute a rights plan, also known as a poison pill, that would dilute the stock ownership of a potential hostile acquirer, likely preventing acquisitions that have not been approved by our board of directors. |

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The existence of the forgoing provisions and anti-takeover measures could limit the price that investors might be willing to pay in the future for shares of our common stock. They could also deter potential acquirers of our company, thereby reducing the likelihood that you could receive a premium for your common stock in an acquisition.

We indemnify our officers and directors against liability to us and our security holders, and such indemnification could increase our operating costs.

Our articles of incorporation and bylaws require us to indemnify our officers and directors against claims associated with carrying out the duties of their offices. We are also required to advance the costs of certain legal defenses upon the indemnitee undertaking to repay such expenses to the extent it is determined that such person was not entitled to indemnification of such expenses. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our officers, directors, or control persons, the SEC has advised that such indemnification is against public policy and is therefore unenforceable.

We cannot predict the impact our multi-class structure may have on the stock price of our common stock.

We cannot predict whether our multi-class structure will result in a lower or more volatile market price of our common stock or in adverse publicity or other adverse consequences. For example, certain index providers have policies that restrict or prohibit the inclusion of companies with multiple-class share structures in certain of their indices, including the Russell 2000 and the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P Composite 1500. Beginning in 2017, MSCI, a leading stock index provider, opened public consultations on their treatment of no-vote and multi-class structures and temporarily barred new multi-class listings from certain of its indices. However, in October 2018, MSCI announced its decision to include equity securities "with unequal voting structures" in its indices and to launch a new index that specifically includes voting rights in its eligibility criteria. Under the announced policies, our multi-class capital structure will make us ineligible for inclusion in certain indices, and as a result, mutual funds, exchange-traded funds and other investment vehicles that attempt to passively track those indices will not be investing in our stock. These policies may depress the valuations of publicly traded companies that are excluded from the indices compared to those of other similar companies that are included. Because of our multi-class structure, we will likely be excluded from certain of these indices and we cannot assure you that other stock indices will not take similar actions. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from stock indices would likely preclude investment by many of these funds and could make shares of our common stock less attractive to other investors. As a result, the market price of shares of our common stock could be adversely affected.

We are an "emerging growth company," as defined in the Securities Act, and a "smaller reporting company," as defined in the Exchange Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors.

We are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We cannot predict if investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our share price may be more volatile.

We are also a "smaller reporting company" as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies until the fiscal year following the determination that our voting and non-voting ordinary shares held by non-affiliates is more than $250 million measured on the last business day of our second fiscal quarter, or our annual revenues are more than $100 million during the most recently completed fiscal year and our voting and non-voting ordinary shares held by non-affiliates is more than $700 million measured on the last business day of our second fiscal quarter.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 1C. CYBERSECURITY

Risk Management and Strategy

We continuously monitor our information systems to assess, identify, and manage risks from vulnerabilities and assess cybersecurity threats. Our process for identifying and assessing material risks from cybersecurity threats operates alongside our broader overall risk assessment process. We monitor risks through routine security assessments and implementation of enhancements to security measures used to protect our systems and data. We address system alerts on an ongoing basis. Depending on the incident, we may utilize third-parties for assistance in investigating and addressing cybersecurity incidents.

We also utilize certain third-party service providers to perform a variety of critical business functions and recognize that we are exposed to cybersecurity threats associated with our use of third-party service providers. We have certain vendor management processes designed to help manage cybersecurity risks associated with our use of certain of these providers. Additionally, we strive to minimize cybersecurity risks when we first select or renew a vendor by including cybersecurity risk as part of our overall vendor evaluation and due diligence process.

We have not had cyber incidents that have materially affected our business or financial condition.

Governance

Management is responsible for identifying and assessing material risks for the business on an ongoing basis, including in relation to cybersecurity. Our Chief Executive Officer oversees our information technology department which monitors the prevention, detection, mitigation, and remediation of cyber incidents, if any.

Our Board of Directors oversees our risk management program as part of its general oversight function.

ITEM 2. PROPERTIES

NCP's manufacturing facilities are located in Changzhou, Jiangsu Province, China. NCP has the land use right to two pieces of land of a total of 47,500 square meters where our offices and factories for production and research and development are located. Because private individuals or entities are not permitted to own title to the land, we hold the right to use the two pieces of land until 2064 and 2065, respectively. NCP has 97 units of 3D printing equipment in the facilities in China and has the capacity to produce more than 19,800 square meters of vinyl flooring per day. The land use right

, certain plant, research center and office are

collateral to NCP's various short-term bank loans. Such short-term bank loans were in the amount of $

1,286,983

and

$3,972,984

as of December 31, 2025 and December 31, 2024, respectively.

On July 26, 2021, NCP contracted with Changzhou Wanyuan Construction Engineering Co. to build a second phase of its factory to expand the 3D printing development and production. The amount required in the contract is $5.39 million. Construction is expected to complete in June 2025, and the second phase of the factory will be approximately 250,000 square feet.

On November 1, 2024, the Company started renting a facility in Fort Lawn, South Carolina, with an area of 106,610 square feet, which includes 4,560 square feet of office space and 98,400 square feet of industrial space. The premises is shared with NDC, our distribution center in the United States. The lease term is for 60 months commencing on November 1, 2024. The monthly base rent for the first year starting on November 1, 2024 is US$33,315.63 and is increased to US$34,315.09 for the second year starting on November 20, 2025, US$35,344.55 for the third year starting on November 20, 2026, US$36,404.88 for the fourth year starting on November 20, 2027, and US$37,497.03 for the fifth year starting on November 20, 2028.

In December 2024, the Company moved its headquarters from California to 2251 Catawba River Rd, Fort Lawn, SC 29714.

ITEM 3. LEGAL PROCEEDINGS

We may from time to time be subject to various legal or administrative claims and proceedings arising in the ordinary course of our business. As of the date of this Annual Report, expect as described below, we are not a party to, and we are not aware of any threat of, any legal proceeding that, in the opinion of our management, is likely to have a material adverse effect on our business, financial condition or operations, nor have we experienced any incident of non-compliance which, in the opinion of our directors, is likely to materially and adversely affect our business, financial condition or operations.

In May 2022, NCP received two administrative penalty letters from the Changzhou Bureau of Ecology and Environment in connection with certain violations of environmental laws and regulations. During the Changzhou Bureau of Ecology and Environment's inspection of NCP's factory in Changzhou, China in February 2022, it was found that a natural gas furnace in NCP's factory produced exhaust gas and NCP failed to equip exhaust gas treatment facilities and caused exhaust gas to be released into the atmosphere. It was also found that NCP failed to complete the environmental protection inspection before brought the natural gas furnace into operation. It was also found that when extinguishing a fire of the natural gas furnace in the factory in February 2022, NCP failed to take emergency measures and caused waste water to be discharged into storm drain. The Changzhou Bureau of Ecology and Environment requested NCP to pay penalties in the amount of RMB 240,000 (approximately $36,782) for the above violations. NCP paid the amount in full in May 2022. As a result of this incident, the Company has strengthened the enforcement of its pollution control measures.

In November 2024, NDC commenced legal proceedings against Ocean Networking and International Trading, LLC ("Ocean Networking"), for, amongst others, breach of contract relating to certain invoices issued by NDC for products supplied to Ocean Networking. The matter was settled in fiscal year 2025 pursuant to a settlement agreement between the parties.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

Our common stock are currently quoted on the NYSE American under the symbol "NCL."

On April 10, 2026, the closing price for the common stock on the NYSE American was $0.1568.

Record Holders

As of April 10, 2026, we had 28 shareholders of record of our common stock. We believe that the number of beneficial owners of our common stock is greater than the number of record holders, because a number of our common stock are held through brokerage firms in "street name."

Dividend Policy

We plan to retain any earnings for the foreseeable future for our operations. We have never paid any dividends on our common stock and do not anticipate paying any cash dividends in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of our board of directors and will depend on our financial condition, operating results, capital requirements and such other factors as our board of directors deems relevant.

Use of Proceeds

On September 29, 2023, our Registration Statement on Form S-1, as amended (File No. 333-273246), was declared effective in connection with our IPO, pursuant to which we sold an aggregate 1,200,000 shares of common stock, at a price to the public of $5.00 per share. Craft Capital Management LLC acted as representative of the underwriters.

Our IPO closed on October 18, 2023. The total gross proceeds from the IPO were $6,000,000, before deducting underwriting discounts and other offering expenses associated with the IPO payable by the Company. All proceeds of the IPO have been used for general corporate and working capital purposes. In connection with our IPO, no payments were made by us to directors, officers or persons owning ten percent or more of our ordinary shares or to their associates or to our affiliates. There has been no material change in the planned use of proceeds from our IPO as described in our prospectus filed pursuant to Rule 424(b)(4) under the Securities Act with the SEC on October 20, 2023. We are holding the balance of the net proceeds in cash, cash equivalents, and investments in short term, investment-grade interest-bearing securities such as money market funds, certificates of deposit, corporate bonds and commercial paper, and obligations of the U.S. government.

Issuer Purchases of Securities

There were no repurchases of the Company's securities during the year ended December 31, 2025.

ITEM 6. [RESERVED]

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information set forth in this section contains certain "forward-looking statements", including, among others (i) expected changes in our revenue and profitability, (ii) prospective business opportunities and (iii) our strategy for financing our business. Forward-looking statements are statements other than historical information or statements of current condition. Some forward-looking statements may be identified by use of terms such as "believes", "anticipates", "intends" or "expects". These forward-looking statements relate to our plans, liquidity, ability to complete financing and purchase capital expenditures, growth of our business including entering into future agreements with companies, and plans to successfully develop and obtain approval to market our product. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Although we believe that our expectations with respect to the forward-looking statements are based upon reasonable assumptions within the bounds of our knowledge of our business and operations, in light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking statements in this prospectus should not be regarded as a representation by us or any other person that our objectives or plans will be achieved. We assume no obligation to update these forward-looking statements to reflect actual results or changes in factors or assumptions affecting forward-looking statements. Our revenues and results of operations could differ materially from those projected in the forward-looking statements as a result of numerous factors, including, but not limited to, the following: the risk of significant natural disaster, the inability of our company to insure against certain risks, inflationary and deflationary conditions and cycles, currency exchange rates, and changing government regulations domestically and internationally affecting our products and businesses.

You should read the following discussion and analysis in conjunction with the Financial Statements and Notes attached hereto, and the other financial data appearing elsewhere in this prospectus.

US Dollars are denoted herein by "USD", "$" and "dollars"

Overview

We commenced operations in August 2013 with the establishment of NBS in Delaware.

In December 2013, NCP was established in China. Most of our products are manufactured through NCP.

In March 2014, Benchwick was established in Hong Kong. All the wholesale and distribution operations are conducted through Benchwick.

In April 2014, MARCO was established in China. All the import/export of our products is conducted through MARCO.

In February 2016, NDC was established in California. NDC is a distribution center in the United States and maintains a small inventory for retail sales.

In September 2017, Ringold was established in China. All of the raw materials are procured from third parties through Ringold.

In September 2018, Crazy Industry was established in China. Crazy Industry is the research and development hub.

In June 2020, Dotfloor was established in California. Dotfloor operates dotfloor.com, our online store that offers our vinyl flooring products to retail customers in the United States.

In March 2022, Northann, our current ultimate holding company, was incorporated in Nevada as part of the restructuring transactions in contemplation of our initial public offering. In connection with its incorporation, in April 2022, we completed a share swap transaction and issued common stock and Series A Preferred Stock of Northann to the then existing shareholders of NBS, based on their then respective equity interests held in NBS. NBS then became our wholly owned subsidiary.

In October 2023, the Company consummated the initial public offering of 1,380,000 shares of common stock (including over allotment to underwriters), par value $0.001 per share, at an offering price of $5.00 per share.

Our revenue mainly consists of wholesale and retail of the vinyl flooring products, which are primarily marketed and sold in the United States and Canada.

Our cost refers to the cost of material and labor cost. The percentage of direct material was over 90% of the total cost of revenue. If the availability of direct materials (raw materials, packaging, sourced products, energy) decreases, or these costs increase, and we are unable to either offset or pass along increased costs to our customers, our financial condition, liquidity or results of operations could be adversely affected.

**Key Factors that Affect Results of Operations**

The Company believes the key factors affecting its financial condition and results of operations include the following:

&nbsp;&nbsp;&nbsp;&nbsp;· We may fail to innovate or offer new products which align with changing market and customer demand.

&nbsp;&nbsp;&nbsp;&nbsp;· Our business may face risks of clients' default on payment.

&nbsp;&nbsp;&nbsp;&nbsp;· We may not manage our growth effectively, and our profitability may suffer.

&nbsp;&nbsp;&nbsp;&nbsp;· Our reputation and brand recognition is crucial to our business. Any harm to our reputation or failure to enhance our brand recognition may materially and adversely affect our business, financial condition and results of operations.

&nbsp;&nbsp;&nbsp;&nbsp;· Increases in labor costs and market price of raw materials may adversely affect our gross margin and results of operations.

&nbsp;&nbsp;&nbsp;&nbsp;· Certain of our products have historically faced significant competition both in the United States and Canada markets, and we have successfully competed against our competitors with our customer service, quality products and rapid fulfilment of customer orders. However, our business could be adversely affected by competitors who reduce prices, improve quality of the products they offer or take other competitive actions, which may reduce our customers' purchases of products from us.

&nbsp;&nbsp;&nbsp;&nbsp;· Rising inflation rate may adversely affect our results of operation. Recently, inflation has trended significantly higher than in prior periods, which may negatively impact our business. Ongoing labor shortages and surge of oil and gas price, driven in part by the COVID-19 pandemic, geopolitical issues and the war in Ukraine, continue to have adverse macroeconomics impact and may result in our cost overruns. In an effort to mitigate the impact, we have raised the price of products to cover increase in costs and slowed down investments on products with low profit-margins.

Critical Accounting Policies and Estimates

Use of Estimates

The preparation of these consolidated financial statements requires management of the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed 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 readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Identified below are the accounting policies that reflect the Company's most significant estimates and judgments, and those that the Company believes are the most critical to fully understanding and evaluating its consolidated financial statements.

Revenue Recognition

The Company recognizes revenues when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. The Company recognizes revenues following the five-step model prescribed under ASU No. 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation.

Revenue for sales of products which are primarily comprised of hardwood floors and three-dimensional printed flooring are recognized at the time of delivery of the products set forth in contracts with customers. At the time of delivery, physical and legal control of the asset is passed from the Company to its customer, at which time the Company believes it has satisfied the single performance obligation to complete a sales transaction in order to recognize revenue. The Company's contracts do not allow for returns, refunds, or warranties; however, it is customary in the industry to manufacturers to ship a small portion of extra product to allow for product quality issues. Also, as matter of good business practice, under very specific situations, the Company has historically agreed to provide minor discounts to customers who made complaints on products purchased. The Company has recorded these costs as period expenses when incurred as the Company is not able to reliably estimate such future expenses.

Revenues are recognized when control of the promised goods or services is transferred to our customers, which may occur at a point in time or over time depending on the terms and conditions of the agreement, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Practical expedients and exemption

The Company has not incurred any costs to obtain contracts and does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

The Company typically enters into agreements with its customers where it's set forth the product to be sold, the price, payment terms, and any antecedent terms such as shipping and delivery specifications; these terms and conditions are most typically specified in purchase order issued by its customers to the Company. The Company typically recognizes revenue at point in time, which is when physical possession and legal title are transferred to the customer, this may be a shipping port or a specified destination; at this point the Company reasonably expect to be paid for the product, or in the event where it was paid advance, the Company's performance obligations have been satisfied and those funds are considered earned by the Company. If the Company sells products on account to customers, they are typically paid within 90 days. Any funds received in advance for the products yet to be transferred to its customer are contract liabilities that are recorded as unearned revenue on the Company's consolidated balance sheets. $1,349,672 and nil were recognized as unearned revenue during the years ended December 31, 2025 and 2024, respectively.

Fair Value of Financial Instruments

U.S. GAAP establishes a three-tier hierarchy to prioritize the inputs used in the valuation methodologies in measuring the fair value of financial instruments. This hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three-tier fair value hierarchy is:

Level 1 – observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 – include other inputs that are directly or indirectly observable in the marketplace.

Level 3 – unobservable inputs which are supported by little or no market activity.

The carrying value of the Company's financial instruments, including cash, accounts receivable, other current assets, accounts payable, and accruals and other payable approximate their fair value due to their short maturities.

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the accompanying consolidated statements of operations and comprehensive loss as other income (expense). To estimate fair value, the Company refers to the quoted rate of return provided by banks at the end of each period using the discounted cash flow method. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.

As of December 31, 2025 and 2024, the Company had no investments in financial instruments.

