# EDGAR Filing Document

**Accession Number:** 0002023153
**File Stem:** 0001493152-26-028303
**Filing Date:** 2026-6
**Character Count:** 526434
**Document Hash:** f76075ee7dbe04707a23a7e7b23f61d5
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-26-028303.hdr.sgml**: 20260611

**ACCESSION NUMBER**: 0001493152-26-028303

**CONFORMED SUBMISSION TYPE**: 20-F/A

**PUBLIC DOCUMENT COUNT**: 106

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260611

**DATE AS OF CHANGE**: 20260611

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** HomesToLife Ltd
- **CENTRAL INDEX KEY:** 0002023153
- **STANDARD INDUSTRIAL CLASSIFICATION:** RETAIL-FURNITURE STORES [5712]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 000000000

**FILING VALUES:**
- **FORM TYPE:** 20-F/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-42290
- **FILM NUMBER:** 261083964

**BUSINESS ADDRESS:**
- **STREET 1:** 6 RAFFLES BOULEVARD
- **STREET 2:** #02-01/02, MARINA SQUARE
- **CITY:** SINGAPORE
- **STATE:** U0
- **ZIP:** 039594
- **BUSINESS PHONE:** 65 9730 3718

**MAIL ADDRESS:**
- **STREET 1:** 6 RAFFLES BOULEVARD
- **STREET 2:** #02-01/02, MARINA SQUARE
- **CITY:** SINGAPORE
- **STATE:** U0
- **ZIP:** 039594

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

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 20-F**

 **(Amendment No. 1)**

20-F/A

☐ **REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

☒ **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**

**OR**

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

Date of event requiring this shell company report

**For the transition period from ________ to ________**

Commission file number: 001-42290

**HOMESTOLIFE LTD**

(Exact name of Registrant as specified in its charter)

**N/A**

(Translation of Registrant's name into English)

**Cayman Islands**

(Jurisdiction of incorporation or organization)

**6 Raffles Boulevard, #02-01/02**

**Marina Square, Singapore 039594**

(Address of principal executive offices)

**Phua Mei Ming**

**Telephone: +65 9730 3718**

**6 Raffles Boulevard, #02-01/02**

**Marina Square, Singapore 039594**

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

**Securities registered or to be registered pursuant to Section 12(b) of the Act.**

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| **Ordinary shares, par value $0.0001 per share** | **HTLM** | **The Nasdaq Stock Market LLC** |

---

Securities registered or to be registered pursuant to Section 12(g) of the Act.

**None**

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

**None**

(Title of Class)

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.

As of December 31, 2025, the issuer had 89,687,500 Ordinary Shares, par value $0.0001 per share, issued and outstanding.

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

Yes ☐ No ☒

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes ☐ No ☒

Note - Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

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

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, 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. ☐

\* The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

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. ☐

Indicate by check mark whether any of those error corrections are restatements that required 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-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☒ International Financial Reporting Standards as issued by the International Accounting Standards Board ☐ Other ☐

\* If "Other" has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

**EXPLANATORY NOTE**

HomesToLife Ltd (the "Company", "we", "our", or "us") is filing this Amendment No. 1 to its Annual Report on Form 20-F (the "Amendment") to amend its Annual Report on Form 20-F for the fiscal year ended December 31, 2025 (the "Annual Report"), as filed with the Securities and Exchange Commission on March 23, 2026.

This Amendment is being filed solely to revise the disclosures in Item 15(a) Disclosure Controls and Procedures of the Annual Report.

Except as described above, no other information included in the Annual Report is being amended or updated by this Amendment and, other than as described herein, this Amendment does not purport to reflect any information or events subsequent to the Annual Report. This Amendment continues to describe the conditions as of the date of the Annual Report and, except as expressly contained herein, we have not updated, modified or supplemented the disclosures contained in the Annual Report.

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| [INTRODUCTION](#ta_001) | [INTRODUCTION](#ta_001) | ii |
| [PART I](#ta_002) | [PART I](#ta_002) | 3 |
| ITEM 1. | [IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS](#ta_003) | 3 |
| ITEM 2. | [OFFER STATISTICS AND EXPECTED TIMETABLE](#ta_004) | 3 |
| ITEM 3. | [KEY INFORMATION](#ta_005) | 3 |
| ITEM 4. | [INFORMATION ON THE COMPANY](#ta_006) | 29 |
| ITEM 4A. | [UNRESOLVED STAFF COMMENTS](#ta_007) | 44 |
| ITEM 5. | [OPERATING AND FINANCIAL REVIEW AND PROSPECTS](#ta_008) | 45 |
| ITEM 6. | [DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](#ta_009) | 59 |
| ITEM 7. | [MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](#ta_010) | 66 |
| ITEM 8. | [FINANCIAL INFORMATION](#ta_011) | 69 |
| ITEM 9. | [THE OFFER AND LISTING](#ta_012) | 70 |
| ITEM 10. | [ADDITIONAL INFORMATION](#ta_013) | 71 |
| ITEM 11. | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#ta_014) | 89 |
| ITEM 12. | [DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES](#ta_015) | 90 |
| [PART II](#ta_016) | [PART II](#ta_016) | 91 |
| ITEM 13. | [DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES](#ta_017) | 91 |
| ITEM 14. | [MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS](#ta_018) | 91 |
| ITEM 15. | [CONTROLS AND PROCEDURES](#ta_019) | 91 |
| ITEM 16. | [\[RESERVED\]](#ta_020) | 92 |
| ITEM 16A. | [AUDIT COMMITTEE FINANCIAL EXPERT](#ta_021) | 92 |
| ITEM 16B. | [CODE OF ETHICS](#ta_022) | 92 |
| ITEM 16C. | [PRINCIPAL ACCOUNTANT FEES AND SERVICES](#ta_023) | 92 |
| ITEM 16D. | [EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES](#ta_024) | 93 |
| ITEM 16E. | [PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS](#ta_025) | 93 |
| ITEM 16F. | [CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT](#ta_026) | 93 |
| ITEM 16G. | [CORPORATE GOVERNANCE](#ta_027) | 93 |
| ITEM 16H. | [MINE SAFETY DISCLOSURE](#ta_028) | 94 |
| ITEM 16I. | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#ta_029) | 94 |
| ITEM 16J. | [INSIDER TRADING POLICIES](#ta_030) | 94 |
| ITEM 16K. | [Cybersecurity](#ta_031) | 94 |
| [PART III](#ta_032) | [PART III](#ta_032) | 96 |
| ITEM 17. | [FINANCIAL STATEMENTS](#ta_033) | 96 |
| ITEM 18. | [FINANCIAL STATEMENTS](#ta_034) | 96 |
| ITEM 19. | [EXHIBITS](#ta_035) | 96 |

---

i

**INTRODUCTION**

In this annual report on Form 20-F, unless the context otherwise requires, references to:

● "CAGR" are to the compounded annual growth rate, representing the year-on-year growth rate over a specific period of time;

● "Company," "HomesToLife Cayman" or "our Company" means HomesToLife Ltd, an exempted company incorporated in the Cayman Islands with limited liability under the Companies Act on February 16, 2024;

● "Companies Act" means the Companies Act (2023 Revision) of the Cayman Islands, as amended, supplemented or modified from time to time;

● "Exchange Act" are to the Securities Exchange Act of 1934, as amended;

● "Group", "our Group", "we", "us", or "our" means our Company and its subsidiaries or any of them, or where the context so requires, in respect of the period before our Company becoming the holding company of its present subsidiaries, such subsidiaries as if they were subsidiaries of our Company at the relevant time or the businesses which have since been acquired or carried on by them or as the case may be their predecessors.

● "HTL FE" means HTL Far East Pte. Ltd., a company incorporated in Singapore on October 28, 2024, and an indirect wholly-owned subsidiary of our Company.

● "HTL Marketing" means HTL Marketing Pte. Ltd., a company incorporated in Singapore on December 23, 2020, and direct wholly-owned subsidiary of our Company.

● "HTL Group" means collectively all of the entities controlled or owned by Major Shareholders.

● "HomesToLife Singapore" means HomesToLife Pte. Ltd., a company incorporated in Singapore on September 28, 1989, and an indirect wholly-owned subsidiary of our Company;

● "Hong Kong" are to the Hong Kong Special Administrative Region of the People's Republic of China for the purposes of this annual report only;

● "Major Shareholders" means Messrs. Phua Yong Pin and Phua Yong Tat, who are also our founders and Chairman/Vice Chairman;

● "Ordinary Shares" or "Shares" are to the ordinary shares of HomesToLife Ltd, par value US$0.0001 per share;

● "S$" or "SGD" means Singapore dollars(s), the lawful currency of Singapore;

● "SEC" or "Securities and Exchange Commission" means the United States Securities and Exchange Commission;

● "Securities Act" are to the Securities Act of 1933, as amended;

● "Singapore Companies Act" means the Companies Act 1967 of Singapore, as amended, supplemented or modified from time to time;

● "US$" or "U.S. dollar(s)" are to the legal currency of the United States; and

● "U.S." refers to the United States of America.

This annual report on Form 20-F includes our audited consolidated and combined financial statements for the years ended December 31, 2025, 2024, and 2023. In this annual report (including our consolidated and combined financial statements), we provide information on our assets, obligations, commitments, liabilities and other financial information in United States dollars. These dollar amounts include translations of amounts in Singapore dollars, Australian dollars, Euros, Japanese Yen, South Korean Won and British Pounds into United States dollars, using exchange rates determined as of a specific date or for a specific period. Changes in the exchange rates will affect the amount of our obligations and the value of our assets in terms of United States dollars which may result in an increase or decrease in the amount of our obligations and the value of our assets.

ii

**FORWARD-LOOKING STATEMENTS**

This annual report contains forward-looking statements that reflect our current expectations and views of future events. The forward-looking statements are contained principally in "Item 3. Key Information—D. Risk Factors," "Item 4. Information on the Company—B. Business Overview," and "Item 5. Operating and Financial Review and Prospects." These forward-looking statements are made under the "safe-harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Known and unknown risks, uncertainties and other factors, including those listed under "Item 3. Key Information—D. Risk Factors," may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements.

The words "may," "might," "will," "could," "would," "should," "expect," "intend," "plan," "goal," "objective," "anticipate," "believe," "estimate," "predict," "potential," "continue" and "ongoing," or the negative of these terms, similar expressions or other comparable terminology intended to identify statements about the future. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy, and financial needs. These forward-looking statements include statements relating to:

● our goals and growth strategies

● our future business development, financial condition and results of operation;

● our expectations regarding demand for and market acceptance of our services;

● our expectations regarding our relationships with our investors and borrowers;

● competition in our industry;

● relevant government policies, laws and regulations relating to our industry;

● continued market acceptance of our services and products;

● protection of our intellectual property rights;

● changes in the laws that affect our operations;

● fluctuations in operating results;

● inflation and fluctuations in foreign currency exchange rates;

● dependence on our senior management and key employees;

● our ability to continue to develop new technologies and/or upgrade our existing technologies;

● our ability to obtain and maintain all necessary government certifications, approvals, and/or licenses to conduct our business;

● the cost of complying with current and future governmental regulations and the impact of any changes in the regulations on our operations;

● capabilities of our business operations;

● changes in general economic, business and industry conditions; and

● other risks and uncertainties indicated in this annual report, including those set forth in "Item 3. Key Information—D. Risk Factors."

These forward-looking statements involve various risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. Our actual results could be materially different from our expectations. Important risks and factors that could cause our actual results to be materially different from our expectations are generally set forth in "Item 3. Key Information—D. Risk Factors," "Item 4. Information on the Company—B. Business Overview," "Item 5. Operating and Financial Review and Prospects," and other sections in this annual report. You should read thoroughly this annual report and the documents that we refer to with the understanding that our actual future results may be materially different from and worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the consolidated and combined statements of operations and comprehensive income.

The reporting currency of the Company is United States Dollar ("US$") and the accompanying consolidated and combined financial statements have been expressed in US$. The Company's major operating subsidiaries operating in Singapore maintains their books and records in US$, with the exception of HomesToLife Pte Ltd, which keeps its books in Singapore Dollars ("SGD") being the primary currency of the economic environment in which its business is conducted. However, other operating subsidiaries operating overseas maintain their books and records in their respective local currencies, Australian Dollars ("AUD "), Euro ("EUR"), Japanese Yen ("JPY"), South Korean Won ("KRW") and British Pound ("GBP"), in each case being the primary currency of the economic environment in which that subsidiary conducts its operations. In general, for consolidation purposes, assets and liabilities of our subsidiaries whose functional currency is not US$ are translated into US$, in accordance with Accounting Standards Codification ("ASC") Topic 830-30, Translation of Financial Statement ("ASC 830"), using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income (loss) within the consolidated and combined statements of changes in shareholders' equity.

Translation of amounts has been made at the following exchange rates into US$1.00 in this annual report:

---

| | | | | |
|:---|:---|:---|:---|:---|
| US$ Exchange rate | 2023 | 2024 | 2025 | At <br> February 28, 2026 |
| Year-end SGD:US$1 exchange rate | 1.3193 | 1.3662 | 1.2847 | 1.2654 |
| Average SGD:US$1 exchange rate | 1.3428 | 1.3363 | 1.3056 | 1.2723 |
| Year-end AUD:US$1 exchange rate | 0.6828 | 0.6185 | 0.6700 | 0.7105 |
| Average AUD:US$1 exchange rate | 0.6644 | 0.6597 | 0.6453 | 0.6939 |
| Year-end EUR:US$1 exchange rate | 0.9040 | 0.9661 | 0.8511 | 0.8479 |
| Average EUR:US$1 exchange rate | 0.9245 | 0.9242 | 0.8859 | 0.8457 |
| Year-end JPY:US$1 exchange rate | 141 | 157 | 156 | 156 |
| Average JPY:US$1 exchange rate | 141 | 151 | 150 | 155 |
| Year-end KRW:US$1 exchange rate | 1291 | 1478 | 1420 | 1414 |
| Average KRW:US$1 exchange rate | 1307 | 1363 | 1399 | 1417 |
| Year-end GBP:US$1 exchange rate | 0.7847 | 0.7987 | 0.7425 | 0.7415 |
| Average GBP:US$1 exchange rate | 0.8039 | 0.7824 | 0.7573 | 0.7366 |

---

**Part I**

**Item 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS**

Not applicable.

**Item 2. OFFER STATISTICS AND EXPECTED TIMETABLE**

Not applicable.

**Item 3. KEY INFORMATION**

A. [Reserved]

B. Capitalization and indebtedness.

Not applicable.

C. Reasons for the offer and use of proceeds.

Not applicable.

D. Risk factors.

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may materially and adversely affect our business, financial condition, results of operations, cash flows and prospects that you should consider before making a decision to invest in our Ordinary Shares. These risks include, but are not limited to, the following:

**Risks Related to Our Business in General**

***We may incur losses in the future.***

We anticipate that our operating expenses, together with the increased general administrative expenses incurred as a public company, will increase in the foreseeable future as we seek to maintain and continue to grow our business and attract potential customers. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenue sufficiently to offset these higher expenses. As a result of the foregoing and other factors, we may incur net losses in the future and may be unable to achieve or maintain profitability on a quarterly or annual basis for the foreseeable future.

***Our operating history may not be indicative of our future growth or financial results and we may not be able to sustain our historical growth rates. If we fail to manage our growth effectively, our business, financial condition and operating results could be harmed.***

Our historical growth rates may not be sustainable or indicative of future growth. As of the date of this annual report, we have a number of operating subsidiaries, the majority of which are held under HTL Marketing. Our business is split into three core divisions: an export division, a leather trading division and a consumer retail division with direct operations in Singapore and Korea. Our operating history may not be indicative of our future growth or financial results. There is no assurance that we will be able to grow our revenues in future periods. Our growth rates may decline for any number of possible reasons, and some of them are beyond our control, including decreasing customers, decreasing customer demand, increasing competition, declining growth of the furniture industry in general, shortage of raw materials, price increase of raw materials, or changes in government policies or general economic conditions.

To manage our growth effectively, we must continue to implement our operational plans and strategies, improve and expand our infrastructure of people and information systems and expand, train and manage our employee base. We plan to expand our sales network and product and services offerings and to increase our customer base and volume of sales. However, the execution of our expansion plan is subject to uncertainty and the sales may not grow at the rate we expect for the reasons stated above. If our new hires perform poorly, if we are unsuccessful in hiring, training, managing and integrating these new employees and staff, or if we are not successful in retaining our existing employees and staff, our business may be harmed. We also face significant competition for personnel. Failure to manage our hiring needs effectively or successfully integrate our new hires may have a material adverse effect on our business, financial condition and operating results. Properly managing our growth will also require us to establish consistent policies across regions and functions, and a failure to do so could likewise harm our business.

Additionally, the growth of our business places significant demands on our operations, as well as our management and other employees. Further, we have faced and may continue to face a number of challenges to our expansion into physical retail locations, including locating retail space with a cost and geographic profile that will allow us to operate in highly desirable shopping locations, hiring in-store talent and expanding our physical retail operations in a cost-effective manner. We have entered into and may continue to enter into long-term leases before we know whether our physical retail strategy or a particular geography will be successful. We are also required to manage relationships with a growing number of suppliers, customers and other third parties across the world. Our information technology systems and our internal controls and procedures may not be adequate to support future growth of our supplier and employee base.

Failure to manage our growth and organizational change effectively could lead us to over-invest or under-invest in technology and operations; result in weaknesses in our infrastructure, systems or controls; give rise to operational mistakes, losses or loss of productivity or business opportunities; reduce customer satisfaction; limit our ability to respond to competitive pressures; and result in loss of employees and reduced productivity of remaining employees. If we are unable to manage the growth of our organization effectively, our business, financial condition and operating results may be materially adversely affected. If our growth rates decline, investors' perceptions of our business and prospects may be adversely affected and the market price of our securities could decline.

***We may not realize the anticipated benefits of our acquisition of HTL Marketing, and the integration of HTL Marketing may present significant challenges that could adversely affect our business, financial condition, and results of operations.***

On May 19, 2025, we closed the acquisition of 100% of the equity interests in HTL Marketing, a B2B procurer and supplier of premium upholstered sofas and leather materials for sofa manufacturing, and a related party. While we believe this acquisition presents significant opportunities for growth and expansion into new markets, we cannot assure that we will realize the anticipated benefits of the transaction, including increased revenue, profitability, or market share.

The process of integrating the acquired business may be disruptive to our existing operations and may require significant resources and management attention. Additionally, any failure to successfully integrate HTL Marketing, or to realize the expected benefits of the acquisition on a timely basis or at all, could adversely affect our business, financial condition, and results of operations.

***Any inability by us to consummate and effectively integrate acquisitions into our business operations may adversely affect our results of operations.***

We may in the future invest time and resources into carefully assessing opportunities for acquisitions and/or strategic investments, and we continue to evaluate potential acquisition opportunities to support, strengthen and grow our business, including potentially in the near term.

Despite diligence and integration planning, acquisitions still present certain risks, including the time and economic costs of integrating an acquisition's IT system, control and financial systems, unforeseen liabilities, and difficulties in bringing together different work cultures and personnel. There can be no assurance that we will be able to locate suitable acquisition candidates, acquire potential acquisition candidates, acquire such candidates on commercially reasonable terms, or integrate acquired businesses successfully in the future. Future acquisitions, including those we may consummate in the near term, may require us to incur additional debt and contingent liabilities, which may adversely affect our business, results of operations and combined financial condition. The process of integrating acquired businesses into our existing operations may result in operating, contractual and supply chain difficulties, such as the failure to retain customers or management personnel. Such difficulties may divert significant financial, operational and managerial resources from our existing operations, and make it more difficult to achieve our operating and strategic objectives.

***We may not succeed in implementing our business strategies and future expansion plan.***

We cannot guarantee our business strategies and future expansion plans as proposed will be successful as there are a number of factors which are beyond our control and may affect our business prospects such as economic and political conditions, global economic conditions, change in government regulations and customers' behavior. In particular, there is no assurance that we will be able to find suitable locations for the opening of new retail stores on terms commercially acceptable to us. On the other hand, such expansion may put pressure on our managerial, financial and operational resources. If we are unable to manage our expansion and the rising costs associated with such expansion effectively, our financial condition and result of operation may be adversely affected.

***Our failure to operate effectively in a highly competitive and evolving industry could have a material adverse effect on our business.***

Our business is rapidly evolving and intensely competitive, with numerous competitors including furniture stores, big box retailers, department stores, specialty retailers and online retailers and marketplaces in respect of our business in Singapore and Korea under our consumer retail division, as well as other global and regional wholesalers of upholstered furniture in respect of our business under our export and leather trading divisions.

We expect competition generally to continue to increase. We believe that our ability to compete successfully depends upon many factors both within and beyond our control, including:

● the size and composition of our customer base;

● the number of suppliers and products we feature in our stores and on our websites;

● our selling and marketing efforts;

● our ability to anticipate consumer demand and preferences;

● the quality, price and reliability of products we offer;

● the convenience of the shopping experience that we provide;

● the adequacy of our customer service;

● our ability to distribute our products and manage our operations; and

● our reputation and brand strength.

Some of our current competitors have, and potential competitors may have, longer operating histories, greater brand recognition, larger fulfillment infrastructures, greater technical capabilities, faster and less costly shipping and assembling, lower prices, significantly greater financial, marketing and other resources and larger customer bases than we do. These factors may allow our competitors to derive greater net revenue and profits from their existing customer base, acquire customers at lower costs or respond more quickly than we can to new or emerging technologies and changes in consumer habits.

***Seasonal trends in our business create variability in our financial and operating results and place increased strain on our operations.***

Historically, we have experienced surges in orders associated with promotional activities and seasonal trends. This activity may place additional demands on our staff in our retail stores and our logistics network and could cause or exacerbate slowdowns or interruptions. Any such service interruptions could prevent us from efficiently receiving or fulfilling orders, which may reduce the volume or quality of goods or services we sell and may cause customer dissatisfaction and harm our reputation and brand. We generally record a higher volume of orders in January, April, August, September, and October for our business. In addition, the comparison of our revenue and operating results between different periods in any given financial year may not be relied upon as indicators of our performance. Any unpredictable and material changes in the market during our peak seasons may materially and adversely affect our financial condition and profitability.

***We may be subject to risks associated with debt financing, including rising interest rates.***

Due to our working capital requirements to support our day-to-day operations and business expansion, we may finance all or a substantial portion of our costs through bank loans and credit facilities.

While we believe that we have sufficient capital from our available cash resources, our cash generated from our business operations and our credit facilities to meet our current working capital and capital expenditure requirements, we may require additional debt financing to operate our business, implement our future business strategies and/or acquire complementary businesses.

Our ability to obtain debt financing depends on a number of factors including our financial strength, creditworthiness and prospects, as well as other factors beyond our control, including general economic, liquidity and political conditions. There is no assurance that we will be able to secure adequate debt financing on terms acceptable to us, or at all. In the event that we are unable to secure adequate debt financing on terms acceptable to us, we may not be able to implement our business strategies and our business and prospects could be materially and adversely affected as a result. Rising interest rates may increase the Company's operational costs of funds.

Any disruptions, volatility or uncertainty of the credit markets could limit our ability to borrow funds or cause our borrowings to become more expensive. As such, we may be forced to pay unattractive interest rates, thereby increasing our interest expense, decreasing our profitability and reducing our financial flexibility if we take on additional debt financing. Any material increase in interest rates would also increase our cost of borrowing and debt financing costs, which may weaken our ability to obtain further future debt financing.

Further, debt financing may restrict our freedom to operate our business as it may require conditions and/or covenants that:

&nbsp;&nbsp;&nbsp;&nbsp;a. limit
 our ability to pay dividends or require us to seek consent for the payment of dividends;

&nbsp;&nbsp;&nbsp;&nbsp;b. require
 us to dedicate a portion of our cash flow from operations to repayments of our debt, thereby reducing the availability of our cash
 flow for capital expenditures, working capital and other general corporate purposes; and

&nbsp;&nbsp;&nbsp;&nbsp;c. limit
 our flexibility in planning for, or reacting to, changes in our business and our industry.

***It is not certain if the Company will be classified as a Singapore tax resident.***

Under the Singapore Income Tax Act 1947 (the "Singapore Income Tax Act"), a company established outside Singapore but whose governing body, being the board of directors, usually exercises de facto control and management of its business in Singapore could be considered a tax resident in Singapore. However, such control and management of the business should not be deemed to be in Singapore if physical board meetings are conducted outside of Singapore. Where board resolutions are passed in the form of written consent signed by the directors each acting in their own jurisdictions, or where the board meetings are held by teleconference or videoconference, it is possible that the place of de facto control and management will be considered to be where the majority of the board are located when they sign such consent or attend such conferences.

We believe that the Company, which is a Cayman Islands exempted company, is not a Singapore tax resident for Singapore income tax purposes. However, the tax residence status of the Company is subject to determination by the Inland Revenue Authority of Singapore ("IRAS"), and uncertainties remain with respect to the interpretation of the term "control and management" for the purposes of the Singapore Income Tax Act. If IRAS determines that the Company is a Singapore tax resident for Singapore income tax purposes, the portion of the Company's single company income on an uncombined basis that is received or deemed by the Singapore Income Tax Act to be received in Singapore, where applicable, may be subject to Singapore income tax at the prevailing tax rate of 17% before applicable income tax exemptions or relief. If the Company is regarded as a Singapore tax resident, any dividends received or deemed received by the Company in Singapore from our subsidiaries located in a foreign jurisdiction with a rate of income tax or tax of a similar nature of no more than 15% may generally be subject to additional Singapore income tax where there is no other applicable tax treaty between such foreign jurisdiction and Singapore. Income is considered to have been received in Singapore when it is: (i) remitted to, transmitted or brought into Singapore; (ii) applied in or towards satisfaction of any debt incurred in respect of a trade or business carried on in Singapore; or (iii) applied to purchase any movable property that is brought into Singapore. In addition, as Singapore does not impose withholding tax on dividends declared by Singapore resident companies, if the Company is considered a Singapore tax resident, dividends paid to the holders of our Shares will not be subject to withholding tax in Singapore. Regardless of whether or not the Company is regarded as a Singapore tax resident, holders of our Shares who are not Singapore tax residents would generally not be subject to Singapore income tax on gains derived from the disposal of our Shares if such shareholders do not maintain a permanent establishment in Singapore, to which the disposition gains may be effectively connected, and the entire process (including the negotiation, deliberation, execution of the acquisition and sale, etc.) leading up to the actual acquisition and sale of our Shares is performed outside of Singapore. For Singapore resident shareholders, if the gain from disposal of our Shares is considered by IRAS as income in nature, such gain will generally be subject to Singapore income tax, and not taxable in Singapore if the gain is considered by IRAS as capital gains in nature. Please refer to the section titled "*Material Income Tax Considerations—Singapore Tax Considerations*" in this annual report.

***Our success depends on our ability to retain our core management team and other key personnel.***

Our performance depends on the continued service and performance of our directors, officers and senior management as they are expected to play an important role in guiding the implementation of our business strategies and future plans. If any of our directors, officers or any members of our senior management were to terminate their service or employment, there can be no assurance that we would be able to find suitable replacements in a timely manner, at acceptable cost or at all. The loss of services of key personnel or the inability to identify, hire, train and retain other qualified and managerial personnel in the future may materially and adversely affect our business, financial condition, results of operations and prospects.

***Competition for highly skilled personnel is often intense and we may incur significant costs or be unsuccessful in attracting, integrating, or retaining qualified personnel to fulfil 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. In addition, if any of our senior management or key personnel joins a competitor or engages in a competing business, we may lose business, trade secrets, business partners and key personnel. Furthermore, prospective candidates and existing employees often consider the value of the equity awards they receive in connection with their employment. Thus, our ability to attract or retain highly skilled employees may be adversely affected by any 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 2024 Incentive Securities Plan will be sufficient to grant equity awards adequate to recruit new employees and to compensate existing employees.

***Our directors' and executive officers' other business activities may pose conflicts of time commitment and conflicts of interest.***

Our directors and executive officers have other business interests outside the Company that could potentially give rise to conflicts of time commitment. For example, our directors and executive officers own and/or are employed in executive positions in other HTL Group companies that operate and conduct sale and manufacturing of such upholstered furniture and related goods.

Below is a chart showing the approximate percentages of the time devoted by certain directors and officers to matters concerning the Company and other companies in 2025.

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Title** | **To Company** | **To other companies** |
| Phua Yong Pin | Chairman | 10% | 90% |
| Phua Yong Tat | Vice-Chairman | 30% | 70% |
| Phua Mei Ming | Chief Executive Officer | 80% | 20% |

---

As these directors and officers devote considerable time and effort to other companies, these sort of business activities could both distract them from focusing on the Company and pose a conflict of time commitment.

***Negative publicity relating to our Group or our Directors, Executive Officers or Major Shareholders or our major suppliers may materially and adversely affect our reputation and share price.***

Negative publicity or announcements relating to our Group or any of our Directors, Executive Officers or Major Shareholders, whether with or without merit, may materially and adversely affect the reputation and goodwill of our Group in the home furnishings industry, consequently affecting our relationships with our customers, suppliers and sub-contractors. Since we rely on a limited number of key suppliers for our leather and fabric upholstered furniture which contributed to a significant portion of our purchases of goods for the fiscal years ended December 31, 2025, 2024 and 2023, any negative publicity or announcements relating to our key suppliers may also adversely affect our reputation in the industry. In addition, such negative publicity may affect market perception of our Group and the performance of our share price.

Negative publicity or announcements may include, among others, newspaper reports of accidents at our work sites, unsuccessful attempts in joint ventures, acquisitions or take-overs, any involvement we or our major suppliers may have in litigation or insolvency proceedings, and unfavorable or negative articles on any of our Directors, Executive Officers or Major Shareholders. Any claims and legal actions brought forward by our customers may also damage our brand image. If our customers, suppliers and sub-contractors subsequently lose confidence in us, this could result in the termination of business relationships or consumer orders. To this end, our business, financial condition, results of operations and prospects may be adversely impacted.

***Our management team has limited experience managing a public company listed in the U.S.***

While the members of our management team have experience in managing a publicly traded company on the Singapore stock exchange in various capacities, prior to our IPO, most members of our management team had not previously served as management of a publicly traded company on a US stock exchange and may not have experience complying with the increasingly complex laws pertaining to such public companies. Our management team may not successfully or efficiently manage a public company that is subject to significant regulatory oversight and reporting obligations under the U.S. federal securities laws as well as the continuous scrutiny of securities analysts and investors. These new obligations and constituents will require significant attention from our management and could divert their attention away from the day-to-day management of our business, which could adversely affect our business and financial performance.

***We are exposed to legal or other proceedings or to other disputes or claims.***

In the event that our retail customers or wholesale (export and leather trading) clients do not make payment in a timely manner, we may seek to enforce our contractual rights and seek recourse via litigation or arbitration. These legal procedures are time- consuming and the settlement of a contract dispute may require additional financial and other resources. Failure to secure adequate payments in time or to manage past due receivables effectively could have a material and adverse effect on our business, financial condition, results of operations and prospects.

Further, disputes and claims may arise, from time to time, between our Group and our customers, clients, suppliers or sub-contractors for various reasons such as delays, unsatisfactory service delivery and alleged breaches of service contracts. To date, we have not been the subject of workplace safety and/or negligence claims from employees and/or members of the public, but there is a risk that such claims may be made against us in the future. These disputes, if remain unresolved or worsen, may eventually result in legal or other proceedings and therefore cause disruptions and delays to our operations, in addition to the extra costs that may be incurred in their settlement or other resolution. Our resources may also be diverted to defend the claims, thereby adversely affecting our Group's business, financial condition, results of operations and prospects.

In the event that we are unable to resolve the aforementioned disputes or claims satisfactorily in a timely manner or at all, our Group's business, financial condition and results of operation may be materially and adversely affected. Please refer to the section titled "Item 4. Information on the Company—B. Business Overview—Legal Proceedings." of this annual report for further details.

***We may not be able to adequately protect our intellectual property rights and there may be copycat counterfeit competition and an inability to protect or use our intellectual property rights may adversely affect our business.***

As of the date of this annual report, we have two trademarks registered in Singapore and a few foreign countries. We are also authorized to use four trademark(s). We might from time to time apply for new trademarks. We cannot assure you that our pending trademark applications, if any, will proceed to registration, and even registered trademarks could be challenged by a third party including by way of revocation or invalidity actions. Unauthorized use of our trademarks may do damage to our brand and reputation and/or affect our business in other ways. We are not aware of any infringement of our intellectual property rights in the past in Singapore or Korea but there is no assurance that there will not be any infringement in the future. In the event that any infringement occurs, we may have to protect our intellectual property rights or other rights through litigation which may be costly and could have adverse impact on our business, results of operations and financial condition.

Moreover, there is no assurance that there will not be any counterfeit products of the furniture products we sourced overseas or our own products being sold in Singapore, Korea or neighboring countries. Demand for our products may be adversely affected should there be any copycat products and in which case, our performance and business operations may also be adversely affected.

In addition, there could be potential trade name or trademark ownership or infringement claims brought by owners of other rights, including registered trademarks, in our marks or marks similar to ours. Any such claims, brand dilution or consumer confusion related to our "HomesToLife" brand could damage our reputation and brand identity and substantially harm our business, financial condition, cash flows and results of operations.

***Our products may be subject to third party intellectual property rights.***

As the products sourced by us are procured from various suppliers, it is not commercially practicable for us to ascertain whether such products infringe on third party intellectual property rights. In the event that any product we sell infringes on third party intellectual property rights, we may also be found liable for such infringement and be compelled to discontinue the sale of the infringing products and/or pay damages or suffer other liabilities. It may also lead to litigation which could result in substantial costs and diversion of resources and negatively affect our reputation, profitability and prospects.