Income tax

The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.

Under ASC 740, a tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition.

The Company accounts for an unrecognized tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the tax authorities. The Company considers and estimates interest and penalties related to the gross unrecognized tax benefits and includes as part of its income tax provision based on the applicable income tax regulations.

The Company did not accrue any liability, interest or penalties related to uncertain tax positions in the provision for income taxes line of the consolidated statements of operations for the year ended December 31, 2025. The Company had no uncertain tax position for the years ended December 31, 2025 and 2024.

Recent Accounting Pronouncements

See the discussion of the recent accounting pronouncements contained in Note 2 to the consolidated financial statements, "Summary of Significant Accounting Policies".

Results of Operations

Comparison of Years Ended December 31, 2025, and 2024

The following table sets forth key components of our results of operations during the years ended December 31, 2025 and 2024, both in dollars and as a percentage of our revenues.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | December 31, | December 31, | December 31, | December 31, |
|  | 2025 | 2025 | 2024 | 2024 |
|  | Amount | % of<br> Revenue | Amount | % of<br> Revenue |
| Revenues | 13601451 | 100.0%<br>| 15349854 | 100.0%<br>|
| Cost of revenues | 10024453 | 73.7%<br>| 11370028 | 74.1%<br>|
| Gross profit | 3576998 | 26.3%<br>| 3979826 | 25.9%<br>|
| Operating expenses |  |  |  |  |
| Selling expenses | 9874283 | 72.6%<br>| 1071633 | 7.0%<br>|
| General and administrative expenses | 3067218 | 22.6%<br>| 3798777 | 24.7%<br>|
| Research and development expenses | 2090835 | 15.4%<br>| 783356 | 5.1%<br>|
| Loss from operations | (11455338) | (84.2)%<br>| (1673940) | (10.9)%<br>|
| Other Income (expenses) |  |  |  |  |
| Interest expense | (212482) | (1.6)%<br>| (470900) | (3.1)%<br>|
| Impairment loss on goodwill | - | -<br>| (2507455) | (16.3)%<br>|
| Interest income | 588 | 0.0%<br>| 120 | 0.0%<br>|
| Other income | 1857 | 0.0%<br>| 306404 | 2.0%<br>|
| Other expenses | (25) | (0.0)%<br>| (32371) | (0.2)%<br>|
| Loss before taxes | (11665400) | (85.8)%<br>| (4378142) | (28.5)%<br>|
| Income tax expenses | (8581) | (0.1)%<br>| (1733) | (0.0)%<br>|
| Net loss | (11673981) | (85.8)%<br>| (4379875) | (28.5)%<br>|
| Other comprehensive income |  |  |  |  |
| Foreign currency translation adjustment | 303727 | 2.2%<br>| 1823453 | 11.9%<br>|
| Total comprehensive loss | (11370254) | (83.6)%<br>| (2556422) | (16.7)%<br>|

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**Revenues.**

Our revenues were $13,601,451 for the year ended December 31, 2025, representing a decrease of $1,748,403 or 11.4% from $15,349,854 for the year ended December 31, 2024. The decrease was mainly due to a decrease in customer demand and sales volume for the year ended December 31, 2025 as compared to the same period of 2024 as a result of the new US tariff.

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| | | |
|:---|:---|:---|
|  | For the Years Ended | For the Years Ended |
|  | December 31, | December 31, |
|  | 2025 | 2024 |
| Sales of products | $13601451 | $15349854 |
| Total | $13601451 | $15349854 |

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**Cost of Revenue.**

Our cost of revenues was $10,024,453 for the year ended December 31, 2025, compared to $11,370,028 for the same period in 2024. Cost of revenues refers to the cost of material and labor cost. The percentage of direct material was over 90% of the total cost of revenues. The decrease of cost of revenues compared to the year ended December 31, 2024 was primarily due to the decrease in sales volume. We paid tariffs of $847,953 for the year ended December 31, 2025, and $290,424 for the year ended December 31, 2024. The increase in tariff was mainly due to the new higher US tariff against goods imported from China.

**Gross profit and gross margin.**

Our gross profit was $3,576,998 for the year ended December 31, 2025, compared with a gross profit of $3,979,826 for the same period in 2024. Gross margin was largely flat.

**Selling expenses.**

As shown below, our selling expenses consist primarily of compensation and benefits to our selling department and other expenses incurred in connection with sales operations. Our selling expenses increased by $8,802,650 to $9,874,283 for year ended December 31, 2025, from $1,071,633 for the year ended December 31, 2024, which was mainly caused by an increase of $8,065,592 in share-based compensation, an increase of $505,194 in rent from the new US warehouse, an increase of $143,218 in salaries and social insurance, and an increase of $82,058 in freight.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, |
|  | 2025 | 2025 | 2024 | 2024 | Fluctuation | Fluctuation |
|  | Amount | Proportion | Amount | Proportion | Amount | Proportion |
| Salaries and social insurance | $473639 | 4.8% | $330421 | 30.9% | $143218 | 43.3% |
| Share-based compensation | 8301842 | 84.0% | 236250 | 22.0% | 8065592 | 3414.0% |
| Freight | 173797 | 1.8% | 91739 | 8.6% | 82058 | 89.4% |
| Rent | 551524 | 5.6% | 46330 | 4.3% | 505194 | 1090.4% |
| Advertising fee | 273971 | 2.8% | 274840 | 25.6% | (869) | -0.3% |
| Travel fee | 99162 | 1.0% | 91497 | 8.5% | 7665 | 8.4% |
| Others | 348 | - | 556 | 0.1% | (208) | -37.4% |
| Total selling expenses | $9874283 | 100.0% | $1071633 | 100.0% | $8802650 | 821.4% |

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**General and administrative expenses.**

As shown below, our general and administrative expenses consist primarily of compensation and benefits to our general management, finance and administrative staff, professional fees and other expenses incurred in connection with general operations. Our general and administrative expenses decreased by $731,559 to $3,067,218 for the year ended December 31, 2025, from $3,798,777 for the same period in 2024. The decrease was mainly caused by a decrease of $1,279,532 in share-based compensation, a lack of $380,457 in impairment loss of equipment, a decrease of $111,661 in salary and social insurance, and partially offset by an increase in service fees of $586,786, an increase in office expense of $106,562, and other items with minor changes.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, | Year Ended December 31, |
|  | 2025 | 2025 | 2024 | 2024 | Fluctuation | Fluctuation |
|  | Amount | Proportion | Amount | Proportion | Amount | Proportion |
| Salary and social insurance | $254530 | 8.3% | $366191 | 9.6% | $(111661) | -30.5% |
| Share-Based Compensation-D&O | 422823 | 13.8% | 1702355 | 44.8% | (1279532) | -75.2% |
| Service fees | 1404552 | 45.8% | 817766 | 21.5% | 586786 | 71.8% |
| Royalty fee | 26736 | 0.9% | 23407 | 0.6% | 3329 | 14.2% |
| Entertainment expenses | 48739 | 1.6% | 53171 | 1.4% | (4432) | -8.3% |
| Taxation | 83546 | 2.7% | 82265 | 2.2% | 1281 | 1.6% |
| Depreciation and amortization | 87266 | 2.8% | 124449 | 3.3% | (37183) | -29.9% |
| Bad debt | - | - | (13891) | - | 13891 | -100.0% |
| Rent | 40443 | 1.3% | 116184 | 3.1% | (75741) | -65.2% |
| Travel fee | 38173 | 1.2% | 47884 | 1.3% | (9711) | -20.3% |
| Office expenses | 424139 | 13.8% | 317577 | 8.4% | 106562 | 33.6% |
| Impairment loss of equipment | - | - | 380457 | 10.0% | (380457) | -100.0% |
| Other | 236271 | 7.7% | (219038) | - | 455309 | -207.9% |
| Total general and administrative expenses | $3067218 | 100.00% | $3798777 | 106.13% | $(731559) | -19.3% |

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**Research and development expenses.**

Our research and development expenses were $$2,090,835 for the year ended December 31, 2025, compared to $783,356 for the same period in 2024.

**Impairment in goodwill**

. In the year ended December 31, 2024, we recognized an impairment charge of $2,507,455 in goodwill resulted from the acquisitions of Cedar Modern Limited and Raleigh Industries Limited in 2024.

**Net (loss) income.** 

As a result of the cumulative effect of the factors described above, our net loss was $11,673,981 for the year ended December 31, 2025 and $4,379,875 for the same period in 2024. The increase in net loss was primarily due to the decrease in gross profit and increase in operating expenses, partly offset by the lack of impairment in goodwill.

**Liquidity and Capital Resources** 

As of December 31, 2025 and 2024, we had cash of $1,030,612 and $245,164, respectively. To date, we have financed our operations primarily through our business operations, borrowings from our stockholders, related and unrelated parties, and proceeds from IPO.

The Company believes that its current levels of cash and cash flows from operations will be sufficient to meet its anticipated cash needs for at least the next twelve months. However, it may need additional cash resources in the future if it finds and wishes to pursue opportunities for investment, acquisition, strategic cooperation or other similar actions. If it determines that its cash requirements exceed its amounts of cash on hand or if it decides to further optimize its capital structure, it may seek to issue additional debt or equity securities or obtain credit facilities or other sources of funding.

The following table set forth a summary of its cash flows for the periods indicated:

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| | | |
|:---|:---|:---|
|  | For the Years Ended | For the Years Ended |
|  | December 31, | December 31, |
|  | 2025 | 2024 |
| Net cash used in operating activities | $(5681239) | $(1233491) |
| Net cash used in investing activities | $(891768) | $(296363) |
| Net cash (used in) provided by financing activities | $7455669 | $(1186585) |

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Operating Activities

Net cash used in operating activities was $5,681,239 for the year ended December 31, 2025.

The net cash used in operating activities for the year ended December 31, 2025 was mainly due to our net loss of $11,673,981 adjusted for (i) a net increase of non-cash items of $9,674,865 which consisted primarily of share-based compensation, depreciation and amortization, and a tax payable write-off, and (ii) a net decrease of $3,682,123 in changes in operating assets and liabilities. The net decrease in changes in operating assets and liabilities was attributable primarily to an increase of $4,122,229 in inventory, a decrease of $2,128,954 in due to related party, and an increase of $520,042 in accounts receivable, partially offset by an increase of $1,469,948 in accruals and other payables, an increase of $1,471,485 in unearned revenue, and a decrease of $274,182 in prepayments.

Net cash used in operating activities was $1,233,491 for the year ended December 31, 2024. The net cash used in operating activities for the year ended December 31, 2024 was mainly due to our net loss of $4,379,875 adjusted for (i) a net increase of non-cash items of $4,945,053 which consisted primarily of share-based compensation, depreciation and amortization, and income from settlement of convertible notes, and (ii) a net decrease of $1,798,669 in changes in operating assets and liabilities. The net decrease in changes in operating assets and liabilities was attributable primarily to a decrease of $1,084,484 in unearned revenue and a decrease of $711,533 in accruals and other payables.

Investing Activities

Net cash used in investing activities was $891,768 for the year ended December 31, 2025. The net cash used in investing activities for the year ended December 31, 2025 mainly included the payments for construction in progress and purchasing equipment.

Net cash used in investing activities was $

296,363 for the year ended December 31, 2024. The net cash used in investing activities for the year ended December 31, 2024 was mainly attributable to payment for construction in progress.

Financing Activities

Net cash provided by financing activities for the year ended December 31, 2025 was $7,455,669. The net cash provided by financing activities was mainly from the net proceeds of $8,228,597 from issuance of common stock, partly offset by net repayment for loan payable of $772,928.

Net cash used in financing activities for the year ended December 31, 2024 was $1,186,585. Net cash used in 2024 was mainly due to net repayment for bank borrowings and loans of $1,823,498, settlement of convertible notes of $500,000, partially offset by proceeds from related party of $1,136,913.

Contractual Obligations

The Company's subsidiary NDC has two operating leases for its corporate office and warehouse. The lease contracts were within three years and the renewal was at landlord's discretion.

Operating lease expenses were $438,854 and $168,331 for the years ended December 31, 2025 and 2024, respectively.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, we are not required to provide information required by this Item.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Our financial statements are contained in pages F-1 through F-22, which appear at the end of this Annual Report on Form 10-K.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure and Control Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, evaluated, as of the end of the period covered by this Annual Report on Form 10-K, the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Based on that evaluation of our disclosure controls and procedures as of December 31, 2025, in light of the material weakness in internal control over financial reporting discussed below, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as of such date were not effective at the reasonable assurance level.

Management's Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and 15(d)-15(f) promulgated under the Exchange Act). We have established disclosure controls and procedures designed to ensure that material information required to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the Securities and Exchange Commission and that any material information relating to us is recorded, processed, summarized and reported to our management including our Chief Executive Officer and Interim Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. In designing and evaluating our disclosure controls and procedures, our management recognizes that controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving desired control objectives.

In reaching a reasonable level of assurance, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by Rule 13a-15(b) under the Exchange Act, we have evaluated, under the supervision and with the participation of our management, including our Chief Executive Officer and Interim Chief Financial Officer, the effectiveness of the design and operation of our internal control over financial reporting (as defined in rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. In the course of this review, we identified material a weakness in our internal control over financial reporting. We determined that we had not maintained sufficient staffing or written policies and procedures for accounting and financial reporting, which contributed to the lack of a formalized process or controls for management's timely review and approval of financial information. Based upon that evaluation, our Chief Executive Officer and our Interim Chief Financial Officer concluded that our internal control over financial reporting was not effective as of December 31, 2025.

Our management, including our Chief Executive Officer and Interim Chief Financial Officer, have determined, based on the procedures we have performed, that the audited consolidated financial statements included in this report fairly present in all material respects our financial condition and results of operations as of and for the years ended December 31, 2025 and 2024 in accordance with U.S. Generally Accepted Accounting Principles.

Attestation Report of the Registered Public Accounting Firm

Management's report on internal control over financial reporting was not subject to attestation by our registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit a smaller reporting company to provide only Management's report in this annual report, which may increase the risk that weaknesses or deficiencies in our internal control over financial reporting go undetected.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(t) and 15d-15(f) under the Exchange Act, during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

During 2025, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement, as defined in Item 408(a) of Regulation S-K.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Executive Officers and Directors

The following table sets forth the names and ages, and titles of our executive officers and members of our Board of Directors.

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| | | |
|:---|:---|:---|
| Name<br>| Age<br>| Position<br>|
| Lin Li | 46 | Chairman of the Board, Chief Executive Officer, President, Secretary, Treasurer  |
| Sunny S. Prasad | 52 | Interim Chief Financial Officer  |
| Kurtis W. Winn | 60 | Chief Operating Officer and Director  |
| Bradley C. Lalonde  | 72 | Independent Director; Chair of Audit Committee  |
| Umesh Patel  | 69 | Independent Director; Chair of Compensation Committee  |
| Jing Zhang  | 46 | Independent Director; Chair of Nominating and Corporate Governance Committee |

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The following is a summary of the biographical information about our officers and directors.

Lin Li,

Chairman of the Board, Chief Executive Officer, President, Secretary, Treasurer

Mr. Li is the founder and serves as the Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer of the Company. Mr. Li has also held executive officer and/or director positions at each of our subsidiaries since inception in 2013. Mr. Li was the general manager of Changzhou Winslon International Trading Co. Ltd. from 2005 to 2012. Mr. Lin Li has been the general manager of Northann (Changzhou) Construction Products Co. Ltd. since 2013. Mr. Lin has built the "Benchwick" brand with the utilization of 3D printing in the vinyl flooring industry and has been devoted to establishing a global ecosystem of design, manufacture and sales. Mr. Li has a bachelor's degree in English from Sichuan International Studies University in China.

Sunny S. Prasad,

Interim Chief Financial Officer

Mr. Sunny S. Prasad has over 30 years of experience as an accountant and auditor with various professional audit firms, and has served as the Managing Partner at Sana Tax Corporation since 2014. Mr. Prasad obtained his Bachelors of Science in Accountancy in 2008 from National University in Sacramento, California.

Kurtis W. Winn,

Chief Operating Officer and Director

Mr. Winn has served as the President of NCP since 2015 and a Director of the Company since June 2022. Mr. Winn has also served as the Chief Operation Officer of National Wood Products, Inc. in Salt Lake City, UT since 1997, where he managed a team of 105 professionals, created and directed sales team training and development programs, managed the date-to-day tactical and long-term strategic activities within the business. Previously, from 1992 to 1997, Mr. Winn served as the regional manager at General Hardwoods, Inc. in Houston, TX, where he led sales calls with team members to establish sales and customer retention goals and managed sales transactions. From 1992 to 2016, Mr. Winn was the territory manager at NCH Corporation, in Phoenix, AZ, where he generated new accounts by implementing effective networking and content marketing strategies. Mr. Winn received his Bachelor of Science in Business Management from Arizona State University.

Bradley C. Lalonde,

Independent Director and Chair of Audit Committee

Mr. Lalonde has been a director of the Company since September 29, 2023. Mr. Lalonde has a 25 years career in investment and corporate banking and over 15 years of experience in general management. Since 2003, Mr. Lalonde has served as the Partner and co-founder of Vietnam Partners, an investment banking serving the Vietnamese government and businesses in Vietnam. Previously, from 2001 to 2023, Mr. Lalonde served as the Director of Citicapital Audit and Risk Review at Citigroup, where he headed the audit teams in New York and Dallas responsible for Citigroup's commercial lending and leasing activities. From 1999 to 2001, Mr. Lalonde served as the Head of Citibank's Non-Banking Financial Institutions Business in Emerging Markets at Citibank, where he was responsible for strategy and business plan implementation in over 40 countries covering investment banks, insurance companies and leasing companies. From 1994 to 1999, Mr. Lalonde held multiple positions, including CEO, Country Risk Manager and Corporate Bank Head at Citibank Vietnam, where he led the first syndicated loan for a Vietnamese corporation and achieved highest possible audit and compliance ratings. Mr. Lalonde worked at Citibank Tunisia from 1989 to 1994, Citibank Turkey from 1984 to 1989, and Citibank in Bahrain, Saudi Arabia and Kuwait from 1981 to 1984. From 1977 to 1981, Mr. Lalonde worked at Chemical Bank as assistant to vice president covering Iran, Turkey and Africa. Mr. Lalonde received his Master degree in International Affairs with concentration in international economic development from Columbia University in 1977; and his Bachelor of Arts in Political Science from University of Michigan in 1975.

Umesh Patel,

Independent Director and Chair of Compensation Committee

Mr. Patel has been a director of the Company since May 23, 2024. He has also been serving as the chief executive officer and a director of Fuse Group Holding Inc., a company exploring opportunities in the mining industry, since February 2017, and the company's chief financial officer since November 2022. He has also been a director of Nova Lifestyle, Inc. (NASDAQ: NVFY) since November 2016 and presently serves as the chairman of the Audit Committee and member of the Compensation Committee and Nominating and Governance Committee. Since May 2012, Mr. Patel has served as a managing partner of DviBri LLC, a California-based consulting company dedicated to managing all aspects of a client's transition from a private firm to a publicly-listed company. From 2001 to 2007, Mr. Patel was the president and CFO of Digital Learning Management Corp. Mr. Patel received his Associate degree in hotel management and catering in 1976, and his Bachelor of Commerce degree specializing in audits and accounts in 1979, both from Maharaja Sayaji Rao University in Baroda, India.

Jing Zhang,

Independent Director and Chair of Nomination Committee

Mr. Zhang has been a director of the Company since December 31, 2024. He is a seasoned professional with expertise in finance, marketing, and e-commerce. He has also been serving as the chief executive officer of Jing's Digital Media Ltd, a company focusing on digital marketing business, since August 2023. From April 2018 to June 2023, he served as a vice president for digital marketing of Ugreen Digital Ltd, one of China's largest manufacturing companies, where he successfully scaled online sales from zero to over $100 million through innovative digital strategies in early stage and is recognized for his leadership in e-commerce and his ability to drive significant business growth. Mr. Zhang received his Bachelor degree in Marketing from Shenzhen University in 2002.

Board of Directors

Our business and affairs are managed under the direction of our Board of Directors. Our Articles, as amended, provide that the total number of directors on our Board of Directors shall be fixed from time to time, by ordinary resolution of the Shareholders. Our board is composed of five directors. Our officers are appointed by the Board of Directors and serve at the discretion of the Board of Directors, rather than for specific terms of office.

Audit Committee

Our Audit Committee consists of Bradley C. Lalonde, Umesh Patel and Jing Zhang. Bradley C. Lalonde is the chairman of our audit committee. We have determined that these directors satisfy the "independence" requirements of section 803A(2) of the NYSE American Company Guide and Rule 10A-3 under the Securities Exchange Act of 1934. Our board of directors has determined that Bradley C. Lalonde qualifies as an audit committee financial expert and has the accounting or financial management expertise as required under Item 407(d)(5)(ii) and (iii) of Regulation S-K. The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our company. The audit committee will be responsible for, among other things:

 selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm;

 reviewing with the independent registered public accounting firm any audit problems or difficulties and management's response;

 reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;

 discussing the annual audited financial statements with management and the independent registered public accounting firm;

Compensation Committee

Our Compensation Committee consists of Bradley C. Lalonde, Umesh Patel and Jing Zhang. Mr. Patel is the chairman of our compensation committee. The compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. Our chief executive officer may not be present at any committee meeting during which his compensation is deliberated. The compensation committee will be responsible for, among other things:

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| | |
|:---|:---|
|  | reviewing the total compensation package for our executive officers and making recommendations to the board; |

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 reviewing the compensation of our non-employee directors and making recommendations to the board with respect to it; and

 periodically reviewing and approving any long-term incentive compensation or equity plans, programs or similar arrangements, annual bonuses, and employee pension and welfare benefit plans.

Nomination Committee

Our Nomination Committee consists of Bradley C. Lalonde, Umesh Patel and Jing Zhang. Mr. Zhang is the chairman of our nomination committee. The nomination committee assists the board of directors in selecting individuals qualified to become our directors and in determining the composition of the board and its committees. The nomination committee is responsible for, among other things:

 recommending nominees to the board for election or re-election to the board, or for appointment to fill any vacancy on the board;

 reviewing annually with the board the current composition of the board with regards to characteristics such as independence, age, skills, experience and availability of service to us;

 selecting and recommending to the board the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself; and

 monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.

Code of Ethics

We have adopted a Code of Ethics applicable to our officers, directors and employees.

Policy for Approval of Related Person Transaction

Our Code of Ethics that our Board of Directors adopted requires us to avoid, wherever possible, all related party transactions that could result in actual or potential conflicts of interests, except in accordance with the approval process and guidelines included in the Code of Ethics. Under our Code of Ethics, a "conflict of interest" arises when an individual's personal interest interferes or appears to interfere with our interests.

In addition, the Audit Committee of our Board of Directors adopted a charter, pursuant to which the audit committee reviews policies and procedures regarding transactions, and reviews and oversees the transactions, between us and officers, directors and other related parties that are not a normal part of our business. If the Board of Directors creates a special committee in connection with such a transaction or holds a meeting of the non-interested directors of the Board to approve such transaction, the Audit Committee will not be required to consider such transaction or assess conflicts of interest in connection with such transaction.

These procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer.

Shareholder Nominees

There have been no material changes to the procedures by which shareholders of the Company may recommend nominees to the Company's Board of Directors.

Family Relationships

There are no family relationships among any of our directors or executive officers.

Legal Proceedings

No director or executive officer has been involved in any legal proceeding during the past ten years that is material to an evaluation of his or her ability or integrity.

Insider Trading Policy

We are committed to promoting high standards of ethical business conduct and compliance with applicable laws, rules and regulations. As part of this commitment, we have adopted an Insider Trading Policy to govern the purchase, sale, and/or other dispositions of our securities by our directors, officers and employees, as well as by the Company itself, that we believe is reasonably designed to promote compliance with insider trading laws, rules and regulations, and the exchange listing standards applicable to us. A copy of our Insider Trading Policy was filed as Exhibit 19.1 to this report.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires directors and certain officers of the Company, as well as persons who own more than 10% of a registered class of the Company's equity securities, to file reports with the SEC.

Based upon a review of filings with the SEC and written representations from our directors, officers, and other persons who own more than 10% of a registered class of the our shares that no other reports were required, the Company believes that all directors did not comply during 2025 with the reporting requirements of Section 16(a) of the Exchange Act, due to their late filings of Form 3s and/or Form 4s.

ITEM 11. EXECUTIVE COMPENSATION

Executive Compensation Table

The following summary compensation table sets forth the compensation earned by our named executive officers during the last two fiscal years as employees of the Company.

Summary Compensation Table

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Fiscal** | **Salary** | **Bonus** | **Stock**<br>**Awards** | **All Other**<br>**Compensation** | **Total** |
| **Name and Principal Position**<br>| **Year** | **(US$)** | **(US$)** | **(US$)** | **(US$)** | **(US$)** |
| Lin Li<br>| 2025 | 130000 |  |  |  | 130000 |
| *Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer*<br>| 2024 | 120000 |  |  |  | 120000 |
| Sunny S. Prasad<sup>(2)</sup><br>| 2025 | - |  |  |  | - |
| *Interim Chief Financial Officer*<br>| 2024 | - |  |  |  | - |
| David M. Kratochvil <sup>(1)</sup><br>| 2025 | - |  |  |  | - |
| *Former Chief Financial Officer*<br>| 2024 | 20000 |  |  |  | 20000 |
| Kurtis W. Winn<br>| 2025 | 100000 |  |  |  | 100000<br>|
| *Chief Operating Officer and Director*<br>| 2024 | 100000 |  |  |  | 100000 |

---

(1) Mr. Kratochvil serves as the Chief Financial Officer of the Company effective on July 14, 2023. On April 15, 2024, Mr. Kratochvil resigned as the CFO.

(2) On April 15, 2024, Mr. Prasad was appointed as the interim CFO of the Company.

Non-Employee Director Compensation

Pursuant to the director offer letters between us and the non-employee directors, each of them is entitled to a certain amount of cash for each calendar year of service on a pro-rated basis. The Company shall also offer each of them equity-based compensation, payable by issuance of the common stock of the Company on a quarterly basis within five business days after such quarter ends. The price per share of common stock shall be the average closing price of the Company's common stock of the last five trading days of such quarter.

The following table and related footnotes summarize the compensation accrued by the Company to each non-employee director for 2025:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| Name <br>| Fees<br>Earned<br>or<br>Paid in<br>Cash | Stock<br>Awards | Option<br>Awards | Non-Equity<br>Incentive Plan<br>Compensation | Change in<br>Pension<br>Value<br>and<br>Nonqualified<br>Deferred<br>Compensation<br>Earnings | All Other<br>Compensation | Total<br>|
|  | **$** | **$** | **$** | **$** | $| $| **$**<br>|
| Bradley C. Lalonde <br>| 20000<br>| 155996 |  |  |  |  | 175996  |
| Umesh Patel <sup>(1)</sup><br>| 15000<br>| 129969 |  |  |  |  | 144969  |
| Jing Zhang <sup>(2)</sup><br>| 15000<br>| 95702 |  |  |  |  | 110702 |

---

(1) Umesh Patel was appointed as our independent director on May 23, 2024.

(2) Jing Zhang was appointed as our independent director on December 31, 2024.

Employment Agreements with Executive Officers and Employee Director

We have entered into employment agreements with each of our executive officers.

Agreement with Lin Li

Mr. Li entered into an employment agreement with the Company on July 1, 2022. Pursuant to the employment agreement, Mr. Li serves as the Chairman of the Board, Chief Executive Officer, President, Treasurer and Secretary of the Company, and is entitled to receive a base salary at an annual rate of US$120,000 and any bonus, equity awards as the board of directors and/or the compensation committee may determine. The employment agreement is for a term of three years. The agreement may be terminated upon either party's failure to renew the agreement, by the Company for or without cause or by Mr. Li with or without good reason. In addition, the agreement may be terminated by either party at any time and for any reason with at least 30 days' prior written notice.

Agreement with Kurtis W. Winn

Mr. Winn entered into an employment agreement with the Company on July 1, 2022. Pursuant to the employment agreement, Mr. Winn serves as the Chief Operating Officer and a director of the Company, and is entitled to receive a base salary at an annual rate of US$100,000 and any bonus, equity awards as the board of directors and/or the compensation committee may determine. The employment agreement is for a term of three years. The agreement may be terminated upon either party's failure to renew the agreement, by the Company for or without cause or by Mr. Winn with or without good reason. In addition, the agreement may be terminated by either party at any time and for any reason with at least 30 days' prior written notice.

Employee Benefit Plans

Enterprises in China are required by PRC laws and regulations to participate in certain employee benefit plans, including social insurance funds, namely a pension plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan and a maternity insurance plan, and a housing provident fund, and contribute to the plans or funds in amounts equal to certain percentages of salaries, including bonuses and allowances, of the employees as specified by the local government from time to time at locations where they operate their businesses or where they are located. Failure to make adequate contributions to various employee benefit plans may be subject to fines and other administrative sanctions. Each of the PRC subsidiaries has established employee benefit plans and has made adequate contributions to such plans as required by law.

Equity Incentive Plan

On May 30, 2023, the Company adopted the 2023 Equity Incentive Plan, or the 2023 Plan, for the purpose of granting share-based compensation awards to current or prospective employees, directors, officers, advisors or consultants of the Company or its affiliates and align their interests with ours.

The maximum aggregate number of shares of common stock which may be issued pursuant to all awards under the 2023 Plan is 3,500,000.The following table sets forth information concerning outstanding equity awards of the Company for each of the named executive officers as of the end of the fiscal year ended December 31, 2025.

Outstanding Equity Awards at 2025 Fiscal Year-End

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Option Awards | Option Awards | Option Awards | Option Awards | Stock Awards | Stock Awards |
| Name | Number of<br>Securities<br>Underlying<br>Unexercised<br>Options (#)<br>Exercisable | Number of<br>Securities<br>Underlying<br>Unexercised<br>Options (#)<br>Unexercisable | Option<br>Exercise<br>Price<br>($) | Option<br>Expiration<br>Date | Number of<br>Shares or<br>Units of Stock<br>That Have Not<br>Vested (#) | Market Value of<br>Shares or Units<br>of Stock That<br>Have Not<br>Vested ($) |
| Lin Li |  |  |  |  |  |  |
| Sunny S. Prasad<sup>(1)</sup> |  |  |  |  |  |  |
| David M. Kratochvil <sup>(2)</sup> |  |  |  |  |  |  |
| Kurtis W. Winn |  |  |  |  |  |  |

---

(1) Mr. Kratochvil serves as the Chief Financial Officer of the Company effective on July 14, 2023. On April 15, 2024, Mr. Kratochvil resigned as the CFO.

(2) On April 15, 2024, Mr. Prasad was appointed as the interim CFO of the Company.

The following paragraphs summarize the terms of the 2023 Plan.

Administration.

The 2023 Plan is administered by the board of directors or committee or individuals authorized by the board of directors, and the Compensation Committee administers the 2023 Plan (such committee that administers the 2023 Plan, the "Committee"). The Committee has the authority to determine the terms and conditions of any agreements evidencing any awards granted under the 2023 Plan and to adopt, alter and repeal rules, guidelines and practices relating to the 2023 Plan. The Committee has full discretion to administer and interpret the 2023 Plan and to adopt such rules, regulations and procedures as it deems necessary or advisable.

Eligibility.

Current or prospective employees, directors, officers, advisors or consultants of the Company or its affiliates are eligible to participate in the 2023 Plan. The Committee has the sole and complete authority to determine who will be granted an award under the 2023 Plan, however, it may delegate such authority to one or more officers of the Company under the circumstances set forth in the 2023 Plan.

Number of Shares Authorized.

Prior to the reverse share split, the 2023 Plan initially provided for an aggregate of Four Million (4,000,000) shares of common stock to be available for awards, which was then increased to Twelve Million (12,000,000) shares of common stock. After the reverse share split on October 7, 2025, the number of shares of common stock available under the 2023 Plan was accordingly reduced from 12,000,000 to 1,500,000. This was then further increased to 3,500,000 shares of common stock pursuant to an ordinary resolution passed by the Company at its annual general meeting on December 31, 2025. If an award is forfeited or if any option terminates, expires or lapses without being exercised, the common stock subject to such award will again be made available for future grant. Shares of common stock that are used to pay the exercise price of an option or that are withheld to satisfy the participant's tax withholding obligation will not be available for re-grant under the 2023 Plan.

Each share of common stock subject to an option or a stock appreciation right will reduce the number of common stock available for issuance by one share, and each common stock underlying an award of restricted stock, restricted stock units, stock bonus awards and performance compensation awards will reduce the number of common stock available for issuance by one share.

If there is any change in the corporate capitalization, the Committee in its sole discretion may make substitutions or adjustments to the number of shares reserved for issuance under the 2023 Plan, the number of shares covered by awards then outstanding under the 2023 Plan, the limitations on awards under the 2023 Plan, the exercise price of outstanding options and such other equitable substitution or adjustments as it may determine appropriate.

Term of Plan.

The 2023 Plan has a term of ten years and no further awards may be granted under the 2023 Plan after that date.

Awards Available for Grant.

The Committee may grant awards of non-qualified stock options, incentive (qualified) stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing.