***We may be exposed to liabilities under applicable anti-corruption laws and any determination that we violated these laws could have a materially adverse effect on our business.***

We are subject to various anti-corruption laws that prohibit companies and their agents from making improper payments or offers of payments for the purpose of obtaining or retaining business. We may conduct business in countries and regions that are generally recognized as potentially more corrupt business environments. Activities in these countries create the risk of unauthorized payments or offers of payments by one of our employees or agents that could be in violation of various anti-corruption laws, including the United States Foreign Corrupt Practices Act (the "FCPA") and the Singapore Prevention of Corruption Act 1960 (the "POCA"). We have implemented safeguards and policies to discourage these practices by our employees and agents but we cannot provide assurance that our internal controls and compliance systems will always protect us from acts committed by our employees or agents. If our employees or agents violate our policies or we fail to maintain adequate record keeping and internal accounting practices to accurately record our transactions, we may be subject to regulatory sanctions. Violations of the FCPA, POCA or other anti-corruption laws, or allegations of any such acts, could damage our reputation and subject us to civil or criminal investigations in the United States and in other jurisdictions. Those and any related shareholder lawsuits could lead to substantial civil and criminal, monetary and nonmonetary penalties and cause us to incur significant legal and investigatory fees which could adversely affect our business, combined financial condition and results of operations.

***We may be subject to product liability and other similar claims and lawsuits if people or property are harmed by the products we sell.***

We source our products from suppliers and are subject to the inherent risks associated therewith, including product recalls, product liability claims, quality control and regulatory action relating to safety, personal injury, death or environmental or property damage. Our suppliers may not have adequate financial resources or insurance coverage to fulfill their obligations under any product warranties given by them. Seeking indemnifications from our suppliers may potentially lead to litigation and claims against us by our customers which may have an adverse effect on our reputation and brand image, lead to negative publicity and, regardless of the validity of such claims, may reduce our sales which may in turn adversely affect our financial performance. We may also be held liable for purchase or import of products made of restricted materials or failing safety standards under the relevant laws and regulations governing the supplier and/or our business operations in Singapore. In addition, if complaints from customers escalate into legal claims, resources such as time and legal costs would have to be incurred to address such claims, thereby further affecting our business and financial performance.

***We may be subject to claims against us relating to any acquisition or business combination.***

There may be liabilities assumed in any acquisition or business combination that we did not discover or that we underestimated in the course of performing our due diligence. Although a seller generally will have indemnification obligations in favor of us under an acquisition or merger agreement, these obligations will usually be subject to financial limitations, such as general deductibles and maximum recovery amounts, as well as time limitations. We cannot ensure that our right to indemnification from any sellers will be enforceable, collectible or sufficient in amount, scope or duration to fully offset the amount of any undiscovered or underestimated liabilities that we may incur. Any such liabilities, individually or collectively, could have a material and adverse effect on our prospects, business and financial results.

***Our operating subsidiaries are subject to the laws of Singapore and the laws of other countries that we do business in, which differ in certain material respects from the laws of the United States.***

As a number of our operating subsidiaries such as HomesToLife Singapore and HTL FE are Singapore incorporated companies, they are required to comply with the laws of Singapore, certain of which are capable of extra-territorial application, as well as their charters. In particular, these operating subsidiaries are required to comply with certain provisions of the Securities and Futures Act 2001 of Singapore (the "SFA"), which prohibit certain forms of market conduct and information disclosures, and impose criminal and civil penalties on corporations, directors and officers in respect of any breach of such provisions. We are also required to comply with the laws of Korea, where we operate two retail store.

Additionally, as we engage in exporting upholstered furniture to various countries in the Europe, Australia, North America, and Asia Pacific regions, we are required to comply with the import and export laws of such countries.

***Adverse change in Singaporean government regulations may materially and adversely affect our operations and financial condition.***

Our major business operations are based in Singapore. Our operations are mainly subject to laws and government regulations of Singapore. In addition, we are required to obtain and maintain several statutory and regulatory permits and approvals under central, state and local rules in Singapore, generally for carrying out our business. Some these approvals are granted for a limited duration and require renewal, and are generally subject to conditions stipulated in the licenses and permits and/or relevant laws or regulations under which such licenses and permits are issued. Failure to comply with such conditions could result in the revocation or non-renewal of the relevant license or permit. As such, we have to constantly monitor and ensure our compliance with such conditions. Should there be any failure to comply with such conditions resulting in the revocation of any of the licenses and permits, we will not be able to carry out our operations. In addition, any change in or introduction of new regulations that require our compliance may increase our cost of operations. All of these will have an adverse effect on our business and financial performance.

Currently we have obtained all licenses necessary for carrying on our businesses in Singapore in the current scope. Should there be any changes in the regulatory requirements and we are not able to comply with them in a timely manner or if compliance of these requirements involved substantial costs, the business, results of operation and our financial position may be adversely affected.

***Our existing insurance may not sufficiently cover the risks related to our business operation.***

We maintain business insurance of our stores and our office, such as combined general and products liability insurance. We also maintain directors and officers liability insurance. While our management believes that we have sufficient insurance coverage for our business operations in line with industry standards and business practices in Australia, France, Japan, Korea, Singapore, and United Kingdom, and although we may be able to increase our insurance coverage when required, we cannot guarantee that our existing insurance policies will sufficiently cover all potential liabilities or risks associated with our business operations. In the event that our insurance does not or is insufficient to compensate, or should we be unable to effect any insurance, for the losses or damages arising from the potential liabilities, our financial condition and results of operations could be adversely affected.

As a public company, we expect the laws, rules and regulations governing U.S. public companies will make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.

In the event that our existing insurance coverage is insufficient to indemnify us against all or any losses, our business, financial condition, results of operations and prospects may be materially and adversely affected.

***A cybersecurity attack, data breach or other security incident could impact our sites, networks, systems, platforms, confidential information and assets causing damage and substantial harm to our business and operating results, reputation and brand, and resulting in proceedings or actions against us by government regulatory bodies or private parties.***

We collect, maintain, transmit and store data about our customers, employees, contractors, suppliers, vendors and others, including payment information and personally identifiable information, as well as other personal, confidential and proprietary information. In certain instances, we leverage and rely on third-party service providers to collect, maintain, transmit and store certain proprietary, personal and confidential information on our behalf, such as credit card data. To protect such data and other information from being breached, compromised or lost, we maintain and regularly assess against industry standard cybersecurity safeguards and best practices.

Like many businesses, despite all of our efforts to defend against cyber threats and respond to incidents, we, and our third party service providers, have in the past and will in the future continue to be subject to cyber-attacks, cyber security threats and attempts to compromise and penetrate our data security systems and disrupt our operations. Recent cybersecurity incidents impacting large institutions, including those resulting in the compromise of sensitive data and the disruption of critical systems, suggest that the risk of such cyber events is significant, even when reasonable measures to protect the confidentiality, integrity, and availability of information are implemented. This may be as a result of deliberate malicious attempts to infiltrate our systems, including but not limited to, state-sponsored attackers or cybercriminal efforts, zero-day vulnerabilities, phishing attacks, software supply chain compromises, or non-malicious factors, including but not limited to, disruptions during the process of upgrading or replacing computer software or hardware, errors by the vendors we rely upon, or other disruptions that may jeopardize the security of our assets or information. We and our service providers may not anticipate or prevent all types of attacks until after they have already been launched and techniques used to obtain unauthorized access may change frequently and may not be known in the market. Security incidents such as ransomware attacks are becoming increasingly prevalent and severe, as well as increasingly difficult to detect. In addition, security breaches or data and asset leaks can also occur as a result of non-technical issues, including intentional or inadvertent actions by our employees or by persons with whom we have commercial relationships. Further, the prevalence of remote work by some of our employees and those of our third-party service providers creates increased risk that a cybersecurity incident may occur.

In addition to data loss and compromise, cybersecurity incidents or breaches of our security measures or those of our third-party service providers could result in interruption, disruption or malfunction of operations; costs relating to breach remediation, deployment or training of additional personnel and protection technologies, responses to governmental investigations and media inquiries and coverage; engagement of third party experts and consultants; litigation, regulatory action and other potential liabilities. Any compromise or breach of our security measures, or those of our third-party service providers, could violate applicable privacy, data security and other laws and regulations, and cause significant legal and financial exposure, adverse publicity and a loss of confidence in our security measures, which could have a material adverse effect on our business, financial condition and operating results. Our reputation and brand could be damaged, our business may suffer, we could be required to expend significant capital and other resources to alleviate problems caused by such incidents and we could be exposed to a risk of loss, litigation or regulatory action and possible liability. Although we maintain cyber liability insurance, we cannot be certain that our coverage will be adequate for liabilities actually incurred or that insurance will continue to be available to us on economically reasonable terms, or at all. We may need to devote significant resources to protect against security breaches or to address problems caused by breaches, diverting resources from the growth and expansion of our business.

**Risks Related to Market and Macro Economic Environment** 

***Any adverse material changes to the Singapore market and other markets where we operate (whether localized or resulting from global economic or other conditions) such as the occurrence of an economic recession, or the imposition of trade tariffs, could have a material adverse effect on our business, results of operations and financial condition.***

During the years ended December 31, 2024 and 2023, substantially all of our revenue was derived from our operations in Singapore. During the year ended December 31, 2025, 88% of our revenue was derived from our operations in Singapore, either from the sales by our retail stores in Singapore, or the export sales originated by our headquarters in Singapore. Any adverse circumstances affecting the Singapore market, such as an economic recession, epidemic outbreak or natural disaster or other adverse incidents may adversely affect our business, financial condition, results of operations and prospects. Any downturn in the industry which we operate in resulting in the postponement, delay or cancellation of contracts and delay in recovery of account receivables is likely to have an adverse impact on our business and profitability.

Uncertain global economic conditions have had and may continue to have an adverse impact on our business in the form of lower net sales due to weakened demand, unfavorable changes in product price/mix, or lower profit margins. In addition, the effect of inflation often results in reduced consumer spending.

During economic downturns or recessions, there can be heightened competition for sales and increased pressure to reduce selling prices as our customers may reduce their demand for our products. If we lose significant sales volume or reduce selling prices significantly, then there could be a negative impact on our combined financial condition or results of operations, profitability and cash flows.

Reduced availability of credit may also adversely affect the ability of some of our customers and suppliers to obtain funds for operations and capital expenditures. This could not only result in reduced or delayed collections of outstanding accounts receivable, but also negatively impact our ability to obtain necessary supplies.

Additionally, we face exposure to shifts in government trade policies, tariffs, and regulatory requirements, including protectionist measures and sanctions, that may raise costs, disrupt supply chains, and limit market access. Some of the key risk drivers include the introduction or escalation of tariffs and duties, quota or local-content requirements, changes in trade agreements, tighter ESG and customs compliance expectations, and geopolitical tensions that influence policy direction. For example, increasing geopolitical risks and the Red Sea crisis affect our trade with the European markets, whilst the imposition of tariffs by the United States and other major economies on goods and services from China, and the slowing economic growth of China, both directly and indirectly impact our business.

These factors can lead to margin compression, longer lead times, supply disruptions, higher compliance costs, reduced flexibility in sourcing strategies, and potential supplier relocation, which would negatively affect our business, results of operations and financial condition.

***Global economic conditions and the effect of economic pressures and other business factors on discretionary consumer spending and consumer preferences may have a material adverse effect on our business, results of operations and financial condition.***

Uncertainties in global economic conditions that are beyond our control have in the past impacted our business and may in the future materially adversely affect our business, results of operations, financial condition and stock price. These adverse economic conditions include inflation, slower growth or recession, new or increased tariffs and other, changes to fiscal and monetary policy, higher interest rates, high unemployment, decreased consumer confidence in the economy, armed hostilities, such as the military conflict between Russia and Ukraine and the Israel-Hamas war, foreign currency exchange rate fluctuations, conditions affecting the retail environment for products we sell, and other matters that influence consumer spending and preferences.

A slowdown in economic growth in Mainland China, including weakened consumer spending and reduced business activity, may adversely affect demand for our products and impact our export and leather trading operations. Economic volatility in China may also result in currency fluctuations and broader supply chain disruptions that could negatively affect our results of operations.

In addition, consumer confidence and spending can be materially adversely affected in response to financial market volatility, negative financial news, conditions in the real estate and mortgage markets, including home equity loans and consumer credit, changes in net worth based on market changes and uncertainty, energy shortages and cost increases, labor and healthcare costs, government actions and general uncertainty regarding the overall future economic environment. Consumers may view a substantial portion of the products we offer as discretionary items rather than necessities. As a result, our operating results are sensitive to changes in macroeconomic conditions that impact consumer spending, including discretionary spending. Declines in consumer spending have and, in the future, may result in decreased demand for our products and services which may have an adverse effect on our results of operations.

A downturn in the economic environment can also lead to financial instability, increased credit and collectability risk on our receivables, the failure of important partners, including suppliers, logistics providers, derivative counterparties and other financial institutions, limitations on our ability to issue new debt, reduced liquidity and declines in the fair value of our financial instruments. These and other economic factors can materially adversely affect our business, results of operations, financial condition and stock price.

***The upholstered furniture industry we are in is heavily reliant on consumer spending, housing market conditions, and design trends.***

The upholstered furniture industry is heavily reliant on consumer spending, housing market conditions, and design trends. Through our consumer retail business, we target the premium mass market and at the middle and upper class consumer markets. If there is a decline of discretionary consumer spending or purchasing power in that demographics due to general economic conditions or other reasons, our business and operating results will be adversely affected. We target the customers who may be purchasing their second or third home and prefer furniture of premium quality at affordable prices. An unfavorable housing market condition can have material adverse effect on our business and operating results. We sell luxury contemporary leather and fabric upholstered furniture, such as, sofas, armchairs, recliners, and related accessories in Singapore. If we fail to move with the latest changes to the popular design trends in the market we operate, our business and operating results will suffer.

***We are exposed to foreign exchange fluctuation.***

The Company has significant exposure to exchange rate fluctuations, both due to translation and transaction exposures. Translation exposures arise from measuring income statements of foreign subsidiaries that have functional currencies other than the U.S. dollar. Transaction exposures involve impact from (i) input costs that are denominated in currencies other than the local reporting currency and (ii) revaluation of working capital balances denominated in currencies other than the functional currency. The Company leverages its diversified portfolio of exposures as a natural hedge. In certain cases, the Company enters into non-qualifying foreign currency contracts to hedge certain balance sheet items subject to revaluation. The change in fair value of these instruments and the underlying exposure are both immediately recognized in earnings, substantially offsetting the foreign currency mark-to-market impact of the related exposure.

The Company currently has a foreign currency hedging policy. The management monitors foreign exchange exposure and will consider hedging significant foreign exchange exposure should the need arise. However, the Company's hedging measures may not fully offset foreign exchange fluctuations. Any residual exposure could adversely affect the Company's profitability and financial performance.

***Any future outbreaks or other public health emergencies like the COVID-19 pandemic could materially affect our business, liquidity, financial condition and operating results.***

The COVID-19 pandemic negatively impacted the global economy, disrupted consumer spending and global supply chains and created significant volatility and disruption of financial markets. The COVID-19 pandemic and the various responses to it globally created significant volatility, uncertainty and economic disruption.

In particular, while we saw increased sales and order activity at times during the COVID-19 pandemic, the pandemic significantly disrupted the global supply chain, including many of our suppliers, logistics providers and other partners. Such disruptions, including staffing shortages, raw material and labor inflation, factory closures and production slowdowns, port closures a stoppages and/or disruptions in delivery systems, materially and adversely affected our suppliers' ability to provide products in a timely manner, or at all, and materially and adversely affected our logistics providers' ability to distribute products to our customers in a timely manner, or at all. Any similar and future outbreaks or other public health emergencies could materially affect our business, liquidity, financial condition and operating results

***Many of the economies in Asia, including Singapore, are experiencing substantial inflationary pressures which may prompt the governments to take action to control the growth of the economy and inflation that could lead to a significant decrease in our profitability in the future.***

While many of the economies in Asia have experienced rapid growth over the last two decades, they currently are experiencing inflationary pressures. As governments take steps to address the current inflationary pressures, there may be significant changes in the availability of bank credit, interest rate increases, limitations on loans, or restrictions on currency conversions and foreign investment. There also may be imposition of price controls. If prices for the products we source or if wages rise at a rate that is insufficient to compensate for the rise in these costs, it may have an adverse effect on our profitability. If these or other similar restrictions are imposed by a government to influence the economy, it may lead to a slowing of economic growth and lower discretionary spending by the consumers at large.

***Failure to effectively manage inflationary pressures in our product procurement costs, wages, rental rates and freight charges could materially adversely affect our business, operating results and financial performance.***

Our major costs include (i) product procurement; (ii) wages, (iii) rental rates, and (iv) freight charges. Our operating results can be materially affected by changes in our procurement costs, including product costs, rents at our retail stores, and transportation costs. Due to the uncertainty of product price fluctuations and inflation, we may not be able to pass some or all of these increased costs to our customers, which may result in lower profit margins. Even if we are able to pass on some of the increased freight charges to our customers in the case of customer ordered furniture, there is no assurance that we will always be successful in doing so. Accordingly, any rapid and significant changes in product prices or other supply chain costs may have a material adverse effect on our gross margins, operating results and financial performance.

**Risks Related to Our Business Divisions**

***We materially rely on our related parties as our furniture suppliers. Such arrangement materially and adversely exposes us to unique risk. Any disruption in the supplier's relationship could have a material adverse effect on our business. Any disruption in the manufacturing of furniture and our inability to identify alternative furniture suppliers may materially and adversely affect our business operations and financial results.***

Historically, as we had disclosed in our IPO prospectus on October 1, 2024, we materially relied on HTL Marketing, which was a related party to us, before our acquisition of HTL Marketing in 2025, for supply of goods to HomesToLife Singapore. For the year ended December 31, 2024, our purchases from HTL Marketing amounted to US$0.9 million, representing 60% of our purchases. For the year ended December 31, 2023, our purchases from HTL Marketing amounted to US$1.0 million, representing 72% of our purchases.

Since January 1, 2025, HomesToLife Singapore has transitioned its major supply source from HTL Marketing to HTL FE. HTL FE signed a contract manufacturing agreement (the "Contract Manufacturing Agreement") with HTL Furniture on November 1, 2024 and HomesToLife Singapore entered into a supply agreement with HTL FE on January 1, 2025, with substantially the same terms as the supply agreement that was originally entered into between HomesToLife Singapore and HTL Marketing. For the year ended December 31, 2025, our purchases from HTL Furniture amounted to US$104.2 million, representing 38.2% of our purchases.

Such arrangements materially and adversely expose us to a unique risk. Our business relies heavily on a stable and adequate supply of furniture from the furniture manufacturers. If our business relationships with the furniture suppliers are interrupted or terminated, this may lead to a material interruption of our operations or a suspension of our ability to procure furniture or delays in fulfilling our customer orders until we find another supplier that can supply our furniture products. Although we have entered into long term agreements with the furniture manufacturers, there is no assurance that the agreements can be renewed on commercially favorable terms upon their expiration.

Any disruption in our supplier relationships could have a material adverse effect on our business. Events that adversely affect our suppliers could impair our ability to obtain the furniture supply that we desire. Such events include problems with our suppliers' businesses, finances, labor relations, ability to obtain raw materials, costs, production, quality control, insurance and reputation, as well as natural disasters, pandemics, or other catastrophic occurrences. A failure by any current or future supplier to comply with the environmental, safety or other laws and regulations, meet require timelines, and hire and retain qualified employees may disrupt our supply of products.

In the event of any early termination or non-renewal of our agreements with the furniture manufacturers, or in the event of any disruption, delay or inability on the part of our suppliers to manufacture sufficient and quality products to us, we cannot assure you that we would be able to identify alternative suppliers on commercially acceptable terms which may thereby result in material and adverse effects on our business, financial conditions and operating results. Failure to find a suitable replacement, even on temporary basis, would have an adverse effect on our brand image, financial conditions, and the result of operations.

If our furniture manufacturers fail to deliver the furniture supply we need on the terms we have agreed, it may be challenging to secure alternative sources at commercially acceptable prices or on other satisfactory terms, in a timely manner. Any extended delays in securing an alternative source could result in late shipments of our products to our customers, which could materially and adversely affect our customer relationship, our brand image, profitability, results of operations, and financial condition. If we experience significant increased demand for our products, there can be no assurance that additional supplies of furniture will be available for us when required on acceptable terms, or at all, or our suppliers would allocate sufficient capacity to us in order to meet our requirements, fulfill our orders in a timely manner or meet our strict quality standards. Even if our existing suppliers are able to meet our needs or if we are able to find new manufacturers, we may encounter delays in production, inconsistencies in quality and additional costs. We are not likely to be able to pass the increased costs to the customer immediately, if at all, which may decrease or eliminate our profitability in any period. Any delays or interruption in or increased costs of purchases could have a material and adverse effect on our ability to meet customers' demand for our products and result in lower net sales and profitability both in the short and long term.

***The supply and price of our products are influenced by a number of factors, some of which are beyond our control.***

As we do not manufacture our products and instead source them from suppliers in the PRC and a few other Asian countries, the price, quality and supply of our products may be influenced by a number of factors that are beyond our control, including but not limited to the prices of raw materials, the imposition of import or export tariffs or sales taxes, the quality control of our suppliers, logistics costs, shipment delay, bad weather and natural hazards. Any of the above mentioned factors could impact on the price, quality and supply of our products which could materially and adversely affect our business, results of operation and financial condition.

***We may be subject to supply chain disruptions, which could have a material adverse effect on our business, financial condition and results of operations.***

Historically we experienced some, but limited disruptions to our supply chain during the PRC government mandated lockdown due to the COVID-19 pandemic. Additionally, our retail stores in Singapore had to close for two months from April 2020 to May 2020 during the Singapore government mandated "circuit breaker" (i.e., lockdown), due to the COVID-19 pandemic, which affected our business. While all our major suppliers are currently fully operational, any future disruption in their operations would impact our ability to produce and deliver our products to customers. Any future reductions in commercial airline and cargo flights, disruptions to ports and other shipping infrastructure resulting in increased transport times to deliver our products to customers, may limit our ability to fulfill orders and we may be unable to satisfy all of the demand for our products in a timely manner, which may adversely affect our relationships with our customers. As a result, any supply chain disruptions may materially affect our outlook or business goals.

Although we have long term and stable cooperation with our suppliers and will continue to work with our existing suppliers, we will continue to identify and secure new suppliers, to expand our supply base. We do not expect our mitigation efforts to introduce new material risks, including those related to product quality, reliability, or regulatory approval of products.

***Our retail business depends on our ability to build and maintain strong brands. We may not be able to maintain and enhance our "HomesToLife" 3 brands if we receive unfavorable customer complaints, negative publicity or otherwise fail to live up to consumers' expectations, which could materially adversely affect our business, results of operations and growth prospects.***

In our retail business, we mainly engage in the sales of upholstered sofas under the brands "HTL", "Domicil," and "Fabbrica"; and to a lesser extent, complementary furniture pieces, such as case goods, tables, bedding and mattress. For our retail business in Singapore and South Korea, our ability to maintain and enhance our one-stop shop concept depends largely on our ability to maintain customer confidence in our product offerings, including by customizing our recommendations of high quality furniture to fit customers' living style; maintaining product availability and delivering products on time and without damage. If customers do not have a satisfactory shopping experience, they may seek out alternative offerings from our competitors and may not return to our retail stores as often in the future, or at all. In addition, unfavorable publicity regarding, product quality or availability, poor customer service, delivery problems, competitive pressures, litigation or regulatory activity, could seriously harm our reputation. Such negative publicity also could have an adverse effect on the size, engagement and loyalty of our customer base and result in decreased net revenue, which could adversely affect our business and financial results.

In addition, maintaining and enhancing our "HomesToLife" brand name may require us to make substantial investments, and these investments may not be successful. If we fail to promote and maintain our brand, or if we incur excessive expenses in this effort, our business, operating results and financial condition may be materially adversely affected. We anticipate that, as our market becomes increasingly competitive, maintaining and enhancing our brand may become increasingly difficult and expensive. Maintaining and enhancing our brand will depend largely on our ability to provide high quality products to our customers.

Customer complaints or negative publicity about our stores, products, delivery times, company practices, employees, customer data handling and security practices or customer support, could rapidly and severely diminish consumer confidence in us and result in harm to our "HomesToLife" brand name and decreased revenue, whether or not the complaints and negative sentiment are based in fact.

***Our marketing efforts to help grow our business may not be effective, and failure to effectively develop and expand our sales and marketing capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our products and services.***

Our success will depend, in part, on our ability to attract new consumers and retain existing customers. We may have to incur significantly higher and more sustained advertising and promotional expenditures in order to attract additional consumers to our stores and convert them into purchasing customers.

In addition, if we do not have a clear and relevant promotional calendar to engage our customers, especially in the current macroeconomic environment, our customers may purchase fewer goods from us or we may have to increase our promotional activities. If the shopping experience we provide does not appeal to consumers or meet the expectations of existing customers, we may not acquire new customers at sustainable rates, acquired customers may not become repeat customers and existing customers' buying patterns and levels may decrease.

***If we fail to acquire new customers, reactivate prior customers or retain existing customers, or fail to do so in a cost-effective manner, our business, financial condition and operating results could be harmed.***

Our success depends on our ability to acquire and retain customers in a cost-effective manner. In order to expand our customer base, we must appeal to and acquire customers who have historically used other means of commerce to purchase home goods and may prefer alternatives to our offerings, such as the websites of our competitors or our suppliers' own websites. We have made significant investments related to customer acquisition and expect to continue to spend significant amounts to acquire additional customers and to reactivate prior customers. Our paid advertising efforts are primarily online channel advertising, including social media advertising, search engine marketing and paid engagement of online media companies. We engage influencers or key opinion leaders within the community via product sponsorship. We also conduct offline advertisements including printed display ads, direct mailing and magazine advertisements. These efforts are expensive and may not result in the cost-effective acquisition of customers. Our marketing expenses have varied from period to period, and we expect this trend to continue as we test new channels and refine our marketing strategies. We may increase or decrease our marketing spend within a period, based on the degree of our achievement of intended results, which may result in increased or decreased customer engagement in any given period. We cannot assure you that the net profit from new or returning customers we acquire will ultimately exceed the cost of acquiring those customers. Additionally, actions by third parties to block or impose restrictions on the delivery of certain advertisements could also adversely impact our business. If we fail to deliver a quality shopping experience, or if consumers do not perceive the products we offer to be of high value and quality, we may not be able to acquire new customers or retain existing customers. If we are unable to acquire new customers or reactivate prior customers who purchase products in numbers sufficient to grow our business, we may not be able to generate the scale necessary to drive beneficial network effects with our suppliers or efficiencies in our logistics network, our net revenue may decrease, and our business, financial condition and operating results may be materially adversely affected.

We also utilize non-paid advertising. Our website benefits significantly from direct searches via various platforms. In addition, our non-paid advertising strategy includes leveraging the value of our organic social media content and user-generated content within our community. Although we employ search engine optimization and search engine marketing strategies, our ability to maintain and increase the number of visitors directed to our website and application is not entirely within our control. Search engines frequently update and change the logic that determines the placement and display of results of a user's search, such that the purchased or algorithmic placement of links to our sites can be negatively affected. Moreover, a search engine could, for competitive or other purposes, alter its search algorithms or results, causing our sites to place lower in search query results. A major search engine could change its algorithms in a manner that negatively affects our paid or non-paid search ranking, and competitive dynamics could impact the effectiveness of search engine marketing or search engine optimization. We also obtain a significant amount of traffic via social networking websites or other channels used by our current and prospective customers. As e-commerce and social networking continue to rapidly evolve, we must continue to establish relationships with these channels and may be unable to develop or maintain these relationships on acceptable terms. If we are unable to cost-effectively drive traffic to our sites, our ability to acquire new customers, reactivate prior customers or retain our existing customers and our financial condition would suffer.

Further, some of our new customers originate from word of mouth or other non-paid referrals from existing customers. If our efforts to satisfy our existing customers are not successful, we may not be able to acquire new customers or reactivate prior customers through these referrals, which may adversely affect how we continue to grow our business, or may require us to incur significantly higher marketing expenses in order to acquire new customers.

***Our success depends in part on our ability to increase our net revenue per active customer. If our efforts to increase customer loyalty and repeat purchasing as well as maintain high levels of customer engagement are not successful, our growth prospects and net revenue will be materially adversely affected.***

Our ability to grow our business depends on our ability to generate increased net revenue and repeat purchases from our customer base. Our customer base in retail requires us to maintain high levels of customer engagement. To do this, we must continue to provide our customers and potential customers with a unified, convenient, efficient and differentiated shopping experience by:

● maintaining high quality of products;

● providing superior pre-sale consulting, and post-sale customer support, services;

● delivering products on time and without damage; and

● maintaining and further developing our online platforms to reduce conversion time from retail furniture consumers to customers.

If we fail to increase net revenue per active customer, generate repeat purchases or maintain high levels of customer engagement, our growth prospects, operating results and financial condition could be materially adversely affected.

We have faced and will continue to face price competition in the future. In addition, competitors with whom we compete, or who can obtain better pricing, more favorable contractual terms and conditions, or more favorable mix of products during periods of limited supply may be able to offer lower prices than we are able to offer. Our operating results and financial condition may be adversely affected by these and other industry-wide pricing pressures.

***Our physical retail stores may not achieve sales or operations targets and may negatively impact our financial results.***

We operate four and two physical retail stores in Singapore and South Korea, respectively. We believe that continued expansion into new physical retail stores represents a growth opportunity for us. Our growth strategy is dependent on our ability to identify and open future store locations in new and existing markets. Our ability to open stores in a timely and successful manner depends in part on the following factors: the availability of desirable store locations; the availability and costs of construction labor and materials; local permitting timelines; the ability to negotiate acceptable lease and development terms at reasonable rates, including the length of rental periods and renewal options and the ability to obtain termination rights; our ability to obtain all required approvals and comply with other regulatory requirements; our relationships with current and prospective landlords; the ability to secure and manage the inventory necessary for the launch and operation of new stores; the availability of capital funding for expansion; and general economic conditions. Any or all of these factors and conditions could materially adversely affect our growth and profitability.

New store openings may negatively impact our financial results due to the effect of store opening costs and lower sales during the initial period following opening. New stores, particularly those in new markets, build their brand recognition and customer base over time and, as a result, may have lower margins and incur higher operating expenses. We may not anticipate all of the challenges imposed by the expansion of our operations into new geographic markets. We may not manage our expansion effectively, and our failure to achieve or properly execute our expansion plans could limit our growth or have a material adverse effect on our business, financial condition and results of operations.

***We may close additional physical retail stores in the future, which could result in significant costs and adversely affect our business, financial condition, and results of operations.***

While we opened a retail store in Singapore in December 2025, we closed retail stores in Singapore in 2025. From time to time, we evaluate the performance and strategic fit of our physical retail stores, and we may determine that certain locations are no longer aligned with our business objectives or are not economically viable. As a result, we may decide to close existing retail stores in the future, whether due to underperformance, changes in market conditions, shifts in consumer behavior, rising operating costs, or broader strategic considerations.

The closure of such physical retail stores may disrupt our operations, reduce our physical presence in certain markets, and adversely affect our brand visibility and impact, which would negatively affect customer awareness and customer loyalty. Store closures may also require management to devote significant time and resources to restructuring activities, which could divert attention away from other aspects of our business.

If we are unable to execute store closures in an efficient and timely manner, or if the anticipated benefits of such closures are not realized, our business, financial condition, and results of operations could be materially and adversely affected.

***Our business may be affected by increase in rental expenses or the termination of leases of our retail stores.***

We operate our own retail stores under the name "HomesToLife" by offering a one-stop solution to retail customers to address their furniture needs. As of the date of this annual report, we have in operation four retail stores under our brand name "HomesToLife" in Singapore, one retail store under brand name "Domicil" in Korea, and one retail store under brand name "Fabbrica" in Korea. The retail stores are essential to our retail sales business as they are an important distribution channel of our products. However, there is no assurance that we can renew the existing tenancies upon their respective expiry or can renew the same on terms and conditions no less favorable to us that the existing ones. Failure to renew the existing tenancies on terms and conditions acceptable to us may lead to disruption of our business and additional costs being incurred for relocation and renovation. If we are unable to find alternative locations that are suitable or on commercially acceptable terms in a timely manner, it may lead to reduction in the number of retail stores and our business, results of operation and financial condition may be adversely affected.

Furthermore, rental expenditure is one of the major costs in our retail sales business operation. For the fiscal years ended December 31, 2025, 2024 and 2023, payments on lease liabilities, which represent rental costs, accounted to US$3.5 million, US$1.9 million and US$1.4 million. Any substantial increase in rental expenses of our retail venues may increase our cost of operation and may adversely affect our profitability and financial positions.

***Merchandise returns could harm our business.***

Our retail stores allow their customers to return products, subject to our return policy. While our current merchandise returns are minimal, if merchandise returns are significant in the future, our business, prospects, financial condition and results of operations could be affected. Further, we modify our policies relating to returns from time to time, which may result in customer dissatisfaction or an increase in the number of product returns. Many of our products are large and require special handling and delivery. From time to time, our products are damaged in transit, which can increase return rates and affect our brand image and reputation.

***We are subject to risks related to online transactions and payment methods.***

For our retail business, we accept payments using a variety of methods, including credit card, debit card, electronic and mobile payment technologies, credit accounts (including promotional financing), gift cards and customer invoicing. We rely on third parties to provide many of these payment methods and payment processing services, including certain promotional financing. As we offer new payment options to consumers, we may be subject to additional regulations, compliance requirements and fraud. For certain payment methods, including credit and debit cards, we pay interchange and other fees, which may increase over time and raise our operating costs and lower profitability. As our business changes, we may also be subject to different rules under existing standards, which may require new assessments that involve costs above what we currently pay for compliance. If we fail to comply with the rules or requirements of any provider of a payment method we accept, if the volume of fraud in our transactions limits or terminates our rights to use payment methods we currently accept, or if a data breach occurs relating to our payment systems, we may, among other things, be subject to fines or higher transaction fees and may lose, or face restrictions placed upon, our ability to accept credit card and debit card payments from consumers or to facilitate other types of online payments. If any of these events were to occur, our business, financial condition and operating results could be materially and adversely affected.

We rarely, if not never, have received orders placed with fraudulent credit card data, we may, in the future, suffer losses as a result of orders placed with such fraudulent credit card data even if the associated financial institution approved payment of the orders. Under current credit card practices, we may be liable for fraudulent credit card transactions. We may, in the future, also suffer losses from other online transaction fraud, including fraudulent returns. If we are unable to detect or control credit card or transaction fraud, our liability for these transactions could harm our business, financial condition and operating results.

***Our efforts to expand our business into new geographic markets internationally will subject us to additional business, legal, financial and competitive risks, may not be successful and could adversely affect our profitability and operating results.***

Through acquisition of HTL Marketing, we operate two retail stores in Korea, in addition to our stores in Singapore. Our business success depends to some extent on our ability to expand our existing one-stop shop concept and product offerings into new geographic markets from time to time. Our plan to expand and/or further penetrate in the Singapore and Asian home furnishings market may be subject to risks such as:

● costs associated with expanding our physical retail locations;

● costs associated with strengthening information technology infrastructure to support anticipated growth in sales and supply volume;

● challenges in recruiting and retaining experienced sales, customer services and management personnel;

● costs associated with potential strategic acquisitions; and

● burdens of complying with a wide variety of local laws and regulations.

The occurrence of any of these risks could negatively affect our expansion plan and consequently our business and operating results.

With the proceeds of our IPO, we have plans to open new HomesToLife stores in Taiwan, Indonesia, Malaysia, and other parts of Asia, besides Korea. We have also incorporated HTL FE, through which we source, distribute, and deliver premium furniture and related products to both consumer and business sectors across the Asia-Pacific region. Additionally, on May 19, 2025, we completed the acquisition of HTL Marketing, a B2B procurer and supplier of premium upholstered sofas and leather materials for sofa manufacturing, from a related party. Expanding internationally is time-consuming, requires significant amounts of management time and resources, substantial upfront investments, including investments in marketing, information technology and additional personnel. Expanding our one-stop shop concept internationally is particularly challenging because it requires us to gain country-specific knowledge about consumers, regional competitors and local laws, construct catalogs specific to the country, open new physical stores, and build local logistics capabilities. These technological and logistical challenges can result in failures or other quality issues that may cause customer dissatisfaction and harm our reputation and brand. In the future, we may also consider incorporating the franchise model in our international expansion plan although there is no assurance at this time that that is what we will do. We also cannot guarantee the success of the franchise model. We may not be able to generate satisfactory net revenue from these efforts to offset related costs. Any lack of market acceptance of our efforts to expand our one-stop shop concept and product offerings into new geographic markets could have a material adverse effect on our business, prospects, financial condition and operating results.

In addition, our current and potential competitors in these new geographic markets may have greater brand recognition, financial resources, longer operating histories and larger customer bases than we do in these markets. If we are not successful to recoup our investments in these new markets, our business, financial condition and operating results may be materially adversely affected.

**Risks Related to Our Corporate Structure and Our Securities**

***We incur significant expenses and devote other significant resources and management time as being a public company, which may negatively impact our financial performance and could cause our results of operations and financial condition to suffer.***

We incur significant legal, accounting, insurance and other expenses as a result of being a public company. Laws, regulations and standards relating to corporate governance and public disclosure for public companies, including the Dodd-Frank Act of 2010, the Sarbanes-Oxley Act, regulations related thereto and the rules and regulations of the SEC and Nasdaq, significantly increase our costs as well as the time that must be devoted to compliance matters. Compliance with these laws, rules, regulations and standards has substantially increased our expenses, including our legal and accounting costs, and make some of our operating activities more time-consuming and costly. Our public company obligations also require attention from our senior management and could divert their attention away from the day-to-day management of our business. These laws, rules, regulations and standards to make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our Board of Directors or as officers. As a result of the foregoing, we have experienced a substantial increase in legal, accounting, insurance and certain other expenses, which will negatively impact our financial performance and could cause our results of operations and financial condition to suffer. Furthermore, if we are unable to satisfy our obligations as a public company, we could be subject to delisting of our Shares, fines, sanctions and other regulatory actions and potential civil litigation.

***If we fail to implement and maintain an effective system of internal controls, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud, and investor confidence and the market price of our shares may be materially and adversely affected.***

We are subject to the reporting requirements of the Exchange Act of 1934 (the "Exchange Act"), the Sarbanes-Oxley Act and the rules and regulations of Nasdaq after we are successfully listed on the Nasdaq Capital Market. Our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. However, in the course of auditing our consolidated and combined financial statements for the financial statements included elsewhere in this annual report, we identified no material weakness in our internal control over financial reporting. As defined in standards established by the PCAOB, a "material weakness" is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

However, we cannot assure you that we will not identify material weaknesses or significant deficiencies in the future. Our failure to correct the material weaknesses or our failure to discover and address any other material weaknesses or control deficiencies could result in inaccuracies in our financial statements and could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis. As a result, our business, financial condition, results of operations and prospects, as well as the trading price of our Shares, may be materially and adversely affected. Moreover, ineffective internal control over financial reporting significantly hinders our ability to prevent fraud.

Section 404 of the Sarbanes-Oxley Act of 2002 requires that we include a report of management on our internal control over financial reporting in our annual report on Form 20-F beginning with our annual report beginning with our second annual report on Form 20-F. In addition, once we cease to be an "emerging growth company" as such term is defined under the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. In addition, as we are a public company, our reporting obligations may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.

During the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act of 2002, we may identify weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting. If we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, harm our results of operations and lead to a decline in the trading price of our shares. Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions. We may also be required to restate our financial statements from prior periods.

***The ability of our subsidiaries to distribute dividends to us may be subject to restrictions under applicable laws.***

We are a holding company, and our operating subsidiaries are located in various jurisdictions. Part of our primary internal sources of funds to meet our cash needs is our share of the dividends, if any, paid by our operating subsidiaries. The distribution of dividends to us from our subsidiaries is subject to restrictions imposed by the applicable laws and regulations in these markets, including requirements relating to the availability of distributable profits and requisite board and shareholder approvals. which are more fully described in the section titled "Dividend Policy" in this annual report. In addition, although there are currently no foreign exchange control regulations which restrict the ability of our operating subsidiaries to distribute dividends to us, standard tax filing and reporting procedures apply, the relevant regulations may be changed and the ability of our subsidiaries to distribute dividends to us may be restricted in the future.

***We do not expect to be subject to certain Nasdaq corporate governance rules applicable to U.S. listed companies.***

As a foreign private issuer, we are entitled to rely on a provision in Nasdaq's corporate governance rules that allows us to follow Cayman Islands corporate law with regards to certain aspects of corporate governance. This allows us to follow certain corporate governance practices that differ in significant respects from the corporate governance requirements applicable to U.S. companies listed on Nasdaq.

In addition, our Audit Committee is not subject to additional Nasdaq requirements applicable to listed U.S. companies, including an affirmative determination that all members of the Audit Committee are "independent," using more stringent criteria than those applicable to the Company under relevant SEC rules. Nasdaq's corporate governance rules require listed U.S. companies to, among other things, seek shareholder approval for the implementation of certain equity compensation plans and issuances of shares, which the Company is not required to follow as a foreign private issuer.

***We are a "controlled company" within the meaning of the Nasdaq Listing Rules and, as a result, may rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies.***

We are a "controlled company" as defined under the Nasdaq Listing Rules because our founders and Chairman/Vice Chairman, Messrs. Phua Yong Pin and Phua Yong Tat, beneficially own approximately 94.79% of our issued and outstanding Shares and are able to exercise approximately 94.79% of the total voting power of our issued and outstanding Shares. For so long as we remain a controlled company under that definition, we are permitted to elect to rely on, and may rely on, certain exemptions from corporate governance rules, including an exemption from the rule that a majority of our board of directors must be independent directors. At this time, we do not intend to rely on these exemptions to corporate governance requirements as a controlled company. However, we may elect to do so in the future. As a result, you may not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.

***We are subject to changing laws, rules and regulations in the U.S. regarding regulatory matters, corporate governance and public disclosure that will increase both our costs and the risks associated with non-compliance.***

We are subject to rules and regulations by various governing bodies and self-regulatory organizations, including, for example, the SEC and The Nasdaq Stock Market, which are charged with the protection of investors and the oversight of companies whose securities are publicly traded, and to new and evolving regulatory measures under applicable law. Our efforts to comply with new and changing laws and regulations have resulted in and are likely to continue to result in increased general and administrative expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.

Moreover, because these laws, regulations and standards are subject to varying interpretations, their application in practice may evolve over time as new guidance becomes available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes, we may be subject to penalty and our business may be harmed.

***An active trading market for our Shares or our Shares may not continue and the trading price for our Shares may fluctuate significantly.***

We cannot assure you that a liquid public market for our Shares will continue. The public offering price for our securities in our initial public offering, or IPO, was determined by negotiation between us and the underwriters based upon several factors, and we can provide no assurance that the trading price of our Shares will not decline below the public offering price. As a result, investors in our securities may experience a significant decrease in the value of their Shares.

***The market price of our Shares 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 public offering price.***

The public offering price for our Shares was determined through negotiations between the underwriters and us and may vary from the current market price of our Shares. If you purchased our Shares in our public offering, you may not be able to resell those shares at or above the public offering price. The market price of our Shares may fluctuate significantly in response to numerous factors, many of which are beyond our control, including:

● actual or anticipated fluctuations in our revenue and other operating results;

● the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;

● 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;

● announcements by us or our competitors of significant products or features, technical innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments;

● price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;

● lawsuits threatened or filed against us or our major suppliers; and

● other events or factors, including those resulting from war or incidents of terrorism, pandemics, or responses to these events.

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. As a relatively small-capitalization company with relatively small public float, we may experience greater stock price volatility, extreme price run-ups, lower trading volume and less liquidity than large-capitalization companies. In particular, our Shares may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices. Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Shares.

In addition, if the trading volumes of our Shares are low, persons buying or selling in relatively small quantities may easily influence prices of the Shares. This low volume of trades could also cause the price of the Shares to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Holders of the Shares 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 the Shares. As a result of this volatility, investors may experience losses on their investment in the Shares. A decline in the market price of the Shares also could adversely affect our ability to sell additional Shares or other securities and our ability to obtain additional financing in the future. No assurance can be given that an active market in the Shares will develop or be sustained. If an active market does not develop, holders of the Shares may be unable to readily sell the Shares they hold or may not be able to sell their Shares at all.

In the past, shareholders 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.

***The sale or availability for sale of substantial amounts of our Shares could adversely affect their market price.***

Sales of substantial amounts of our Shares in the public market, or the perception that these sales could occur, could adversely affect the market price of our Shares and could materially impair our ability to raise capital through equity offerings in the future. As of the date of this annual report, we had 89,687,500 Shares outstanding. We cannot predict what effect, if any, market sales of securities held by our significant shareholders or any other shareholder or the availability of these securities for future sale will have on the market price of our Shares.

***Techniques employed by short sellers may drive down the market price of the Shares.***

Short selling is the practice of selling securities that the seller does not own but rather has borrowed from a third party with the intention of buying identical securities back at a later date to return to the lender. The short seller hopes to profit from a decline in the value of the securities between the sale of the borrowed securities and the purchase of the replacement shares, as the short seller expects to pay less in that purchase than it received in the sale. As it is in the short seller's interest for the price of the security to decline, many short sellers publish, or arrange for the publication of, negative opinions and allegations regarding the relevant issuer and its business prospects in order to create negative market momentum and generate profits for themselves after selling a security short. These short attacks have, in the past, led to selling of shares in the market. If we were to become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we could have to expend a significant amount of resources to investigate such allegations and/or defend ourselves. While we would strongly defend against any such short seller attacks, we may be constrained in the manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues of commercial confidentiality.

***Securities analysts may not publish favorable research or reports about our business or may publish no information at all, which could cause our stock price or trading volume to decline.***

The trading market for our securities are influenced to some extent by the research and reports that industry or financial analysts publish about us and our business. We do not control these analysts. As a newly listed company, we may be slow to attract research coverage and the analysts who publish information about our securities will have had relatively little experience with us, which could affect their ability to accurately forecast our results and could make it more likely that we fail to meet their estimates. In the event we obtain securities or industry analyst coverage, if any of the analysts who cover us provide inaccurate or unfavorable research or issue an adverse opinion regarding our stock price, our stock price could decline. If one or more of these analysts cease coverage of us or fail to publish reports covering us regularly, we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline and result in the loss of all or a part of your investment in us.

***Because may or may not pay dividends in the foreseeable future, you must rely on price appreciation of our Shares for return on your investment.***

We currently intend to declare and pay and annual dividend for 2025. We may pay out dividends where we assess that we have sufficient available funds. However, there is no guarantee that we will pay any cash dividends for future years.. Therefore, you should not rely on an investment in our Shares as a source for any future dividend income.

The Company's board of directors has the authority to pay interim dividends. Subject to the requirements of the Companies Act, the Company may by ordinary resolution declare final dividends in accordance with the respective rights of its shareholders but no dividend shall exceed the amount recommended by the directors. Even if our directors and shareholders decide to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our Shares will likely depend entirely upon any future price appreciation of our Shares. There is no guarantee that our Shares will appreciate in value in the future or even maintain the price at which you purchased our Shares. You may not realize a return on your investment in our Shares and you may even lose your entire investment.

***As a company incorporated in the Cayman Islands, we may adopt certain home country practices in relation to corporate governance matters that differ significantly from corporate governance requirements of Nasdaq. These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance requirements of Nasdaq.***

As a company incorporated under the laws of the Cayman Islands that is listed on Nasdaq, we are subject to Nasdaq corporate governance listing standards. However, Nasdaq rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the Cayman Islands which is our home country, may differ significantly from corporate governance requirements of Nasdaq, including, but not limited to, board of directors independent requirements, director nomination procedures, compensation committee matters. We may follow our home country law instead of the Nasdaq Listing Rules that require us to obtain shareholder approval for certain dilutive events, such as certain transactions other than a public offering involving issuances of a 20% or greater interest in the Company, and acquisitions of the stock or assets of another Company. As a result, our shareholders may be afforded less protection than they otherwise would enjoy under the corporate governance requirements of Nasdaq applicable to U.S. domestic issuers.

***You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.***

We are an exempted company incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our amended and restated memorandum and articles of association, as amended ("Memorandum and Articles of Association"), the Companies Act (As Revised) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary duties of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States and some states (such as Delaware) have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States.

Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than the Memorandum and Articles of Association and any special resolutions passed by such companies, and the register of mortgages and charges of such companies) or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our Memorandum and Articles of Association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

As a result of all of the above, our shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of our board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.

***We are a foreign private issuer and, as a result, are not subject to U.S. proxy rules and are subject to more lenient and less frequent Exchange Act reporting obligations than a U.S. issuer.***

Because we qualify as a foreign private issuer under the Exchange Act, we are exempted from certain provisions of the Exchange Act that are applicable to U.S. public companies, including:

● the sections of the Exchange Act that regulate the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and

● the rules under the Exchange Act that require the filing of quarterly reports on Form 10-Q containing unaudited financial and other specified information and current reports on Form 8-K upon the occurrence of specified significant events.

In addition, foreign private issuers are not required to file their annual report on Form 20-F until 120 days after the end of each fiscal year, while U.S. domestic issuers that are not large accelerated filers or accelerated filers are required to file their annual report on Form 10-K within 90 days after the end of each fiscal year. Foreign private issuers are also exempt from Regulation FD, aimed at preventing issuers from making selective disclosures of material information. As a result, you may not have the same protections afforded to shareholders of companies that are not foreign private issuers. In addition, our officers, directors and principal shareholders are exempt from the reporting and "short-swing" profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder. Therefore, our shareholders may not know on a timely basis when our officers, directors and principal shareholders purchase or sell our Shares.

***There can be no assurance that we will not be a passive foreign investment company, or PFIC, for U.S. federal income tax purposes for any taxable year, which could subject U.S. investors in our Shares to significant adverse U.S. income tax consequences.***

In general, we will be treated as a passive foreign investment company ("PFIC") for any taxable year in which either (1) at least 75% of our gross income (looking through certain 25% or more-owned subsidiaries) is passive income or (2) at least 50% of the average value of our assets (looking through certain 25% or more-owned subsidiaries) is attributable to assets that produce, or are held for the production of, passive income. Passive income generally includes, without limitation, dividends, interest, rents, royalties, and gains from the disposition of passive assets. If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder (as defined in the Section of this annual report captioned "*Certain United States Federal Income Tax Considerations*") of our securities, the U.S. Holder may be subject to increased U.S. federal income tax liability and may be subject to additional reporting requirements. The determination of whether we are a PFIC is a fact-intensive determination made on an annual basis applying principles and methodologies that in some circumstances are unclear and subject to varying interpretation. Our actual PFIC status for any taxable year will not be determinable until after the end of such taxable year. Accordingly, there can be no assurance with respect to our status as a PFIC for our current taxable year or any subsequent taxable year. We urge U.S. Holders to consult their own tax advisors regarding the possible application of the PFIC rules in light of their individual circumstances.

***For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public companies.***

In April 2012, President Obama signed into law the JOBS Act. We are classified as an "emerging growth Company" under the JOBS Act. For as long as we are an emerging growth Company, which may be up to five full fiscal years, unlike other public companies, we will not be required to, among other things, (i) provide an auditor's attestation report on management's assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act, (ii) comply with any new requirements adopted by the PCAOB requiring mandatory audit firm rotation or a supplement to the auditor's report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer, (iii) provide certain disclosure regarding executive compensation required of larger public companies or (iv) hold nonbinding advisory votes on executive compensation. We will remain an emerging growth Company for up to five years, although we will lose that status sooner if we have more than $1.235 billion of revenues in a fiscal year, have more than $700 million in market value of our Shares held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period.

To the extent that we rely on any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not emerging growth companies. If some investors find our Shares to be less attractive as a result, there may be a less active trading market for our Shares and our share price may be more volatile.

***We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.***

As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer's most recently completed second fiscal quarter. In the future, we would lose our foreign private issuer status if (1) more than 50% of our outstanding voting securities are owned by U.S. residents and (2) a majority of our directors or executive officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status. If we lose our foreign private issuer status, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act . In addition, we will lose our ability to rely upon exemptions from certain corporate governance requirements under the Nasdaq Listing Rules.

***Our Major Shareholders have substantial influence over our company. Their interests may not be aligned with the interests of our other shareholders, and they could prevent or cause a change of control or other transactions.***

As of the date of this annual report, our founders and Chairman/Vice Chairman, Messrs. Phua Yong Pin and Phua Yong Tat, beneficially own approximately 94.79% of our issued and outstanding Shares and are able to exercise approximately 94.79% of the total voting power of our issued and outstanding Shares.

Accordingly, these Major Shareholders could have significant influence in determining the outcome of any corporate transaction or other matter submitted to the shareholders for approval, including mergers, consolidations, the election of directors and other significant corporate actions. Without the consent of our Major Shareholders, we may be prevented from entering into transactions that could be beneficial to us or our minority shareholders. In addition, our directors and officers could violate their fiduciary duties by diverting business opportunities from us to themselves or others. The interests of our Major Shareholders may differ from the interests of our other shareholders. The concentration in the ownership of our Shares may cause a material decline in the value of our Shares. For more information regarding our principal shareholder, see "Principal Shareholders."

***Judgments obtained against us by our shareholders may not be enforceable.***

We are an exempted company incorporated under the laws of the Cayman Islands. We conduct our operations outside the United States and substantially all of our assets are located outside the United States. In addition, substantially all of our directors and executive officers and the experts named in this annual report reside outside the United States, and most of their assets are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against us or against them in the United States in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. In addition, in original actions brought in courts in jurisdictions located outside the United States, it may be difficult for investors to enforce liabilities based upon U.S. securities laws. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands, or other relevant jurisdictions may render you unable to enforce a judgment against our assets or the assets of our directors and officers.

Ogier, our counsel as to the laws of the Cayman Islands, has advised us that there is uncertainty as to whether the courts of the Cayman Islands would (i) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States, or (ii) entertain original actions brought in the Cayman Islands against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States. Accordingly, there can be no assurance that the Singapore courts would enforce against us, our Directors or our Executive Officers, judgments obtained in the United States which are predicated upon the civil liability provisions of the federal securities laws of the United States.

***We cannot assure you that we will be able to meet the continued listing standards of Nasdaq in the future.***

We cannot assure you that we will be able to meet the continued listing standards of Nasdaq in the future. If we fail to comply with the applicable listing standards and Nasdaq delists our Shares, we and our Shareholders could face significant material adverse consequences, including:

● a limited availability of market quotations for our Shares;

● reduced liquidity for our Shares;

● a determination that our Shares are "penny stock", which would require brokers trading in our Shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our Shares;

● a limited amount of news about us and analyst coverage of us; and

● a decreased ability for us to issue additional equity securities or obtain additional equity or debt financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as "covered securities." Because we expect that our Shares will be listed on Nasdaq, such securities will be covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject to regulations in each state in which we offer our securities.

**Item 4. INFORMATION ON THE COMPANY**

A. History and Development of the Company

Our Company was incorporated in the Cayman Islands on February 16, 2024 under the Companies Act as an exempted company with limited liability. Our authorized share capital is currently US$50,000.00 divided into 500,000,000 ordinary shares of par value of US$0.0001 each.

HomesToLife Singapore, one of our major operating subsidiaries, was initially incorporated in September 1989 under the name, "Hwa Tat Lee Leather Pte Ltd" in Singapore by three brothers, Messrs. Phua Yong Pin, Phua Yong Sin and Phua Yong Tat (altogether known as, the "Phua Brothers"), as part of the then HTL Group of companies founded by the Phua Brothers. It underwent several name changes before becoming HomesToLife Pte. Ltd. in 2019. Its business transitioned from leather trading to furniture retail in 2014, was sold to a third party in 2018, returned to the beneficial ownership of Messrs. Phua Yong Pin and Phua Yong Tat in 2022.

Prior to the reorganization in 2024, HomesToLife Singapore was a wholly-owned subsidiary of New Century International Homes Pte. Ltd., a Singapore incorporated company, which was in turn an indirect wholly-owned subsidiary of Golden Hill Investments. In preparation for the Company's IPO, our Group completed a reorganization (the "Reorganization") from February and May 2024.

After the Reorganization, HomesToLife Cayman directly owns HomesToLife International, which is the direct holding company of 100% shares of HomesToLife Singapore. Golden Hill BVI, Summer Capital Pte. Ltd. and four Pre-IPO Investors collectively own all issued and outstanding Shares of HomesToLife Cayman.

Subsequently, our Shares were priced on September 30, 2024, and began trading on the Nasdaq Capital Market under the ticker "HTLM" on October 1, 2024. Our IPO closed on October 2, 2024.

On October 28, 2024, we incorporated HTL FE as a second operating company under HomesToLife International Pte. Ltd.. HTL FE engages in the exporting upholstered furniture within the Asia-Pacific region since February 1, 2026.

On May 19, 2025, we acquired 100% of the equity interests in HTL Marketing, a B2B procurer and supplier of premium upholstered sofas and leather materials for sofa manufacturing, from a related party, for a consideration of 75,000,000 ordinary shares of the Company issued to the seller. With the acquisition of HTL Marketing, the Company has significantly expanded its operations to include the exporting upholstered furniture across the Asia-Pacific, Europe and North America regions. New Century Furniture Pte. Ltd. ("NCFTP"), HTL France SAS ("HTLF"), HTL ANZ PTY LTD ("HTLA"), HTL Korea Co., Ltd. ("HTL Korea"), Hwa Tat Lee Japan Co., Ltd. ("HTL Japan"), Terasoh Co., Ltd. ("TCL"), HTL Taiwan Holding Pte. Ltd. ("HTL TW"), HTL (UK) Limited ("HTL UK") became wholly-owned subsidiaries of the Company on May 19, 2025 upon the acquisition of HTL Marketing.

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***Corporate Structure***

As at the date of this annual report, our Group comprised of the Company and its subsidiaries, HomesToLife International, HomesToLife Singapore, HTL FE, HTL Marketing, NCFTP, HTLF, HTLA, HTL Korea, HTL Japan, TCL, HTLTW, and HTL UK.

The chart below illustrates our corporate structures and identifies our subsidiaries as of the date of this annual report:

![](form20-fa_002.jpg)

B. Business Overview

**Overview**

HomesToLife Ltd is a global home furniture company headquartered in Singapore, operating through three core business divisions: (i) export division for supplying furniture to retail partners worldwide, (ii) leather trading division, and (iii) retail division, with direct retail operations in Singapore and South Korea.

Leveraging more than 50 years of heritage established by its founders, the Group combines consumer retail, wholesale distribution and sourcing capabilities, supported by a diversified manufacturing and sourcing network across China, Vietnam and India.

In May 2025, the Group strengthened its design, product development and merchandising capabilities through the acquisition of HTL Marketing, further enhancing its ability to develop proprietary designs, expand product offerings and support both its consumer retail and wholesale businesses.

![](form20-fa_001.jpg)

Across both divisions, the Group operates an integrated, **end-to-end supply-chain model** that encompasses product design and development, sourcing and manufacturing partner management, and logistics and distribution channel coordination.

This operating model enables the Group to translate designs into production-ready products efficiently, support both branded and white-label offerings, and deliver scale, consistency and resilience across multiple markets.

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***Design & Product Development***

Research and development is central to the Group's growth, with ongoing collaborations with global designers since the early 2010s resulting in a broad portfolio of original products, many of which have achieved sustained commercial success. Supported by this pipeline, the Group maintains consistent product launch momentum, introducing new offerings at international, regional and home shows to meet evolving market needs across geographies. This approach enables "impact customization," allowing customers and partners to tailor product selections without the cost or complexity of full bespoke manufacturing.

***Sourcing and Manufacturing Partners Management***

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The Group selects manufacturers across China, Vietnam, and India based on scale, cost and operational efficiency, while suppliers are managed to ensure timely delivery of raw materials on a just-in-time basis to appointed factories. This is supported by centralized freight management, warehousing and distribution capabilities, enabling seamless end-to-end service delivery. Across the supply chain, the Group maintains audit, quality and environmental compliance standards to support consistent execution and operational reliability.

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***Logistics and Distribution Channel Management***

We provide end-to-end global logistics solutions covering freight, customs, insurance, and shipping. From factory pick-up in China, Vietnam, and India, to shared shipping with leading freight forwarders, and last mile delivery service providers.

**Export & Leather Trading Divisions**

Our export and leather trading divisions comprise of our export sales business and leather trading business.

Under our export sales business, we engage in business-to-business sales of upholstered furniture by fulfilling purchase orders from our customers, including but not limited to furniture retailers and distributors, which we meet at fairs such as Canton Fair, Shanghai Fair, and Brussels Fair, or know of us or our subsidiaries based on existing relationships. Products are sold on a wholesale basis under FOB and landed terms and include both branded and white-label offerings. Our export sales business is carried out through a number of subsidiaries of the Company, including HTL FE, HTLF, HTLA, HTL Japan, HTL UK, and HTL Marketing. Our export sales business accounted for 92.5% of our total revenue for the year ended December 31, 2025.

Under our leather trading business, we procure raw hides from global suppliers and sell them to related tanneries to be converted into finished upholstery leather used in upholstered furniture to ensure stable supply and consistent quality for upholstered products, improves cost visibility, and speeds up new leather launches with custom colors/textures. We engage with our business partners in the wholesale trade of leather materials for sofa manufacturing. Our leather trading business is conducted through HTL Marketing and accounted for 5.1% of our total revenue for the year ended December 31, 2025.

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**Retail Division**

The retail division includes our retail business in Singapore and South Korea, which is primarily conducted through HomesToLife Singapore and HTL Korea. This division focuses on the sale of upholstered furniture and related home furnishing products to end consumers through our retail store network. Our retail stores are strategically located in areas with good market potential or customer demands, taking into account population density, average income level of residents and their discretionary spending, and the presence of related trade mix in proximity. Our consumer retail division accounted for 2.4% of our total revenue for the year ended December 31, 2025.

Singapore

HomesToLife Singapore operates a limited consumer retail presence in Singapore, primarily serving as a direct-to-consumer channel and brand showcase for the Group's upholstered furniture offerings. As of the date of this annual report, HomesToLife Singapore operates four retail store locations, offering customized leather and fabric upholstered furniture, case goods and home accessories sourced from selected third-party suppliers.

The Singapore retail operations also function as a testing platform for new designs, materials and retail concepts, providing customer insights that support the Group's product development and merchandising activities. Selected retail locations additionally feature dedicated space for brands such as Domicil and Fabbrica, and the business is complemented by an e-commerce platform at www.homestolife.com offering online purchasing and post-sales support.

South Korea

In South Korea, our consumer retail operations are conducted through HTL Korea and comprise a combination of direct retail stores, department store sales and franchise operations (suspended since December 2025). For the franchisee business in Korea, HTL Korea signs franchise agreements with qualified franchisees, which clearly stipulate the scope of authorized product sales, brand usage standards, supply terms, and payment conditions. HTL Korea supplies approved products to franchisees and provides ongoing operational support, including brand guidance and marketing assistance, to ensure consistency in brand presentation and customer experience.

**Competitive Strength**

We believe the following key competitive strengths are crucial to our success and future growth.

***Integrated Supply-Chain Platform***

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The Group operates as an integrated supply-chain solutions provider and brand builder, combining end-to-end capabilities across design and product development, sourcing and manufacturing partner management, and logistics and distribution channel coordination.

Through this integrated platform, the Group supports both its own branded offerings and white-label partnerships, enabling retail partners to access scalable, production-ready solutions across multiple markets. This model allows the Group to deliver global scale with consistency in quality, lead times and execution, while remaining flexible to local market requirements and customer specifications.

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***Multi-year supplier agreements with established leather and fabric upholstered furniture manufacturers***

Because of (1) the rich resources such as manufacturers that HTL Group has and (2) stable supply of products with reasonable prices based on the group-level negotiation, we are able to secure good-quality products and in normal circumstances deliver the customized products within 8-12 weeks after our customers place an order. We believe this is faster than many of our competitors.

***Established brand***

The Group maintains a diversified portfolio of six furniture brands: Domicil, Fabbrica, Corium, HomesToLife, RelaxStudio and Gallery - each positioned to address different consumer preferences and price segments across markets. This multi-brand approach enables the Group to deploy a mixed brand strategy tailored to local market dynamics, supporting both branded and white-label distribution.

Over the past ten plus years, through our subsidiaries engaged in our consumer retail business, we have established the HomesToLife, Domicil and Fabbrica brand and reputation as premium furniture retailers that offer and sell products that deliver exceptional value. Its products are designed by leading industry designers, hand crafted by dedicated and experienced craftsman using a wide selection of quality and durable materials.

Apart from this, we have also established HTL as a trusted and reliable brand in the wholesale furniture industry, and our furniture is recognized for its high quality. As a result, many of our wholesale customers, including retailers that operate their own brands, place orders for our wholesale furniture on a recurrent basis, and we enjoy steady and brisk sales to such wholesale customers.

Through these brands, the products that the Group distribute are sold in more than 5,000 retail outlets globally, allowing it to maximize market coverage and growth potential while leveraging a common integrated supply-chain and product

***Unique position to offer a one-stop shop for retail customers***

In addition to a broad range of upholstered product offering, HomesToLife Singapore and HTL Korea also offer and sell case goods and accessories, and a carefully curated range of home furniture that are sourced internationally and handpicked by us, giving customers a one-stop shop with all furnishings they need to furnish their homes and express their individuality through their choice furniture. Because of our management's decades long track record in the upholstered furniture industry and ownership in the HTL Group which has multiple luxury brands of furniture, HomesToLife Singapore and HTL Korea are in a unique position to offer a one-stop shop for our retail customers.

Additionally, HomesToLife Singapore and HTL Korea position themselves as a luxury furniture retailer, and our sales staff provided significant value-added services at no additional cost to our customers, in order to promote better conversion rates. For example, our sales staff at each of our retail stores are hired for and trained to provide interior design consultancy services for our potential customers. Thus, a customer could provide our sales staff with a general description of the type of furniture, and our sales staff would be able to recommend furniture based on each such customer's needs.

***Industry veterans with deep knowledge in local market holding leadership positions***

Our management team has extensive knowledge and experience in the global upholstered furniture industry. Both Mr. Phua Yong Pin, our Chairman, and Mr. Phua Yong Tat, our vice Chairman have over 40 years of experience in the furniture industry. Messrs. Phua Yong Tat and Phua Yong Pin are primarily responsible for the overall management, formulation of business strategies and day-to-day management of our operations. We benefit from the extensive experience and deep knowledge in the local markets of our management team in the industry, which has enabled us to anticipate market trends and changing consumer tastes, offer premium customization options and product offerings, and develop strong business relationship with our customers and suppliers. We believe that the commitment of our management team has been one of the key factors to our success and a competitive edge in our planned expansions.

Apart from our focus on the Singapore and South Korea retail market, leveraging on our deep expertise in the upholstered furniture industry, we have also identified opportunities in and expanded into the exporting upholstered furniture to various countries within the Asia-Pacific region, including but not limited to Japan, Korea, and Indonesia. Additionally, through our acquisition of HTL Marketing, our sales now span key global markets across Asia-Pacific, Europe, and North America.

**Business Strategies**

***Marketing & Brand Direction***

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The Group is entering a new phase of brand-led expansion, with HTL Marketing playing a central role in shaping brand strategy, capability building, and regional execution. The Group continues to leverage HomesToLife and Domicil as key growth engines across Asia. With strong foundations in Singapore and South Korea, these brands serve as strategic springboards to scale across high-potential Asian markets, supporting both Retail and broader Group objectives.