Options.

The Committee is authorized to grant options to purchase shares of common stock that are either "qualified," meaning they are intended to satisfy the requirements of Internal Revenue Code of 1986, as amended, or the Code, Section 422 for incentive stock options, or "non-qualified," meaning they are not intended to satisfy the requirements of Section 422 of the Code. Options granted under the 2023 Plan are subject to the terms and conditions established by the Committee. Under the terms of the 2023 Plan, the exercise price of the options will be set forth in the applicable award agreement. Options granted under the 2023 Plan are subject to such terms, including the exercise price and the conditions and timing of exercise, as may be determined by the Committee and specified in the applicable award agreement. The maximum term of an option granted under the 2023 Plan is ten years from the date of grant (or five years in the case of a qualified option granted to a 10% stockholder).

Stock Appreciation Rights.

The Committee is authorized to award stock appreciation rights (or SARs) under the 2023 Plan. SARs are subject to the terms and conditions established by the Committee. An SAR is a contractual right that allows a participant to receive, either in the form of cash, shares or any combination of cash and shares, the appreciation, if any, in the value of a share over a certain period of time. An option granted under the 2023 Plan may include SARs and SARs may also be awarded to a participant independent of the grant of an option. SARs granted in connection with an option shall be subject to terms similar to the option corresponding to such SARs. SARs shall be subject to terms established by the Committee and reflected in the award agreement.

Restricted Stock.

The Committee is authorized to award restricted stock under the 2023 Plan. The Committee will determine the terms of such restricted stock awards. Restricted stock are shares of common stock that generally are non-transferable and subject to other restrictions determined by the Committee for a specified period. Unless the Committee determines otherwise or specifies otherwise in an award agreement, if the participant terminates employment or services during the restricted period, then any unvested restricted stock is forfeited.

Restricted Stock Unit Awards.

The Committee is authorized to award restricted stock unit awards. The Committee will determine the terms of such restricted stock units. Unless the Committee determines otherwise or specifies otherwise in an award agreement, if the participant terminates employment or services during the period of time over which all or a portion of the units are to be earned, then any unvested units will be forfeited.

Stock Bonus Awards.

The Committee is authorized to grant awards of unrestricted common stock or other awards denominated in common stock, either alone or in tandem with other awards, under such terms and conditions as the Committee may determine.

Performance Compensation Awards.

The Committee is authorized to grant any award under the 2023 Plan in the form of a performance compensation award by conditioning the vesting of the award on the attainment of specific levels of performance of the Company and/or one or more affiliates, divisions or operational units, or any combination thereof, as determined by the Committee.

Transferability.

Each award may be exercised during the participant's lifetime only by the participant or, if permissible under applicable law, by the participant's guardian or legal representative and may not be otherwise transferred or encumbered by a participant other than by will or by the laws of descent and distribution. The Committee, however, may permit awards (other than incentive stock options) to be transferred to family members, a trust for the benefit of such family members, a partnership or limited liability company whose partners or stockholders are the participant and his or her family members or anyone else approved by it.

Amendment.

The board of directors may amend, suspend or terminate the 2023 Plan at any time; however, stockholder approval to amend the 2023 Plan may be necessary if the law or the rules of the national exchange so requires. No amendment, suspension or termination will impair the rights of any participant or recipient of any award without the consent of the participant or recipient.

Change in Control.

Except to the extent otherwise provided in an award agreement or as determined by the Committee in its sole discretion, in the event of a change in control, all outstanding options and equity awards (other than performance compensation awards) issued under the 2023 Plan will become fully vested and performance compensation awards will vest, as determined by the Committee, based on the level of attainment of the specified performance goals.

Compensation Committee Report

The following report of the Compensation Committee shall not be deemed to be "soliciting material" or to be "filed" with the Securities and Exchange Commission, nor shall this report be incorporated by reference into any filing made by the Company under the Securities Act of 1933, as amended, or the Exchange Act.

The Compensation Committee has reviewed and discussed the executive compensation, as disclosed above, with management. Based on this review and those discussions, the Compensation Committee recommended that the executive compensation be included in this report.

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| |
|:---|
| By the Compensation Committee |
| Bradley C. Lalonde |
| Umesh Patel |
| Jing Zhang |

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April 14, 2026

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table provides information as to shares of common stock and shares of Series A Preferred Stock beneficially owned and the percentage of voting power as of June 30, 2025, by:

 each director;

 each named executive officer;

 all directors and executive officers as a group; and

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| | |
|:---|:---|
|  | each person known by us to beneficially own at least 5% of our common stock |

---

The

calculations in the table below are based on 53,733,083 shares of common stock and 625,000 shares of Series A Preferred Stock issued and outstanding as of April 10, 2026, and do not include common stock issuable upon exercise of outstanding warrants. Each share of common stock entitles the holder to one vote and share of Series A Preferred Stock entitles the holder to ten votes on any matter on which action of the stockholders of the corporation is sought. The Series A Preferred Stock will vote together with the common stock. As of April 10, 2026, we had 28 stockholders of

record.

Beneficial ownership is determined under the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock subject to options, warrants and convertible notes currently exercisable or convertible, or exercisable or convertible within 60 days are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person.

Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o Northann Corp., 2251 Catawba River Rd, Fort Lawn, SC 29714.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Common Stock<br>Beneficially<br>Owned | Common Stock<br>Beneficially<br>Owned | Series A Preferred Stock<br>Beneficially Owned | Series A Preferred Stock<br>Beneficially Owned | Percentage of Voting<br>Power |
|  | Number | % | Number | % |  |
| Directors and Executive Officers: |  |  |  |  |  |
| Lin Li (Chairman, President, CEO, Treasurer and Secretary) | 1803750 | 3.4% | 625000 | 100% | 13.4% |
| Sunny S. Prasad (CFO) | 0 | -  | 0 | -  | -  |
| Kurtis W. Winn (Chief Operating Officer and Director) | 0 | -  | 0 | -  | -  |
| Bradley C. Lalonde (Independent Director) | 31527 | \* | 0 | -  | \*% |
| Umesh Patel<br>(Independent Director) | 22448 | \* | 0 | -  | \*% |
| Jing Zhang (Independent Director) | 5725 | \* | 0 | -  | \*% |
| All Directors and Executive Officers as a Group | 1863450 | 3.5% | 625000 | 100% | 13.5% |
| Principal Stockholders holding 5% or more: |  |  |  |  |  |
| Lin Li (Chairman, President, CEO, Treasurer and Secretary) | 1803750 | 3.4% | 625000 | 100% | 13.4% |

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\* less than 1%

Equity Compensation Plan

The following table provides information as of December 31, 2025 about our equity compensation plan and arrangements:

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| | | | |
|:---|:---|:---|:---|
| Plan category | Number of<br>securities to<br>be issued upon<br>exercise<br>of outstanding<br>options<br>and restricted<br>stock units | Weighted-average<br>exercise price<br>of<br>outstanding<br>options,<br>and restricted<br>stock units | Number of<br>securities<br>remaining<br>available for<br>future issuance<br>under equity<br>compensation<br>plans |
| Equity compensation plans approved by security holders |  |  | 2000000 |
| Equity compensation plans not approved by security holders |  |  | - |
| Total |  |  | 2000000 |

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Employment Agreements and Indemnification Agreements

See "ITEM 11. EXECUTIVE COMPENSATION—Employment Agreements with Executive Officers and Employee Director".

Other Transactions with Related Parties

During the fiscal years ended December 31, 2025 and 2024, Lin Li, our Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer, provided working capital to support the Company's operations when needed. The borrowings were unsecured, due on demand, and interest free. As of December 31, 2025, the Company was owed $1,834,784 by Lin Li. As of December 31, 2024, the Company owed Lin Li $1,416,432.

EB-5 Loan Agreement

On January 21, 2025, 3D PRINTING entered into an EB-5 loan agreement (the "Loan Agreement") with 3DFLOR OPPORTUNITY, LP, a Delaware limited partnership and a related party controlled by the Company's CEO, Chairman and controlling shareholder, Lin Li ("3DFLOR"), pursuant to which 3DFLOR agreed to provide 3D PRINTING a loan, with an initial maximum principal amount of $24,000,000 at an interest rate of 1.00% per year. The loan shall be secured by a pledge of all 49 million Class A Units of 3D PRINTING, and a promissory note. Subject to certain conditions as set out under the Loan Agreement being fulfilled, 3DFLOR would make an initial advance to 3D PRINTING. The amount of such initial advance would be as requested by 3D PRINTING. Subsequently, subject to certain restrictions, requests for further advances may also be made from time to time by 3D PRINTING. The closing date of the Loan Agreement shall be the date on which the initial advance is received by 3D PRINTING, and the maturity date of the loan under the Loan Agreement is the third anniversary of the closing date, unless such maturity is extended pursuant to Section 2.04 or accelerated as a result of Section 6.02(a). 3D PRINTING intends to use such funds to finance the development and expansion of a 3D printing manufacturing facility located at 2251 Catawba River Road, Fort Lawn, South Carolina.

In connection with the Loan Agreement, 3D PRINTING issued a promissory note to 3DFLOR in an amount of $24,000,000, dated January 27, 2025 (the "Promissory Note"). The Promissory Note bears the interest of one percent (1%) per year and the interest shall be non-compounding and calculated on the basis of a 366-day year, payable on the basis of the actual number of days elapsed. Pursuant to the Loan Agreement, the principal is due and is repayable in full on the third (3rd) anniversary of the closing date of the Loan Agreement.

In connection with the Loan Agreement, on January 27, 2025, Benchwick LLC entered into a membership interest pledge agreement with 3DFLOR and 3D PRINTING, in favor of 3DFLOR (the "Pledge Agreement"), to pledge to 3DFLOR (i) all 49 million Class A Units of 3D PRINTING it owns (the "Pledged Units") and (ii) all proceeds and products of the Pledged Units (collectively with the Pledged Units, "Collateral"), as security for the performance of 3D PRINTING's obligations under the Loan Agreement. Under the Pledge Agreement, Benchwick LLC shall, from time to time, be required by 3DFLOR to perfect the security interest of 3DFLOR in the Collateral. Under the Pledge Agreement, 3DFLOR is granted a first priority lien on all Collateral. Benchwick cannot transfer or encumber the Collateral without 3DFLOR's approval, and 3DFLOR can seize, sell, or liquidate the Collateral if there is a default.

On February 27, 2025, 3D PRINTING filed a UCC-1 Financing Statement securing 3DFLOR's security interests in the Collateral with Delaware. The Company's audit committee approved and ratified the above mentioned transactions.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

On May 29, 2025, LAO Professionals ("LAO") was appointed as the Company's independent registered public accounting firm. Prior to May 29, 2025, WWC, P.C. has served as the Company's independent registered public accounting firm since November 2021. The following table sets forth the aggregate fees for professional services rendered by LAO for the year ended December 31, 2025:

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| | |
|:---|:---|
|  | **2025**  |
| Audit Fees<sup>(1)</sup><br>| $64000<br>|
| Audit-Related Fees<sup>(2)</sup><br>| 2500<br>|
| Tax Fees<br>| -<br>|
| All Other Fees<br>| -<br>|
| **Total** <br>| $66500<br>|

---

The following table sets forth the aggregate fees for professional services rendered by WWC, P.C. for the year ended December 31, 2024:

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| | |
|:---|:---|
|  | 2024  |
| Audit Fees<sup>(1)</sup> | $135000 |
| Audit-Related Fees<sup>(2)</sup> | 50000 |
| Tax Fees | - |
| All Other Fees | - |
| Total  | $145000 |

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(1) Includes fees for professional services rendered during the fiscal year for the audit of our annual financial statements and for reviews of the financial statements included in our quarterly reports on Form 10-Q.

(2) Includes fees for services that generally only the independent registered public accounting firm can be reasonably expected to provide, including comfort letters, consents, and review of registration statements filed with the SEC.

The Audit Committee has implemented pre-approval procedures consistent with the rules adopted by the SEC. All audit and permitted non-audit services are pre-approved by the Audit Committee. The Audit Committee has delegated the responsibility of approving proposed non-audit services that arise between Audit Committee meetings to the chairman of the Audit Committee, provided that the decision to approve the services is presented for ratification at the next scheduled Audit Committee meeting.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES

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| | |
|:---|:---|
| Exhibit<br>Number | <br>Description |
| [3.1](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-1.htm) | [Articles of Incorporation (incorporated by reference to Exhibit 3.1 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-1.htm) |
| [3.2](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-2.htm) | [Certificate of Amendment to the Articles of Incorporation (incorporated by reference to Exhibit 3.2 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-2.htm) |
| [3.3](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-3.htm) | [Certificate of Designation of Series A Preferred Stock (incorporated by reference to Exhibit 3.3 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-3.htm) |
| [3.4](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-4.htm) | [Certificate of Amendment to the Certificate of Designation of Series A Preferred Stock (incorporated by reference to Exhibit 3.4 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-4.htm) |
| [3.5](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-5.htm) | [Bylaws (incorporated by reference to Exhibit 3.5 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex3-5.htm) |
| [3.6](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-1.htm) | [Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K (File No. 000-41816), filed with the Securities and Exchange Commission on October 7, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-1.htm) |
| [3.7](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-2.htm) | [Certificate of Amendment to Designation (incorporated by reference to Exhibit 3.2 of our Current Report on Form 8-K (File No. 000-41816), filed with the Securities and Exchange Commission on October 7, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-2.htm) |
| [3.8](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-3.htm) | [Certificate of Correction to Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.3 of our Current Report on Form 8-K (File No. 000-41816), filed with the Securities and Exchange Commission on October 7, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-3.htm) |
| [3.9](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-4.htm) | [Certificate of Correction to Certificate of Amendment to Designation (incorporated by reference to Exhibit 3.4 of our Current Report on Form 8-K (File No. 000-41816), filed with the Securities and Exchange Commission on October 7, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000605/ncl097_ex3-4.htm) |
| [4.5\*](ncl120_ex4-5.htm) | [Description of Securities](ncl120_ex4-5.htm) |
| [10.1](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-2.htm) | [Employment Agreement between the Company and Lin Li dated July 1, 2022 (incorporated by reference to Exhibit 10.2 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-2.htm) |
| [10.2](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-4.htm) | [Employment Agreement between the Company and Kurtis W. Winn dated July 1, 2022 (incorporated by reference to Exhibit 10.4 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-4.htm) |
| [10.3](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-12.htm) | [English translation of the Construction Agreement between NCP and Changzhou Wanyuan Construction Engineering Co., dated July 26, 2021 (incorporated by reference to Exhibit 10.12 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-12.htm) |
| [10.4](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-4.htm) | [English Translation of Form of Loan Agreement by and between NCP and Industrial and Commercial Bank of China dated June 4, 2024 (Contract No. 2024 (Wujin) Zi 00690) (incorporated by reference to Exhibit 10.4 of our Registration Statement on Form S-1 (File No. 333-284033), as amended, initially filed with the Securities and Exchange Commission on January 14, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-4.htm) |
| [10.5](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-5.htm) | [English Translation of Form of Loan Agreement by and between NCP and Industrial and Commercial Bank of China dated June 4, 2024 (Contract No. 2024 (Wujin) Zi 00957) (incorporated by reference to Exhibit 10.5 of our Registration Statement on Form S-1 (File No. 333-284033), as amended, initially filed with the Securities and Exchange Commission on January 14, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-5.htm) |
| [10.6](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-6.htm) | [English Translation of Loan Agreement by and between NCP and Jiangnan Rural Commercial Bank entered on March 26, 2020 (incorporated by reference to Exhibit 10.6 of our Registration Statement on Form S-1 (File No. 333-284033), as amended, initially filed with the Securities and Exchange Commission on January 14, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001279/or060_ex10-6.htm) |

---

---

| | |
|:---|:---|
| [10.7](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-17.htm) | [2023 Equity Incentive Plan (incorporated by reference to Exhibit 10.17 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-17.htm) |
| [10.8†](http://www.sec.gov/Archives/edgar/data/1923780/000157587224000865/or044_ex10-1.htm) | [Lease Agreement, dated July 26, 2024 and amended as of August 5, 2024, among Northann Corp. and SKY SC LLC (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on August 5, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224000865/or044_ex10-1.htm) |
| [10.9](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001083/or046_ex10-1.htm) | [Share Purchase Agreement, dated as of October 11, 2024, by and between Northann Corp .and Chuntao Li (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on October 15, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001083/or046_ex10-1.htm) |
| [10.10](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001177/or048_ex10-1.htm) | [Share Purchase Agreement by and between the Company and Jianquan Xu dated November 13, 2024 (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on November 15, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001177/or048_ex10-1.htm) |
| [10.11](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001200/or051_ex10-2.htm) | [First Amendment of Lease, dated November 19, 2024, among Northann Corp. and SKY SC LLC (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed with the SEC on November 21, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001200/or051_ex10-2.htm) |
| [10.12](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-1.htm) | [Financing and Strategic Planning Advisory Agreement by and between the Company and Linkun Investment LLC dated December 4, 2024 (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on December 5, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-1.htm) |
| [10.13](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-2.htm) | [Business Development Agreement by and between the Company and CAKL Holdings Sdn Bhd dated December 4, 2024 (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed with the SEC on December 5, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-2.htm) |
| [10.14](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-3.htm) | [Technical Service Agreement by and between the Company and San River International Sdn Bhd dated December 4, 2024 (incorporated by reference to Exhibit 10.3 of our Current Report on Form 8-K filed with the SEC on December 5, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001237/or056_ex10-3.htm) |
| [10.15](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-1.htm) | [Form of Share Purchase Agreement by and between the Company and Oneflow LLC as the lead investor and other investors dated December 6, 2024 (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on December 6, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-1.htm) |
| [10.16](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-2.htm) | [Form of Registration Rights Agreement by and between the Company and Oneflow LLC as the lead investor and other investors dated December 6, 2024 (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed with the SEC on December 6, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-2.htm) |
| [10.17](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-3.htm) | [Form of Share Purchase Agreement by and between the Company and X29 LLC as the lead investor and other investors dated December 6, 2024 (incorporated by reference to Exhibit 10.3 of our Current Report on Form 8-K filed with the SEC on December 6, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-3.htm) |
| [10.18](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-4.htm) | [Form of Registration Rights Agreement by and between the Company and X29 LLC as the lead investor and other investors dated December 6, 2024 (incorporated by reference to Exhibit 10.4 of our Current Report on Form 8-K filed with the SEC on December 6, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001243/or057_ex10-4.htm) |
| [10.19](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001276/or061_ex10-1.htm) | [Form of Share Purchase Agreement by and between the Company and Caitlin Xu Kang as the lead investor and other investors dated December 20, 2024 (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on December 23, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224001276/or061_ex10-1.htm) |
| [10.20](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-1.htm) | [EB-5 Loan Agreement dated January 21, 2025, between 3D PRINTING DEV, LLC and 3DFLOR OPPORTUNITY, LP (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on March 5, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-1.htm) |
| [10.21](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-2.htm) | [Promissory Note issued by 3D PRINTING DEV, LLC on January 27, 2025 (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed with the SEC on March 5, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-2.htm) |
| [10.22](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-3.htm) | [Membership Interest Pledge Agreement dated January 27, 2025, by and among Benchwick LLC, 3DFLOR OPPORTUNITY, LP and 3D PRINTING DEV, LLC (incorporated by reference to Exhibit 10.3 of our Current Report on Form 8-K filed with the SEC on March 5, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000217/or076_ex10-3.htm) |
| [10.23](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000771/ncl109_ex10-1.htm) | [Financing and Strategic Planning Advisory Agreement by and between the Company and Linkun Investment LLC dated December 18, 2025 (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K filed with the SEC on December 23, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000771/ncl109_ex10-1.htm) |
| [10.24](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000771/ncl109_ex10-2.htm) | [Operation and Strategic Planning Advisory Agreement by and between the Company and Lu Wang dated December 19, 2025 (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K filed with the SEC on December 23, 2025)](http://www.sec.gov/Archives/edgar/data/1923780/000157587225000771/ncl109_ex10-2.htm) |
| [14.1](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-16.htm) | [Code of Business Conduct and Ethics of the Company (incorporated by reference to Exhibit 10.16 of our Registration Statement on Form S-1 File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex10-16.htm) |
| [14.2](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex14-2.htm) | [Insider Trading Policy (incorporated by reference to Exhibit 14.2 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex14-2.htm) |
| [21.1\*](ncl120_ex21-1.htm) | [List of Subsidiaries](ncl120_ex21-1.htm) |
| [23.1\*](ncl120_ex23-1.htm) | [Consent of LAO Professionals](ncl120_ex23-1.htm) |

---

---

| | |
|:---|:---|
| [31.1\*](ncl120_ex31-1.htm) | [Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer](ncl120_ex31-1.htm) |
| [31.2\*](ncl120_ex31-2.htm) | [Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial officer](ncl120_ex31-2.htm) |
| [32.1\*](ncl120_ex32-1.htm) | [Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ncl120_ex32-1.htm) |
| [32.2\*](ncl120_ex32-2.htm) | [Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ncl120_ex32-2.htm) |
| [97.1](http://www.sec.gov/Archives/edgar/data/1923780/000157587224000353/or035_ex97-1.htm) | [Clawback Policy (incorporated by reference to Exhibit 97.1 of our Annual Report on Form 10-K filed with the SEC on April 15, 2024)](http://www.sec.gov/Archives/edgar/data/1923780/000157587224000353/or035_ex97-1.htm) |
| [99.1](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-2.htm) | [Audit Committee Charter (incorporated by reference to Exhibit 99.2 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-2.htm) |
| [99.2](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-3.htm) | [Nominating Committee Charter (incorporated by reference to Exhibit 99.3 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-3.htm) |
| [99.3](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-4.htm) | [Compensation Committee Charter (incorporated by reference to Exhibit 99.44 of our Registration Statement on Form S-1 (File No. 333-273246), as amended, initially filed with the Securities and Exchange Commission on July 14, 2023)](http://www.sec.gov/Archives/edgar/data/1923780/000157587223001155/or011_ex99-4.htm) |
| 101.INS<br>\*<br>| XBRL INSTANCE DOCUMENT |
| 101.SCH<br>\*<br>| XBRL TAXONOMY EXTENSION SCHEMA |
| 101.CAL<br>\*<br>| XBRL TAXONOMY EXTENSION CALCULATION LINKBASE |
| 101.DEF<br>\*<br>| XBRL TAXONOMY EXTENSION DEFINITION LINKBASE |
| 101.LAB<br>\*<br>| XBRL TAXONOMY EXTENSION LABEL LINKBASE |
| 101.PRE<br>\*<br>| XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE |

---

\* Filed herewith

Item 16. Form 10-K Summary

None.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | NORTHANN CORP. | NORTHANN CORP. |
| Dated: April 14, 2026 | By: | /s/ <br>Lin Li<br>|
|  |  | Lin Li |
|  |  | Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer |

---

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| Signatures | Title | Date |
| /s/ Lin Li | Chairman of the Board, Chief Executive Officer, | April 14, 2026 |
| Lin Li | President, Secretary, and Treasurer (Principal Executive Officer) |  |
| /s/ Sunny S. Prasad | Interim Chief Financial Officer | April 14, 2026 |
| Sunny S. Prasad  | (Principal Financial Officer and Interim Principal Accounting Officer) |  |
| /s/ <br>Kurtis W. Winn<br>| Chief Operating Officer and Director | April 14, 2026 |
| Kurtis W. Winn |  |  |
| /s/ <br>Bradley C. Lalonde<br>| Director | April 14, 2026 |
| Bradley C. Lalonde |  |  |
|  | Director | April 14, 2026 |
| Umesh Patel |  |  |
| /s/ <br>Jing Zhang<br>| Director | April 14, 2026 |
| Jing Zhang |  |  |

---

INDEX TO FINANCIAL STATEMENTS

---

| | |
|:---|:---|
| Consolidated Financial Statements for the Fiscal Years Ended December 31, 2025 and 2024 |  |
| [Report of Independent Registered Accounting Firm](#a_001_reportofindepen) | [F-2](#a_001_reportofindepen) |
| [Consolidated Balance Sheets as of December 31, 2025 and 2024](#f_001_northanncorp) | [F-3](#f_001_northanncorp) |
| [Consolidated Statements of Income and Comprehensive Income (Loss) for the Years Ended December 31, 2025 and 2024](#f_002_northanncorp) | [F-4](#f_002_northanncorp) |
| [Consolidated Statements of Stockholders' Deficit for the years ended December 31, 2025 and 2024](#f_003_northanncorp) | [F-5](#f_003_northanncorp) |
| [Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024](#f_004_northanncorp) | [F-6](#f_004_northanncorp) |
| [Notes to Consolidated Financial Statements](#f_005_notestoconsolid) | [F-7](#f_005_notestoconsolid) |

---

**Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Northann Corp.**

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of Northann Corp. (the "Company") as of December 31, 2025, and the related consolidated statements of operations, changes in stockholders' equity and cash flows for the year ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2025, and the results of its consolidated operations and its cash flows for the year ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

**Going Concern**

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1, the Company suffered an accumulated deficit of $(21,367,799) and a net loss of $(11,673,981). These matters raise substantial doubt about the Company's ability to continue as a going concern. Management's plans with regards to these matters are also described in Note 1 to the financial statements. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Basis for Opinion**

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

**Critical Audit Matters**

Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. Communication of critical audit matters does not alter in any way our opinion on the financial statements taken as a whole and we are not, by communicating the critical audit matters, providing separate opinions on the critical audit matter or on the accounts or disclosures to which they relate.

<u>Revenue recognition</u>

*Description of the Matter*

As discussed in Note 2 to the consolidated financial statements, the Company recognizes revenue when its customer obtains control of promised goods, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods. For the year ended December 31, 2025, the Company recognized revenue of $13,601,451 through multiple distribution channels, including wholesale distribution and retail sales. During the fiscal year, the Company significantly expanded its retail channel, with retail sales increasing from 0.19% to 7.09% of total revenue, and entered into new vendor agreements with several major home improvement retail chains in North America.

Auditing the Company's revenue recognition was complex due to the significant expansion of distribution channels during the year and the varying terms across wholesale and retail arrangements. The determination of when control transfers to the customer required evaluation of the specific shipping terms and delivery arrangements for each channel, particularly as the Company transitioned to new retail partnerships with different contractual terms than its existing wholesale relationships.

*How We Addressed the Matter in Our Audit*

To test revenue recognition, our audit procedures included, among others, evaluating the Company's revenue recognition policies for compliance with ASC 606, reviewing a sample of sales contracts and purchase orders across both wholesale and retail channels to assess the appropriateness of the timing of revenue recognition, and testing whether revenue was recorded in the correct period by examining shipping documentation and delivery confirmations near the year-end. We also evaluated management's disclosures related to the disaggregation of revenue by channel and product line and concluded that revenue recognition was appropriate.

/S/ Lateef Awojobi

**LAO PROFESSIONALS**

(PCAOB ID 7057)

Lagos, Nigeria

We have served as the Company's auditor since 2025.

April 14, 2026

NORTHANN CORP.

CONSOLIDATED BALANCE SHEETS

(In U.S. dollars)

---

| | | |
|:---|:---|:---|
|  | December 31,  | December 31,  |
|  | 2025  | 2024  |
| ASSETS |  |  |
| Current Assets |  |  |
| Cash and cash equivalents | $1030612 | $245164 |
| Accounts receivable, net | 3512715 | 3106561 |
| Inventory | 6185698 | 1995611 |
| Prepaid expense | 573094 | 490948 |
| Other receivables and other current assets | 50075 | 74984 |
| Due from related party | 985018 | -  |
| Total Current Assets | 12337212 | 5913268 |
| Property, plant and equipment, net | 3507401 | 3894434 |
| Construction in progress | 2127295 | 1258701 |
| Intangible assets, net | 994928 | 977986 |
| Operating lease right-of-use assets, net | 1466512 | 1822266 |
| Security deposits | 9030 | 9030 |
| TOTAL ASSETS | $20442378 | $13875685 |
| LIABILITIES AND STOCKHOLDERS' EQUITY |  |  |
| Current Liabilities |  |  |
| Accounts and other payables and accruals | $4322020 | $2600469 |
| Unearned revenue | 1349672 | -  |
| Operating lease liabilities, current | 374585 | 355754 |
| Loan payable, current | 1302745 | 4699081 |
| Tax payable | 22538 | 601317 |
| Due to related party | -  | 1416432 |
| Total Current Liabilities | 7371560 | 9673053 |
| Operating lease liabilities, non-current | 1091927 | 1466512 |
| Loan payable, non-current | 2968709 | 136947 |
| TOTAL LIABILITIES | 11432196 | 11276512 |
| Commitments and contingencies | -  | -  |
| Stockholders' Equity |  |  |
| Preferred stock – Series A: $0.001 par value, 20,000,000 shares authorized, 625,000 shares issued and outstanding as of December 31, 2025 and December 31, 2024\* | 625 | 625 |
| Preferred stock – Undesignated: 80,000,000 authorized, $0.001 par value, No shares issued and outstanding | - | - |
| Common stock: $0.001 par value, 400,000,000 shares authorized, 22,933,083 shares issued and outstanding as of December 31, 2025 and 6,933,050 shares issued and outstanding as of December 31, 2024\* | 22933 | 6933 |
| Subscription receivable | (12706602) | (1375000) |
| Additional paid-in Capital | 41709686 | 15540071 |
| Accrued compensation expense | -  | (2927250) |
| Accumulated deficit | (21367799) | (9693818) |
| Accumulated other comprehensive income | 1351339 | 1047612 |
| Total stockholders' deficit | 9010182 | 2599173 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $20442378 | $13875685 |

---

\* Retroactively reflect 1-for-8 reverse stock split effective on October 7, 2025. (Note 16)

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

NORTHANN CORP.

CONSOLIDATED STATEMENTS OF

**OPERATIONS AND COMPREHENSIVE LOSS**

(In U.S. dollars)

---

| | | |
|:---|:---|:---|
|  | Year Ended | Year Ended |
|  | December 31, | December 31, |
|  | 2025  | 2024  |
| Revenue | $13601451 | $15349854 |
| Cost of revenue | 10024453 | 11370028 |
| Gross Profit | 3576998 | 3979826 |
| Operating Expenses |  |  |
| Selling | 9874283 | 1071633 |
| General and administrative | 3067218 | 3798777 |
| Research and development | 2090835 | 783356 |
| Total Operating Expenses | 15032336 | 5653766 |
| LOSS FROM OPERATIONS | (11455338) | (1673940) |
| Other Income (Expense) |  |  |
| Interest income | 588 | 120 |
| Interest expense | (212482) | (470900) |
| Other income | 1857 | 306404 |
| Other expense | (25) | (32371) |
| Impairment loss in goodwill | -  | (2507455) |
| Total other income (expense) | (210062) | (2704202) |
| LOSS BEFORE TAXES | (11665400) | (4378142) |
| Income tax expense | (8581) | (1733) |
| NET LOSS | $(11673981) | $(4379875) |
| Other comprehensive income |  |  |
| Foreign currency translation adjustment | 303727 | 1823453 |
| Total comprehensive loss | $(11370254) | $(2556422) |
| Basic and dilutive earnings per share | $(0.82) | $(1.33) |
| Weighted average common shares outstanding - basic\* | 14304671 | 3283499 |
| Weighted average common shares outstanding - diluted\* | 14304671 | 3283499 |

---

\* Retroactively reflect 1-for-8 reverse stock split effective on October 7, 2025. (Note 16)

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

NORTHANN CORP.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(In U.S. dollars)

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Preferred Stock | Preferred Stock | Common Stock | Common Stock | | | | | |
|  | Number of<br> Shares\*  | Par Value  | Number of<br> Shares\*  | Par Value  | <br><br>Subscription<br> Receivable  | <br>Additional<br>Paid-in<br> Capital  | <br><br>Accumulated<br> Deficit  | Accumulated<br>Other<br>Comprehensive<br> Income (Loss)  | <br>Total<br>Stockholders'<br> Deficit  |
| Balance - December 31, 2023 | 625000 | $625 | 2672500 | $2673 | $(25000) | $6694098 | $(5313943) | $(775841) | $582612 |
| Issuance of common stock | - | - | 4260550 | 4260 | (1350000) | 8845973 | - | - | 7500233 |
| Net loss | -  | -  | -  | -  | -  | -  | (4379875) | -  | (4379875) |
| Accrued compensation expense | - | - | - | - | - | (2927250) | - | - | (2927250) |
| Accumulated other comprehensive income | -  | -  | -  | -  | -  | -  | -  | 1823453 | 1823453 |
| Balance - December 31, 2024 | 625000 | $625 | 6933050 | $6933 | $(1375000) | $12612821 | $(9693818) | $1047612 | $2599173 |