Guided by HTL Marketing, the Group is increasing marketing investment in Asia by deploying an integrated marketing mix. This reflects confidence in HomesToLife's traction and relevance amid evolving regional demographics, including rising affluence, urbanization, and growing demand for aspirational home living solutions.

Within the broader portfolio, the brand Domicil continues to perform strongly in established markets, supported by rising average order values and increasing engagement among affluent, repeat buyers. The Group is prudently expanding points of sale while refining distribution partnerships to strengthen brand-channel alignment and long-term sustainability.

Trade marketing remains a strategic enabler across all segments. Continued investment in technology, talent, and local market capabilities — coordinated between HTL Marketing and regional teams — enhances competitiveness and reinforces the "Easy Buy, Easy Sell" model, delivering efficiency and value to trading partners globally.

Disciplined investments are also being made in both emerging and established markets, including the continued scaling of the Company's India business following its strategic entry in 2020. Collectively, these initiatives reflect a focused and disciplined brand direction — strengthening leadership in core markets while capturing scalable growth opportunities across Asia and other high-potential regions.

***Group-Wide Marketing Framework and Brand Governance***

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Marketing across all brands is guided by a centrally aligned, Group-wide framework led by HTL Marketing to ensure brand consistency, strategic coherence, and disciplined execution across export, leather trading and retail segments.

At the corporate level, HTL Marketing defines overarching brand positioning, portfolio architecture, and long-term equity priorities. Regional and market-level teams drive localization and in-market activation while operating within clearly defined brand parameters. This structure ensures both strategic alignment and market responsiveness.

Clear governance processes ensure that marketing investments, channel strategies, and partnership initiatives remain aligned with Group objectives. Cross-functional coordination between HTL Marketing, regional teams, brand, trade marketing, and supply chain teams reinforces consistency in messaging, product positioning, and customer experience across all markets. This integrated approach enables the Company to scale globally while preserving brand integrity, operational discipline, and differentiated market positioning.

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***Integrated Multi-Segment Marketing Strategy***

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HTL Marketing, in partnership with regional teams, is designed to support the distinct dynamics of export, leather trading and retail while maintaining a unified brand identity:

**● Export:** Brand credibility, product reliability, and scalable partnerships that support long-term distributor growth.

**● Leather Trading:** Quality assurance, supply consistency, regulatory compliance, and value-added services to reinforce the Group's reputation among global partners.

**● Retail:** Lifestyle positioning, consumer engagement, and premium accessibility through the Group's various brand portfolio.

This differentiated yet integrated approach ensures each segment's value proposition is clearly articulated while collectively reinforcing the Group's global brand positioning and market leadership. Aligning messaging, channel strategy, and service standards across segments strengthens cross-segment synergies, enhances operational efficiency, and ensures balanced contribution to Group performance.

***Enhancing Brand Equity Across Our Portfolio***

 ****

The Group continues to reinforce its portfolio brands through coordinated efforts between HTL Marketing and HTL FE to enhance market reach and customer targeting. For example, the brand HomesToLife enables consumers to express individuality through curated living spaces, while the brand Domicil addresses design-led, premium segments with clear portfolio differentiation.

Across retail and wholesale, this structured brand architecture sharpens customer targeting and strengthens overall brand equity. Consistent storytelling, curated collections, and an elevated retail and trade experience deepen engagement across end-consumers and business partners, driving sustainable, brand-led growth.

***Elevating Global Brand Visibility and Engagement***

 ****

Building on the portfolio strategy, HTL Marketing — working closely with other regional teams — advances global brand recognition through an integrated marketing approach anchored in brand equity and customer lifetime value across export, leather trading and retail channels.

High-impact marketing initiatives and strategic partnerships optimize audience segmentation, engagement, and acquisition efficiency. Customer-centric, content-led marketing enhances brand relevance and fosters deeper emotional connections with consumers while strengthening credibility among trade and export partners.

The Company remains disciplined and agile in refining its channel mix to reflect evolving consumer and trade behaviors globally. Complementing digital initiatives, selective participation in exhibitions and curated industry platforms reinforces brand authority, supports premium positioning, and expands market access across multiple distribution channels. Collectively, these initiatives strengthen brand differentiation, expand global mindshare, and support sustainable, multi-segment growth.

***Driving Global Brand Presence Across Export, Leather Trading and Retail***

 ****

Complementing marketing initiatives, the Company's export, leather trading and retail operations — supported by HTL Marketing and regional teams — collectively serve as strategic pillars in enhancing international visibility and credibility.

The integrated supply chain underpins all three segments, delivering consistent quality, customization, flexibility, and reliability. This operational strength supports differentiated retail experiences, scalable wholesale partnerships, and competitive export and leather trading capabilities — reinforcing a unified brand promise across global markets.

Participation in leading international exhibitions, including Canton Fair, Shanghai Fair, and Brussels Fair, positions the Group as a trusted, design-forward partner within the global furnishings ecosystem. Through coordinated brand alignment and market development efforts, the Group deepens trade relationships, enhances brand authority, and creates sustainable opportunities for long-term, diversified growth.

**Products and Brands We Sell**

**Export**

*Sofas*

The main products that are sold by our subsidiaries engaged in our export sales business to our customers, on a wholesale basis, are stock sofas that are manufactured through its manufacturing partners.

For HomesToLife Singapore and HTL Korea, HTL FE and HTL Marketing sell the products under the Group's brands, including but not limited to "Domicil", "Fabbrica", and "Homestolife" brands. Other customers mostly purchase sofas from our subsidiaries on a white-label basis and sell these sofas under their own brands.

**Leather Trading**

The main products that are sold by HTL Marketing as part of our leather trading business to our customers, on a wholesale basis, are raw hides procured from global suppliers. HTL Marketing sell them to related tanneries which convert the raw hides into finished upholstery leather used in upholstered furniture.

**Retail**

The Group offers a number of brands of upholstered furniture to customers, mainly sofas and also case goods, such as coffee tables, dining tables and bedding, through its consumer retail operations.

*Sofas*

The Group sells customized sofas and stock sofas. HomesToLife Singapore also exclusively carries the "Domicil" and "Fabbrica" brands in Singapore, while similar product positioning and collections are offered in South Korea. The Group stocks sofas in a range of styles and price points to cater to varying customer preferences.

*Case Goods*

In addition to upholstered furniture, the Group also sells case goods such as coffee tables, dining tables and bedding. These products are primarily procured from unrelated third party suppliers and are offered alongside upholstered furniture to provide customers with a more comprehensive home furnishing solution.

**Our Customers**

**Export**

Apart from the Singapore and South Korea retail market, we also engage in exporting upholstered furniture through a number of our other subsidiaries. A majority of our customers under our export business are upholstered furniture retailers in their respective countries and we also sell products to other wholesalers.

**Leather Trading**

A majority of our customers under our leather trading business are related tanneries.

**Retail**

For HomesToLife Singapore and HTL Korea, the majority of their sales are generated through sales from their retail stores. Our retail customers come from all walks of life, from the mass market to the affluent. For sofas, different brands are positioned to capture different segments of the market. The majority of our customers are individuals and families. We target the customers who may be purchasing their second or third home and prefer the furniture of premium quality at affordable prices.

**Our Suppliers**

**Export**

For our export business, our main suppliers are HTL Furniture and other suppliers within the HTL Group.

HTL Marketing and HTL FE purchase finished sofas from our related-party suppliers in China, Indian, Italy and Vietnam for resale to related and unrelated distributors. The key terms of the contract manufacturing agreements between HTL Marketing/HTL FE and such suppliers are set out below:

Rights and responsibilities

● During
 the term of the contract manufacturing agreement, the supplier shall not engage in any other
 business nor provide any other manufacturing services for any other entities including a
 natural person without the prior written consent of HTL Marketing/HTL FE.

● Should
 the supplier deem it necessary to utilize subcontractors for the manufacturing purpose, prior
 written permission must besought from HTL Marketing/HTL FE.

● Within
 three years after termination, without the prior written consent of HTL Marketing/HTL FE, the supplier
 shall not cooperate with any company with a similar business model or a competitive relationship
 with HTL Marketing/HTL FE, and shall not manufacture any sofa. In the event of a breach, HTL Marketing/HTL FE
 has the right to require the supplier to pay all its profits to HTL Marketing/HTL FE within 7 days.

● Except
 with HTL Marketing/HTL FE's written consent, the supplier shall purchase all materials and
 other necessary components from HTL Marketing's nominated suppliers at the supplier's
 own cost and expense, and shall not use any other materials or components in the manufacture
 of the products other than those specified as required by HTL Marketing/HTL FE.

● The
 supplier shall manufacture and assure that the specifications and quality standards of the
 products are adhered to, as directed by HTL Marketing/HTL FE.

Pricing

The products shall be priced on an arm's length basis.

Payment terms

HTL Marketing/HTL FE shall pay the purchase price within 90 Singapore working days after receipt of the invoices.

Delivery

The supplier shall deliver the products according to delivery schedules provided by HTL Marketing/HTL FE.

**Leather Trading**

For our leather trading business, our raw leather is generally sourced from suppliers based in Brazil, through HTL Marketing.

HTL Marketing's Central Procurement Unit ("CPU") procures leather hides, which is a key manufacturing raw material, from third party suppliers, and then mainly sells to related parties.

**Retail**

For our retail business, our major costs of purchases include (i) product procurement; (ii) rental costs and (iii) freight charges.

HomesToLife Singapore and HTL Korea entered into products supply agreements with HTL Marketing and HTL FE, for the supply of products. HTL Marketing and HTL FE, in turn, source for raw materials (including raw leather) and manufacturing services mainly from other related parties within the HTL Group pursuant to the same contract manufacturing agreements that HTL Marketing and HTL FE entered with the suppliers for the export business.

All of our other suppliers for the products that HomesToLife Singapore and HTL Korea sells are unrelated third parties. Our founders visited various suppliers that manufacture and supply the products that HTL Group plans to sell, and then produced a list of approved third party suppliers for the companies under the HTL Group to procure the products. HTL Group entities have entered into master purchase agreements with these suppliers. These non-related suppliers, collectively supply around 32% of the goods and products sold by HomesToLife Singapore and 1% of the goods and products sold by HTL Korea. One of the key reasons for the selection of such suppliers is that they provide favorable wholesale prices to HTL Group. They also have good selection of designs and/or products with premium quality. We engage directly with suppliers, and do not have any middlemen in our supply chain.

*Related Services*

Apart from goods and products that are supplied by our suppliers, we also contract with a number of other service providers, including freight/delivery services for the transport and delivery of goods and products from our warehouses to our customers as part of the order fulfilment process. For the transport and delivery of goods and products from our suppliers to our warehouses, we mainly work with the shipping companies which have signed the master agreements with HTL Group. All of them are third parties, unrelated to us or HTL Group. We also provide the repair services for free for our sold products within warranty period.

**Seasonality**

In general, We generally record a higher volume of orders in January, April, August, September, and October for our business. Our consumer retail business, which is carried out by HomesToLife Singapore and HTL Korea, is subject to seasonality in a limited capacity. Large sales events take place over the course of each year and many retailers, including us, participate in such sales by offering discounts on our goods and products. Such sales may also extend to our export sales business and leather trading business. As a result of such promotional sales events, there may be higher revenue recorded by us.

**Pricing Strategies**

**Export Sales**

The products we sell as part of our export sales business are sold at wholesale prices, with an appropriate mark-up to cost that accounts for, amongst others, cost of purchase, exchange rate, duty and tariff, ocean freight, warranty, and other costs. We take into account factors such as quality of the products, market demand, popularity of the brands, the design and craftsmanship of the product, and competitors' pricing of comparable products.

**Leather Trading**

Our leather products are sold by HTL Marketing at wholesale prices, with an appropriate mark-up to cost that accounts for, amongst others, cost of purchase, ocean freight, warranty, and other costs.

**Consumer Retail**

HomesToLife Singapore and HTL Korea sell products at retail prices, with an appropriate mark-up to cost that accounts for, amongst others, labor, retail store rental, delivery, and other costs. HomesToLife Singapore and HTL Korea take into account factors such as quality of the products, market demand, popularity of the brands, the design and craftsmanship of the product, competitors' pricing of comparable products, and the purchasing power of the target market.

During promotional events such as the Great Singapore Sale in Singapore and Korea Grand Sale in South Korea, HomesToLife Singapore may offer discount of up to 70% on the retail price of selected goods and products, while HTL Korea may offer discounts of up to 50% for displayed products and up to 30% for new products, depending on the nature of the promotional campaign. Such promotional activities generally attract more potential customers to their retail stores and also increases their revenue during this period.

**Quality Control**

We emphasize safety and quality as fundamental requirements for all our products, and have a dedicated quality assurance and brand management team. We ensure the quality of our goods and products through various measures.

First, we are stringent in our selection of suppliers. With respect to third party suppliers, our management team and product team visits and inspects the factories of such third party suppliers and manufacturers to ensure that the goods and products produced meet the standards consistent with our brand names. We also constantly liaise with our furniture suppliers (both related-party and third party) to ensure products are of reliable quality. Each supplier, except our related parties, needs to be onboarded at the HTL Group level as an approved supplier, before we can place purchase orders with such approved vendors. The procurement team from the HTL Group will also regularly assess such approved vendors' workmanship and product quality as well as their reputation. For products of new design, the procurement team from the HTL Group also inspects the products for workmanship and look into the product design to screen out safety or quality issues. Many of the HTL Group suppliers and third party suppliers and manufacturers passed the qualify certifications, such as ISO 14001:2015 for Leather Finishing for Upholstery Leather.

Second, we conduct quality control inspections of goods and products in our warehouse, before such goods and products are delivered to customers. This allows us to identify defects or deviations from our quality standards.

Third, we take our customer feedback and return analysis very seriously. Each time a product is returned due to defects, we spare no effort in investigating the cause of such defects in order to derive any recurring quality issues and taking corrective actions.

Fourth, HomesToLife Singapore's and HTL Korea's goods and products come with a warranty period of up to 10 years, to provide its customers with assurance with respect to the quality and durability of our goods and products. For our export sales business and leather trading business, we also sell products on a wholesale basis and provide a structure warranty period of up to two years.

**Marketing**

**Export Sales and Leather Trading**

For our export sales and leather trading business, our integrated, end-to-end supply-chain model increases the visibility of our core values to customers, including product customization, production flexibility, stable quality and consistent specification, regulatory compliance, distribution, and comprehensive after-sales support.

We are engaged in the latest sofa exhibitions, including at Canton Fair, Shanghai Fair, and Brussels Fair where its products are marketed to other retailers across the world, including in markets in Asia-Pacific, Europe, and North America. We provide our local teams with marketing support, including product training and marketing materials in local language.

**Retail**

***Singapore***

To enhance its brand awareness, HomesToLife Singapore has conducted various marketing and promotional activities through different local media, including mainly social media (Facebook and Instagram), on regular basis.

HomesToLife Singapore's marketing team is responsible for designing and launching marketing campaigns to promote its brand and image and does so by focusing campaigns through the highest-impact channels such as social media platforms like Instagram and Facebook.

Unlike other retailers, HomesToLife Singapore creates most of its content in-house instead of relying on external agencies to have full control over its brand identity. Such content is usually more engaging and done with shorter lead times to respond to market changes. Most importantly, we believe it is also economically more effective. Combining gimmicks such as giveaways, collaborating with other brands, or working directly with key opinion leaders has proven to be effective in engaging and increasing awareness.

When HomesToLife Singapore pays for advertising, it may work with established media agencies to increase brand awareness.

HomesToLife Singapore also engages performance marketing agencies to place data-driven digital advertisements that use AI algorithms for targeted audience outreach on the Google search engine, serving ads to potential customer across different platforms.

HomesToLife Singapore relies a lot less on traditional mass media such as television and newspaper advertisements, as it has found that social media focused advertisements resonate well with its potential customers due to their localized approach, and have a strong positive effect on our sales and revenue figures.

Business Improvement Initiative

In response to the operational losses experienced by HomesToLife Singapore, HomesToLife Cayman's Chief Executive Officer, Phua Mei Ming, led a comprehensive restructuring initiative designed to enhance financial performance. The key measures of this initiative were as follows:

● The closure of underperforming stores and the opening of new stores in desirable locations

● The reallocation of surplus staff to other affiliated companies.

● The implementation of stringent controls over expenses, particularly in the areas of marketing and advertising.

The restructuring initiative commenced on April 1, 2025 and, except for potential new store opening, the rest was completed in 2025.

South Korea

Similar marketing approaches, including digital and campaign-based promotions, are also adopted by HTL Korea, with adjustments made to suit local market conditions.

*Offline channel expansion as a core brand-building strategy*

 

HTL Korea focuses on strengthening brand presence and expanding customer touchpoints through offline retail channels, primarily via department store concessions and COCO stores. In 2025, HTL Korea opened two COCO stores and ten permanent department store locations and successfully executed more than ten department store pop-up events at major department stores, significantly increasing engagement with target customers.

As a result, a customer survey conducted in 2025 indicated that approximately 70% of brand awareness among purchasing customers originated from department store exposure, demonstrating the effectiveness of offline channels as a key driver of brand visibility.

 

*Strategic digital marketing and owned media optimization*

 

HTL Korea's digital marketing strategy is designed to reinforce offline brand exposure by ensuring that potential customers encounter relevant and consistent content when searching for information online. The Company actively manages its official website and Instagram account as core owned media channels, while timely updates on new store openings and promotions are disseminated through major portal and map services to maximize information reach and accuracy.

In addition, HTL Korea has accumulated 189 verified customer reviews, which serve as a key asset in building brand credibility. These reviews support purchasing decisions at the point of sale and contribute to strengthening customer loyalty.

*Media mix and performance-driven approach*

 

Given the high-involvement nature of furniture purchases, HTL Korea adopts a media mix strategy that goes beyond traditional paid advertising. The Company collaborates selectively with industry experts and content creators, including YouTubers, to support consumers throughout their purchase journey.

Combined with targeted search advertising, Meta platform campaigns, and network-based digital advertising, this approach resulted a 53% increase in searches in 2025 compared to the prior year.

**Environmental Protection and ESG**

While due to the nature of our business, our operational activities do not directly generate industrial pollutants. As such, we have not directly incurred any cost of compliance with applicable laws and regulations as of the date of this annual report and do not expect that we will directly incur significant costs for such compliance in the future. As of the date of this annual report, we had not come across any material non-compliance issues in respect of any applicable laws and regulations on environmental protection. We have not been subject to any administrative sanctions or penalties that have a material and adverse effect on our financial condition or business operation.

At the retail level, HomesToLife Singapore and HTL Korea have implemented initiatives such as marketing campaigns aimed at reducing wastage, including strategies to minimize the use of foam boards and the digitalization of its catalogues.

**Impact of Inflation on Our Business and Mitigation Efforts**

The following table shows the factors contributing to the inflationary pressures that we have experienced, the resulting impact to our company, and the actions we have taken to mitigate the impact these inflationary pressures had on our operations.

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| | | | |
|:---|:---|:---|:---|
|  | **Factors** | **Impact** | **Mitigating Efforts** |
| 1 | Increasing purchase price of products | Increased product costs | We have been managing the price adjustments over time to increase average invoice value.<br> We have been adding more variety in value-added features to allow the sales team to upsell. |
| 2 | Increasing employee wages | Increased labor costs | A material portion of the compensation of our sales employees is based on sales-driven bonus. |
| 3 | Increasing rent | Increased rental costs | We offer premium product assortments in high-rent locations to ensure a higher sales value per square foot. We closely monitor product turnover per square foot to switch out slow-moving products in response to consumer preference. |
| 4 | Increasing shipping and logistic rates | Increased transportation costs | We negotiate with shipping companies on freight charges. For custom orders, any increased shipping costs is typically reflected in product price adjustment. |

---

**Competition**

The principal competitors with respect to our export business are set out as follows:

● Jason Furniture (Hangzhou)

● Man Wah Holdings

● Natuzzi Group

With an international sales network, international design teams, and more efficient Asia-based production, we believe we are uniquely positioned in the markets for exporting upholstered furniture. The upholstered furniture we export is designed to appeal to wholesales customers which are looking for fashionable furniture at competitive prices with broad choice.

The retail sale of upholstered furniture is a highly fragmented and competitive business. We believe that the primary elements of competition in our industry are merchandise (quality, style, selection, price and display), customer service, marketing and advertising, and store location and design. We compete with numerous other independent and chain retail furniture stores and wholesalers.

HomesToLife Singapore and HTL Korea believe that they are uniquely positioned in the local markets for upholstered furniture, with a targeted mix of goods and products that appeals to customers across various segments, from mass market to the affluent. Their experienced sales personnel and customer service are considered as important factors in ensuring their competitive success. They also believes that significant additional competitive advantages are also provided by their ability to make prompt delivery of orders through maintenance of ready-stock inventory in warehouse, and to tailor merchandise to customers' desires through custom orders. Their after-sales and service recovery processes are also robust, allowing them to ensure customer satisfaction with their goods and products.

HomesToLife Singapore's principal competitors in Singapore are large chain retail furniture stores benefit from more established name recognition, such as:

● Castlery

● Cellini

● Commune

● Harvey Norman

● Star Furniture

● King Living

HTL Korea's principal competitors in South Korea are:

● Jakomo

● Casamia

● Essa

● Natuzzi

● Dauning

**Intellectual Property Rights**

We regard our trademarks, domain name and similar intellectual property as critical to our success. As of the date of this annual report, we own, through our subsidiaries, all trademarks relating to our brands, including "HomesToLife," "DOMICIL," and "FABBRICA."

Our trademarks are primarily held by both HTL Marketing and Singapore, and these trademarks are licensed for used by entities within the HTL Group.

Our subsidiaries are the registered owners of a number of domain names that are used in the course of our business.

**Our Employees**

In total we had 169, 34, and 30 full-time employees as of December 31, 2025, 2024 and 2023, respectively. The number increase in 2025 was due to the Group's acquisition of HTL Marketing in 2025. These employees are stationed all across the world in the markets that we are active in, with the majority of them being in Singapore, and with a portion of employees undertaking business travel as part of their job scopes.

The following table sets forth the number of our full-time employees categorized by function as of December 31, 2025, 2024 and 2023:

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| | | | |
|:---|:---|:---|:---|
| **Function** | As of<br> December 31, 2023 | As of<br> December 31, 2024 | As of<br> December 31, 2025 |
| General and Administration | 7 | 11 | 80 |
| Sales and Marketing | 23 | 23 | 89 |
| **Total** | 30 | 34 | 169 |

---

Our employees in Singapore are part of the Building Construction and Timber Industries Employees' Union ("Union") of Singapore, and we have entered into a collective agreement with the Union on December 8, 2021 ("Collective Agreement"), that, amongst others, sets out a set of basic and favourable employment terms and conditions such as the working hours and rate of payment for overtime work for our employees, as well as the number of rest days per week for each employee. HomesToLife Singapore executed the new Collective Agreement with the National Trade Union ("NTUC") on March 5, 2025, which was certified by the Singapore Industrial Arbitration Court on March 28, 2025.

We consider that we have maintained a good relationship with our employees and have not experienced any significant disputes with our employees or any disruption to our operations due to any labor disputes. In addition, we have not experienced any difficulties in the recruitment and retention of experienced core staff or skilled personnel.

Our remuneration package includes salary and discretionary bonuses. In general, we determine employees' salaries based on their experience, qualifications and level of positions. In order to attract and retain valuable employees, we review the performance of our employees annually which will be taken into account in annual salary review and promotion appraisal. In addition, employees will have regular discussions with their managers to keep track of the goals that they have set up in the beginning of the year.

**Properties**

As of the date of this annual report, our subsidiaries have entered into a number of lease agreements that are required for each of its business activities, including four retail stores for HomesToLife Singapore, and two retail stores for HTL Korea, and leases for office space for other subsidiaries. For HomesToLife Cayman, we have been granted the use of the premises at 6 Raffles Boulevard, #02-01/02/53, Singapore 039594, which has a size of 5,694 sqft, by HomesToLife Singapore, for use as our principal executive office. We also maintain sales offices and warehouses in Australia, Japan, United Kingdom, and France, which are necessary to support our operations in such regions.

Apart from one warehouse and one non-operating factory in Japan, all of our and our subsidiaries' properties are leased.

**Licenses and Permits**

We confirm that we have obtained all material licenses, certificates and approvals required for carrying on our business activities in Singapore, Japan, Korea and other foreign countries that we have the business activities.

**Insurance**

We maintain business insurance of our stores, warehouses, and offices, and for goods and products in transit. We also maintain directors and officers liability insurance. We believe that our current insurance policies are sufficient for our operations.

**Legal Proceedings**

To the best of our knowledge, we are not currently the subject of any material governmental investigation, private lawsuit or other legal proceeding. From time to time, we may be involved in legal and regulatory proceedings or investigations concerning matters that arise in the ordinary course of our business and that could result in significant fines or penalties, have an adverse impact on our reputation, business and financial condition or results of operations and divert the attention of our management from the operation of our business. The outcome of any future litigation, regulatory or other proceedings cannot be predicted with certainty, and some lawsuits, claims, actions or proceedings may be disposed of unfavorably to us.

**Government Regulations**

We are an international company that is registered under the laws of the Cayman Islands with offices located in Singapore, Japan, Korea, Australia, France, and the United Kingdom, and with employees in these countries, and in a few Southeast Asia countries where we don't have any offices. As a result of this organizational structure and the scope of our operations, we are subject to the relevant laws and regulations of Singapore and other countries where we export our products to, and we are also affected by policies which may be introduced by such authorities from time to time. We are subject to a variety of laws and regulations that involve matters central to our business, including consumer protection, employment, workplace safety, personal data protection, taxation, anti-money laundering, foreign investment and exchange control, and intellectual property. We have identified the main categories of laws and regulations that materially affect our operations below. We believe that we comply with all these laws and regulations, and therefore none of them have materially affected the Company or operations in the past.

As of the date of this annual report, our directors believe that we are not in breach of any laws or regulations applicable to our business operations that would materially affect our business operations, and our Group is in compliance with all the applicable laws and regulations that are material to our business operations. The Group may be subject to certain fines/penalties arising from its ordinary course of business from time to time.

**<u>Laws relating to Sale of Goods</u>**

Laws related to the sale of goods are key to our export sales business. We are subject to a number of such laws across the jurisdictions that we carry out business activities in, including jurisdictions where our wholesale customers are located. In general, these laws deem us to have implied that the goods supplied under our contracts are of satisfactory quality.

**<u>Laws relating to Consumer Protection</u>**

Laws related to consumer protection are particularly relevant for us with respect to our retail operations in Singapore and Korea, as we conduct a consumer-facing business in these countries.

In Singapore, a number of laws and guidelines govern consumer protection, such as the Consumer Protection (Fair Trading) Act 2003 of Singapore, the Singapore Code of Advertising Practice, the Consumer Protection (Trade Descriptions and Safety Requirements) Act 1975, the Unfair Contracts Terms Act 1977 of Singapore, and Misrepresentation Act 1967 of Singapore.

In Korea, there are similar laws and guidelines that govern consumer protection issues.

**<u>Laws relating to Employment Matters and Workplace Safety</u>**

We employ our employees in various jurisdictions, and laws relating to employment and workplace safety matters affect us greatly. In Singapore where we have the most employees, these include, the Employment Act 1968, the Central Provident Fund Act 1953 of Singapore, the Employment of Foreign Manpower Act 1990, Workplace Safety and Health Act 2006 and Work Injury Compensation Act 2019.

**<u>Laws relating to Personal Data Protection</u>**

In conducting our business activities, we collect the personal data of individuals, including our customers. This an important part of our business model and, as a result, our compliance with laws dealing with the collection and processing of personal data is important to us. Regulators around the world have adopted or proposed requirements regarding the collection, use, transfer, security, storage, destruction, and other processing of personal data, and these laws are increasing in number, enforcement, fines, and other penalties.

 ****

**<u>Laws relating to Foreign Investment and Exchange Control</u>**

Some of the jurisdictions that we operate in have foreign investment and exchange control laws that materially affect us. In general, for these jurisdictions, there are restrictions on the repatriation of earnings and capital, or on remittances, foreign exchange transactions and capital movements to different degrees.

C. Organizational Structure

See "—A. History and Development of the Company."

D. Property, Plants and Equipment

See "—B. Business Overview."

**Item 4A. UNRESOLVED STAFF COMMENTS**

Not applicable.

**Item 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS**

You should read the following discussion and analysis of the Company's financial condition and results of operations in conjunction with the Company's consolidated and combined financial statements and the related notes included elsewhere in this annual report. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. The Company's actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under "Item 3. Key Information — 3.D. Risk Factors" or in other parts of this annual report.

**Overview**

HomesToLife Ltd was incorporated in the Cayman Islands with limited liability under the Companies Act on February 16, 2024.

The Company, through its subsidiaries, is principally engaged in the sale and distribution of leather upholstered furniture, such as, sofas, armchairs, recliners, and related accessories, with its unique design and craftmanship, throughout a network of retail stores under six brand names in Europe, the North America, and Asia.

On May 5, 2025, the Company entered into a definitive sale and purchase agreement (the "Sale and Purchase Agreement") with New Century International Homes Pte Ltd ("New Century") to acquire 100% of equity interests in HTL Marketing Pte Ltd ("HTL Marketing"). Under the terms of the Sale and Purchase Agreement, in exchange for acquiring HTL Marketing, the Company issued 75,000,000 ordinary shares to New Century, par value US$0.0001 per share (the "Ordinary Shares"), which are subjected to two-year lock-up restrictions. This transaction was closed on May 19, 2025. As at the date of acquisition, HTL Marketing directly and indirectly holds the following eight subsidiaries:

- New Century Furniture Pte. Ltd.

- HTL (UK) Limited

- HTL France SAS

- HTL ANZ PTY LTD

- HTL Korea Co., Ltd

- Hwa Tat Lee Japan Co., Ltd

- Terasoh Co., Ltd

- HTL Taiwan Holding Pte. Ltd

On May 5, 2025, HTL Marketing and certain related parties entered into a deed of global settlement involving debt restructuring under the corporate reorganization exercise.

The Company and HTL Marketing were controlled by common shareholders prior to this acquisition. Accordingly, the transaction was accounted for as a transfer of business between entities under common control in accordance with ASC 805-50. In accordance with ASC 805-50-45-5, the accompanying consolidated and combined financial statements have been retrospectively adjusted to present the results of the entities as if the current corporate structure had existed since the beginning of the earliest period presented. The consolidation and combination of the Company has been accounted for at historical cost at the beginning of the first period presented in the accompanying consolidated and combined financial statements. The number of outstanding shares in the consolidated and combined balance sheets, the consolidated and combined statements of changes in shareholders' equity, and per share information including the net earnings per share have been presented retrospectively as of the beginning of the earliest period presented on the consolidated and combined financial statements to reflect the final shares immediately after the acquisition on May 5, 2025.

A. Operating Results

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| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| **Revenues, net** |  |  |  |
| &nbsp;&nbsp;&nbsp;From third parties | $316003465 | $315867933 | $356187074 |
| &nbsp;&nbsp;&nbsp;**From related parties** | 9981004 | 19192918 | 21689049 |
|  | 325984469 | 335060851 | 377876123 |
| &nbsp;&nbsp;&nbsp;Cost of goods sold | (239738076) | (252032836) | (272571322) |
| Gross profit | 86246393 | 83028015 | 105304801 |
| Operating expenses: |  |  |  |
| Sales and distribution expenses | (51622790) | (54727281) | (66331518) |
| General and administrative expenses | (17400101) | (17348952) | (18336882) |
| Listing expenses | - | (1440130) | (1265042) |
| Total operating expenses | (69022891) | (73516363) | (85933442) |
| **Income from operations** | 17223502 | 9511652 | 19371359 |
| Total other (expense) income, net | (5042120) | 1324861 | 1382613 |
| **Income before income taxes** | 12181382 | 10836513 | 20753972 |
| Income tax expense | (1864201) | (2415742) | (4199820) |
| **NET INCOME** | $10317181 | $8420771 | $16554152 |

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**KEY FACTORS THAT AFFECT OPERATING RESULTS**

Our operating results are primarily affected by the following factors:

● growth
 in Asia-Pacific, Europe and North America economy;

● consumers
 and customers demand;

● competition
 in the furniture market;

● market
 conditions and our market position; and

● our
 ability to broaden product offerings and diversify our customer base.

***KEY COMPONENTS OF OUR RESULTS OF OPERATIONS***

**Revenues**

Our revenues are mainly derived from export sales. The following table sets forth the components of our revenues in amounts and percentages of the total revenues for the years presented:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2023 | 2024 | 2024 | 2025 | 2025 |
|  | US$ | % | US$ | % | US$ | % |
| Export Sales | 311098665 | 95.4 | 312043186 | 93.1 | 349599092 | 92.5 |
| Leather Trading | 9813484 | 3.0 | 18453936 | 5.5 | 19161359 | 5.1 |
| Retail Sales | 5072320 | 1.6 | 4563729 | 1.4 | 9115672 | 2.4 |
| Revenues, net | 325984469 | 100 | 335060851 | 100 | 377876123 | 100 |

---

For the year ended December 31, 2025, revenue from export sales contributed 92.5% of our revenue, revenue from leather trading contributed 5.1% of our revenue, and revenue from retail sales contributed 2.4% of our revenue.

For the year ended December 31, 2024, revenue from export sales contributed 93.1% of our revenue, revenue from leather trading contributed 5.5% of our revenue, and revenue from retail sales contributed 1.4% of our revenue.