---

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Preferred Stock | Preferred Stock | Common Stock | Common Stock | | | | | |
|  | Number of<br> Shares\*  | Par Value  | Number of<br> Shares\*  | Par Value  | <br><br>Subscription<br> Receivable  | <br>Additional<br>Paid-in<br> Capital  | <br><br>Accumulated<br> Deficit  | Accumulated<br>Other<br>Comprehensive<br> Income (Loss)  | <br>Total<br>Stockholders'<br> Deficit  |
| Balance - December 31, 2024 | 625000 | $625 | $6933050 | $6933 | $(1375000) | $12612821 | $(9693818) | $1047612 | $2599173 |
| Reverse stock split rounding shares |  |  | 35 |  |  |  |  |  |  |
| Net loss | -  | -  | -  | -  | -  | -  | (11673981) | -  | (11673981) |
| Issuance of common stock |  | -  | 15000000 | 15000 | (11331602) | 19545200 | -  | -  | 8228598 |
| Issuance of common stock for services | -  | -  | 999998 | 1000 | -  | 6624415 | -  | -  | 6625415 |
| Accrued compensation expense |  |  |  |  |  | 2927250 |  |  | 2927250 |
| Accumulated other comprehensive income | -  | -  | -  | -  | - |  |  | 303727 | 303727 |
| Balance - December 31, 2025 | 625000 | $625 | 22933083 | $22933 | $(12706602) | $41709686 | $(21367799) | $1351339 | $9010182 |

---

\* Retroactively reflect 1-for-8 reverse stock split effective on October 7, 2025. (Note 16)

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

NORTHANN CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In U.S. dollars)

---

| | | |
|:---|:---|:---|
|  | Year Ended | Year Ended |
|  | December 31, | December 31, |
|  | 2025 | 2024  |
| CASH FLOWS FROM OPERATING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(11673981) | $(4379875) |
| &nbsp;&nbsp;&nbsp;Net income from discontinued operations |  |  |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 661705 | 645493 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based Compensation | 9552665 | 2042105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment of goodwill | -  | 2507455 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income from settlement of convertible notes | -  | (250000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease expense | 438854 | 168331 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax payable write-off | (539505) | -  |
| &nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (520042) | (491103) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | (4122229) | 649877 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other receivable | 27427 | 52328 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepayments | 274182 | (179546) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (108585) | (41968) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accruals and other payables | 1469948 | (705645) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unearned revenue | 1471485 | (1084484) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest | (4510) | 9234 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease payment | (438854) | (168331) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax payable | (40845) | (7362) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to related party | (2128954) | -  |
| Net Cash (Used in) Operating Activities | (5681239) | (1233491) |
| CASH FLOWS FROM INVESTING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of equipment | (100289) | -  |
| &nbsp;&nbsp;&nbsp;Payments for construction | (791479) | (296363) |
| Net Cash (Used in) Investing Activities | (891768) | (296363) |
| CASH FLOWS FROM FINANCING ACTIVITIES |  |  |
| &nbsp;&nbsp;&nbsp;Issuance of common shares | 6853597 | -  |
| &nbsp;&nbsp;&nbsp;Stock Subscription Receivable | 1375000 | -  |
| &nbsp;&nbsp;&nbsp;Amounts received from related parties | -  | 1136913 |
| &nbsp;&nbsp;&nbsp;Proceeds from loan payable, non-current | 2778137 | -  |
| &nbsp;&nbsp;&nbsp;Proceeds from bank borrowings | -  | 726099 |
| &nbsp;&nbsp;&nbsp;Repayments of loan payable, current | (3551065) | (1704697) |
| &nbsp;&nbsp;&nbsp;Repayment of secured borrowing arrangement | -  | (844900) |
| &nbsp;&nbsp;&nbsp;Settlement of convertible notes | -  | (500000) |
| Net Cash Provided by (Used in) Financing Activities | 7455669 | (1186585) |
| EFFECT OF EXCHANGE RATE CHANGE ON CASH & CASH EQUIVALENTS | (97214) | 1856389 |
| Net change in cash and cash equivalents | 785448 | (860050) |
| Cash and cash equivalents, beginning of period | 245164 | 1105214 |
| Cash and cash equivalents, end of period | $1030612 | $245164 |
| SUPPLEMENTAL CASH FLOW INFORMATION: |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid for income taxes | $8581 | $246140 |
| &nbsp;&nbsp;&nbsp;Cash paid for interest | $216992 | $120525 |

---

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

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31 2025

AND 202

(In U.S. dollars)

1. ORGANIZATION AND BUSINESS

The Company commenced operations in August 2013 with the establishment of Northann Building Solutions LLC. ("NBS") in Delaware. In December 2013, Northann (Changzhou) Construction Products Ltd ("NCP") was established in China. All of its products were manufactured through NCP.

In March 2014, Benchwich Construction Products Ltd ("Benchwick") was established in Hong Kong. All wholesales to distributors are conducted through Benchwick.

In April 2014, Changzhou Macro Merit International Trading Co., Ltd. ("MARCO") was established in China. All the import/export of our products are conducted through MARCO.

In February 2016, Northann Distribution Center Inc. ("NDC") was established in California. NDC is a distribution center in the United States and maintains a small inventory for retail sales.

In September 2017, Changzhou Ringold International Trading Co., Ltd. ("Ringold") was established in China. All of the raw material are procured from third parties through Ringold.

In September 2018, Crazy Industry (Changzhou) Industry Technology Co., Ltd. ("Crazy Industry") was established in China. Crazy Industry is the research and development hub.

In June 2020, Dotfloor Inc. ("Dotfloor") was established in California. Dotfloor operates dotfloor.com, the online store that offers our vinyl flooring products to retail customers in the United States.

In March 2022, Northann Corp. ("Northann"), the current ultimate holding company, was incorporated in Nevada as part of the restructuring transactions in contemplation of our initial public offering. In connection with its incorporation, in April 2022, we completed a share swap transaction and issued common stock and Series A Preferred Stock of Northann to the then existing shareholders of NBS, based on their then respective equity interests held in NBS. NBS then became our wholly owned subsidiary. In accordance to ASC 805-50-30-5 and ASC 805-50-45-1 through 45-5, the series of restructuring transactions have been accounted for as transactions between entities under common control; accordingly, the Company's historical capital structure has been retroactively restated to the first period presented.

On October 23, 2023, the Company consummated the initial public offering (the "IPO") of 1,200,000 shares of common stock, par value $0.001 per share at an offering price of $5.00 per share. On October 25, 2023, the underwriters of the IPO fully exercised the over-allotment option granted by the Company and purchased additional 180,000 shares of Common Stock at $5.00 per share. The closing of the Over-Allotment Option took place on October 26, 2023.

In October and November 2024, the Company acquired Cedar Modern Limited and Raleigh Industries Limited, respectively.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of December 31, 202

, the Company had a working capital of $

4,965,653

and net cash used in operating activities of $

5,681,238

for the year ended December 31, 202

. The Company may not have adequate liquidity to remain solvent and settle its obligations when payment become due; these factors gave rise to substantial doubt that the Company would continue as a going concern. Management is closely monitoring its financial position, especially its working capital and cash position, as well as its gross profit margins where its positive results of operations will allow the Company to continue as going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainly.

In February 2026, the Company received a purchase order of approximately $2.0 million from a leading Midwest home improvement retailer for Benchwick flooring products. This order, together with the Company's existing vendor relationships with several major North American home improvement retail chains, demonstrates the growing market acceptance of the Company's 3D-printed flooring products.

Subsequent to December 31, 2025, the Company has received partial payments toward the subscription receivable balance of $12,706,602. Management has obtained payment commitments from the subscription holders and expects substantially all of the remaining subscription receivable balance to be collected during the first and second quarters of fiscal year 2026. The collection of these amounts will significantly strengthen the Company's cash position and liquidity, extending the Company's cash runway well beyond twelve months from the date of these financial statements. Management believes the subscription receivable is fully collectible based on the following factors: (i) the subscription holders have demonstrated their intent and ability to pay through partial payments received subsequent to the balance sheet date; (ii) the subscription agreements are legally binding and enforceable; (iii) the Company has maintained active communication with all subscription holders regarding payment schedules; and (iv) management is not aware of any indicators of financial distress or inability to pay on the part of any subscription holder. Accordingly, no allowance for credit losses has been recorded against the subscription receivable as of December 31, 2025.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), and include the assets, liabilities, revenues, expenses and cash flows of all subsidiaries. All significant inter-company transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.

Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.

Use of Estimates

The preparation of these consolidation financial statements requires management of the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures. On an on-going basis, the Company evaluates its estimates based on historical experience and on various other assumptions that are believed 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 readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Identified below are the accounting policies that reflect the Company's most significant estimates and judgments, and those that the Company believes are the most critical to fully understanding and evaluating its consolidated financial statements.

Basis of Consolidation

The consolidated financial statements include the financial statements of the Company.

Revenue Recognition

The Company recognizes revenues when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. The Company recognizes revenues following the five-step model prescribed under ASU No. 2014-09: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation.

Revenue for sales of products which are primarily comprised of hardwood floors and three-dimensional printed flooring are recognized at the time of delivery of the products set forth in contracts with customers. At the time of delivery, physical and legal control of the asset is passed from the Company to its customer, at which time the Company believes it has satisfied the single performance obligation to complete a sales transaction in order to recognize revenue. The Company's contracts do not allow for returns, refunds, or warranties; however, it is customary in the industry to manufacturers to ship a small portion of extra product to allow for product quality issues. Also, as matter of good business practice, under very specific situations, the Company has historically agreed to provide minor discounts to customers who made complaints on products purchased. The Company has recorded these costs as period expenses when incurred as the Company is not able to reliably estimate such future expenses.

Revenues are recognized when control of the promised goods or services is transferred to our customers, which may occur at a point in time or over time depending on the terms and conditions of the agreement, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Practical expedients and exemption

The Company has not incurred any costs to obtain contracts and does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less.

The Company typically enters into agreements with its customers where its set forth the product to be sold, the price, payment terms, and any antecedent terms such as shipping and delivery specifications; these terms and conditions are most typically specified in purchase order issued by its customers to the Company. The Company typically recognizes revenue at point in time, which is when physical possession and legal title are transferred to the customer, this may be a shipping port or a specified destination; at this point the Company reasonably expect to paid for the product, or in the event where it was paid advance, the Company's performance obligations have been satisfied and those funds are considered earned by the Company. If the Company sells products on account to customers, they are typically paid within 90 days. Any funds received in advance for the products yet to be transferred to its customer are contract liabilities that are recorded as unearned revenue on the Company's consolidated balance sheets. $

1,349,672

and $nil were recognized as revenue from unearned revenue during the years ended December 31, 2025 and 2024.

Taxation

The Company accounts for income taxes using an asset and liability approach which allows for the recognition and measurement of deferred tax assets based upon the likelihood of realization of tax benefits in future years. Under the asset and liability approach, deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will either expire before the Company is able to realize their benefits, or that future deductibility is uncertain.

Under ASC 740, a tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The evaluation of a tax position is a two-step process. The first step is to determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigations based on the technical merits of that position. The second step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold is met. Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the year incurred. GAAP also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transition.

On December 22, 2017, the Tax Cuts and Jobs Act (the "Tax Act") was enacted by the U.S. government which included a wide range of tax reform affecting businesses including the corporate tax rates, international tax provisions, tax credits and deduction with majority of the tax provision effective after December 31, 2017. Certain activities conducted in foreign jurisdictions may result in the imposition of U.S. corporate income taxes on the Company when its subsidiaries, controlled foreign corporations ("CFCs"), generate income that is subject to Subpart F or GILTI under the U.S. Internal Revenue Code beginning after December 31, 2017.

The Company accounts for an unrecognized tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the tax authorities. The Company considers and estimates interest and penalties related to the gross unrecognized tax benefits and includes as part of its income tax provision based on the applicable income tax regulations.

The Company did not accrue any liability, interest or penalties related to uncertain tax positions in the provision for income taxes line of the consolidated statements of operations for the year ended December 31, 202

. The Company had no uncertain tax position for the years ended December 31, 202

and 202

.

Foreign Currency and Foreign Currency Translation

The functional currency of the Company is the Chinese Yuan ("RMB"), as their functional currencies. An entity's functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management's judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements.

Foreign currency transactions denominated in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are re-measured at the applicable rates of exchange in effect at that date. Gains and losses resulting from foreign currency re-measurement are included in the statements of comprehensive loss.

The consolidated financial statements are presented in U.S. dollars. Assets and liabilities are translated into U.S. dollars at the current exchange rate in effect at the balance sheet date, and revenues and expenses are translated at the average of the exchange rates in effect during the reporting period. Stockholders' equity accounts are translated using the historical exchange rates at the date the entry to stockholders' equity was recorded, except for the change in retained earnings during the period, which is translated using the historical exchange rates used to translate each period's income statement. Differences resulting from translating functional currencies to the reporting currency are recorded in accumulated other comprehensive income in the consolidated balance sheets.

Translation of amounts from RMB and HKD into U.S. dollars has been made at the following exchange rates:

---

| | | |
|:---|:---|:---|
| Balance sheet items, except for equity accounts |  |  |
| December 31, 202<br>5<br>| RMB 6.9931<br> to $1 | HKD <br>7.8<br>to $1<br>|
| December 31, 202<br>4<br>| RMB <br>7.2993 to $1<br>| HKD<br> 7.7677 <br>to $1<br>|
| Income statement and cash flows items |  |  |
| For the year ended December 31, 202<br>5<br>| RMB <br>7.1875<br> to $1<br>| HKD <br>7.8<br>to $1<br>|
| For the year ended December <br>31, 2024<br>| RMB <br>7.1957<br>to $1<br>| HKD<br> 7.803 <br>to$1<br>|

---

Cash

Cash consists of cash on hand and at banks and highly liquid investments, which are unrestricted from withdrawal or use, and which have original maturities of three months or less when purchased.

Accounts Receivable, Net

Accounts receivable is stated at the historical carrying amount net of allowance for doubtful accounts. The Company determines the allowance for doubtful accounts on an individual basis taking into consideration various factors including but not limited to historical collection experience and creditworthiness of the debtors as well as the age of the individual receivables balance.

Additionally, the Company would make specific bad debt provisions based on any specific knowledge the Company has acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require the Company to use judgment in assessing its collectability.

Allowance for doubtful accounts was nil and nil as of December 31, 2025 and 2024.

Long-Lived Assets

Long-lived assets consist primarily of equipment and intangible assets.

Equipment

Equipment is recorded at cost less accumulated depreciation and accumulated impairment. Depreciation is computed using the accelerated depreciation method over the estimated useful lives of the assets.

---

| | | |
|:---|:---|:---|
|  | Estimated useful lives (years) | Estimated useful lives (years) |
| Office and computer equipment |  | 3-5 |
| Manufacturing equipment |  | 10-20 |
| Automobile |  | 5 |

---

Expenditure for maintenance and repairs is expensed as incurred.

The gain or loss on the disposal of equipment is the difference between the net sales proceeds and the lower of the carrying value or fair value less cost to sell the relevant assets

and is

recognized in general and administrative expenses in the consolidated statements of comprehensive loss.

Land Use Rights, Net

Land use rights are a form of intangible assets in the PRC. They are recorded at cost less accumulated amortization with no residual value. Amortization of land use rights are computed using the straight-line method over their estimated useful lives.

The estimated useful lives of the Company's land use rights are as listed below:

Estimated useful lives (years) <br> Land use right 50

Impairment of Long-lived Assets

In accordance with ASC 360-10-35, the Company reviews the carrying values of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Based on the existence of one or more indicators of impairment, the Company measures any impairment of long-lived assets using the projected discounted cash flow method at the asset group level. The estimation of future cash flows requires significant management judgment based on the Company's historical results and anticipated results and is subject to many factors. The discount rate that is commensurate with the risk inhere

nt in the Company's business model is determined by its management. An impairment loss would be recorded if the Company determined that the carrying value of long-lived assets may not be recoverable. The impairment to be recognized is measured by the amount by which the carrying values of the assets exceed the fair value of the assets.

No impairment loss

has been recorded by the Company in the years ended December 31, 202

and 202

.

Net earnings per share of common stock

The Company has adopted ASC Topic 260, "Earnings per Share," ("EPS") which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying consolidation financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

---

| | | |
|:---|:---|:---|
|  | 2025 | 2024 |
| Net <br>loss<br>| $(10673981) | $(4379875) |
| Weighted average number of shares of common stock outstanding - basic<br>\* <br>| 14304671 | 3283499 |
| Add: potentially dilutive effect of shares issuable upon exercise of warrants | -  | -  |
| Weighted average number of shares of common stock outstanding - diluted<br>\*<br>| 14304671 | 3283499 |
| Net <br>loss<br> per ordinary share<br>|  |  |
| -Basic | $(0.82) | $(1.33) |
| -Diluted | $(0.82) | $(1.33) |

---

\* Retrospectively restated for the effect of 1-for-8 reverse stock split. (Note 16)

Segments

The Company evaluates a reporting unit by first identifying its operating segments, and then evaluates each operating segment to determine if it includes one or more components that constitute a business. If there are components within an operating segment that meets the definition of a business, the Company evaluates those components to determine if they must be aggregated into one or more reporting units. If applicable, when determining if it is appropriate to aggregate different operating segments, the Company determines if the segments are economically similar and, if so, the operating segments are aggregated. The Company has only one major reportable segment in the periods presented. The Company's chief operation decision maker is the Company's Chief Executive Officer.