For the year ended December 31, 2023, revenue from export sales contributed 95.4% of our revenue, revenue from leather trading contributed 3.0% of our revenue, and revenue from retail sales contributed 1.6% of our revenue.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2023 | 2024 | 2024 | 2025 | 2025 |
|  | US$ | % | US$ | % | US$ | % |
| *Sales, by geographic regions:* |  |  |  |  |  |  |
| Asia Pacific | 80073034 | 24.5 | 95848418 | 28.6 | 101605918 | 26.9 |
| Europe | 194139405 | 59.6 | 196591871 | 58.7 | 225547377 | 59.7 |
| North America | 51772030 | 15.9 | 42620562 | 12.7 | 50722828 | 13.4 |
| Revenues, net | 325984469 | 100 | 335060851 | 100 | 377876123 | 100 |

---

For the year ended December 31, 2025, 59.7% of our revenue was generated from Europe, while 26.9% came from Asia Pacific and 13.4% came from North America.

For the year ended December 31, 2024, 58.7% of our revenue was generated from Europe, while 28.6% came from Asia Pacific and 12.7% came from North America.

For the year ended December 31, 2023, 59.6% of our revenue was generated from Europe, while 24.5% came from Asia Pacific and 15.9% came from North America.

**Cost of goods sold**

Cost of goods sold primarily includes cost of acquiring leather and fabric upholstered furniture, raw hides from suppliers, inbound shipping and fulfilment costs necessary to bring inventory to its present location and condition, and inventory write-downs, which consist of allowance for obsolete and slow-moving inventories.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2023 | 2024 | 2024 | 2025 | 2025 |
|  | US$ | % of revenue | US$ | % of revenue | US$ | % of revenue |
| Export Sales | 228577666 | 73.5 | 232617863 | 74.5 | 250842924 | 71.8 |
| Leather Trading | 9375723 | 95.5 | 17582488 | 95.3 | 18425586 | 96.2 |
| Retail Sales | 1784687 | 35.2 | 1832485 | 40.2 | 3302812 | 36.2 |
| Cost of goods sold | 239738076 | 73.5 | 252032836 | 75.2 | 272571322 | 72.1 |

---

 

*Export sales*

Our cost of goods sold account for 71.8%, 74.5% and 73.5% of our revenue from export sales for the years ended December 31, 2025, 2024 and 2023, respectively.

*Leather trading*

Our cost of goods sold account for 96.2%, 95.3% and 95.5% of our revenue from leather trading for the years ended December 31, 2025, 2024 and 2023, respectively.

*Retail sales*

Our cost of goods sold account for 36.2%, 40.2% and 35.2% of our revenue from retail sales for the years ended December 31, 2025, 2024 and 2023, respectively.

**Gross profit and gross profit margin**

Our gross profit equals to our revenues less cost of goods sold. Our gross profit is primarily affected by our ability to generate revenues and the fluctuation of our costs.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2023 | 2024 | 2024 | 2025 | 2025 |
|  | US$ | (%) | US$ | (%) | US$ | (%) |
| Export Sales | 82520999 | 26.5 | 79425323 | 25.5 | 98756168 | 28.2 |
| Leather Trading | 437761 | 4.5 | 871448 | 4.7 | 735773 | 3.8 |
| Retail Sales | 3287633 | 64.8 | 2731244 | 59.8 | 5812860 | 63.8 |
| Gross profit/gross margin | 86246393 | 26.5 | 83028015 | 24.8 | 105304801 | 27.9 |

---

*Export Sales*

Our gross profit was $98.8 million, $79.4 million and $82.5 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Our gross profit margin was 28.2%, 25.5% and 26.5% for the years ended December 31, 2025, 2024 and 2023, respectively.

*Leather Trading*

Our gross profit was $0.7 million, $0.9 million and $0.4 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Our gross profit margin was 3.8%, 4.7% and 4.5% for the years ended December 31, 2025, 2024 and 2023, respectively.

*Retail Sales*

Our gross profit was $5.8 million, $2.7 million and $3.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Our gross profit margin was 63.8%, 59.8% and 64.8% for the years ended December 31, 2025, 2024 and 2023, respectively.

We plan to closely monitor and optimize our product-mix from time to time to enhance our gross profit margin.

**Operating Expenses**

Our operating expenses consist of sales and distribution expenses, general and administrative expenses and listing expenses.

Our sales and distribution expenses consist primarily of ocean freights, outwards land transports, salaries of our sales persons, sales commissions, and warranty expenses. Sales and distribution expenses account for 17.6%, 16.3% and 15.8% of our revenues for the years ended December 31, 2025, 2024 and 2023, respectively.

Our general and administrative expenses consist primarily of salaries of our office staff, depreciation of right-of-use assets of our office, professional fees, and traveling expenses. General and administrative expenses account for 4.9%, 5.2% and 5.3% of our revenues for the years ended December 31, 2025, 2024 and 2023, respectively.

Our listing expenses consist primarily of audit fee for our IPO, statutory and legal expenses, and insurance expenses. Listing expenses account for 0.3%, 0.4%, and nil of our revenues for the years ended December 31, 2025, 2024 and 2023, respectively.

**Income Tax**

***Cayman Islands***

We are incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, we are not subject to income or capital gains taxes. Additionally, upon payments of dividends by us to its shareholders, no Cayman withholding tax will be imposed.

The summary of effective income tax rates by the governing countries is as follows:-

---

| | | | |
|:---|:---|:---|:---|
| Jurisdiction | Income Tax Rate | Income Tax Rate | Income Tax Rate |
|  | 2023 | 2024 | 2025 |
| France | 25% | 25% | 25% |
| Australia | 30% | 30% | 30% |
| South Korea | 9.9% | 9.9% | 9.9% |
| Japan | 34% | 34% | 34% |
| United Kingdom | 25% | 25% | 25% |
| Singapore | 17% | 17% | 17% |

---

**RESULTS OF OPERATIONS**

The following table sets forth a summary of our consolidated results of operations for the periods indicated. This information should be read together with our consolidated and combined financial statements and related notes included elsewhere in this Report. The operating results in any period are not necessarily indicative of the results that may be expected for any future period.

**Year Ended December 31, 2024 Compared to Year Ended December 31, 2025**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2024 | 2025 | Change (Increase/(decrease)) | Change (Increase/(decrease)) |
|  | US$ | US$ | US$ | % |
| **Revenues, net** | 335060851 | 377876123 | 42815272 | 12.8 |
| Cost of goods sold | (252032836) | (272571322) | (20538486) | 8.1 |
| Gross profit | 83028015 | 105304801 | 22276786 | 26.8 |
| Operating expenses: |  |  |  |  |
| Sales and distribution expenses | (54727281) | (66331518) | 11604237 | 21.2 |
| General and administrative expenses | (17348952) | (18336882) | 987930 | 5.7 |
| Listing expenses | (1440130) | (1265042) | (175088) | (12.2) |
| Total operating expenses | (73516363) | (85933442) | (12417079) | 16.9 |
| **Income from operations** | 9511652 | 19371359 | 9859707 | 103.7 |
| Other income (expense): |  |  |  |  |
| Interest expense | (1042888) | (1406903) | 364015 | 34.9 |
| Interest income | 119306 | 23134 | (96172) | (80.6) |
| Government subsidies | 28040 | 69994 | 41954 | 149.6 |
| Foreign exchange gain, net | 2184854 | 3505118 | 1320264 | 60.4 |
| Professional fees on acquisition of HTL Marketing |  | (1261560) | 1261560 | N/A |
| Scrap sofa sale income | 562310 | 414664 | (147646) | (26.3) |
| Change in fair value of derivatives financial instruments | (403350) | (74765) | (328585) | (81.5) |
| Gain on derecognition of right-of-use asset |  | 90368 | 90368 | N/A |
| Sundry income (expense) | (123411) | 22563 | 145974 | 118.3 |
| Total other income, net | 1324861 | 1382613 | 57752 | 4.4 |
| **Income before income taxes** | 10836513 | 20753972 | 9917459 | 91.5 |
| Income tax expense | (2415742) | (4199820) | 1784078 | 73.9 |
| **NET INCOME** | 8420771 | 16554152 | 8133381 | 96.6 |

---

**Revenue**

Our revenues increased by approximately $42.8 million or 12.8%, from approximately $335.1 million for the year ended December 31, 2024 to approximately $377.9 million for the year ended December 31, 2025. This growth was primarily driven by two factors:

(a) $37.6 million or 12.0% increase in export sales, supported by higher sales volumes across key regions and a favorable shift in sales mix; and

(b) $4.6 million rise in retail sales, attributed to the $4.7 million contribution from Korea's retail business, which commenced operations in August 2024.

**Cost of goods sold**

Cost of goods sold primarily represents cost of acquiring leather and fabric upholstered furniture, raw hides from suppliers, inbound shipping and fulfilment costs necessary to bring inventory to its present location and condition, and inventory write-downs, which consist of allowance for obsolete and slow-moving inventories.

Cost of goods sold increased by $20.5 million, or 8.1%, to $272.6 million for the year ended December 31, 2025 from $252.0 million for the year ended December 31, 2024. The increase in cost of goods sold was primarily attributable to the increase in our revenues.

**Gross profit**

As a result of the foregoing, gross profit for the years ended December 31, 2025 and 2024 was approximately $105.3 million and $83.0 million, respectively, with an increase of approximately $22.3 million or 26.8%.

During the year ended December 31, 2025, gross profit margin was 27.9%, as compared to 24.8% for the year ended December 31, 2024, increased by 3.1%. This improvement was attributable to a favorable shift in product mix, as the proportion of fabric sofas in total sales has risen steadily, and fabric sofas generate a higher gross margin compared to other product categories.

**Sales and distribution expenses**

Major components of sales and distribution expenses included salaries of our salespersons, sales commissions, provision for warranty expenses, ocean freights, and outwards land transport costs. For the year ended December 31, 2025, sales and distribution expenses were $66.3 million, which increased by $11.6 million from $54.7 million for the preceding year. The increase was in line with the 13% higher sales value and 19% higher sales volume.

The increase in sales and distribution expenses of $11.6 million was primarily attributed by several factors. A significant contributor was the rise in freight and shipping costs due to the Suez Canal disruption, which led to a 22% increase in freight rates and an associated increase in ocean freight cost of $8.6 million. This was partially offset by price adjustments passed on to customers. Additionally, expenses increased due to higher commission expenses of $1.3 million and an increase in payroll expenses of $0.8 million.

**General and administrative expenses**

For the year ended December 31, 2025, general and administrative expenses were approximately $18.3 million, an increase of approximately $1.0 million as compared to $17.3 million for the preceding year. The increase was mainly due to the increase in the headcounts for office staff of $1.2 million during the year ended December 31, 2025.

**Listing expenses**

For the year ended December 31, 2025, listing expenses were approximately $1.3 million, a slight decrease of approximately $0.1 million as compared to $1.4 million for the preceding year.

**Income from operations**

As a result of the aforementioned, our income from operations was approximately $19.4 million for the year ended December 31, 2025, and $9.5 million for the preceding year. The increase of approximately $9.9 million or 103.7% was primarily due to the increase in our gross profit, reflecting an increase in sales during the year.

**Other income (expense)**

Other income (expense) primarily consists of interest income, government subsidies, foreign exchange gain, net, scrap sofa sale income, gain on derecognition of right-of-use asset, sundry income, and offset by interest expense, professional fees on acquisition of HTL Marketing, change in fair value of derivatives financial instruments and sundry expense.

For the year ended December 31, 2025, our other income, net slightly increased $0.06 million or 4.4% from $1.3 million for the preceding year to $1.4 million. The increase was mainly due to the increase in foreign exchange gain of $1.3 million, increase in change in fair value of derivatives financial instruments of $0.3 million, increase in sundry income of $0.1 million, and offset by the increase in interest expense of $0.4 million and professional fees on acquisition of HTL Marketing of $1.3 million.

**Income tax expenses**

For the year ended December 31, 2025, income tax expense was approximately $4.2 million, an increase of approximately $1.8 million or 73.9% from $2.4 million for the prior year. This increase was attributable to the rise in operating income.

**Net income**

As a result of the foregoing, our net income for the years ended December 31, 2025 and 2024 was approximately $16.6 million and $8.4 million, respectively. Net income margin for the years ended December 31, 2025 and 2024 was 4.4% and 2.5%, respectively.

**Year Ended December 31, 2023 Compared to Year Ended December 31, 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | Change (Increase/(decrease)) | Change (Increase/(decrease)) |
|  | US$ | US$ | US$ | % |
| **Revenues, net** | 325984469 | 335060851 | 9076382 | 2.8 |
| Cost of goods sold | (239738076) | (252032836) | 12294760 | 5.1 |
| Gross profit | 86246393 | 83028015 | (3218378) | (3.7) |
| Operating expenses: |  |  |  |  |
| Sales and distribution expenses | (51622790) | (54727281) | 3104491 | 6.0 |
| General and administrative expenses | (17400101) | (17348952) | (51149) | (0.3) |
| Listing expenses | - | (1440130) | 1440130 | N/A |
| Total operating expenses | (69022891) | (73516363) | 4493472 | 6.5 |
| **Income from operations** | 17223502 | 9511652 | (7711850) | (44.8) |
| Other income (expense): |  |  |  |  |
| Interest expense | (881717) | (1042888) | 161171 | 18.3 |
| Interest income | 339351 | 119306 | (220045) | (64.8) |
| Government subsidies | 42339 | 28040 | (14299) | (33.8) |
| Foreign exchange (loss) gain, net | (8196633) | 2184854 | 10381487 | 126.7 |
| Scrap sofa sale income | 696290 | 562310 | (133980) | (19.2) |
| Change in fair value of derivatives financial instruments | 2841215 | (403350) | (3244565) | (114.2) |
| Sundry income (expense) | 117035 | (123411) | (240446) | (205.4) |
| Total other (expense) income, net | (5042120) | 1324861 | 6366981 | 126.3 |
| **Income before income taxes** | 12181382 | 10836513 | (1344869) | (11.0) |
| Income tax expense | (1864201) | (2415742) | 551541 | 29.6 |
| **NET INCOME** | 10317181 | 8420771 | (1896410) | (18.4) |

---

**Revenues, net**

Our revenues increased by approximately $9.1 million, or 2.8%, from approximately $326.0 million for the year ended December 31, 2023 to $335.1 million for the year ended December 31, 2024, primarily driven by the following factors:

(a) $0.9 million or 0.3% increase in export sales revenue;

(b) $8.6 million or 88.0% surge in leather trading revenue, mainly due to stock replenishment at related party tannery factories; and

(c) $0.5 million or 10.0% decrease in retail sales revenue, primarily attributable to the decrease in the sale of our leather and fabric upholstered home furniture products. For the year ended December 31, 2024, rising inflation and weakened consumer sentiment had impacted our performance.

**Cost of goods sold**

Our cost of goods sold increased by approximately $12.3 million, or 5.1%, from approximately $239.7 million for the year ended December 31, 2023 to $252.0 million for the year ended December 31, 2024. The increase in cost of goods sold was primarily attributable to the increase in our revenues and a shift in product sales mix, as our sale of fabric sofas, which has a lower margin, accounted for a larger proportion of our total revenues.

**Gross profit**

As a result of the foregoing, gross profit for the years ended December 31, 2024 and 2023 was approximately $83.0 million and $86.2 million, respectively, with a decrease of approximately $3.2 million or 3.7%, primarily due to the shift in the sales mix among our products.

**Sales and distribution expenses**

For the year ended December 31, 2024, sales and distribution expenses were approximately $54.7 million, which increased by approximately $3.1 million or 6.0% from approximately $51.6 million for the preceding year. The increase was mainly due to increases in the salaries of our salespersons, higher warranty expenses, increase in ocean freights and inland trucking costs.

**General and administrative expenses**

For the year ended December 31, 2024, we incurred general and administrative expenses of approximately $17.3 million, a slight decrease of $0.05 million or 0.3%, as compared to approximately $17.4 million for the year ended December 31, 2023.

**Listing expenses**

For the year ended December 31, 2024, listing expenses were approximately $1.4 million, which mainly related to the audit fee of $0.7 million and listing maintenance fee of $0.4 million incurred during the IPO process. The Company was listed on Nasdaq on October 1, 2024.

**Income from operations**

As a result of the aforementioned, our income from operations decreased by approximately $7.7 million, or 44.8%, to approximately $9.5 million for the year ended December 31, 2024, as compared to approximately $17.2 million for the year ended December 31, 2023, which was primarily due to the decrease in our gross profit, increase in sales and distribution expenses and listing expenses during the year.

**Other income (expense)**

Other income (expense) primarily consists of interest income, government subsidies, foreign exchange gain, net, scrap sofa sale income, sundry income, and offset by interest expense, change in fair value of derivatives financial instruments and sundry expense.

For the year ended December 31, 2024, our total other income, net increased $6.4 million or 126.3% to approximately $1.3 million as compared to the total other expense, net of $5.0 million for the preceding year. The increase was mainly due to the increase in foreign exchange gain of $10.4 million, and offset by the decrease in change in fair value of derivatives financial instruments of $3.2 million, interest income of $0.2 million, scrap sofa sale income of $0.1 million and sundry income of $0.2 million.

**Income tax expenses**

For the year ended December 31, 2024, our income tax expense was approximately $2.4 million, an increase of approximately $0.6 million or 29.6% as compared to $1.9 million for the prior year. This increase was attributable to higher non-taxable items incurred during the year ended December 31, 2023, as compared to the year ended December 31, 2024.

**Net income**

As a result of the foregoing, our net income for the years ended December 31, 2024 and 2023 was approximately $8.4 million and $10.3 million, respectively, with a decrease of $1.9 million or 18.4%. Net income margin was 2.5% and 3.2%, respectively for the aforesaid years.

B. Liquidity and capital resources

To date, we have financed our operations primarily through cash flows from operating activities, IPO and equity financing from institutional investors. As of December 31, 2025, we reported working capital of approximately $20.4 million and retained earnings of approximately $2.8 million. For the year ended December 31, 2025, we had aggregate cash inflows of approximately $2.4 million.

As of December 31, 2024, we reported working capital of approximately $4.9 million and accumulated deficits of approximately $13.8 million. For the year ended December 31, 2024, we had aggregate cash outflows of approximately $6.6 million.

As of December 31, 2025 and 2024, our cash balance was $27.3 million and $24.9 million, respectively.

**Working capital**

The following table sets forth a summary of our working capital as of December 31, 2025 and 2024, respectively:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | As of December 31, | As of December 31, | | |
|  | 2024 | 2025 | Change | Change |
|  | US$ | US$ | US$ | % |
| Current assets | 107774538 | 125765852 | 17991314 | 16.7 |
| Current liabilities | 102920770 | 105360761 | 2439991 | 2.4 |
| Net current assets (working capital) | 4853768 | 20405091 | 15551323 | 320.4 |

---

As of December 31, 2025, current assets of $125.8 million comprised of cash and cash equivalents of $27.3 million, accounts receivables, net of $76.0 million, inventories, net of $9.6 million, deposit, prepayments and other receivables of $5.9 million, and amounts due from related parties of $7.0 million. Current liabilities of $105.4 million comprised of accounts payable of $4.5 million, accounts payable, related parties of $74.9 million, customer deposits of $1.2 million, accrued liabilities and other payables of $6.1 million, short-term borrowings of $10.4 million, warranty liabilities of $2.2 million, derivatives financial instruments of $0.07 million, income tax payable of $4.2 million, and lease liabilities, current portion of $1.9 million. As a result of the foregoing, working capital as of December 31, 2025 was $20.4 million.

As of December 31, 2024, current assets of $107.8 million comprised of cash and cash equivalents of $24.9 million, accounts receivables, net of $66.9 million, inventories, net of $8.0 million, amounts due from related parties of $2.8 million, and deposit, prepayments and other receivables of $5.1 million. Current liabilities of $102.9 million comprised of accounts payable of $2.7 million, accounts payable, related parties of $72.7 million, customer deposits of $0.9 million, accrued liabilities and other payables of $4.4 million, short-term borrowings of $15.3 million, amounts due to related parties of $0.3 million, warranty liabilities of $2.1 million, income tax payable of $2.5 million, and lease liabilities, current portion of $2.1 million. As a result of the foregoing, working capital as of December 31, 2024 was $4.9 million.

**CASH FLOWS**

The following table sets forth a summary of our cash flows for the years indicated:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
|  | US$ | US$ | US$ |
| Net cash provided by operating activities | 18843730 | 384538 | 13479592 |
| Net cash used in investing activities | (275742) | (515509) | (2136453) |
| Net cash used in financing activities | (23278934) | (5527866) | (9377770) |
| Effect on exchange rate change on cash and cash equivalents | (74709) | (905513) | 450101 |
| **Net change in cash and cash equivalents** | (4785655) | (6564350) | 2415470 |
| **BEGINNING OF YEAR** | 36210626 | 31424971 | 24860621 |
| **END OF YEAR** | 31424971 | 24860621 | 27276091 |

---

**Operating activities**

For the year ended December 31, 2025, we recorded net cash provided by operating activities of $13.5 million, which consisted of net income of $16.6 million as adjusted for non-cash items and change in operating assets and liabilities. Adjustments for non-cash items mainly consisted of depreciation of property, plant and equipment of $0.5 million, amortization of operating right-of-use assets of $2.0 million, allowance for obsolete inventories of $0.08 million, written-off inventories of $0.06 million, benefit for deferred income taxes of $0.04 million, provision for allowance for expected credit losses of $0.2 million, provision for warranty liabilities of $6.5 million, provision for reinstatement cost of $0.1 million, non-cash lease expense of $2.1 million, change in fair value of derivative financial instruments of $0.07 million, and written-off property, plant and equipment of $0.04 million. Change in operating assets and liabilities primarily included increase in accounts receivables of $9.3 million, increase in inventories of $1.6 million, increase in deposits, prepayments and other receivables of $0.7 million, decrease in warranty liabilities of $6.4 million, and being offset by increase in accounts payable of $3.9 million, increase in customer deposits of $0.3 million, increase in accrued liabilities and other payables of $1.6 million, and increase in income tax payable of $1.7 million.

For the year ended December 31, 2024, we recorded net cash provided by operating activities of $0.4 million, which consisted of net income of $8.4 million as adjusted for non-cash items and change in operating assets and liabilities. Adjustments for non-cash items mainly consisted of depreciation of property, plant and equipment of $0.2 million, amortization of operating right-of-use assets of $1.9 million, allowance for obsolete inventories of $0.3 million, written-off inventories of $0.05 million, benefit for deferred income taxes of $0.1 million, provision for warranty liabilities of $6.1 million, reversal of reinstatement cost of $0.05 million, non-cash lease expense of $1.9 million, change in fair value of derivative financial instruments of $0.4 million, and written-off of property, plant and equipment of $0.01 million. Change in operating assets and liabilities primarily included increase in accounts receivables of $9.6 million, increase in inventories of $2.1 million, increase in deposits, prepayments and other receivables of $0.1 million, decrease in accrued liabilities and other payables of $0.06 million, decrease in warranty liabilities of $6.3 million, and being offset by increase in accounts payable of $2.0 million, and increase in income tax payable of $1.3 million.

For the year ended December 31, 2023, we recorded net cash provided by operating activities of $18.8 million, which consisted of net income of $10.3 million as adjusted for non-cash items and change in operating assets and liabilities. Adjustments for non-cash items mainly consisted of depreciation of property, plant and equipment of $0.1 million, amortization of operating right-of-use assets of $1.5 million, allowance for obsolete inventories of $0.4 million, written-off inventories of $0.4 million, provision for deferred income taxes of $0.06 million, provision for allowance for expected credit losses of $0.1 million, provision for warranty liabilities of $4.4 million, provision for reinstatement cost of $0.3 million, non-cash lease expense of $1.7 million, and change in fair value of derivative financial instruments of $(2.8) million. Change in operating assets and liabilities primarily included decrease in accounts payable of $1.7 million, decrease in deposits, prepayments and other receivables of $0.1 million, decrease in accrued liabilities and other payables of $1.2 million, decrease in warranty liabilities of $5.2 million, and being offset by decrease in accounts receivable of $11.0 million, decrease in inventories of $2.0 million, increase in customer deposits of $0.9 million, and increase in income tax payable of $1.1 million.

**Investing activity**

For the year ended December 31, 2025, we recorded net cash used in investing activities of $2.1 million, being purchase of property, plant and equipment of $1.1 million and advance payment for acquisition of long-term investments of $1.0 million.

For the years ended December 31, 2024 and 2023, we recorded net cash used in investing activities of $0.5 million and $0.3 million, respectively which comprised of the purchase of property, plant and equipment for these years.

**Financing activities**

For the year ended December 31, 2025, we recorded net cash used in financing activities of $9.4 million, being proceeds from short-term borrowings of $56.9 million, repayments of short-term borrowings of $61.7 million, advances from related parties of $12.3 million, repayments to related parties of $21.1 million, and decrease in amount due from related parties due to reorganization and scrapping of $4.3 million.

For the year ended December 31, 2024, we recorded net used in financing activities of $5.5 million, being proceeds from short-term borrowings of $40.8 million, repayments of short-term borrowings of $26.5 million, advances from related parties of $20.8 million, repayments to related parties of $20.4 million, increase in amounts due from related parties due to reorganization and scrapping of $11.9 million, dividend paid to common shareholders of $11.8 million, and net proceeds from initial public offering of $3.6 million.

For the year ended December 31, 2023, we recorded net cash used in financing activities of $23.3 million, being proceeds from short-term borrowings of $35.4 million, repayments of short-term borrowings of $54.4 million, advances from related parties of $27.7 million, repayments to related parties of $30.7 million, and increase in amounts due from related parties due to reorganization and scrapping of $1.4 million.

**Accounts receivable**

Our net accounts receivable were $76.0 million and $66.9 million as of December 31, 2025 and 2024, respectively. The increase was primarily attributed to the increase in revenues for the year ended December 31, 2025.

We did not charge any interest on or hold any collateral as security over these accounts receivable balances. We generally offer credit periods ranging from 7 to 115 days to our customers. We have not had and do not expect to have issues collecting payment from these longer ageing invoices.

As of December 31, 2025 and 2024, an aging analysis for our accounts receivable, net are as follows:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **As of December 31, 2025** | **Balance** | **Current** | **1 – 120 days** | **121 – 150 days** | **151 – 180 days** | **Over 181 days** |
| Accounts receivable | 76265908 | 59895433 | 15929738 | 90092 | 188622 | 162023 |
| Allowance for expected credit losses | (255199) | - | (5915) | (31854) | (100309) | (117121) |
| Accounts receivable, net | 76010709 | 59895433 | 15923823 | 58238 | 88313 | 44902 |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **As of December 31, 2024** | **Balance** | **Current** | **1 – 120 days** | **121 – 150 days** | **151 – 180 days** | **Over 181 days** |
| Accounts receivable | 66987726 | 54189101 | 12520084 | 40953 | 68765 | 168823 |
| Allowance for expected credit losses | (59124) | (8549) | (6846) | (226) | (499) | (43004) |
| Accounts receivable, net | 66928602 | 54180552 | 12513238 | 40727 | 68266 | 125819 |

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Accounts receivables are due from credit card processors and customers and related parties in export sales and leather trading. We have a policy for determining the allowance for expected credit losses based on assessments of the recoverability of the accounts receivable and individual account analysis, including the current creditworthiness and the past collection history of each credit card processors and customers, and current economic industry trends. For individual (specific) provisions, we perform individual assessment of the debtors that exhibit indicators of elevated credit risk, such as current creditworthiness, past collection history, known disputes, and other information relevant to the individual counterparty's ability to satisfy its obligations. For collective (general) provisions, we evaluate receivables on a pooled basis using historical collection experience adjusted for current conditions and anticipated future economic factors. These pooled estimates incorporate aging trends, historical loss rates, industry conditions, and macroeconomic forecasts relevant to our credit exposure. Based on these analyses, we develop an estimate of the expected credit losses for the accounts receivable.

**Credit facility**

HTL Marketing obtained the trade financing revolving and factoring facilities from United Overseas Bank Limited and Citibank Singapore Ltd in Singapore, in the aggregate principal amount of up to $33 million for the years ended December 31, 2024 and 2025. These facilities bear an effective average annual interest rate of 5.52% to 5.94% and maturity ranging from January 2026 to April 2026. As of December 31, 2025 and 2024, the total outstanding balance were $10.4 million and $15.3 million, respectively.

These banking facilities contain financial covenants requiring HTL Marketing to maintain defined financial ratios throughout the term of the facilities. We evaluated compliance with these covenants and determined that HTL Marketing was in compliance with all such requirements as of the reporting date*.* 

These banking facilities are secured by an irrevocable corporate guarantee provided by one of our major shareholders, Golden Hill Capital Pte. Ltd. ("GHC") with a maximum amount of $50 million and certain assignments of accounts receivable. The corporate guarantee expires six months after the full repayment of all loans.

**Future Capital Requirements**

Historically, our primary use of cash has been to finance working capital needs. We expect that we will be able to meet our needs to fund operations, capital expenditures and other commitments in the next 12 months primarily with our cash and cash equivalents, accounts receivable and operating cash flows.

We may, however, require additional cash resources due to changes in business conditions or other future developments. If these sources are insufficient to satisfy our cash requirements, we may seek to sell additional equity or debt securities or obtain a credit facility. The sale of additional equity or equity-linked securities could result in additional dilution to shareholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financial covenants that would restrict operations. Financing may not be available in amounts or on terms acceptable to us, or at all.

Our capital requirements for 2025 and future years will depend on numerous factors, including management's evaluation of the timing of projects to pursue. Subject to our ability to generate revenues and cash flow from operations and our ability to raise additional capital (including through possible joint ventures, acquisitions, and/or partnerships), we expect to incur substantial expenditures to carry out our business plan, as well as costs associated with our capital raising efforts and being a public company.

**Material Cash Requirements**

Our cash requirements consist primarily of day-to-day operating expenses, capital expenditure and contractual obligations with respect to operating leases. We lease most of our office facilities, retail stores and warehouses. We expect to make future payments on existing leases from cash generated from operations. We have limited credit available from our major vendors and are obligated to settle the purchase invoices, which further constrains our cash liquidity.

In order to enhance the growth in international trade business, we expect to incur approximately $2.1 million in the business development projects and the launch of more sales and marketing campaigns to expand the market exposure.

We believe that we have sufficient working capital for our requirements for at least the next 12 months from the date of this filing, absent unforeseen circumstances, taking into account the financial resources presently available to us, including cash and cash equivalents on hand, cash flows from our operations and credit facility.

***Capital Expenditures***

Our capital expenditures amounted to approximately $1.1 million, $0.5 million, and $0.3 million relating to the purchase of property, plant and equipment for the years ended December 31, 2025, 2024 and 2023, respectively.

We plan to fund our future capital expenditures with our existing cash balance and cash flows from our operations. We will continue to make capital expenditures to meet the expected growth of our business, including property renovation, office equipment and leasehold improvements.

***Contractual Obligations***

We have also entered into commercial operating lease agreements with various third parties, for the use of retail stores and warehouse in Singapore.

The following table sets forth our contractual obligations as of December 31, 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Payment Due by Period** | **Payment Due by Period** | **Payment Due by Period** | **Payment Due by Period** | **Payment Due by Period** |
| <br>Contractual obligations | **Total** | **Less than <br> 1 Year** | **1-3 Years** | **3-5 Years** | **More than <br> 5 Years** |
|  | **US$** | **US$** | **US$** | **US$** | **US$** |
| Operating lease obligations | 7497260 | 1924657 | 3229234 | 1031274 | 1312095 |
| Short-term borrowings | 10389094 | 10389094 | - | - | - |
| **Total** | **17886354** | **12313751** | **3229234** | **1031274** | **1312095** |

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**Off-Balance Sheet Arrangements**

We have off-balance sheet financial guarantees but do not have other off-balance sheet commitments to guarantee the payment obligations of any third parties. We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder's equity or that are not reflected in our consolidated and combined financial statements but have entered into derivative contracts on foreign currency forward contracts. Furthermore, we do not have any retained or contingent interest in assets transferred to an uncombined entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any uncombined entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.

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| | | | |
|:---|:---|:---|:---|
| Off Balance Sheet Agreement | December 31, 2023 <br> $'million | December 31, 2024 <br> $'million | December 31, 2025 <br> $'million |
| Issuance of letter of credit | 1.1 | 2.4 | 2.5 |
| Outstanding foreign exchange derivative contracts | 91.8 |  | 126.2 |

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C. Research and Development, Patents and Licenses, etc.

See "Item 4. Information on the Company—B. Business Overview—Intellectual Property."

D. Trend Information

Other than as disclosed in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the current year that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital reserves, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.

**QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK**

*Concentration of credit risk*

Financial instruments that potentially expose us to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. We place our cash and cash equivalents with financial institutions with high credit ratings and quality.

We conduct credit evaluations of customers and generally do not require collateral or other security from our customers. We establish an allowance for expected credit losses primarily based upon the age of the receivables and factors surrounding the credit risk of specific customers.

*Concentration risk in major vendors*

For the years ended December 31, 2023, 2024 and 2025, the vendor, being related parties, which accounted for 10% or more of our cost of goods sold and our outstanding accounts payable balances at year-end date, are presented as follows:

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| | | | |
|:---|:---|:---|:---|
|  | Year ended <br> December 31, 2025 | Year ended <br> December 31, 2025 | As of <br> December 31, 2025 |
| Vendor | Cost of <br> goods sold | Percentage <br> of cost of <br> goods sold | Accounts <br> payable |
|  | US$ |  | US$ |
| HTL Furniture (China) Co., Ltd. (related party) | 104218558 | 38% | 4587578 |
| HTL Furniture (Changshu) Co., Ltd. (related party) | 83491944 | 31% | 32088012 |
| HTL Furniture (Kunshan) Co., Ltd. (related party) | 28965947 | 11% | 16747618 |

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| | | | |
|:---|:---|:---|:---|
|  | Year ended <br> December 31, 2024 | Year ended <br> December 31, 2024 | As of <br> December 31, 2024 |
| Vendor | Cost of goods sold | Percentage of <br> cost of goods sold | Accounts payable |
|  | US$ |  | US$ |
| HTL Furniture (China) Co., Ltd. (related party) | 107053182 | 42% | 10998808 |
| HTL Furniture (Changshu) Co., Ltd. (related party) | 74784827 | 30% | 32467504 |
| HTL Furniture (Kunshan) Co., Ltd. (related party) | 32054553 | 13% | 18118921 |

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| | | | |
|:---|:---|:---|:---|
|  | Year ended<br> December 31, 2023 | Year ended<br> December 31, 2023 | As of <br> December 31, 2023 |
| Vendor | Cost of goods sold | Percentage of<br> cost of goods sold | Accounts payable |
|  | US$ |  | US$ |
| HTL Furniture (China) Co., Ltd. (related party) | 107277084 | 45% | 11330061 |
| HTL Furniture (Changshu) Co., Ltd. (related party) | 68735988 | 29% | 35048466 |
| HTL Furniture (Kunshan) Co., Ltd. (related party) | 33666337 | 14% | 13878608 |

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*Liquidity risk*

Our policy is to regularly monitor our liquidity requirements, to ensure that we maintain sufficient reserves of cash and adequate committed lines of funding from major financial institutions to meet our liquidity requirements in the short and long term. See "Liquidity and Capital Resources" for details.

HTL Marketing obtained the trade financing revolving and factoring facilities among various financial institutions in Singapore, in the aggregate principal amount of up to $33 million, which bear annual interest at the effective average rates of 5.52% to 5.94% with maturity of 90 days to 180 days. The purpose of these banking facilities is to support its furniture export and leather trading operations. These banking facilities are secured by an irrevocable corporate guarantee provided by GHC with a maximum aggregate amount of $50 million and certain assignments of accounts receivable. The corporate guarantee expires six months after the full repayment of all loans. As of December 31, 2024 and 2025, the short-term borrowings were $15.3 million and $10.4 million, respectively.

If HTL Marketing defaults on its obligations, GHC would be required to repay the outstanding amounts under the guarantee. A material default could adversely affect GHC's capacity to support the Company future financing requirements.

While the guarantee does not create direct financial obligations for the Company, any operational disruption at HTL Marketing such as a loan termination would negatively impact the Company's consolidated revenues and gross profit, as HTL Marketing accounts for approximately 95% of the Company's export sales.

We closely monitor HTL Marketing's loan utilization and repayment status on a monthly basis, and GHC provides quarterly updates regarding its continued ability to maintain the guarantee.

*Economic and political risk*

The Group is exposed to economic and political risks arising from fluctuations in macroeconomic conditions, including changes in economic growth, inflation, interest rates, and foreign exchange rates, which may affect customer demand, operating costs, and profitability. In addition, the Group operates across multiple jurisdictions and is subject to political and regulatory uncertainties, such as changes in trade policies, tariffs, foreign investment regulations, tax regimes, and sanctions, as well as potential geopolitical tensions that could disrupt business operations or supply chains. While the Group mitigates these risks through geographic diversification, ongoing monitoring of regulatory developments, and the implementation of appropriate risk management measures, adverse economic or political developments may still have a material impact on the Group's operations and financial performance.

E. Critical Accounting Estimates

 ****

We prepare our consolidated and combined financial statements in accordance with U.S. GAAP, which requires our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.

Our expectations regarding the future are based on available information and assumptions that we believe to be reasonable, which together form our basis for making judgments about matters that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates.

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates, which we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations.

While management believes its judgments, estimates and assumptions are reasonable, they are based on information presently available and actual results may differ significantly from those estimates under different assumptions and conditions. We believe that the following critical accounting estimates involve the most significant judgments used in the preparation of our financial statements.

When reading our consolidated and combined financial statements, you should consider our selection of critical accounting policies, the judgment and other uncertainties affecting the application of such policies and the sensitivity of reported results to changes in conditions and assumptions. Some of our accounting policies require a higher degree of judgment than others in their application. The accounting policies that involve critical accounting estimates include the following: (i) revenue recognition; (ii) accounts receivable, net; (iii) inventories; (iv) impairment of long-lived assets; (v) leases; and (vi) income taxes. See Note 2 — Summary of Significant Accounting Policies to our consolidated and combined financial statements for the disclosure of these accounting policies.

A list of recently issued accounting pronouncements that are relevant to us is included in Note 2 to our consolidated and combined financial statements included elsewhere in this annual report.

Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments, or events that are reasonably likely to have a material effect on our net revenue, income from continuing operations, profitability, liquidity, or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

**Item 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES**

A. Directors and Senior Management

The following table sets forth information regarding our directors and executive officers as of the date of this annual report.

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| | | |
|:---|:---|:---|
| **Directors and Executive officers** | **Age** | **Position** |
| Phua Yong Pin | 78 | Chairman and Director |
| Phua Yong Tat | 74 | Vice Chairman and Director |
| Phua Mei Ming | 48 | Chief Executive Officer |
| Chai Zhengjie "Jeff" | 54 | Interim Chief Financial Officer |
| Jun Wang <sup>(1)(2)(3)</sup> | 43 | Independent non-executive director |
| Lee Ai Ming <sup>(1)(2)(3)</sup> | 71 | Independent non-executive director |
| Sophia Dai <sup>(1)(2)(3)</sup> | 44 | Independent non-executive director |

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<sup>(1)</sup> Member of the Audit Committee

<sup>(2)</sup> Member of the Compensation Committee

<sup>(3)</sup> Member of the Nomination Committee

Below is a summary of the business experiences of each our executive officers and directors:

*Phua Yong Pin* is the Chairman and a director of the Company. Mr. Phua oversees the HTL Group's overall management, merger and acquisition and corporate/commercial transaction matters, and is responsible for overseeing the PRC, Vietnam and India based manufacturing and retail operations of HTL Group. Mr. Phua is one of the founders of the Company and the HTL Group, and has committed to expanding and promoting the Company's business for upholstered furniture. Mr. Phua has over 40 years of experience in the furniture industry. Since September 2020, Mr. Phua has been the Chairman of the HTL Group. From April 2020 to September 2020, Mr. Phua was a consultant of the HTL Group. From April 2010 to March 2020, Mr. Phua was the Group Chairman of the HTL Group. From August 1993 to March 2010, Mr. Phua was a director of Hwa Tat Lee Holdings Pte Ltd., before it changed its name to HTL International Holdings Limited. In September 1991, Phua Yong Pin co-founded Hwa Tat Lee Holding Pte Ltd and acted as its Executive Director until August 1993. Mr. Phua co-founded HTL Manufacturing, the predecessor of the HTL Group in the 1980s as a sofa maker in Singapore.

*Phua Yong Tat* is the Vice-Chairman and a director of the Company. Mr. Phua oversees the HTL Group's the general corporate strategy and brand promotion management and business expansion, including sales, marketing, and product development, and is responsible for the business, product development, product design, marketing and sales of the HTL Group. Mr. Phua is one of the founders of the Company and the HTL Group, and has committed to expanding and promoting the Company's business for upholstered furniture. Mr. Phua has over 40 years of experience in the furniture industry. Since September 2020, Mr. Phua has been the CEO of the HTL Group. From April 2020 to September 2020, Mr. Phua was a consultant of the HTL Group. From September 2016 to March 2020, Mr. Phua was CEO of the HTL Group. From April 2010 to September 2016, Mr. Phua was the Group Managing Director of the HTL Group. From August 1993 to March 2010, Mr. Phua was a director of Hwa Tat Lee Holdings Pte Ltd, before it changed its name to HTL International Holdings Limited. In September 1991, Phua Yong Tat co-founded Hwa Tat Lee Holding Pte Ltd and acted as its Managing Director until August 1993. Mr. Phua co-founded HTL Manufacturing, the predecessor of the HTL Group in the 1980s as a sofa maker in Singapore.

*Phua Mei Ming* is the Chief Executive Officer of the Company. She has been the CEO of HTL Marketing since October 2022 and was Chief Operating Officer and Director of HTL Marketing between July 2022 and September 2022. She was the Chief Operating Officer of HTL Manufacturing from January 2021 to June 2022. From September 2018 to September 2020, Ms. Phua was the general manager of the HomesToLife Singapore and oversaw HomesToLife Singapore's operations. From January 2012 to December 2017, Ms. Phua was the director for HR and communications of HTL Group. From January 2010 to January 2012, Ms. Phua was the HR director of the HTL Group. She was also the general manager of Domicil Pte Ltd. from January 2007 to January 2012. From January 1999 to December 2006, Ms. Phua was sales of HTL Manufacturing. Ms. Phua graduated in 1999, and holds a Bachelor's degree in business administration from the National University of Singapore, She brings with her over 25 years of experience in the furniture industry, and a wealth of expertise through having served in various roles in the Company. With over 10 years collectively spent in leadership positions, she has directed both retail and wholesale operations, brand development and management, marketing and HR. Her strategic vision and adept leadership have contributed to the Company's growth, evident in her track record of driving sales and fostering organizational development.

 

*Chai Zhengjie "Jeff"* is the interim Chief Financial Officer of the Company, a position he was appointed to on November 19, 2025, following the departure of the Company's previous Chief Financial Officer. Mr. Chai has served as the CFO and secretary of HTL Furniture Inc., a U.S. company which is a related party of the Company, since January 2024. Mr. Chai has also served as Regional VP of Finance for a few subsidiaries of the Company since January 2024. Mr. Chai was the CFO, secretary and VP of Finance and Operations of HTL Furniture Inc. from September 2020 to December 2023. Mr. Chai received his bachelor of science degree in Accountancy from Boise State University in 2004, a Master of Business Administration degree from Boise State University in 1999, and a bachelor of engineering in International Business and Automatic Control Engineering degree from Shanghai Jiao Tong University in 1994. Mr. Chai is a licensed Certified Public Accountant.

*Jun Wang* began serving as our independent Director on February 19, 2025. Mr. Wang serves as chairman of the audit committee and as a member of the compensation and nomination committees. Mr. Wang has more than 15 years' experience in the investments and venture finance industry. Mr. Wang has been serving as Managing Director/Venture Partner of Youshan Capital, an emerging Chinese private equity manager with over CNY 13 billion Assets Under Management ("AUM"), focusing on growth stage and control opportunities in China, since April 2024. From October 2018 to March 2024, Mr. Wang served as Managing Director of Cornell Capital, a NY-based mid-market buyout fund with over US$6 billion AUM, focusing on cross-border control opportunities. Mr. Wang received his Master of Arts in Economics from the University of British Columbia in November 2008, his Bachelor of Arts – Honors with specialization in Economics with Distinction from the University of Western Ontario in July 2007, after transferring from Peking University in 2004.

*Long Ai Ming (aka Mrs. Lee Ai Ming)* began serving as our independent Director on September 30, 2024, when the registration statement for our initial public offering was declared effective. Mrs. Lee serves as chairman of the nomination committee and as a member of the audit and compensation committees. Mrs. Lee is also a director of Temasek Life Sciences Laboratory Limited, and serves as a member of the audit committee, and a director of Lendlease Global Commercial REIT, a real estate investment trust listed on the SGX where she serves as a member of the audit, compensation, and nominating committees. Mrs. Lee was an advocate and solicitor of the Supreme Court of Singapore, and a senior consultant at Dentons Rodyk & Davidson LLP (formerly Rodyk & Davidson LLP), where she practiced law from 1982 to March 2025. Prior to joining Dentons Rodyk & Davidson LLP, Mrs. Lee practiced law at Francis T Seow from 1978 to 1982. Mrs. Lee graduated from the University of Singapore in 1977 with an LLB (Hons) degree. We believe that Mrs. Lee is qualified to serve on our board because of her rich legal experiences.

*Sophia Dai* began serving as our independent Director on February 19, 2025. Ms. Dai serves as chairman of the compensation committee and as a member of the audit and nomination committees. Ms. Dai has 20 years of experience in international capital markets, with expertise spanning IPOs, fundraising, investment, M&A, financial management, and business development across regions. Since January 2025, Ms. Dai has been a founder and director of Montavian Pte. Ltd., a business consulting firm specializing in offering tailored consulting services to clients. Since October 2024, Ms. Dai has also been the Managing Director of Shanghai Ridgehall Enterprise Development Co., Ltd., a consulting firm specializing in identifying high-growth Asian companies and supporting their international expansion. Prior to this, Ms. Dai was the Chief Financial Officer and Co-President of AgiiPlus Group, an integrated platform providing work solutions and enterprise services, from May 2021 to October 2024. She played a key role in preparing the company for an Initial Public Offering on the Nasdaq stock exchange. Ms. Dai has held several senior leadership roles, including serving as Head of Strategic Investments and Senior Vice President at City Developments Limited (CDL, SGX: C09), a member of the Hong Leong Group and a publicly listed company on the Singapore Exchange, from April 2019 to April 2021. Earlier in her career, Sophia held senior roles at AM Alpha, an investment house specializing in global real estate investment. Ms. Dai received her Bachelor's Degree in International Finance in 2003 from Fudan University, Shanghai, and her Master of Science (Estate Management) in 2005 from the National University of Singapore. She has also been a CFA charter holder since 2010.

**Family relationships**

Phua Yong Pin and Phua Yong Tat are brothers who co-founded the HTL Group more than 40 years ago. Phua Mei Ming is the oldest daughter of Phua Yong Tat.

Apart from the above, none of the directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K.

B. Compensation

**Compensation of Directors and Executive Officers**

HomesToLife Cayman was incorporated in 2024. Prior to August 1, 2024, we did not pay our executive officers. We entered into employment agreements with our Chief Executive Officer, Phua Mei Ming, and former Chief Financial Officer, Chew Kwang Yong, on August 1, 2024, under which they receive nominal remuneration. The majority of the compensation of Phua Mei Ming and of Chew Kwang Yong prior to his departure from the Company, are paid by other companies within the HTL Group.

As the interim Chief Financial Officer, Chai Zhengjie "Jeff" signed an employment agreement with HTL Furniture Inc., a U.S. company which is a related party of the Company, and his compensation has been paid by HTL Furniture Inc.

We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors. We have no service contracts with any of our directors providing for benefits upon termination of employment.

In the year ended December 31, 2025, the compensation paid to our directors and executive officers was $1,425,811.

***Equity Incentive Plan***

We have not granted any equity awards to our directors or executive officers during the years ended December 31, 2025, 2024, and 2023.

We approved the HomesToLife Ltd 2024 Incentive Securities Plan on September 17, 2024, which we refer to as the Plan in this annual report, to attract and retain the best available personnel, provide additional incentives to employees, directors and consultants, and promote the success of our business.

The maximum aggregate number of Shares that may be issued under the Plan is 2,900,000. As of the date of this annual report, no awards have been granted under the Plan.

The following paragraphs summarize the principal terms of the Plan.

*Types of Awards.* The Plan permits the award of non-qualified stock options, incentive stock options, restricted stock, unrestricted stock and any combination of the foregoing.

*Plan Administration.* The Plan will be administered by the Compensation Committee.

*Eligibility.* We may grant awards to employees, directors and/or consultants determined by the Compensation Committee to be eligible for participation in the Plan in accordance with its terms.

*Vesting Schedule.* In general, the Compensation Committee determines the vesting schedule, which is specified in the relevant award agreements.

*Exercise of Awards.* In general, the Compensation Committee determines the exercise or purchase price, as applicable, for each award, which is stated in the relevant award agreement. Options that are vested and exercisable will terminate if they are not exercised prior to the time as the Compensation Committee determines at the time of grant.

*Transfer Restrictions.* Awards may not be transferred in any manner by the participant other than in accordance with the exceptions provided in the plan or the relevant award agreement or otherwise determined by the Compensation Committee, such as transfers by will or the laws of descent and distribution.

Termination and Amendment of the Plan. The Plan will terminate on the 10 year anniversary of its adoption by the Board.

 ****

***Incentive Compensation***

We maintain performance-based bonus and sales incentive schemes for eligible employees.

C. Board Practices

**Board of Directors**

Our board of directors consists of 5 directors. A director is not required to hold any shares in our Company to qualify to serve as a director. The Corporate Governance Rules of the Nasdaq generally require that a majority of an issuer's board of directors must consist of independent directors. Our board of directors has determined that each of Jun Wang, Lee Ai Ming, and Sophia Dai, is an "independent director" as defined in the Nasdaq Listing Rules. Our board of directors is composed of a majority of independent directors.

**Duties of directors**

As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he owes the following duties to the company — a duty to act bona fide in the best interests of the company, a duty not to make a profit based on his or her position as director (unless the company permits him to do so) and a duty not to put himself in a position where the interests of the company conflict with his or her personal interest or his or her duty to a third party. A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his or her duties a greater degree of skill than may reasonably be expected from a person of his or her knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

**Committees of the board of directors**

We have established an audit committee, a compensation committee and a nominating and corporate governance committee under our Board of Directors. We adopted a charter for each of the three committees. Each committee's members and functions are described below.

*Audit Committee.*

Our audit committee consists of our three independent directors, and is chaired by Jun Wang. We have determined that Mr. Wang satisfies the requirements of Rule 5605(c)(2) of the Listing Rules of the NASDAQ and meet the independence standards under Rule 10A-3 under the Securities Exchange Act of 1934, as amended. We have determined that Mr. Wang qualifies as an "audit committee financial expert." The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our Company. The audit committee is responsible for, among other things:

● reviewing and recommending to our board for approval, the appointment, re-appointment or removal of the independent auditor, after considering its annual performance evaluation of the independent auditor;

● approving the remuneration and terms of engagement of the independent auditor and pre-approving all auditing and non-auditing services permitted to be performed by our independent auditors at least annually;

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

● discussing with our independent auditor, among other things, the audits of the financial statements, including whether any material information should be disclosed, issues regarding accounting and auditing principles and practices;

● 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;

● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures;

● approving annual audit plans, and undertaking an annual performance evaluation of the internal audit function;

● establishing and overseeing procedures for the handling of complaints and whistleblowing; and

● meeting separately and periodically with management and the independent registered public accounting firm.

*Compensation Committee.*

Our compensation committee consists of our three independent directors and is chaired by Sophia Dai. We have determined that Ms. Dai satisfies the "independence" requirements of Rule5605(c)(2) of the Listing Rules of the NASDAQ. 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 their compensation is deliberated upon. The compensation committee is responsible for, among other things:

● overseeing the development and implementation of compensation programs in consultation with our management;

● at least annually, reviewing and approving, or recommending to the board for its approval, the compensation for our executive officers;

● at least annually, reviewing and recommending to the board for determination with respect to the compensation of our non-executive directors;

● at least annually, reviewing periodically and approving any incentive compensation or equity plans, programs or other similar arrangements;

● reviewing executive officer and director indemnification and insurance matters; and

● overseeing our regulatory compliance with respect to compensation matters, including our policies on restrictions on compensation plans and loans to directors and executive officers.

*Nominating and Corporate Governance Committee.*

Our nominating and corporate governance committee consists of our three independent directors, and is chaired by Lee Ai Ming. We have determined that Mrs. Lee satisfies the "independence" requirements of Rule5605(c)(2) of the Listing Rules of the NASDAQ. The nominating and corporate governance committee assists the board in selecting individuals qualified to become our directors and in determining the composition of the board and its committees. The nominating and corporate governance 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, knowledge, skills, experiences, expertise, diversity and availability of service to us;

● developing and recommending to our board such policies and procedures with respect to nomination or appointment of members of our board and chairs and members of its committees or other corporate governance matters as may be required pursuant to any SEC or Nasdaq rules, or otherwise considered desirable and appropriate;

● 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

● evaluating the performance and effectiveness of the board as a whole.

***Code of Business Conduct and Ethics***

We have adopted a code of business conduct and ethics, which is applicable to all of our directors, executive officers and employees and is publicly available.

**Employment Agreements and Director Agreements**

We entered into employment agreements with each of our executive officers, Ms. Phua Mei Ming and Mr. Chew Kwang Yong, pursuant to which such individuals are employed as an executive officer for a continuous term unless we or the executive officer gives prior notice to terminate such employment in accordance with the employment agreement. Our employment agreement with Mr. Chew Kwang Yong was terminated on November 19, 2025, upon the advance notice by Mr. Chew. We may terminate the employment for cause without notice, at any time for certain acts, such as repeated or continuing breach of the executive officer's obligations under the employment agreement, any act or conduct which would bring the executive officer or our company into disrepute, any serious misconduct, unreasonable absenteeism or willful disobedience of our company's lawful orders, willful refusal to perform all or any duties, insubordination, breach of company secrecy, or violation of the applicable laws and regulations. We may also terminate the employment without cause at any time upon 3 months' advance written notice. Each executive officer may resign at any time upon 3 months' advance written notice or upon payment of 3 months remuneration in lieu of notice for the relevant notice period.

As the interim Chief Financial Officer, Chai Zhengjie "Jeff" signed an employment agreement with HTL Furniture Inc., a U.S. company which is a related party of the Company.

Each executive officer has agreed to hold, both during and after two years after the termination or expiry of his employment agreement, in strict confidence and not to use for his own account or divulge or disclose to any person, firm or company, except as required in the performance of his duties in connection with the employment or as required by applicable laws or if the information lawfully comes into the public domain, any trade secret, intellectual property, or any of confidential information of or relating to our Group the confidential information of any third party received by us and for which we owe confidentiality obligations to. Each executive officer has also agreed to disclose in confidence to us all inventions, designs and trade secrets which he conceives, develops during his employment with us and to assign all right, title and interest in them to us, and assist us in obtaining and enforcing patents, copyrights and other legal rights for these inventions, designs and trade secrets.

In addition, each executive officer has agreed to be bound by non-competition and non-solicitation restrictions during the term of the employment and for six (6) months following the last date of employment. Specifically, each executive officer has agreed not to: (i) engage or seek to do business which shall be in competition with our business, or (ii) solicit, divert or do business with any person, firm or company who has done business with our company in the previous 12 months preceding the termination of the executive officer's employment, or (iii) canvass or attempt to entice away the custom of any person who had in the previous 12 months before the termination of the executive officer's employment had been a customer or supplier of the our company, or (iv) solicit, induce or attempt to induce any employee or independent contractor to terminate his or her employment or engagement with us. The employment agreements also contain other customary terms and provisions.

We also entered into director agreements with each of our independent directors which agreements set forth the terms and provisions of their engagement.

D. Employees

See "—B. Business Overview."

E. Share Ownership

The following table sets forth information regarding the beneficial ownership of our Shares as of the date of this annual report by our officers, directors, and 5% or greater beneficial owners of Shares. There is no other person or group of affiliated persons known by us to beneficially own more than 5% of our Shares. Holders of our Shares are entitled to one (1) vote per share and vote on all matters submitted to a vote of our shareholders, except as may otherwise be required by law.

We have determined beneficial ownership in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Unless otherwise indicated, the person identified in this table has sole voting and investment power with respect to all shares shown as beneficially owned by him, subject to applicable community property laws.

---

| | | |
|:---|:---|:---|
| | **Shares Beneficially Owned** | **Shares Beneficially Owned** |
| <br>**Name of Beneficial Owners<sup>(1)</sup>** | **Number** | **%** |
| **Directors and Executive Officers:** |  |  |
| Phua Yong Pin**<sup>(2)</sup>** | 42506250 | 47.4 |
| Phua Yong Tat**<sup>(2)</sup>** | 42506250 | 47.4 |
| Phua Mei Ming |  |  |
| Chai Zhengjie "Jeff" | 625 | \* |
| Jun Wang |  |  |
| Lee Ai Ming |  |  |
| Sophia Dai |  |  |
| All directors and executive officers as a group (7 persons) | 85013125 | 94.8 |
| **5% shareholders:** |  |  |
| Golden Hill BVI**<sup>(2)</sup>** | 10012500 | 11.2 |
| New Century International Homes Pte. Ltd. **<sup>(2)</sup>** | 75000000 | 83.6 |

---

\* Less than 1%.

(1) Unless
 otherwise noted, the business address of each of the above entities or individuals is 6 Raffles Boulevard, #02-01/02, Marina Square,
 Singapore 039594.

(2) Each
 of Phua Yong Pin and Phua Yong Tat indirectly owns 50% of Golden Hill Capital Ltd and of New Century International Homes Pte. Ltd.
 As such, Phua Yong Pin and Phua Yong Tat are deemed to jointly beneficially own 85,012,500 Shares held through Golden Hill BVI. The
 mailing address for Golden Hill BVI and of New Century International Homes Pte. Ltd. is 229 Mountbatten Road, #03-44/45, Singapore
 398007.

F. Disclosure of a registrant's action to recover erroneously awarded compensation.

N/A

**Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS**

A. Major Shareholders

See "Item 6. Directors, Senior Management and Employees—E. Share Ownership."

B. Related Party Transactions

In addition to the executive officer and director compensation arrangements discussed in "Executive Compensation," below we describe transactions since incorporation, to which we have been a participant, in which the amount involved in the transaction is material to our Company and in which any of the following is a party: (a) enterprises that directly or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, our Company; (b) associates; (c) individuals owning, directly or indirectly, an interest in the voting power of our Company that gives them significant influence over our Company, and close members of any such individual's family; (d) key management personnel: that is, those persons having authority and responsibility for planning, directing and controlling the activities of our Company, including directors and senior management of companies and close members of such individuals' families; and (e) enterprises in which a substantial interest in the voting power is owned, directly or indirectly, by any person described in (c) or (d) or over which such a person is able to exercise significant influence.

Nature of relationships with related parties:

---

| | |
|:---|:---|
| Name of related party | Relationship with the Company |
| New Century International Homes Pte. Ltd. | Controlling shareholder |
| Golden Hill Capital Pte. Ltd. ("GHC") | Major shareholder |
| Golden Hill Capital Ltd. | Indirect major shareholder |
| Gruppo 8 S.R.L. | Entity controlled by two common controlling beneficial shareholders |
| H.T.L. Furniture, Inc. | Entity controlled by two common controlling beneficial shareholders |
| Corium Italia S.R.L. | Entity controlled by two common controlling beneficial shareholders |
| HTL Global Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Trading (India) Private Limited | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (China) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Changshu) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Sofa (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Huaian) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture Vietnam Company Limited. | Entity controlled by two common controlling beneficial shareholders |
| HTL Product Design (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Import/Export Trading (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Sofa India Private Limited | Entity controlled by two common controlling beneficial shareholders |
| Trends Leather (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Middle East Furniture LLC | Entity controlled by two common controlling beneficial shareholders |
| New Century Overseas Investments Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Home Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Leather Trading (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders, closed on January 10, 2025 |
| HTL Leather (China) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Manufacturing Pte Ltd. | Entity controlled by two common controlling beneficial shareholders, sold out on April 22, 2025 |

---

Related party balances consisted of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
| US$ |  | As of December 31, | As of December 31, | As of February 28, |
|  |  | 2024 | 2025 | 2026 |
| Name of related party | Nature |  |  |  |
| Gruppo 8 S.R.L. | Accounts receivable – related parties (a) | $26025 | $101783 | $7394 |
| Corium Italia S.R.L. | Accounts receivable – related parties (a) | 287910 | 154660 | 155252 |
| Trends Leather (Yangzhou) Co., Ltd. | Accounts receivable – related parties (a) | 615016 | 5507066 | 4782831 |
|  |  | $928951 | $5763509 | $4945477 |
| HTL Global Pte. Ltd. | Amount due from related party (b) | $996316 | $2708435 | $1095577 |
| New Century International Homes Pte. Ltd. | Amount due from related party (b) | 1811538 | 1571817 | 1571818 |
| Golden Hill Capital Pte Ltd | Amount due from related party (b) | - | 2745840 | - |
|  |  | $2807854 | $7026092 | $2667395 |
| HTL Furniture (China) Co., Ltd. | Accounts payable – related parties (c) | $10998808 | $4587578 | $2645258 |
| HTL Furniture (Changshu) Co., Ltd. | Accounts payable – related parties (c) | 32467504 | 32088012 | 34032059 |
| HTL Sofa (Kunshan) Co., Ltd. | Accounts payable – related parties (c) | 18118921 | 16747618 | 15093458 |
| HTL Furniture (Huaian) Co., Ltd. | Accounts payable – related parties (c) | 9031916 | 8173680 | 4150564 |
| HTL Import/Export Trading (Kunshan) Co., Ltd. | Accounts payable – related parties (c) | 22885 | 176533 | 163396 |
| HTL Furniture Vietnam Company Limited. | Accounts payable – related parties (c) | 1398608 | 12017175 | 12399219 |
| HTL Furniture (Yangzhou) Co., Ltd. | Accounts payable – related parties (c) |  | 85458 | 54707 |
| HTL Product Design (Kunshan) Co., Ltd. | Accounts payable – related parties (c) | 659510 | 845404 | 620352 |
| HTL Middle East Furniture LLC | Accounts payable – related parties (c) | 26647 | 29900 | 30970 |
| Corium Italia S.R.L | Accounts payable – related parties (c) |  | 45215 | 45389 |
| Gruppo 8 S.R.L. | Accounts payable – related parties (c) | - | 94417 | - |
|  |  | $72724799 | $74890989 | $69235372 |
| HTL Global Pte. Ltd. | Amount due to related party (d) | $292753 | $- | $- |

---

(a) Accounts
 receivable due from related parties represented trade receivables from the sale of goods with the Company in the normal course of
 business, which are unsecured, interest-free and grant with credit terms ranging from 60 to 90 days from the issue date of invoice.

(b) These
 balances represented non-trade temporary advances made by the Company, which are unsecured, interest-free and repayable on demand.

(c) Accounts
 payable due to related parties represented trade payables from the purchase of goods to the Company in the normal course of business,
 which are unsecured, interest-free and payable on demand.

(d) These
 balances represented non-trade temporary advances, which are unsecured, interest-free and has no fixed terms of repayment.

In the ordinary course of business, during the years ended December 31, 2023, 2024 and 2025, the Company has involved with transactions, either at cost or current market prices and on the normal commercial terms among related parties. The following table provides the transactions with these parties for the years as presented (for the portion of such period that they were considered related):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | Years ended December 31, | Years ended December 31, | Years ended December 31, | |
|  |  | 2023 | 2024 | 2025 |<br>From January 1, 2026, to February 28, 2026 |
| Name of related parties | Nature |  |  |  |  |
| HTL Furniture Inc | Sale of Sofa | $168910 | $212654 | $143808 | $1558 |
| New Century Trading（India）Private Limited | Sale of Sofa | 217 | 2273588 | 2660281 | 205338 |
| Corium Italia S.R.L | Sale of Sofa | (1607) |  |  |  |
| HTL Leather Trading (Yangzhou) Co., Ltd. | Sale of leather | 7015330 |  |  |  |
| Trends Leather (Yangzhou) Co., Ltd. | Sale of leather | 2105669 | 16706676 | 18884960 | 1793918 |
| HTL Leather (China) Co., Ltd. | Sale of leather | 692485 | - | - | - |
|  |  | $9981004 | $19192918 | $21689049 | $2000814 |
| Corium Italia S.R.L | Purchase of goods | $28008 | $14410 | $- | $- |
| HTL Import/Export Trading (Kunshan) Co. Ltd. | Purchase of goods | 132563 | 92165 | 461824 | 55511 |
| Gruppo 8 S.R.L. | Purchase of goods |  | 105344 | 835250 |  |
| New Century Sofa India Private Limited | Purchase of goods | 1217589 | 8044440 | 7910832 | 761265 |
| HTL Furniture (Huai An) Co., Ltd. | Purchase of goods | 17289382 | 10967375 | 9797106 | 1750241 |
| HTL Furniture Vietnam Company Limited. | Purchase of goods |  | 3901169 | 21255119 | 4916887 |
| HTL Furniture (Kunshan) Co., Ltd. | Purchase of goods | 33666337 | 32054553 | 28965947 | 3797407 |
| HTL Furniture (Changshu) Co., Ltd. | Purchase of goods | 68735988 | 74784827 | 83491944 | 13150783 |
| HTL Furniture (China) Co., Ltd. | Purchase of goods | 107277084 | 107053182 | 104218558 | 17074230 |
| Trends Leather Yangzhou Co Ltd | Purchase of sample leather | 3288 | 1182 | 1231 | - |
|  |  | $228350239 | $237018647 | $256937811 | 41506324 |
| HTL Global Pte. Ltd. | Commission income | $- | $- | $14573 | $- |
| Gruppo 8 S.R.L. | Commission income |  | 27205 | 69409 |  |
| Corium Italia S.R.L | Commission income | 240662 | 107049 | - | - |
|  |  | $240662 | $134254 | 83982 | $- |
| New Century Trading（India）Private Limited - Mumbai | Commission expense | $55358 | $253695 | $377863 | $68460 |
| HTL Furniture Inc | Commission expense | 2193852 | 1979659 | 2038722 | 498384 |
| HTL Furniture Inc | Service fee | - | 453795 | 395290 | 27692 |
|  |  | $2249210 | $2687149 | $2811875 | $594536 |
| HTL Furniture (Yangzhou) Co. Ltd | Professional fee | $- | $- | $522234 | $122656 |
| HTL Import/Export Trading (Kunshan) Co. Ltd | Professional fee |  | 110392 | 560638 | 272456 |
| HTL Product Design (Kunshan) Co. Ltd | Professional fee | 4200561 | 5411696 | 5178857 | 671648 |
|  |  | $4200561 | $5522088 | $6261729 | $1066760 |
| HTL Global Pte. Ltd. (SG) | Recharge of costs | $- | $104381 | $6905 | $- |
| HTL MIDDLE EAST FURNITURE L.L.C | Recharge of costs |  |  | 119015 | 30971 |
| New Century Trading（India）Private Limited | Recharge of costs | 1045600 | - | - | 19500 |
|  |  | $1045600 | $104381 | $125920 | $50471 |
| H.T.L. Furniture, Inc. | Showroom rental expense | $494660 | $552824 | $524897 | $56260 |
| New Century International Homes Pte Ltd | Office rental income | $- | $- | $4609 | $- |
| New Century Trading（India）Private Limited | Ocean Freight recharge | $- | $- | $242249 | $- |
| HTL Furniture Inc | Customers' Claims | $- | $- | $40426 | $11718 |
| HTL Global Pte. Ltd. (SG) | Management fees | $- | $- | $3452 | $- |
| HTL Manufacturing Pte Ltd | Other Income - Service Fee | $114657 | $- | $- | $- |

---

C. Interests of Experts and Counsel

Not applicable.