Shipping and Handling Costs

Outbound shipping and handling costs are expenses as incurred and charged to the selling expense. Inbound shipping and freight are charged for raw material and components are accounted for as cost of revenues.

Fair Value of Financial Instruments

U.S. GAAP establishes a three-tier hierarchy to prioritize the inputs used in the valuation methodologies in measuring the fair value of financial instruments. This hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three-tier fair value hierarchy is:

Level 1 – observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 – include other inputs that are directly or indirectly observable in the market place.

Level 3 – unobservable inputs which are supported by little or no market activity.

The carrying value of the Company's financial instruments, including cash, accounts and other receivables, other current assets, accounts and other payables, and other short-term liabilities approximate their fair value due to their short maturities.

In accordance with ASC 825, for investments in financial instruments with a variable interest rate indexed to performance of underlying assets, the Company elected the fair value method at the date of initial recognition and carried these investments at fair value. Changes in the fair value are reflected in the accompanying consolidated statements of operations and comprehensive loss as other income (expense). To estimate fair value, the Company refers to the quoted rate of return provided by banks at the end of each period using the discounted cash flow method. The Company classifies the valuation techniques that use these inputs as Level 2 of fair value measurements.

As of December 31, 202

and 202

, the Company had no investments in financial instruments.

Leases

In February 2016, the FASB issued ASU 2016-12, Leases (ASC Topic 842), which amends the leases requirements in ASC Topic 840, Leases. Under the new lease accounting standard, a lessee will be required to recognize a right-of-use asset and lease liability for most leases on the balance sheet. The new standard also modifies the classification criteria and accounting for sales-type and direct financing leases, and enhances the disclosure requirements. Leases will continue to be classified as either finance or operating leases.

The Company adopted ASC Topic 842 using the modified retrospective transition method effective January 1, 2019. There was no cumulative effect of initially applying ASC Topic 842 that required an adjustment to the opening retained earnings on the adoption date nor revision of the balances in comparative periods. As a result of the adoption, the Company recognized a lease liability and right-of-use asset for each of the existing lease arrangement. The adoption of the new lease standard does not have a material impact on the consolidated income statements or the consolidated statements of cash flows.

The Company determines if an arrangement is a lease at inception. The lease payments under the lease arrangements are fixed. Non-lease components include payments for building management, utilities and property tax. It separates the non-lease components from the lease components to which they relate.

Lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is the Company's incremental borrowing rate, because the interest rate implicit in the leases is not readily determinable. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. The lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company generally uses the base, non-cancellable, lease term when determining the lease assets and liabilities.

Recent accounting pronouncements

Recently adopted accounting pronouncements

In November 2023, the FASB issued ASU 2023-07. The amendments improve reportable segment disclosure requirements. Main provisions include: (1) significant segment expenses—public entities are required to disclose significant segment expenses by reportable segment if they are regularly provided to the CODM and included in each reported measure of segment profit or loss; (2) other segment items—public entities are required to disclose other segment items by reportable segment. Such a disclosure would constitute the difference between reported segment revenues less the significant segment expenses (disclosed) less reported segment profit or loss; (3) multiple measures of a segment's profit or loss—public entities may disclose more than one measure of segment profit or loss used by the CODM, provided that at least one of the reported measures includes the segment profit or loss measure that is most consistent with GAAP measurement principles; (4) CODM-related disclosures—disclosure of the CODM's title and position is required on an annual basis, as well as an explanation of how the CODM uses the reported measure(s) and other disclosures; (5) entities with a single reportable segment—public entities must apply all of the ASU's disclosure requirements, as well as all existing segment disclosure and reconciliation requirements in ASC Topic 280,

Segment Reporting

; (6) recasting of prior-period segment information to conform to current-period segment information—recasting is required if segment information regularly provided to the CODM is changed in a manner that causes the identification of significant segment expenses to change. The amendments in ASU 2023-07 are effective for all public entities for fiscal years beginning after December 15, 2023. Early adoption is permitted. A public entity should apply the amendments in this update retrospectively to all prior periods presented in the financial statements. The Company adopted this update beginning January 1, 2024.

In December 2023, the FASB issued ASU 2023-09, which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. The ASU amends ASC 740-10-50-12 to require public business entities ("PBEs") to disclose a reconciliation between the amount of reported income tax expense (or benefit) from continuing operations and the amount computed by multiplying the income (or loss) from continuing operations before income taxes by the applicable statutory federal (national) income tax rate of the jurisdiction (country) of domicile. If PBE is not domiciled in the United States, the federal (national) income tax rate in such entity's jurisdiction (country) of domicile shall normally be used in the rate reconciliation. The amendments prohibit the use of different income tax rates for subsidiaries or segments. Further, PBEs that use an income tax rate in the rate reconciliation that is other than the U.S. income tax rate must disclose the rate used and the basis for using it. The ASU also adds ASC 740-10-50-12A, which requires entities to annually disaggregate the income tax rate reconciliation between the following eight categories by both percentages and reporting currency amounts: (1) State and local income tax, net of federal (national) income tax effect; (2) Foreign tax effects; (3) Effect of changes in tax laws or rates enacted in the current period; (4) Effect of cross-border tax laws; (5) Tax credits; (6) Changes in valuation allowances; (7) Nontaxable or nondeductible items; (8) Changes in unrecognized tax benefits. PBEs must apply the ASU's guidance to annual periods beginning after December 15, 2024 (2025 for calendar-year-end PBEs). Early adoption is permitted. Entities may apply the amendments prospectively or may elect retrospective application. The Company adopted this update beginning January 1, 2025.

Recently issued accounting pronouncements not yet adopted

In November 2024, the FASB issued ASU 2024-03 "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)". The amendments in this update intend to improve the disclosures about a public business entity's expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization, and depletion) in commonly presented expense captions (such as cost of sales, selling, general and administrative expenses, and research and development). ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The Company is currently evaluating the impact from the adoption of this ASU on its consolidated financial statements.

3. ACCOUNTS RECEIVABLE, NET

Accounts receivable consist of the following:

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025 | December 31,<br>2024 |
| Gross accounts receivable | $3512715 | $3106561 |
| Total | $3512715 | $3106561 |

---

There was no allowance for doubtful accounts recorded as of December 31, 2025, and 202

4. 4. OTHER RECEIVABLES

Other receivables consist of the following:

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025 | December 31,<br>2024 |
| Deposit and other assets | $50075 | $74984 |
| Total | $50075 | $74984 |

---

5. INVENTORY, NET

Inventories, net, consist of the following:

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025 | December 31,<br>2024 |
| Raw materials and components | $1636052 | $1517697 |
| Finished goods | 4549646 | 477913 |
| Total | 6185698 | 1995611 |
| less: Impairment | - | - |
| Inventories, net | $6185698 | $1995611 |

---

6. EQUIPMENT, NET

Equipment, net consists of the following:

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025 | December 31,<br>2024 |
| Manufacturing equipment | 8699909 | 8315845 |
| Office equipment | 402313 | 314748 |
| Less: Accumulated depreciation | 5594821 | 4736159 |
| Total | $3507401 | $3894434 |

---

Depreciation expenses charged to the consolidated statements of operations for the years ended December 31, 2025 and 2024 were $637,948 and $625,434, respectively.

7. **INTANGIBLE ASSETS , NET** 

---

| | | |
|:---|:---|:---|
|  | December 31,<br>2025 | December 31,<br>2024 |
| Land use right | $1133437 | $1087291 |
| Software | 24167 | 23154 |
| less: Accumulated amortization | 162676 | 132459 |
|  | $944928 | $977986 |

---

The Company has pledged its land use rights at No. 199, Newtag, Wujin District, Changzhou, Jiangsu Province, China, 213000 to Industrial and Commercial Bank of China Limited as a collateral for securing its loans.

8. LOAN PAYABLE

Short-term and long-term loans as of December 31, 2025 and December 31, 2024 represents mainly bank borrowings obtained from financial institutions in the PRC.

The short-term and long-term bank borrowings were secured by land use right. The weighted average interest rate for the bank borrowings for the years ended December 31, 202

and 202

was approximately 4.45% and 4.30%, respectively.

Current

---

| | | | | |
|:---|:---|:---|:---|:---|
| Bank | Loan period | Interest<br>rate | Balance at<br>December 31,<br>2025 | Balance at<br>December 31,<br>2024 |
| Industrial and Commercial Bank of China | June 4, 2024-June 12, 2025 | 4.35% | $- | $1369994 |
| Industrial and Commercial Bank of China | June 4, 2024-June 10, 2025 | 4.35% | - | 1369994 |
| Jiangnan Rural Commercial Bank | July 28, 2025-March 28, 2026 | 4.55% | 1286983 | 1232994 |
| Agricultural Bank of China, Changzhou Zhonglou Sub-branch | July 26, 2024-August 23, 2025 | 3.25% | - | 726097 |
| Auto Loan, current | From June 16, 2025 to June 30, 2030 | 1.99% | 15762 | - |
| Total |  |  | $1302745 | $4699080 |

---

Non-current

---

| | | | | |
|:---|:---|:---|:---|:---|
| Bank | Loan period | Interest<br>rate | Balance at<br>December 31,<br>2025 | Balance at<br>December 31,<br>2024 |
| Industrial and Commercial Bank of China | June 13, 2025-June 13, 2028 | 3.45% | $1358481 | $- |
| Industrial and Commercial Bank of China | June 13, 2025-June 13, 2028 | 3.45% | 1429981 | - |
| EIDL Loan | From June 26, 2020 to June 25, 2050 | 3.75% | 133971 | 136947 |
| Auto Loan, non-current | From June 16, 2025 to June 30, 2030 | 1.99% | 46276 | - |
| Total |  |  | $2968709 | $136947 |

---

9. BALANCES WITH RELATED PARTY

1) Related party transactions

For the year

s

ended December 31, 202

5 and 2024

, the Company's related party provided working capital to support the Company's operations when needed. The borrowings were unsecured, due on demand, and interest free. The following table summarizes borrowing transactions with the Company's related party:

2) Related party balances

---

| | | | | |
|:---|:---|:---|:---|:---|
| Accounts | Name of Related Party | Note | December 31,<br>2025 | December 31,<br>2024 |
| Amount due (from) to related party | Lin Li, Chief Executive Officer and Chairman of the Board |  | $(985018) | $1416432 |

---

All the above balances are due on demand, interest-free and unsecured. The Company used the funds for its operations.

10. EQUITY

Preferred Stock

The Company is authorized to issue 500,000,000 shares of capital stock, consisting of 400,000,000 shares of common stock, par value US$0.001 per share, and 100,000,000 shares of preferred stock, par value US$0.001 per share. 20,000,000 shares were designated to be series A preferred stock (the "Series A Preferred Stock") out of the 100,000,000 shares of blank check preferred stock. Each share of common stock is entitled to one vote and each share of Series A Preferred Stock is entitled to ten votes on any matter on which action of the stockholders of the corporation is sought. The Series A Preferred Stock will vote together with the common stock. Common stock and Series A Preferred Stock are not convertible into each other. Holders of Series A Preferred Stock are not entitled to receive dividends. The Series A Preferred Stock does not have liquidation preference over the Company's Common Stock, and therefore ranks pari passu with the Common Stock in the event of liquidation.

Common Stock

The Company is authorized to issue 400,000,000 shares of common stock with par value of US$0.001 per share. Each share of common stock entitles the holder to one vote. For the sake of comparability, the share structure as of the date of this report has been carried back in the Company's statement of stockholders' equity as if they had been issued and outstanding from the beginning of the first period presented.

11. INCOME TAXES

United States of America

The Company is subject to taxation in the United States (USA) at the tax rate of 21%.

Hong Kong

Two-tier Profits Tax Rates

The two-tier profits tax rates system was introduced under the Inland Revenue (Amendment)(No.3) Ordinance 2018 (the "Ordinance") of Hong Kong became effective for the assessment year 2018/2019. Under the two-tier profit tax rates regime, the profits tax rate for the first HKD 2 million (approximately $257,868) of assessable profits of a corporation will be subject to the lowered tax rate, 8.25% while the remaining assessable profits will be subject to the legacy tax rate, 16.5%. The Ordinance only allows one entity within a group of "connected entities" is eligible for the two-tier tax rate benefit. An entity is a connected entity of another entity if (1) one of them has control over the other; (2) both of them are under the control (more than 50% of the issued share capital) of the same entity; (3) in the case of the first entity being a natural person carrying on a sole proprietorship business-the other entity is the same person carrying on another sole proprietorship business. Since Benchwick is wholly owned and under the control of Northann, it is a connected entity. Under the Ordinance, it is an entity's election to nominate the entity that will be subject to the two-tier profits tax rates on its profits tax return. The election is irrevocable. The Company elected Benchwick to be subject to the two-tier profits tax rates.

The provision for current income and deferred taxes of Benchwick has been calculated by applying the new tax rate of 8.25%.

PRC

In accordance with the relevant tax laws and regulations of the PRC, a company registered in the PRC is subject to income taxes within the PRC at the applicable tax rate on taxable income. All the PRC subsidiaries that are not entitled to any tax holiday were subject to income tax at a rate of 25% for the year ended December 31, 2024 and 2023. According to PRC tax regulations, the PRC net operating loss can generally carry forward for no longer than five years starting from the year subsequent to the year in which the loss was incurred. Carry back of losses is not permitted. If not utilized, the PRC net operating loss will expire in 2026.

The income tax expense was $8,581 and $

1,733

for the years ended December 31, 202

and 202

, respectively.

The income tax provision consists of the following components:

---

| | | |
|:---|:---|:---|
|  | For the year ended<br>December 31,<br>2025 | For the year ended<br>December 31,<br>2024 |
| Current: |  |  |
| Federal | $4097 | $- |
| State | 4484 | (108) |
| Foreign |  | 1841 |
| Total current | $8581 | $1733 |
| Deferred: |  |  |
| Federal | $- | $- |
| State | - | - |
| Foreign | -  | - |
| Total deferred | $- | $- |
| Total income tax expense | $8581 | $1733 |

---

A reconciliation between the Company's actual provision for income taxes and the provision at the United States statutory rate is as follow:

---

| | | |
|:---|:---|:---|
|  | For the year ended<br>December 31,<br>2025 | For the year ended<br>December 31,<br>2024 |
| Loss<br> before income tax expense <br>| $(11665400) | $(4378142) |
| Statutory tax rate | 27.98% | 29.84% |
| Income tax computed at statutory income tax rate | (3264399) | (1306437) |
| Impact of different tax rates in other jurisdictions | 65531 | 1115557 |
| Tax effect of non-deductible expenses | 2673577 | 192615 |
| Change in valuation allowance | 533872<br>| -<br>|
| Total income tax expense | $8581 | $1733 |

---

The effective tax rate were (0.07%) and (0.04%) for the years ended December 31, 202

and 202

, respectively.

At December 31, 2025 and 2024, the Company had net operating loss ("NOL") carry-forwards for income tax purposes. No tax benefit was reported with respect to these NOL carry-forwards in the accompanying consolidated financial statements because the Company believes the realization of the net deferred tax assets for the NOL as of December 31, 2025, was not considered more likely than not and accordingly, the potential tax benefits of the net operating loss carry-forwards are fully offset by a full valuation allowance.

Uncertain tax positions

The Company did not have any uncertain tax positions during the years ended December 31, 202

and 202

.

The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by the respective jurisdictions, where applicable. The statute of limitations for the tax returns varies by jurisdictions.

The amounts of uncertain tax liabilities listed above are based on the recognition and measurement criteria of ASC Topic 740, and the balance is presented as current liability in the consolidated financial statements as of December 31, 2025. The Company anticipated that the settlements with the taxing authority are remitted within one year.

Our policy is to include interest and penalty charges related to uncertain tax liabilities as necessary in the provision for income taxes. The Company has a liability for accrued interest of $nil as of December 31, 2025 and 2024, respectively.

The statute of limitations for the Internal Revenue Services to assess the income tax returns on a taxpayer expires three years from the due date of the profits tax return or the date on which it was filed, whichever is later.

In accordance with the Hong Kong profits tax regulations, a tax assessment by the IRD may be initiated within six years after the relevant year of assessment, but extendable to 10 years in the case of potential willful underpayment or evasion.

In accordance with PRC Tax Administration Law on the Levying and Collection of Taxes, the PRC tax authorities generally have up to five years to assess underpaid tax plus penalties and interest for PRC entities' tax filings. In the case of tax evasion, which is not clearly defined in the law, there is no limitation on the tax years open for investigation. Accordingly, the PRC entities remain subject to examination by the tax authorities based on the above.