**Item 8. FINANCIAL INFORMATION**

A. Consolidated Statements and Other Financial Information

We have appended the combined and consolidated financial statements filed as part of this annual report. See "Item 18. Financial Statements."

**Legal Proceedings**

See "Item 4. Information on the Company—B. Business Overview—Legal Proceedings."

**Dividend Policy**

We have not previously declared or paid cash dividends and there is no guarantee that we will declare or pay any dividends in the near future on our shares. We currently intend to retain most, if not all, of our available funds and any future earnings to operate and expand our business. We may pay out dividends where we assess that we have sufficient available funds. However, even though we may intend to pay out such dividends, there is no guarantee that we will do so. Therefore, you should not rely on an investment in our Shares as a source for any future dividend income.

We are a holding Company incorporated in the Cayman Islands. We rely principally on dividends from our operating subsidiaries for our cash requirements, including any payment of dividends to our shareholders.

The Company's board of directors has the authority to pay interim dividends. Subject to the requirements of the Companies Act, the Company may by ordinary resolution declare final dividends in accordance with the respective rights of its shareholders but no dividend shall exceed the amount recommended by the directors. Even if our directors and shareholders decide to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors.

Subject to the Companies Act and our Memorandum and Articles of Association, our Company in general meeting may declare dividends in accordance with the respective rights of the members but no dividend shall be declared in excess of the amount recommended by our board of directors. Subject to a solvency test, as prescribed in the Companies Act, and the provisions, if any, of our Memorandum and Articles of Association, a company may pay dividends and distributions out of its share premium account. In addition, based upon English case law which is likely to be persuasive in the Cayman Islands, dividends may be paid out of distributable profits.

B. Significant Changes

Except as disclosed elsewhere in this annual report, we have not experienced any significant changes since the date of our audited consolidated financial statements included in this annual report.

**Item 9. THE OFFER AND LISTING**

A. Offer and Listing Details

Our ordinary shares have been listed on the Nasdaq Capital Market and commenced trading under the ticker symbol "HTLM" on October 1, 2024.

B. Plan of Distribution

Not applicable.

C. Markets

Our ordinary shares have been listed on the Nasdaq Capital Market and commenced trading under the ticker symbol "HTLM" on October 1, 2024.

D. Selling Shareholders

Not applicable.

E. Dilution

Not applicable.

F. Expenses of the Issue

Not applicable.

**Item 10. ADDITIONAL INFORMATION**

A. Share Capital

Not applicable.

B. Memorandum and Articles of Association

Our Memorandum and Articles of Association is incorporated into this annual report as Exhibit 1.1 hereto.

The following are summaries of material provisions of our Memorandum and Articles of Association and the Companies Act as they relate to the material terms of our Ordinary Shares.

**Ordinary Shares**

***General***

All of our issued and outstanding Ordinary Shares are fully paid and non-assessable. The Ordinary Shares are issued in registered form, and are issued when registered in our register of members. Unless the board of directors determine otherwise, each holder of our ordinary shares will not receive a certificate in respect of such ordinary shares. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Ordinary Shares. We may not issue shares to bearer.

***Dividends***

Subject to the Companies Act and our Memorandum and Articles of Association, our Company in general meeting may declare dividends in accordance with the respective rights of the Members but no dividend shall be declared in excess of the amount recommended by our board of directors.

Subject to the provisions of the Companies Act and any rights attaching to any class or classes of shares under and in accordance with the articles:

(i) the
 directors may declare dividends or distributions out of our funds which are lawfully available for that purpose; and;

(ii) our
 shareholders may, by ordinary resolution, declare dividends but no such dividend shall exceed the amount recommended by the directors

Subject to the requirements of the Companies Act regarding the application of a company's share premium account and with the sanction of an ordinary resolution, dividends may also be declared and paid out of any share premium account. The directors when paying dividends to shareholders may make such payment either in cash or in specie.

Unless provided by the rights attached to a share, no dividend shall bear interest.

***Voting Rights***

Subject to any special rights, restrictions or privileges as to voting for the time being attached to any class or classes of shares, unless any share carries special voting rights or unless a call or other amount presently payable has not been paid, at any general meeting: (a) on a poll every member present in person and every person representing a member by proxy or, in the case of a member being a corporation, by a duly authorised representative shall have one vote for every share ; and (b) on a show of hands every member who is present in person (or, in the case of a member being a corporation, by a duly authorised representative) and every person representing a member by proxy shall have one vote. No member is bound to vote on his shares or any of them nor is he bound to vote each of his Shares in the same way. All members holding shares of a particular class of shares are entitled to vote at a meeting of the holders of that class of Shares.

***Transfer of Ordinary Shares***

Subject to the Companies Act and our Memorandum and Articles of Association and provided that a transfer of ordinary shares complies with applicable rules of the Nasdaq (if such ordinary shares are listed on Nasdaq), a shareholder may transfer ordinary shares to another person by completing an instrument of transfer in the usual or common form or in a form prescribed by Nasdaq or in such other form as our board of directors may approve, executed:

● where the ordinary shares are fully paid, by or on behalf of that shareholder; and

● where the ordinary shares are partly paid, by or on behalf of that shareholder and the transferee.

The transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the register of members of our Company in respect of that share.

Our board of directors shall keep or cause to be kept a register of members as required by the Companies Act and may cause the Company to maintain one or more branch registers as contemplated by the Companies Act, provided that where the Company is maintaining one or more branch registers, the board of directors shall ensure that a duplicate of each branch register is kept with the Company's principal register of members and updated within such number of days of any amendment having been made to such branch register as may be required by the Companies Act. The title to shares listed on Nasdaq may be evidenced and transferred in accordance with the laws applicable to the rules and regulations of the Nasdaq and, for these purposes, the register of members may be maintained in accordance with Section 40B of the Companies Act.

Where the ordinary shares of any class in question are not listed on or subject to the rules of the Nasdaq, our board of directors may, in our absolute discretion, decline to register a transfer of any share (not being a fully paid up share) or on which our Company has a lien. It may also decline to register a transfer of any share issued unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the
 instrument of transfer is lodged with the Company, accompanied by the certificate (if any) for the shares to which it relates and
 such other evidence as the board of directors of the Company may reasonably require to show the right of the transferor to make the
 transfer;

(b) the
 instrument of transfer is in respect of only one class of shares;

(c) the
 instrument of transfer is properly stamped, if required;

(d) in
 the case of a transfer to joint holders, the number of joint holders to whom the share is to be transferred does not exceed four;

(e) the
 shares transferred are fully paid up and free of any lien in favour of the Company; and

(f) any
 applicable fee of such maximum sum as the Nasdaq may determine to be payable, or such lesser sum as the board of the directors of
 the Company may from time to time require, related to the transfer is paid to the Company.

The registration of transfers of shares or of any class of shares may, after compliance with any notice requirement of Nasdaq, be suspended at such times and for such periods (not exceeding in the whole thirty days in any year) as our board of directors may determine.

***Calls on Ordinary Shares and Forfeiture of Ordinary Shares***

Subject to our Memorandum and Articles of Association and to the terms of allotment, our board of directors may, from time to time, make such calls as it thinks fit upon the members in respect of any monies unpaid on the shares held by them respectively (subject to receiving at least 14 clear days' notice specifying when and where payment is to be made) pay to us the amount called on his shares. A call may provide for payment to be by instalments. If a call remains unpaid after it has become due and payable the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid: (a) at the rate fixed by the terms of allotment of the share or in the notice of the call; or (b) if no rate is fixed, at ten per cent per annum. The Directors may waive payment of the interest wholly or in part.

If a call remains unpaid after it has become due and payable, our board of directors may, give to the person from whom it is due not less than 14 days' notice requiring payment of: (a) the amount unpaid, (b) any interest which may have accrued and (c) any expenses which have been incurred by the Company due to that person's default. The notice shall state the following: the place where payment is to be made; and (b) a warning that if the notice is not complied with the Shares in respect of which the call is made will be liable to be forfeited.

If the requirements of any such notice are not complied with, the directors may, before the payment required by the notice has been made, resolve that any share the subject of that notice be forfeited. Such forfeiture will include all dividends or other monies payable in respect of the forfeited Share and not paid before the forfeiture.

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, nevertheless, remain liable to pay to our Company all monies which, at the date of forfeiture, were payable by him to our Company in respect of the shares together with all expenses and interest from the date of forfeiture or surrender until payment, but his liability shall cease if and when we receive payment in full of the unpaid amount.

***Redemption of Ordinary Shares***

Subject to the Companies Act, our Memorandum and Articles of Association, and, where applicable, the Nasdaq listing rules or any other law or so far as not prohibited by any law and subject to any rights conferred on the holders of any class of Shares, we may by action of our directors:

● issue shares that are to be redeemed or liable to be redeemed, at our option or the shareholder holding those redeemable shares, on the terms and in the manner our directors determine before the issue of those shares;

● with the consent by special resolution of the shareholders holding shares of a particular class, vary the rights attaching to that class of shares so as to provide that those shares are to be redeemed or are liable to be redeemed at our option on the terms and in the manner which the directors determine at the time of such variation; and

● purchase all or any of our own shares of any class including any redeemable shares on the terms and in the manner which the directors determine at the time of such purchase.

***Variations of Rights of Shares***

Subject to the Companies Act and without prejudice to our Memorandum and Articles of Association, if at any time the share capital of our Company is divided into different classes of shares, all or any of the special rights attached to any class of shares may (unless otherwise provided for by the terms of issue of the shares of that class) be varied either with the consent in writing of the holders of not less than two-thirds of the issued shares of that class, or with the sanction of a resolution passed by a majority of not less than two-thirds of the votes by the holders of shares of the class present in person or by proxy at a separate general meeting of the holders of shares of that class.

Any special rights conferred upon the holders of any shares or class of shares shall not, unless otherwise expressly provided in the rights attaching to the terms of issue of such shares, be deemed to be varied by the creation or issue of further shares ranking *pari passu* therewith.

***General Meetings of Shareholders***

Our Company not obligated by the Cayman Companies Act to call shareholders' annual general meetings; accordingly, we may, but shall not be obliged to, in each year hold a general meeting as an annual general meeting. Any annual general meeting held shall be held at such time and place as may be determined by our board of directors. All general meetings other than annual general meetings shall be called extraordinary general meetings.

The directors may convene general meetings whenever they think fit. General meetings may be convened on the written requisition of one or more members entitled to attend and vote at our general meetings who (together) hold at least one tenth of the rights to vote at such general meeting in accordance with the notice provisions in the articles, specifying the purpose of the meeting and signed by each of the shareholders making the requisition. If the directors do not convene such meeting within 21 clear days' from the date of receipt of the written requisition, those shareholders who requested the meeting or any of them may convene the general meeting themselves within three months after the end of such period of 21 clear days in which case reasonable expenses incurred by them as a result of the directors failing to convene a meeting shall be reimbursed by us.

Every general meeting of our Company shall be called by at least 5 clear days' notice in writing. The notice must specify the day and the hour, place of the meeting, whether the meeting will be held virtually, at a physical place or both, if the meeting is to be held in any part at a physical place, the address of such place, if the meeting is to be held in two or more places or in any part virtually, the Electronic Communication Facilities (as defined in our Memorandum and Articles of Association) that will be used to facilitate the meeting, including the procedures to be followed by any shareholder or other participant of the meeting who wishes to utilise such Electronic Communication Facilities for the purposes of attending and participating in such meeting and the general nature of that business.

Subject to the Companies Act, a meeting may be convened on shorter notice, subject to the Companies Act with the consent of the member or members who, individually or collectively, hold at least ninety per cent of the voting rights of all those who have a right to vote at that meeting:

Save as provided in the relevant Article of our Memorandum and Articles of Association, no business shall be transacted at any general meeting unless a quorum is present in person or by proxy.

The quorum for a general meeting shall be: (a) if the Company has only one member: that member; (b) if the Company has more than one member: subject to Article 11.1(b)(ii) of our Memorandum and Articles of Association, two or more members holding shares carrying the right to vote at such general meeting; or for so long as any shares are listed on Nasdaq, one or more members holding shares that represent not less than one-third of the outstanding shares carrying the right to vote at such general meeting.

***Inspection of Books and Records***

Our shareholders have no general right to inspect or obtain copies of the register of members or corporate records of our company. They will, however, have such rights as may be set out in our Memorandum and Articles of Association.

***Changes in Capital***

Subject to the Companies Act, our shareholders may, by ordinary resolution:

(a) increase
 our share capital by new shares of the amount fixed by that ordinary resolution and with the attached rights, priorities and privileges
 set out in that ordinary resolution;

(b) consolidate
 and divide all or any of our share capital into shares of larger amount than our existing shares;

(c) sub-divide
 our shares or any of them into our shares of smaller amount than is fixed by our Company's Memorandum and Articles of Association,
 so, however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced our shares
 shall be the same as it was in case of the share from which the reduced our shares is derived;

(d) cancel
 any shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person
 and diminish the amount of our share capital by the amount of the shares so cancelled or, in the case of shares without nominal par
 value, diminish the number of shares into which its capital is divided; and

(e) convert
 all or any of our paid-up shares into stock, and reconvert that stock into paid up shares of any denomination.

Subject to the Companies Act and to any rights for the time being conferred on the shareholders holding a particular class of shares, our shareholders may, by special resolution, reduce our share capital in any way.

**Certain Cayman Islands Company Considerations**

**Exempted Company**

We are an exempted company with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except for the exemptions and privileges listed below:

● an
 exempted company does not have to file an annual return of its shareholders with the Registrar of Companies in the Cayman Islands;

● an
 exempted company's register of members is not open to inspection;

● an
 exempted company does not have to hold an annual general meeting;

● an
 exempted company may obtain an undertaking against the imposition of any future taxation;

● an
 exempted company may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;

● an
 exempted company may register as a limited duration company; and

● an
 exempted company may register as a segregated portfolio company.

"Limited liability" means that the liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company.

**Differences in Corporate Law**

The Companies Act is modeled after that of England and Wales but does not follow recent statutory enactments in England. In addition, the Companies Act differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of the significant differences between the provisions of the Companies Act applicable to us and the laws applicable to companies incorporated in the State of Delaware.

This discussion does not purport to be a complete statement of the rights of holders of our Ordinary Shares under applicable law in the Cayman Islands or the rights of holders of the common stock of a typical corporation under applicable Delaware law.

***Mergers and Similar Arrangements***

 ****

The Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies provided that the laws of the foreign jurisdiction permit such merger or consolidation. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company, and (b) a "consolidation" means the combination of two or more constituent companies into a combined company and the vesting of the undertaking, property and liabilities of such companies to the combined company. In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company's articles of association. The plan must be filed with the Registrar of Companies of the Cayman Islands together with a declaration as to the solvency of the combined or surviving company, a statement setting out the assets and liabilities of each constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.

A merger between a Cayman Islands parent company and its Cayman subsidiary or subsidiaries does not require authorization by a resolution of shareholders. For this purpose a subsidiary is a company of which at least ninety percent (90%) of the issued shares entitled to vote are owned by the parent company.

The consent of each holder of a fixed or floating security interest over a constituent company is required unless this requirement is waived by a court in the Cayman Islands.

Save in certain circumstances, a dissentient shareholder of a Cayman constituent company is entitled to payment of the fair value of his shares upon dissenting to a merger or consolidation. The exercise of such dissenter rights will preclude the exercise by the dissenting shareholder of any other rights to which he or she might otherwise be entitled by virtue of holding shares, save for the right to seek relief on the grounds that the merger or consolidation is void or unlawful.

Separate from the statutory provisions relating to mergers and consolidations, the Companies Act also contains statutory provisions that facilitate the reconstruction and amalgamation of companies by way of schemes of arrangement, provided that the arrangement is approved by (i) seventy-five per cent. (75%) in value of shareholders or class of shareholders or (ii) a majority in number representing seventy-five per cent. (75%) in value of creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:

● the
 statutory provisions as to the required majority vote have been met;

● the
 shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion
 of the minority to promote interests adverse to those of the class;

● the
 arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest;
 and

● the
 arrangement is not one that would more properly be sanctioned under some other provision of the Companies Act.

The Companies Act also contains a statutory power of compulsory acquisition which may facilitate the "squeeze out" of dissentient minority shareholder upon a tender offer. When a tender offer is made and accepted by holders of ninety percent (90%) of the shares affected, the offeror may, within a two-month period after the approval by the said holders, require the holders of the remaining shares to transfer such shares to the offeror on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands.

If an arrangement and reconstruction is thus approved, the dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of Delaware corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

***Shareholders' Suits***

In principle, we will normally be the proper plaintiff and as a general rule a derivative action may not be brought by a minority shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, the Cayman Islands court can be expected to follow and apply the common law principles (namely the rule in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against or derivative actions in the name of the company to challenge actions where:

● a
 company acts or proposes to act illegally or ultra vires;

● the
 act complained of, although not ultra vires, could only be effected duly if authorized by more than a simple majority vote that has
 not been obtained; and

● those
 who control the company are perpetrating a "fraud on the minority".

***Indemnification of Directors and Executive Officers and Limitation of Liability***

Cayman Islands law does not limit the extent to which a company's memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against the indemnified person's own fraud or dishonesty or against the consequences of committing a crime.

Under Delaware corporate law, a corporation has the power to indemnify any director, officer, employee, or agent of corporation who was, is, or is threatened to be made a party to a proceeding (other than a derivative proceeding), by reason of the fact that such person is or was a director, officer, employee or agent of the corporation against all reasonably incurred expenses, judgments and amounts paid in settlement so long as the person acted in good faith and in a manner the person believed to be in, or not opposed to, the best interests of the corporation, and if with respect to a criminal proceeding, the person had no reasonable cause to believe that his or her conduct would be unlawful. A corporation has the power to indemnify a director, officer, employee or agent in connection with the defense or settlement of a derivative action against expenses reasonable and actually incurred provided such person acted in good faith and in a manner he or she reasonably believe to be in, or not opposed to, the corporation's best interest and if such person has been adjudged liable only if a court determines that the person is fairly and reasonably entitled to indemnification. To the extent a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any proceeding, such person shall be indemnified against expenses actually and reasonably incurred.

***Directors' Fiduciary Duties***

Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that a director act in a manner he or she reasonably believes to be in the best interests of the corporation. He or she must not use his or her corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interest of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, a director must prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.

As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he owes the following duties to the company — a duty to act bona fide in the best interests of the company, a duty not to make a profit based on his or her position as director (unless the company permits him to do so) and a duty not to put himself in a position where the interests of the company conflict with his or her personal interest or his or her duty to a third party. The common law duties owed by a director are those to act with skill, care and diligence that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company and, also, to act with the skill, care and diligence in keeping with a standard of care commensurate with any particular skill they have which enables them to meet a higher standard than a director without those skills.

***Shareholder Action by Written Consent***

Under the Delaware General Corporation Act, a corporation may eliminate the right of shareholders to act by written consent by amendment to its certificate of incorporation. The Cayman Companies Act allows a special resolution to be passed in writing if signed by all the being entitled to vote shareholders (if so authorized by the memorandum and articles of association).

***Shareholder Proposals***

Under the Delaware General Corporation Act, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided it complies with the notice provisions in the governing documents. A special meeting may be called by the board of directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.

The Companies Act does not have provisions governing the proceedings of shareholders meetings which are usually provided in the memorandum and articles of association.

***Cumulative Voting***

Under the Delaware General Corporation Act, cumulative voting for elections of directors is not permitted unless the corporation's certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single director, which increases the shareholder's voting power with respect to electing such director. There are no prohibitions in relation to cumulative voting under the Cayman Companies Act, but our Memorandum and Articles of Association do not provide for cumulative voting. As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.

***Removal of Directors***

Under the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Removal of directors are governed by the terms of the Memorandum and Articles of Association. Under the Memorandum and Articles of Association, directors may be removed by an ordinary resolution of our shareholders.

***Transactions with Interested Shareholders***

The Delaware General Corporation Act contains a business combination statute applicable to Delaware corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging in certain business combinations with an "interested shareholder" for three years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target's outstanding voting stock within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the target's board of directors.

Cayman Islands law has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such transactions must be entered into bona fide in the best interests of the company and for a proper corporate purpose and not with the effect of constituting a fraud on the minority shareholders.

***Dissolution; Winding Up***

Under the Delaware General Corporation Act, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation's outstanding shares. Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.

Under Cayman Islands law, a company may be wound up by either an order of the courts of the Cayman Islands or by a special resolution of its members or, if the company is unable to pay its debts as they fall due, by an ordinary resolution of its members. The court has authority to order winding up in a number of specified circumstances including where it is, in the opinion of the court, just and equitable to do so. Under the Companies Act and our Articles of Association, our company may be dissolved, liquidated or wound up by a special resolution of our shareholders.

***Variation of Rights of Shares***

Under the Delaware General Corporation Act, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under our Memorandum and Articles of Association, whenever our capital is divided into different classes of shares, the rights attaching to any class of share (unless otherwise provided by the terms of issue of the shares of that class) may be varied either with the consent in writing of the holders of not less than two-thirds of the issued shares of that class, or with the sanction of a resolution passed by a majority of not less than two-thirds of the votes by the holders of shares of the class present in person or by proxy at a separate general meeting of the holders of shares of that class.

***Amendment of Governing Documents***

Under the Delaware General Corporation Act, a corporation's governing documents may be amended with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. As permitted by Cayman Islands law, the Memorandum and Articles of Association may only be amended by a special resolution of our shareholders.

***Rights of Non-Resident or Foreign Shareholders***

There are no limitations imposed by our Memorandum and Articles of Association on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions in the Memorandum and Articles of Association governing the ownership threshold above which shareholder ownership must be disclosed.

***Anti-money Laundering — Cayman Islands***

In order to comply with legislation or regulations aimed at the prevention of money laundering, we are required to adopt and maintain anti-money laundering procedures and may require subscribers to provide evidence to verify their identity and source of funds. Where permitted, and subject to certain conditions, we may also delegate the maintenance of our anti-money laundering procedures (including the acquisition of due diligence information) to a suitable person.

We reserve the right to request such information as is necessary to verify the identity of a subscriber. In some cases the directors may be satisfied that no further information is required since an exemption applies under the Anti-Money Laundering Regulations (Revised) of the Cayman Islands, as amended and revised from time to time (the "Regulations"). Depending on the circumstances of each application, a detailed verification of identity might not be required where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the
 subscriber makes the payment for their investment from an account held in the subscriber's name at a recognized financial institution;
 or

(b) the
 subscriber is regulated by a recognized regulatory authority and is based or incorporated in, or formed under the law of, a recognized
 jurisdiction; or

(c) the
 application is made through an intermediary which is regulated by a recognized regulatory authority and is based in or incorporated
 in, or formed under the law of a recognized jurisdiction and an assurance is provided in relation to the procedures undertaken on
 the underlying investors.

For the purposes of these exceptions, recognition of a financial institution, regulatory authority, or jurisdiction will be determined in accordance with the Regulations by reference to those jurisdictions recognized by the Cayman Islands Monetary Authority as having equivalent anti-money laundering regulations.

In the event of delay or failure on the part of the subscriber in producing any information required for verification purposes, we may refuse to accept the application, in which case any funds received will be returned without interest to the account from which they were originally debited.

We also reserve the right to refuse to make any redemption payment to a shareholder if our directors or officers suspect or are advised that the payment of redemption proceeds to such shareholder might result in a breach of applicable anti-money laundering or other laws or regulations by any person in any relevant jurisdiction, or if such refusal is considered necessary or appropriate to ensure our compliance with any such laws or regulations in any applicable jurisdiction.

If any person resident in the Cayman Islands knows or suspects or has reason for knowing or suspecting that another person is engaged in criminal conduct or is involved with terrorism or terrorist property and the information for that knowledge or suspicion came to their attention in the course of their business in the regulated sector, or other trade, profession, business or employment, the person will be required to report such knowledge or suspicion to (i) a nominated officer (appointed in accordance with the Proceeds of Crime Act (Revised) of the Cayman Islands) or the Financial Reporting Authority of the Cayman Islands, pursuant to the Proceeds of Crime Act (Revised), if the disclosure relates to criminal conduct or money laundering or (ii) to a police constable or a nominated officer (pursuant to the Terrorism Act (Revised) of the Cayman Islands) or the Financial Reporting Authority, pursuant to the Terrorism Act (Revised), if the disclosure relates to involvement with terrorism or terrorist financing and terrorist property. Such a report shall not be treated as a breach of confidence or of any restriction upon the disclosure of information imposed by any enactment or otherwise.

***Data Protection in the Cayman Islands — Privacy Notice***

 ****

This privacy notice explains the manner in which we collect, process, and maintain personal data about our investors pursuant to the Data Protection Act (Revised) of the Cayman Islands, as amended from time to time and any regulations, codes of practice, or orders promulgated pursuant thereto (the "DPA").

We are committed to processing personal data in accordance with the DPA. In our use of personal data, we will be characterized under the DPA as a "data controller," whilst certain of our service providers, affiliates, and delegates may act as "data processors" under the DPA. These service providers may process personal information for their own lawful purposes in connection with services provided to us.

For the purpose of this privacy notice, "you" or "your" shall mean the subscriber and shall also include any individual connected to the subscriber.

By virtue of your investment in our Company, we and certain of our service providers may collect, record, store, transfer, and otherwise process personal data by which individuals may be directly or indirectly identified. We may combine personal data that you provide to us with personal data that we collect from, or about you. This may include personal data collected in an online or offline context including from credit reference agencies and other available public databases or data sources, such as news outlines, websites and other media sources and international sanctions lists.

Your personal data will be processed fairly and for lawful purposes, including (a) where the processing is necessary for us to perform a contract to which you are a party or for taking pre-contractual steps at your request, (b) where the processing is necessary for compliance with any legal, tax, or regulatory obligation to which we are subject, or (c) where the processing is for the purposes of legitimate interests pursued by us or by a service provider to whom the data are disclosed, or (d) where you otherwise consent to the processing of personal data for any other specific purpose. As a data controller, we will only use your personal data for the purposes for which we collected it. If we need to use your personal data for an unrelated purpose, we will contact you.

We anticipate that we will share your personal data with our service providers for the purposes set out in this privacy notice. We may also share relevant personal data where it is lawful to do so and necessary to comply with our contractual obligations or your instructions or where it is necessary or desirable to do so in connection with any regulatory reporting obligations. In exceptional circumstances, we will share your personal data with regulatory, prosecuting, and other governmental agencies or departments, and parties to litigation (whether pending or threatened), in any country or territory including to any other person where we have a public or legal duty to do so (e.g. to assist with detecting and preventing fraud, tax evasion, and financial crime or compliance with a court order).

Your personal data shall not be held by our Company for longer than necessary with regard to the purposes of the data processing.

We will not sell your personal data. Any transfer of personal data outside of the Cayman Islands shall be in accordance with the requirements of the DPA. Where necessary, we will ensure that separate and appropriate legal agreements are put in place with the recipient of that data.

We will only transfer personal data in accordance with the requirements of the DPA, and will apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental loss, destruction, or damage to the personal data.

If you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in relation to your investment into our Company, this will be relevant for those individuals and you should transmit this document to those individuals for their awareness and consideration.

You have certain rights under the DPA, including (a) the right to be informed as to how we collect and use your personal data (and this privacy notice fulfils our obligation in this respect), (b) the right to obtain a copy of your personal data, (c) the right to require us to stop direct marketing, (d) the right to have inaccurate or incomplete personal data corrected, (e) the right to withdraw your consent and require us to stop processing or restrict the processing, or not begin the processing of your personal data, (f) the right to be notified of a data breach (unless the breach is unlikely to be prejudicial), (g) the right to obtain information as to any countries or territories outside the Cayman Islands to which we, whether directly or indirectly, transfer, intend to transfer, or wish to transfer your personal data, general measures we take to ensure the security of personal data, and any information available to us as to the source of your personal data, (h) the right to complain to the Office of the Ombudsman of the Cayman Islands, and (i) the right to require us to delete your personal data in some limited circumstances.

If you do not wish to provide us with requested personal data or subsequently withdraw your consent, you may not be able to invest in our Company or remain invested in our Company as it will affect our ability to manage your investment.

If you consider that your personal data has not been handled correctly, or you are not satisfied with our responses to any requests you have made regarding the use of your personal data, you have the right to complain to the Cayman Islands' Ombudsman. The Ombudsman can be contacted by calling +1 (345) 946-6283 or by email at <u>info@ombudsman.ky</u>.

***Economic Substance Legislation of the Cayman Islands***

 ****

The Cayman Islands, together with several other non-European Union jurisdictions, have introduced legislation aimed at addressing concerns raised by the Council of the European Union as to offshore structures engaged in certain activities which attract profits without real economic activity. The International Tax Co-operation (Economic Substance) Act (Revised) (the "Substance Act") came into force in the Cayman Islands in January 2019introducing certain economic substance requirements for in-scope Cayman Islands entities which are engaged in certain "relevant activities." An exempted company incorporated in the Cayman Islands as is our Company is an in-scope Cayman Islands entity; however, it does not include an entity that is tax resident outside the Cayman Islands. Our Company being a holding company with no material operations will likely be subject to more limited substance requirements. However, as it is a new regime, it is anticipated that the Substance Act will evolve and be subject to further clarification and amendments. Failure to satisfy applicable requirements may subject us to penalties under the Substance Act.

E. Taxation

**Cayman Islands Taxation**

Pursuant to the Tax Concessions Act (Revised) of the Cayman Islands, our Company has obtained an undertaking from the Carbinet Office of the Cayman Islands: (a) that no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to our Company or its operations; and (b) in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall not be payable on or in respect of the shares, debentures or other obligations of our Company or by way of withholding in whole or in part of any relevant payment as defined in the Tax Concessions Act (Revised) of the Cayman Islands. The undertaking for our Company is for a period of 20 years from 27 May 2024.

The Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands. The Cayman Islands is a party to a double tax treaty entered with the United Kingdom in 2010 but is otherwise is not party to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

Payments of dividends and capital in respect of our Shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital to any holder of our Shares, nor will gains derived from the disposal of our Shares be subject to Cayman Islands income or corporation tax.

No stamp duty is payable in the Cayman Islands in respect of the issue of our Shares or on an instrument of transfer in respect of our Shares, so long as the instrument of transfer is not executed in, brought to, or produced before a court of the Cayman Islands.

**Singapore Tax Considerations**

The statements made herein regarding taxation are general in nature and based on certain aspects of current tax laws of Singapore and administrative guidelines issued by the relevant authorities in force as of the date of this annual report and are subject to any changes in such laws or administrative guidelines, or in the interpretation of these laws or guidelines, occurring after such date, which could be made on a retrospective basis. These laws and guidelines are also subject to various interpretations and the relevant tax authorities or the courts could later disagree with the explanations or conclusions set out below. The statements below are not to be regarded as advice on the tax position of any holder of our Shares or of any person acquiring, selling or otherwise dealing with our Shares or on any tax implications arising from the acquisition, sale or other dealings in respect of our Shares. The statements made herein do not purport to be a comprehensive or exhaustive description of all of the tax considerations that may be relevant to a decision to purchase, own or dispose of our Shares and do not purport to deal with the tax consequences applicable to all categories of investors, some of which (such as dealers in securities) may be subject to special rules. Prospective holders of our Shares are advised to consult their own tax advisers as to the Singapore or other tax consequences of the acquisition, ownership of or disposal of our Shares. It is emphasized that neither the Company nor any other persons involved in this annual report accepts responsibility for any tax consequences or liabilities resulting from the subscription for, purchase, holding or disposal of our Shares.

**Individual Income Tax**

Individual taxpayers who are Singapore tax residents are subject to tax on income accrued or derived from Singapore. All foreign-sourced income (except for income received through a partnership in Singapore) received on or after January 1, 2004 in Singapore by tax resident individuals will be exempt from tax. Certain Singapore-sourced investment income (such as interest from debt securities) derived by tax resident individuals on or after January 1, 2004 from certain financial instruments (other than income derived through a partnership in Singapore or from the carrying on of a trade, business or profession) will be exempt from tax.

A Singapore tax resident individual is taxed at progressive rates ranging from 0% to a maximum rate of 24% after deduction of qualifying personal reliefs where applicable, with effect from Year of Assessment ("YA") 2024 onwards.

Non-resident individuals are generally subject to income tax on income accrued in or derived from Singapore at flat rate of 15% or at the progressive resident rates ranging from 0% to a maximum rate of 24%, whichever yields a higher tax. A non-resident individual exercising a short-term employment in Singapore for not more than 60 days may be exempt from tax in Singapore. Such short-term employment exemption does not apply if the individual receives payment in the capacity of a board director, a public entertainer or a professional in Singapore or if the individual's absences from Singapore are incidental to his or her Singapore employment.

**Corporate Income Tax**

A company established outside Singapore but whose governing body, being the board of directors, usually exercises de facto control and management of its business in Singapore could be considered tax residents in Singapore. However, such control and management of the business should not be deemed to be in Singapore if physical board meetings are conducted outside of Singapore. Where board resolutions are passed in the form of written consent signed by the directors each acting in their own jurisdictions it is possible that the place of de facto control and management will be considered to be where the majority of the board are located when they sign such consent.