12. CHINA CONTRIBUTION PLAN

The Company participates in a government-mandated multi-employer defined contribution plan pursuant to which certain retirement, medical and other welfare benefits are provided to employees. Chinese labor regulations require the Company to pay to the local labor bureau a monthly contribution at a stated contribution rate based on the monthly compensation of qualified employees. The relevant local labor bureau is responsible for meeting all retirement benefit obligations; the Company has no further commitments beyond their monthly contributions. For the years ended December 31, 202

and 202

, the Company contributed a total of

$67,853

and $

67,699

, respectively, to these funds.

13. OPERATING LEASE

The Company has an operating lease for its office facilities. The lease is located at 9820 Dino Drive, Suite 110, Elk Grove, California, 95624, which consist of approximately 3,653 square feet. The initial lease term commenced on August 1, 2020 and ended on August 31, 2023.

The lease was renewed for additional 36 months to end on August 31, 2026

.

The Company has an operating lease for its warehouse facilities. The lease is located at 2251 Catawba River Road, Fort Lawn, SC, which consist of approximately 106,610 square feet. The lease term commenced on August 20, 2024 and will end on August 31, 2029.

Leases with an initial term of 12 months or less are not recorded on the balance sheet; the Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company does not separate non-lease components from the lease components to which they relate, and instead accounts for each separate lease and non-lease component associated with that lease component as a single lease component for all underlying asset classes.

The following table provides a summary of leases by balance sheet location as of December 31, 202

and 202

:

---

| | | |
|:---|:---|:---|
| Assets/liabilities | December 31,<br>2025 | December 31,<br>2024 |
| Assets |  |  |
| Operating lease right-of-use assets | $1466512 | $1822266 |
| Liabilities |  |  |
| Operating lease liability - current | $374585 | $355754 |
| Operating lease liability - non-current | 1091927 | 1466512 |
| Total lease liabilities | $1466512 | $1822266 |

---

The operating lease expenses for the year ended December 31, 202

and 202

were as follows:

---

| | | | |
|:---|:---|:---|:---|
| Lease Cost | Classification | December 31,<br>2025 | December 31,<br>2024 |
| Operating lease expense | General and administrative expenses | $438854 | $438854 |

---

Maturities of operating lease liabilities as of December 31, 202

were as follows:

---

| | |
|:---|:---|
| Maturity of Lease Liabilities | Operating<br>Leases |
| Within one year  | $439278 |
| Within a period of more than one year but not more than two years  | 428376 |
| Within a period of more than two year but not more than three years  | 441227 |
| Within a period of more than three year but not more than four years | 299976 |
| Within a period of more than four years but not more than five years | - |
| More than five years | - |
| Total lease commitment | $1608857 |
| Less: interest | (142345) |
| Present value of lease payments | $1466512 |

---

Lease liabilities include lease and non-lease component such as management fee.

---

| | | |
|:---|:---|:---|
| Lease Term and Discount Rate | December 31,<br>2025 | December 31,<br>2024 |
| Weighted-average remaining lease term (years) |  |  |
| Operating leases | 3.62 | 4.57 |
| Weighted-average discount rate (%) |  |  |
| Operating leases | 5% | 5% |

---

14. CONCENTRATIONS AND CREDIT RISK

(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Concentrations

During the fiscal year ended December 31, 2025, two customers accounted for nearly 69.7% of the Company's revenues. During the fiscal year ended December 31, 2024, two customers accounted for nearly

% of the Company's revenues. No other customer accounted for more than 10% of the Company's revenue in the year ended December 31, 2025 and no other customer accounted for more than 6% in the year ended December 31, 2024.

As of December 31, 202

, one customer accounted for

% of the Company's accounts receivable. As of December 31, 202

, five customers accounted for 94% of the Company's accounts receivable. No other customer accounted for more than 10% of the Company's accounts receivable as of December 31, 202

and no other customer accounted for more than 3% as of December 31, 202

.

During the fiscal year ended December 31, 202

,

two

suppliers accounted for a total of

44%

of the Company's cost of revenues. During the fiscal year ended December 31, 202

, suppliers accounted for a total of

% of the Company's cost of revenues. No other supplier accounted for over 10% of the Company's cost of revenues in the year ended December 31, 2025 and no other supplier accounted for over 4% in the year ended December 31, 2024.

As of December 31, 202

, one supplier accounted for a total of 20% of the Company's accounts payable. As of December 31, 202

, one supplier accounted for over 10% of the Company's accounts payable.

(b) Credit risk

Financial instruments that potentially subject the Company to a significant concentration of credit risk consist primarily of cash. As of December 31, 202

and 202

, substantially all of the Company's cash were held by major financial institutions located in the PRC, Hong Kong, and the United States, which management believes are of high credit quality. Deposits in the United States up to $250,000 are insured by the Federal Depository Insurance Corporation.

For the credit risk related to trade accounts receivable, the Company performs ongoing credit evaluations of its customers and, if necessary, maintains reserves for potential credit losses. Historically, such losses have been within management's expectations.

15. CAPITAL COMMITMENTS

On July 26, 2021, the Company has contracted Changzhou Wanyuan Construction Engineering Co. to build a second phase of its factory.

The amount required in the contract is $10 million. Construction is expected to take approximately one and half year, and the second phase of the factory will be approximately 250,000 square feet.

16. STOCK SPLIT

Effective on October 7, 2025, the Company implemented a 1-for-8 reverse stock split of the issued and outstanding shares. Under the reverse split, every eight shares of the issued and outstanding shares were converted into one share of the same kind, with a par value of $0.001 each. Except as otherwise indicated, all information in the consolidated financial statements concerning share and per share data gives retroactive effect to the 1-for-8 reverse stock split. The total number of outstanding common shares immediately before the reverse split was 179,797,995 and immediately after the reverse split was 22,474,784. The total number of outstanding preferred shares immediately before the reverse split was 5,000,000 and immediately after the reverse split was 625,000.

17. SECURED BORROWING ARRANGEMENT

In July 2023, the Company signed a secured borrowing agreement with a financial institution in the United States, in which the Company borrowed $1,000,000 secured by its accounts receivable amounted $1,491,000.

It is scheduled under the agreement that the Company pays $49,700 per week for thirty weeks to the financial institution to repay the loan.

On January 21, 2025, 3D PRINTING entered into an EB-5 loan agreement with 3DFLOR Chairman and controlling shareholder, Lin Li ("3DFLOR"), pursuant to which 3DFLOR agreed to provide 3D PRINTING a loan, with an initial maximum principal amount of $24,000,000 at an interest rate of 1.00% per year.

18. SUBSEQUENT EVENT

In January 2026, the Company issued

an aggregate of 12,500,000 shares of common stock to the designees of Kingsford Consultancy Ltd. pursuant to the Asset Purchase Agreement entered

with Kingsford Consultancy Ltd. on November 23, 2025.

In January and March 2026, the Company issued

an aggregate of 8,000,000

and 7,000,000 shares of common stock

, respectively, to the designees of Asia Resource Holdings Limited pursuant to the Development Agreement entered

with Asia Resource Holdings Limited on November 23, 2025.

In February 2026, the Company issued an aggregate of 1,800,000 shares of common stock to the designees of Linkun Investment LLC pursuant to the Financing and Strategic Planning Advisory Agreement entered with Linkun Investment LLC on December 18, 2025.

In February 2026, the Company issued an aggregate of 1,500,000 shares of common stock to a designee of Lu Wang pursuant to the Operation and Strategic Planning Advisory Agreement entered with Lu Wang on December 19, 2025.

19. UNRESTRICTED NET ASSETS

The following presents condensed financial information of Northann Corp:

Condensed Financial Information on Financial Position

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2025 | 2024 |
| Cash | 200 | - |
| Amounts due from subsidiaries | 10907404 | 4422688 |
| Total current assets | 10907404 | 4422688 |
| All other non-current assets | 1443566 | - |
| Interests in a subsidiary | 8941175 | 9452997 |
| Total Assets | 21292144 | 13875685 |
| Liabilities and Stockholders' Deficit |  |  |
| All other current liabilities | 431276 | 358626 |
| Amounts due to subsidiaries | 11850686 | 10881994 |
| Total current liabilities | 12281962 | 11240620 |
| Non-current liabilities | - | 35892 |
| Total Liabilities | 12281962 | 11240620 |
| Stockholders' Equity (Deficit) |  |  |
| Preferred stock,100,000,000 shares authorized – Series A, $0.001 par value, 20,000,000 shares designated, 5,000,000 shares issued and outstanding as of December 31, 2024 and 2023<br>\*<br>| 625 | 625 |
| Common stock, $0.001 par value, 400,000,000 shares authorized, 55,464,000 and <br>20,000,000<br> shares issued and outstanding as of December 31, 2024 and 2023<br>, respectively\*<br>| 22933 | 6933 |
| Subscription receivable | (12706602) | (1375000) |
| Additional Paid-in Capital | 41709686 | 15540071 |
| Accrued compensation expense | - | (2927250) |
| (Accumulated deficit) re<br>tained earnings<br>| (21367799) | (9693818) |
| Accumulated other comprehensive loss | 1351339 | 1047612 |
| Total Stockholders' Equity | 9010182 | 2599173 |
| Total Liabilities and Stockholders' Deficit | 21292144 | 13875685 |

---

\* Retrospectively restated for the effect of 2-for-1 reverse stock split. (Note 18)

Condensed Financial Information on Results of Operations

---

| | | |
|:---|:---|:---|
|  | For the years ended<br>December 31, | For the years ended<br>December 31, |
|  | 2025 | 2024 |
| Revenue | - | 250000 |
| Cost or revenues | - | - |
| Operating expenses | 10133014 | 2668613 |
| Income taxes | - | 1733 |
| L<br>oss – Parent only<br>| (10133014) | (2420347) |
| I<br>ncome (loss)<br>– Subsidiaries with unrestricted net assets<br>| (1337454) | 1175106 |
| Loss – Subsidiaries with restricted net assets | (203513) | (3134633) |
| Net <br>loss<br> – Consolidated<br>| (11673981) | (4379875) |

---

Condensed Financial Information on Cash Flows

---

| | | |
|:---|:---|:---|
|  | For the years ended<br>December 31, | For the years ended<br>December 31, |
|  | 2025 | 2024 |
| Cash used in operating activities | (10133014) | (2420347) |
| Cash used in investing activities | - | - |
| Cash provided by financing activities | 10133214 | 2419977 |
| Net cash flows | 200 | (370) |
| Beginning cash balance | - | 370 |
| Ending cash balance | 200 | - |

---

&nbsp;&nbsp;&nbsp;&nbsp;(i) Basis of presentation

The condensed financial information reflects the accounts of the Company. The condensed financial information should be read in connection with the consolidated financial statements and notes thereto. The condensed financial information is presented as if the incorporation of the Company were in effect since January 1, 2020,

&nbsp;&nbsp;&nbsp;&nbsp;(ii) Restricted Net Assets

Schedule I of Rule 5-04 of Regulation S-X requires the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant's proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party (i.e., lender, regulatory agency, foreign government, etc.). The Company's only assets are its equity interests in its subsidiaries. Unrestricted net assets are held in the Company's subsidiaries located in the US and Hong Kong. The Company does maintain substantial assets and operating subsidiaries in China; therefore, the ability for operating subsidiaries to pay dividends or transfer assets to the Company may be restricted due to the foreign exchange control policies and availability of cash balances of the Chinese operating subsidiaries.

As of December 31, 202

and 202

, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stocks or guarantees of the Company, except for those which have been separately disclosed in the Consolidated Financial Statements, if any.

## Exhibit 4.5

**Exhibit 4.5**

**DESCRIPTION OF SECURITIES**

**Authorized Stock**

The Company is authorized to issue 500,000,000 shares of capital stock, consisting of 400,000,000 shares of common stock, par value of US$0.001 per share, and 100,000,000 shares of blank check preferred stock, par value of US$0.001 per share. As of the date of this Annual Report, there are 53,733,083 shares of common stock and 625,000 shares of Series A Preferred Stock issued and outstanding, not including shares of common stock issuable upon exercise of outstanding warrants. The shares of common stock are held by eight stockholders of record and the shares of Series A Preferred Stock are held by one stockholder of record.

**Common Stock**

Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought. The holders of our common stock possess all voting power. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all shares of our common stock that are present in person or represented by proxy, subject to any voting rights granted to holders of any preferred stock. Holders of our common stock representing at least one-third our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our Articles of Incorporation. Our Articles of Incorporation do not provide for cumulative voting in the election of directors.

**Dividends**

There are no restrictions in our Articles of Incorporation or Bylaws that prevent the Company from declaring dividends. The Nevada Revised Statutes, however, prohibit the Company from declaring dividends where, after giving effect to the distribution of the dividends:

&nbsp;&nbsp;&nbsp;&nbsp;· the Company would not be able to pay its debts as they become due in the usual course of business; or

&nbsp;&nbsp;&nbsp;&nbsp;· the total assets of the Company would be less than the sum of the total liabilities of the Company plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution, unless otherwise permitted under our Articles of Incorporation.

**Reserve Stock Split**

On July 5, 2023, as approved by the board of directors and the majority shareholder of the Company, the Company effected a reverse split of our outstanding common stock and Series A Preferred Stock at a ratio of 2-for-1. On October 7, 2025, as approved by the board of directors and the majority shareholder of the Company, the Company effected a reverse split of our outstanding common stock and Series A Preferred Stock at a ratio of 8-for-1. All references to common stock, Series A Preferred Stock, share data, per share data, and related information have been retroactively adjusted, where applicable, in this Annual Report to reflect the reverse split of our issued and outstanding common stock and Series A Preferred Stock as if these events had occurred at the beginning of the earliest period presented.

**Listing of Common Stock**

Our common stock is listed on the NYSE American under the symbol "NCL".

**Transfer Agent and Registrar**

The transfer agent for our common stock is VStock Transfer LLC. The address is 18 Lafayette Pl, Woodmere, NY 11598. The telephone number is (212) 828-8436.

## Exhibit 21.1

**Exhibit 21.1**

**Northann Corp.**

**List of Subsidiaries**

---

| | |
|:---|:---|
| **Name of Subsidiary** | **Jurisdiction of Incorporation or Organization** |
| Northann Building Solutions LLC | Delaware |
| Northann (Changzhou) Construction Products Co., Ltd. | People's Republic of China |
| Northann Distribution Center Inc | California |
| Dotfloor, Inc. | California |
| Benchwick Construction Products Co., Limited | Hong Kong |
| Benchwick LLC | Delaware |
| 3D PRINTING DEV, LLC | Delaware |
| Crazy Industry (Chengzhou) Industry Technology Co., Ltd. | People's Republic of China |
| Changzhou Ringold International Trading Co., Ltd. | People's Republic of China |
| Changzhou Marco Merit International Trading Co., Ltd. | People's Republic of China |

---

## Exhibit 23.1

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

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To The Shareholders and Board of Directors of Northann, Corp.

We hereby consent to the incorporation by reference of our report dated April 13, 2026 in Annual Report on Form 10-K relating to the audit of the consolidated balance sheets of Northann Corp. and its subsidiaries (collectively the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of income and comprehensive income (loss), stockholders' equity (deficit) and cash flows for the years ended December 31, 2025 and 2024, and the related notes (collectively referred to as the financial statements).

The report of Northann Corp. includes an explanatory paragraph about the existence of substantial doubt about its ability to continue as a going concern.

/S/ Lateef Awojobi

LAO PROFESSIONALS

PCAOB No:7057

Lagos, Nigeria

April 14, 2026

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION**

I, Lin Li, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2025, of Northann Corp. (the "registrant");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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: April 14, 2026 | */s/ Lin Li* |
|  | Lin Li |
|  | Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer (Principal Executive Officer) |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION**

I, Sunny S. Prasad, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2025, of Northann Corp. (the "registrant");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our 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;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's fourth fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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: April 14, 2026 | */s/ Sunny S. Prasad* |
|  | Sunny S. Prasad |
|  | Interim Chief Financial Officer (Principal Financial Officer and Principal 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**

In connection with the Annual Report of Northann Corp. (the "Company") on Form 10-K pursuant for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Lin Li, Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer (Principal Executive Officer) of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: April 14, 2026

<u>*/s Lin Li*</u> <br> Lin Li <br> Chairman of the Board, Chief Executive Officer, President, Secretary, and Treasurer (Principal Executive Officer)

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of Northann Corp. (the "Company") on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Sunny S. Prasad, Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: April 14, 2026

---

| |
|:---|
| */s/ Sunny S. Prasad* |
| Sunny S. Prasad |
| Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) |

---