In addition, foreign-owned investment holding companies with purely passive sources of income and/ or receiving only foreign-sourced income (generally companies with 50% or more of their shares held by foreign companies or non-Singapore individual shareholders), the Inland Revenue Authority of Singapore may require the company to demonstrate decisions on strategic matters are made in Singapore and management of its business is exercised in Singapore when determining its tax residency status. Apart from demonstrating that decisions on strategic matters are made in Singapore, the company must also:

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| |
|:---|
| Have at least 1 director based in Singapore who holds an executive position and is not a nominee director; |
| Have at least 1 key employee (e.g. CEO, CFO, COO) based in Singapore; or |
| Be managed by a related company based in Singapore (e.g. the related company makes the decisions relating to the operations of the foreign-owned investment holding company or reviews the performance of the investments of the company) |

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A Singapore tax resident company is subject to Singapore income tax on income accruing in or derived from Singapore and on foreign-sourced income received or deemed to be received in Singapore, unless certain exemptions apply. If the foreign-sourced income is subject to tax in Singapore and overseas, tax reliefs may be available to alleviate the double taxation suffered.

Foreign-sourced income received or deemed to be received in Singapore by a Singapore tax resident company may be exempt from Singapore income tax pursuant to Section 13(8) of the Income Tax Act 1947 of Singapore under the tax exemption regime for specified foreign-sourced income, which includes foreign-sourced dividend, foreign branch profits and foreign-sourced service income, provided that the prescribed qualifying conditions are satisfied.

The prevailing corporate income tax rate in Singapore is 17%. Under the tax exemption scheme for new start-up companies, qualifying newly incorporated companies may enjoy tax exemption on 75% of the first S$100,000 of normal chargeable income and 50% of the next S$100,000 of normal chargeable income for each of the company's first three consecutive YAs falling in or after YA 2020.

To qualify for the new start-up companies tax exemption scheme, the company must be incorporated in Singapore, be a tax resident in Singapore for that YA and have no more than 20 shareholders throughout the basis period for that YA, with at least one shareholder being an individual holding at least 10% of the issued ordinary shares. The new start-up companies tax exemption scheme does not apply to investment holding companies or companies engaged in property development for sale, investment or both.

From YA 2020 onwards, companies that do not qualify for the start-up tax exemption scheme may instead benefit from the partial tax exemption scheme. Under the partial tax exemption scheme, 75% of the first S$10,000 of normal chargeable income and 50% of the next S$190,000 of normal chargeable income are exempt from corporate income tax.

As announced in Singapore Budget 2026, a corporate income tax rebate will be granted for YA 2026. Eligible companies will receive a rebate equivalent to 40% of their corporate income tax payable for YA 2026, subject to a maximum benefit of S$30,000 per company. Active companies that employed at least one local employee in the 2025 calendar year may receive a minimum benefit of S$1,500 in the form of a CIT Rebate Cash Grant, even if their tax payable is reduced by existing exemptions and reliefs. The CIT rebate will be applied automatically by the Inland Revenue Authority of Singapore based on the company's estimated chargeable income and tax return filings for YA 2026, and no separate application is required.

**Dividend Distributions**

Under Singapore's one-tier corporate tax system, dividends paid by a Singapore tax resident company are exempt from Singapore income tax in the hands of its shareholders, regardless of whether the shareholder is a company or an individual and whether or not the shareholder is a Singapore tax resident. As such, no Singapore withholding tax is imposed on the payment of such dividends.

**Gains on Disposal of our Shares**

Under Section 10L of the Singapore Income Tax Act, which became effective on January 1, 2024, foreign-sourced gains derived from the sale or disposal of a foreign asset and received in Singapore by an entity that is a member of a relevant group may be treated as income chargeable to tax under Section 10(1)(g) of the Singapore Income Tax Act.

For purposes of Section 10L, "foreign-sourced disposal gains" generally refer to gains derived from the sale or disposal of movable or immovable property situated outside Singapore. A group will be regarded as a relevant group if the entities within the group are not all incorporated, registered or established in Singapore, or if any entity within the group has a place of business outside Singapore. For these purposes, an entity includes any legal person (other than an individual), as well as a general partnership, limited partnership or trust.

Foreign-sourced disposal gains will generally be subject to tax in Singapore only if they are received in Singapore by an entity that does not have adequate economic substance in Singapore and where the sale or disposal of the foreign asset occurs on or after January 1, 2024. Foreign-sourced disposal gains derived by foreign entities (that is, entities incorporated, registered or established outside Singapore) that do not operate in or from Singapore will generally fall outside the scope of Section 10L.

Investors should consult their own tax advisers regarding the tax consequences of any gains arising from the disposition of our ordinary shares.

Corporate shareholders that are subject to Singapore income tax treatment under Section 34A or 34AA of the Singapore Income Tax Act in connection with the adoption of Singapore Financial Reporting Standard 39 (FRS 39) or Singapore Financial Reporting Standard 109 (FRS 109) may, for accounting purposes, be required to recognize gains or losses (other than capital gains or losses) even if there has been no sale or disposal of our ordinary shares. Such corporate shareholders should consult their own accounting and tax advisers regarding the Singapore income tax implications of acquiring, holding, or disposing of our ordinary shares as a result of the adoption of FRS 39 or FRS 109.

Shareholders should consult their own tax advisers regarding the Singapore tax consequences of the acquisition, ownership and disposition of our ordinary shares arising from the adoption of FRS19 or FRS109.

**Estate Duty**

Singapore estate duty was abolished with respect to all deaths occurring on or after February 15, 2008.

**Shareholders, whether or not domiciled in Singapore, should consult their own tax advisors regarding the Singapore tax consequences.**

**Certain United States Federal Income Tax Considerations**

The following discussion is a summary of U.S. federal income tax considerations generally applicable to U.S. Holders (as defined below) of the ownership and disposition of our Shares. This summary applies only to U.S. Holders that hold our Shares as capital assets (generally, property held for investment) and that have the U.S. dollar as their functional currency. This summary is based on U.S. tax laws in effect as of the date of this annual report, on U.S. Treasury regulations in effect or, in some cases, proposed as of the date of this annual report, and judicial and administrative interpretations thereof available on or before such date. All of the foregoing authorities are subject to change, which could apply retroactively and could affect the tax consequences described below. No ruling has been sought from the Internal Revenue Service ("**IRS**") with respect to any U.S. federal income tax considerations described below, and there can be no assurance that the IRS or a court will not take a contrary position. Moreover, this summary does not address the U.S. federal estate, gift, backup withholding, and alternative minimum tax considerations, or any state, local, and non-U.S. tax considerations, relating to the ownership and disposition of our Shares. The following summary does not address all aspects of U.S. federal income taxation that may be important to particular investors in light of their individual circumstances or to persons in special tax situations such as:

● financial institutions or financial services entities;

● underwriters;

● insurance companies;

● pension plans;

● cooperatives;

● regulated investment companies;

● real estate investment trusts;

● grantor trusts;

● broker-dealers;

● traders that elect to use a mark-to-market method of accounting;

● governments or agencies or instrumentalities thereof;

● certain former U.S. citizens or long-term residents;

● tax-exempt entities (including private foundations);

● persons liable for alternative minimum tax;

● persons holding stock as part of a straddle, hedging, conversion or other integrated transaction;

● persons whose functional currency is not the U.S. dollar;

● passive foreign investment companies;

● controlled foreign corporations;

● the Company's officers or directors;

● holders who are not U.S. Holders;

● persons that actually or constructively own 5% or more of the total combined voting power of all classes of our voting stock; or

● partnerships or other entities taxable as partnerships for U.S. federal income tax purposes, or persons holding Shares through such entities.

For purposes of this discussion, a "U.S. Holder" is a beneficial owner of our Shares that is, for U.S. federal income tax purposes:

● an individual who is a citizen or resident of the United States;

● a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in the United States or under the laws of the United States, any state thereof or the District of Columbia;

● an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or

● a trust that (1) is subject to the primary supervision of a court within the United States and the control of one or more U.S. persons for all substantial decisions, or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

If a partnership (or other entity treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of our Shares, the tax treatment of a partner in the partnership will generally depend upon the status of the partner and the activities of the partnership. Partnerships holding our Shares and their partners are urged to consult their tax advisors regarding an investment in our Shares.

**Persons considering an investment in our Shares should consult their own tax advisors as to the particular tax consequences applicable to them relating to the purchase, ownership and disposition of our Shares including the applicability of U.S. federal, state and local tax laws and non-U.S. tax laws.**

**Taxation of Dividends and Other Distributions on Our Shares**

As discussed under "*Dividend Policy*" above, we have not previously declared or paid cash dividends and there is no guarantee that we will declare or pay any dividends in the near future on our shares, however, we may pay out dividends where we assess that we have sufficient available funds. Subject to the PFIC rules discussed below, a U.S. Holder generally will be required to include in gross income, in accordance with such U.S. Holder's method of accounting for United States federal income tax purposes, as dividends the amount of any distribution paid on the Shares to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined under United States federal income tax principles). Such dividends paid by us will be taxable to a corporate U.S. Holder as dividend income and will not be eligible for the dividends-received deduction generally allowed to domestic corporations in respect of dividends received from other domestic corporations. Dividends received by certain non-corporate U.S. Holders (including individuals) may be "qualified dividend income," which is taxed at the lower capital gains rate, provided that our Shares are readily tradable on an established securities market in the United States and the U.S. Holder satisfies certain holding periods and other requirements. In this regard, Shares generally are considered to be readily tradable on an established securities market in the United States if they are listed on Nasdaq, as our Shares are expected to be.

Distributions in excess of such earnings and profits generally will be applied against and reduce the U.S. Holder's basis in its Shares (but not below zero) and, to the extent in excess of such basis, will be treated as gain from the sale or exchange of such Shares. In the event that we do not maintain calculations of our earnings and profits under United States federal income tax principles, a U.S. Holder should expect that all cash distributions will be reported as dividends for United States federal income tax purposes. U.S. Holders should consult their own tax advisors regarding the availability of the lower rate for any cash dividends paid with respect to our Shares.

Dividends will generally be treated as income from foreign sources for U.S. foreign tax credit purposes and will generally constitute passive category income. Depending on the U.S. Holder's individual facts and circumstances, a U.S. Holder may be eligible, subject to a number of complex limitations, to claim a foreign tax credit not in excess of any applicable treaty rate in respect of any foreign withholding taxes imposed on dividends received on our Shares. A U.S. Holder who does not elect to claim a foreign tax credit for foreign tax withheld may instead claim a deduction, for U.S. federal income tax purposes, in respect of such withholding, but only for a year in which such U.S. Holder elects to do so for all creditable foreign income taxes. The rules governing the foreign tax credit are complex and their outcome depends in large part on the U.S. Holder's individual facts and circumstances. Accordingly, U.S. Holders are urged to consult their tax advisors regarding the availability of the foreign tax credit under their particular circumstances.

**Taxation of Sale or Other Disposition of Our Shares**

Subject to the discussion below under "Passive Foreign Investment Company Rules," a U.S. Holder will generally recognize capital gain or loss upon the sale or other disposition of our Shares in an amount equal to the difference between the amount realized upon the disposition and the U.S. Holder's adjusted tax basis in such Shares. Any capital gain or loss will be long term if the Shares have been held for more than one year and will generally be U.S.-source gain or loss for U.S. foreign tax credit purposes. Long-term capital gains of non-corporate taxpayers are currently eligible for reduced rates of taxation. The deductibility of a capital loss may be subject to limitations. U.S. Holders are urged to consult their tax advisors regarding the tax consequences if a foreign tax is imposed on a disposition of our Shares, including the availability of the foreign tax credit under their particular circumstances.

***<u>Passive Foreign Investment Company Rules</u>***

A non-U.S. corporation, such as our company, will be classified as a PFIC, for U.S. federal income tax purposes for any taxable year, if either (i) 75% or more of its gross income for such year consists of certain types of "passive" income or (ii) 50% or more of the value of its assets (determined on the basis of a quarterly average) during such year is attributable to assets that produce or are held for the production of passive income. For this purpose, cash and cash equivalents are categorized as passive assets and the company's goodwill and other unbooked intangibles are taken into account as non-passive assets. Passive income generally includes, among other things, dividends, interest, rents, royalties, and gains from the disposition of passive assets. We will be treated as owning a proportionate share of the assets and earning a proportionate share of the income of any other corporation in which we own, directly or indirectly, more than 25% (by value) of the stock.

No assurance can be given as to whether we may be or may become a PFIC, as this is a factual determination made annually that will depend, in part, upon the composition of our income and assets. Under circumstances where our revenue from activities that produce passive income significantly increase relative to our revenue from activities that produce non-passive income, or where we determine not to deploy significant amounts of cash for active purposes, our risk of becoming classified as a PFIC may substantially increase. In addition, because there are uncertainties in the application of the relevant rules, it is possible that the IRS may challenge our classification of certain income and assets as non-passive or our valuation of our tangible and intangible assets, each of which may result in our becoming a PFIC for the current or subsequent taxable years. If we were classified as a PFIC for any year during which a U.S. Holder held our Shares, we generally would continue to be treated as a PFIC for all succeeding years during which such U.S. Holder held our Shares even if we cease to be a PFIC in subsequent years, unless certain elections are made. Our U.S. counsel expresses no opinion with respect to our PFIC status for any taxable year.

If we are classified as a PFIC for any taxable year during which a U.S. Holder holds our Shares, and unless the U.S. Holder makes a mark-to-market election (as described below), the U.S. Holder will generally be subject to special tax rules that have a penalizing effect, regardless of whether we remain a PFIC, on (i) any excess distribution that we make to the U.S. Holder (which generally means any distribution paid during a taxable year to a U.S. Holder that is greater than 125 percent of the average annual distributions paid in the three preceding taxable years or, if shorter, the U.S. Holder's holding period for the Shares), and (ii) any gain realized on the sale or other disposition of Shares. Under these rules,

● the
 U.S. Holder's gain or excess distribution will be allocated ratably over the U.S. Holder's holding period for the Shares;

● the
 amount allocated to the current taxable year and any taxable years in the U.S. Holder's holding period prior to the first taxable
 year in which we are classified as a PFIC (each, a "pre-PFIC year"), will be taxable as ordinary income;

● the
 amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect
 for individuals or corporations, as appropriate, for that year; and

● an
 additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed in respect of the tax attributable
 to each prior taxable year, other than a pre-PFIC year, of the U.S. Holder.

If we are treated as a PFIC for any taxable year during which a U.S. Holder holds our Shares, or if any of our subsidiaries is also a PFIC, such U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of any lower-tier PFICs for purposes of the application of these rules. U.S. Holders are urged to consult their tax advisors regarding the application of the PFIC rules to any of our subsidiaries.

As an alternative to the foregoing rules, a U.S. Holder of "marketable stock" in a PFIC may make a mark-to-market election with respect to such stock, provided that such stock is "regularly traded" within the meaning of applicable U.S. Treasury regulations. If our Shares qualify as being regularly traded, and an election is made, the U.S. Holder will generally (i) include as ordinary income for each taxable year that we are a PFIC the excess, if any, of the fair market value of Shares held at the end of the taxable year over the adjusted tax basis of such Shares and (ii) deduct as an ordinary loss the excess, if any, of the adjusted tax basis of the Shares over the fair market value of such Shares held at the end of the taxable year, but such deduction will only be allowed to the extent of the amount previously included in income as a result of the mark-to-market election. The U.S. Holder's adjusted tax basis in the Shares would be adjusted to reflect any income or loss resulting from the mark-to-market election. If a U.S. Holder makes a mark-to-market election in respect of a corporation classified as a PFIC and such corporation ceases to be classified as a PFIC, the U.S. Holder will not be required to take into account the gain or loss described above during any period that such corporation is not classified as a PFIC. If a U.S. Holder makes a mark-to-market election, any gain such U.S. Holder recognizes upon the sale or other disposition of our Shares in a year when we are a PFIC will be treated as ordinary income and any loss will be treated as ordinary loss, but such loss will only be treated as ordinary loss to the extent of the net amount previously included in income as a result of the mark-to-market election.

Because a mark-to-market election cannot be made for any lower-tier PFICs that we may own, a U.S. Holder may continue to be subject to the PFIC rules with respect to such U.S. Holder's indirect interest in any investments held by us that are treated as an equity interest in a PFIC for U.S. federal income tax purposes.

Furthermore, as an alternative to the foregoing rules, a U.S. Holder that owns stock of a PFIC generally may make a "qualified electing fund" election regarding such corporation to elect out of the PFIC rules described above regarding excess distributions and recognized gains. However, we do not intend to provide information necessary for U.S. Holders to make qualified electing fund elections which, if available, would result in tax treatment different from the general tax treatment for PFICs described above.

If a U.S. Holder owns our Shares during any taxable year that we are a PFIC, the U.S. Holder must generally file an annual IRS Form 8621 and provide such other information as may be required by the U.S. Treasury Department, whether or not a mark-to-market election is or has been made. If we are or become a PFIC, you should consult your tax advisor regarding any reporting requirements that may apply to you.

You should consult your tax advisors regarding how the PFIC rules apply to your investment in our Shares.

**Information Reporting and Backup Withholding**

Certain U.S. Holders are required to report information to the IRS relating to an interest in "specified foreign financial assets," including shares issued by a non-United States corporation, for any year in which the aggregate value of all specified foreign financial assets exceeds $50,000 (or a higher dollar amount prescribed by the IRS), subject to certain exceptions (including an exception for shares held in custodial accounts maintained with a U.S. financial institution). These rules also impose penalties if a U.S. Holder is required to submit such information to the IRS and fails to do so.

In addition, dividend payments with respect to our Shares and proceeds from the sale, exchange or redemption of our Shares may be subject to additional information reporting to the IRS and possible U.S. backup withholding. Backup withholding will not apply, however, to a U.S. Holder who furnishes a correct taxpayer identification number and makes any other required certification on IRS Form W-9 or who is otherwise exempt from backup withholding. U.S. Holders who are required to establish their exempt status generally must provide such certification on IRS Form W-9. U.S. Holders are urged to consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against your U.S. federal income tax liability, and you may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the IRS and furnishing any required information. We do not intend to withhold taxes for individual Shareholders. However, transactions effected through certain brokers or other intermediaries may be subject to withholding taxes (including backup withholding), and such brokers or intermediaries may be required by law to withhold such taxes.

**EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING THE PARTICULAR U.S. FEDERAL, STATE, LOCAL AND NON-U.S. TAX CONSEQUENCES OF PURCHASING, HOLDING AND DISPOSING OF OUR SHARES, INCLUDING THE CONSEQUENCES OF ANY PROPOSED CHANGE IN APPLICABLE LAWS.**

F. Dividends and Paying Agents

Not applicable.

G. Statement by Experts

Not applicable.

H. Documents on Display

We have previously filed with the SEC our Registration Statement on Form F-1, as amended (File Number: 333-281693).

We are subject to the periodic reporting and other informational requirements of the Exchange Act. Under the Exchange Act, we are required to file reports and other information with the SEC. Specifically, we are required to file annually a Form 20-F within four months after the end of each fiscal year. Copies of reports and other information, when so filed, may be inspected without charge and may be obtained at prescribed rates at the public reference facilities maintained by the SEC at Judiciary Plaza, 100 F Street, N.E., Washington, D.C. 20549. The public may obtain information regarding the Washington, D.C. Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains a website at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding registrants that make electronic filings with the SEC using its EDGAR system. As a foreign private issuer, we are exempt from the rules of the Exchange Act prescribing, among other things, the furnishing and content of proxy statements to shareholders, and our executive officers, directors and principal shareholders are exempt from the short-swing profit recovery provisions contained in Section 16 of the Exchange Act.

I. Subsidiary Information

For a listing of our subsidiaries, see "Item 4. Information on the Company—A. History and Development of the Company."

**Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

 ****

Foreign Exchange Risk

We have significant exposure to exchange rate fluctuations, both due to translation and transaction exposures. Translation exposures arise from measuring income statements of foreign subsidiaries with functional currencies other than the U.S. dollar. Transaction exposures involve impact from (i) input costs that are denominated in currencies other than the local reporting currency and (ii) revaluation of working capital balances denominated in currencies other than the functional currency. We leverage our diversified portfolio of exposures as a natural hedge. In certain cases, we enter into non-qualifying foreign currency contracts to hedge certain balance sheet items subject to revaluation. The change in fair value of these instruments and the underlying exposure are both immediately recognized in earnings, substantially offsetting the foreign currency mark-to-market impact of the related exposure.

Currently we have a foreign currency hedging policy. We monitor foreign exchange exposure and will consider hedging significant foreign exchange exposure should the need arise.

Concentration and credit risk

The Company is exposed to the following concentrations of risks:

(a) Major customers

For the years ended December 31, 2023, 2024 and 2025, the customers who accounted for more than 10% of the Company's total revenues are presented as follows:

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| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Customer A | 24% | 25% | 25% |
| Customer B | 12% | 10% | 8% |

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As of December 31, 2024 and 2025, accounts receivable due from these customers which accounted for more than 10% of the total consolidated accounts receivable, respectively are presented as follows:

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| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Customer A | 38% | 32% |
| Customer B | 19% | 15% |

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(b) Major vendors

For the years ended December 31, 2023, 2024 and 2025, the vendors who accounted for more than 10% of the Company's cost of goods sold are presented as follows:

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| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Vendor A, related party | 45% | 42% | 38% |
| Vendor B, related party | 29% | 30% | 31% |
| Vendor C, related party | 14% | 13% | 11% |

---

As of December 31, 2024 and 2025, accounts payable due to these vendors which accounted for more than 10% of the total consolidated accounts payable, respectively are presented as follows:

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Vendor A, related party | 15% | 6% |
| Vendor B, related party | 43% | 40% |
| Vendor C, related party | 24% | 21% |

---

The major vendors of the Company are located in China.

 ****

Interest Rate Risk

The Company is exposed to interest rate risk primarily relating to the fixed-rate trading financing and factoring facility. The Company has not used any derivative instruments to mitigate its exposure associated with interest rate risk. However, the management monitors interest rate exposure and will consider other necessary actions when significant interest rate exposure is anticipated.

 ****

Inflation Risk

After peaking during the post-pandemic period of 2022–2023, when supply-chain disruptions, labor shortages, and elevated energy and commodity prices drove inflation to historically high levels, global inflation has continued to ease through 2024 and into 2025 and remains significantly below its prior peak. Despite this moderation, inflation levels in many markets remain elevated relative to long-term averages. Persistently higher prices can erode consumers' real disposable incomes and weaken consumer confidence, which may lead households to defer, scale back, or reprioritize discretionary spending on home furnishings. As a result, consumers may become increasingly price sensitive, favoring lower-cost alternatives or delaying purchase decisions altogether. This shift in purchasing behavior could place downward pressure on our product pricing and sales volumes, adversely affecting the Company's revenue and profitability. In addition, inflationary pressures may increase the costs of raw materials, labor, transportation, energy, and other goods and services required to operate and expand the business. If the Company is unable to fully pass these higher input costs on to customers in a timely manner, margins and overall financial performance may be negatively impacted.

**Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES**

A. Debt Securities

Not applicable.

B. Warrants and Rights

Not applicable.

C. Other Securities

Not applicable.

D. American Depositary Shares

Not applicable.

**Part II**

**Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES**

None.

**Item 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS**

See "Item 10. Additional Information" for a description of the rights of securities holders, which remain unchanged.

**Use of Proceeds**

 ****

***Registration Statement on Form F-1, as amended (File Number 333-281693)***

The following "Use of Proceeds" information relates to the registration statement on Form F-1, as amended (File Number 333- 281693) for our initial public offering, which was declared effective by the SEC on September 30, 2024. On October 2, 2024, we completed our initial public offering in which we issued and sold an aggregate of 1,437,500 Shares, which was inclusive of the fully-exercised over-allotment option to purchase an additional 187,500 Shares, at a price of $4.00 per share, raising an aggregate total of $5,750,000, before deducting underwriting discounts and other offering expenses.

The net proceeds raised from the initial public offering were approximately US$3,554,110 after deducting underwriting discounts and all offering expenses paid or payable by us. As of the date of this annual report, we have used approximately US$3,416,133 from the net proceeds for funding working capital and other general corporate purposes. None of the expenses included payments to our directors or officers or their associates, or persons owning more than 10% or more of our equity securities or our affiliates.

Save as disclosed in this annual report, none of the net proceeds from the initial public offering were paid, directly or indirectly, to any of our directors or officers or their associates, persons owning 10% or more of our equity securities or our affiliates.

**Item 15. CONTROLS AND PROCEDURES**

(a) Disclosure
 Controls and Procedures.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report, as required by Rule 13a-15(b) under the Exchange Act.

Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer has concluded that, as of December 31, 2025, our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) were effective.

(b) Management's
 annual report on internal control over financial reporting.

As required by SEC rules and regulations implementing Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of Exchange Act). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external reporting purposes in accordance with GAAP. Our internal control over financial reporting includes those policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect errors or misstatements in our financial statements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree or compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of our internal control over financial reporting at December 31, 2025. In making these assessments, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013). Based on our assessments and those criteria as described above, and given that no material weaknesses were identified in our disclosure controls, management determined that we maintain an effective internal control over financial reporting as of December 31, 2025.

(c) Attestation
 report of the registered public accounting firm.

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting as we are an emerging growth company under the JOBS Act. Management's report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC.

(d) Changes
 in internal control over financial reporting.

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the year ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

**Item 16. [RESERVED]**

<u>Item 16A. AUDIT COMMITTEE FINANCIAL EXPERT</u>

Jun Wang qualifies as an "audit committee financial expert" as defined in Item 16A of Form 20-F. Mr. Wang satisfies the "independence" requirements of Section 5605(a)(2) of the NASDAQ Listing Rules as well as the independence requirements of Rule 10A-3 under the Exchange Act.

Item 16B. CODE OF ETHICS

In connection with our IPO, we have adopted a code of business conduct and ethics, which is applicable to all of our directors, executive officers and employees and is publicly available on our website at https://investors.homestolife.com/governance.

Item 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table sets forth the aggregate fees by categories specified below in connection with certain professional services rendered and billed by Audit Alliance LLP and CLA Global TS Public Accounting Corporation, our independent registered public accounting firms. Audit Alliance LLP ceased to be our independent registered public accounting firm on June 5, 2025. On June 6, 2025, we appointed CLA Global TS Public Accounting Corporation as our independent registered public accounting firm. The Company's decision of the change of the Company's independent registered public accounting firm was not the result of any disagreement between the Company and Audit Alliance on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure.

 ****

---

| | | | |
|:---|:---|:---|:---|
|  | For the Fiscal Years Ended December 31, | For the Fiscal Years Ended December 31, | For the Fiscal Years Ended December 31, |
|  | 2025 | 2024 | 2023 |
| Audit fees<sup>(1)</sup> | 398546 | 732850 |  |
| - Annual audit fee | 333333 | 190000 |  |
| - Interim audit fee | 65213 | 54500 |  |
| - IPO audit fees<sup>(2)</sup> |  | 488350 |  |
| Audit-Related fees |  |  |  |
| Tax fees |  |  |  |
| All other fees<sup>(3)</sup> | - | - |  |
| Total | 398546 | 732850 |  |

---

(1) Audit
 fees include the aggregate fees billed for each of the fiscal years for professional services rendered by Audit Alliance LLP for
 the audit of our annual financial statements and for the audits of our financial statements and review of the interim financial statements
 in connection with our initial public offering in 2024 and up to the date they ceased to be our independent registered public accounting
 firm on June 5, 2025. The interim audit fee during the fiscal year ended December 31, 2025 was billed by CLA Global TS Public Accounting
 Corporation for the review of the interim financial statements after June 5, 2025.

(2) IPO
 audit fees cover the fiscal year ended December 31, 2024 for the audits of our financial statements in connection with our initial
 public offering in 2024.

(3) All
 other fees include the aggregate fees billed in each of the fiscal years for products and services provided by our independent registered
 public accounting firm, other than the services reported under audit fees, audit-related fees, and tax fees.

The audit committee of our board of directors has established its pre-approval policies and procedures, pursuant to which the audit committee approved the foregoing audit, tax, and non-audit services provided by Audit Alliance LLP and CLA Global TS Public Accounting Corporation, in the fiscal years as described above. Consistent with our audit committee's responsibility for engaging our independent auditors, all audit and permitted non-audit services require pre-approval by the audit committee. The full audit committee approves proposed services and fee estimates for these services. One or more independent directors serving on the audit committee may be delegated by the full audit committee to pre-approve any audit and non-audit services. Any such delegation shall be presented to the full audit committee at its next scheduled meeting. Pursuant to these procedures, the audit committee approved the foregoing audit services provided by Audit Alliance LLP and CLA Global TS Public Accounting Corporation.

**Item 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES**

Not applicable.

**Item 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS**

None.

**Item 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT**

Previously disclosed.

**Item 16G. CORPORATE GOVERNANCE**

As a company incorporated in the Cayman Islands with limited liability that is listed on the Nasdaq Capital Market, we are subject to the Nasdaq corporate governance listing standards. Nasdaq rules, however, permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the Nasdaq corporate governance listing standards.

Nasdaq Listing Rule 5635 generally provides that shareholder approval is required of U.S. domestic companies listed on Nasdaq prior to issuance (or potential issuance) of securities (i) equaling 20% or more of the company's common stock or voting power for less than the greater of market or book value; (ii) resulting in a change of control of the company; and (iii) which is being issued pursuant to a stock option or purchase plan to be established or materially amended or other equity compensation arrangement made or materially amended. Notwithstanding this general requirement, Nasdaq Listing Rule 5615(a)(3)(A) permits foreign private issuers to follow their home country practice rather than these shareholder approval requirements. The Cayman Islands do not require shareholder approval prior to any of the foregoing types of issuances. We, therefore, are not required to obtain such shareholder approval prior to entering into a transaction with the potential to issue securities as described above.

Nasdaq Listing Rule 5605(b)(1) requires listed companies to have, among other things, a majority of its board members be independent. As a foreign private issuer, however, we are permitted to, and we may follow home country practice in lieu of the above requirements. The corporate governance practice in our home country, the Cayman Islands, does not require a majority of our board to consist of independent directors. Currently, a majority of our board members are independent. However, if we change our board composition such that independent directors do not constitute a majority of our board of directors, our shareholders may be afforded less protection than they would otherwise enjoy under Nasdaq's corporate governance requirements applicable to U.S. domestic issuers. See "Item 3. Key Information—D. Risk Factors—Risks related to Our Corporate Structure and Our Securities — As a company incorporated in the Cayman Islands, we may adopt certain home country practices in relation to corporate governance matters that differ significantly from corporate governance requirements of Nasdaq. These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance requirements of Nasdaq."

Other than those described above, there are no significant differences between our corporate governance practices and those followed by U.S. domestic companies under Nasdaq corporate governance listing standards.

Item 16H. MINE SAFETY DISCLOSURE

Not applicable.

Item 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

Item 16J. Insider trading policies

Our insider trading policy was adopted by our Board on March 28, 2025, and is exhibited to this annual report.

<u>Item 16K. Cybersecurity</u>

*Risk Management and Strategy*

We identify and assess material risks from cybersecurity threats to our information systems and the information residing in our information systems by monitoring and evaluating our threat environment on an ongoing basis using various methods including, for example, using manual and automated tools, subscribing to reports and services that identify cybersecurity threats, analyzing reports of threats and threat actors, conducting scans of the threat environment, and conducting risk assessments.

We manage material risks from cybersecurity threats to our information systems and the information residing in our information systems through various processes and procedures, including, depending on the environment, risk assessment, incident detection and response, vulnerability management, disaster recovery and business continuity plans, internal controls within our accounting and financial reporting functions, encryption of data, network security controls, access controls, physical security, asset management, systems monitoring, and employee training. We engage third-party service providers to provide some of the resources used in our information systems and some third-party service providers have access to information residing in our information systems. With respect to such third parties, we seek to engage reliable, reputable service providers that maintain cybersecurity programs. Depending on the nature and extent of the services provided, the sensitivity and quantity of information processed, and the identity of the service provider, our processes may include conducting due diligence on the cybersecurity practices of such provider and contractually imposing cybersecurity related obligations on the provider.

We are not aware of any risks from cybersecurity threats, including as a result of any cybersecurity incidents, which have materially affected or are reasonably likely to materially affect our Group, including our business strategy, results of operations, or financial condition. Refer to "Item 3. Key Information—D. Risk Factors—Risks Related to Our Business in General — A cybersecurity attack, data breach or other security incident could impact our sites, networks, systems, platforms, confidential information and assets causing damage and substantial harm to our business and operating results, reputation and brand, and resulting in proceedings or actions against us by government regulatory bodies or private parties."

*Cybersecurity Governance*

Our Board of Directors holds oversight responsibility over our Group's risk management and strategy, including material risks related to cybersecurity threats. This oversight is executed directly by our board of directors and through its committees. Our audit committee oversees the management of our Group's major financial risk exposures, the steps management has taken to monitor and control such exposures, and the process by which risk assessment and management is undertaken and handled, which would include cybersecurity risks, in accordance with its charter. The audit committee holds regular meetings and receives periodic reports from management regarding risk management, including major financial risk exposures from cybersecurity threats or incidents.

Within management, the Group's IT manager is primarily responsible for assessing and managing our material risks from cybersecurity threats on a day-to-day basis and keep the senior executive officers informed on a regular basis of the identification, assessment, and management of cybersecurity risks and of any cybersecurity incidents. Such management personnel have prior experience and training in managing information systems and cybersecurity matters and participate in ongoing training programs.

As of the date hereof, the Company has not encountered cybersecurity incidents that the company believes to have been material to the Company taken as a whole.

**Risk management and strategy**

We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our cybersecurity risk management program is aligned to the Company's business strategy and shares common methodologies, reporting channels and governance processes that apply to other areas of enterprise risk, including legal, compliance, strategic, operational, and financial risk. Key elements of our cybersecurity risk management program include:

● risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise information technology environment;

● the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls;

● training and awareness programs for team members that include periodic and ongoing assessments to drive adoption and awareness of cybersecurity processes and controls;

● a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and a third-party risk management process for service providers, suppliers, and vendors.

In the last three fiscal years, the Company has not experienced any material cybersecurity incidents, and expenses incurred from cybersecurity incidents were immaterial.

**Governance**

As part of our overall enterprise risk management program, we prioritize the identification and management of cybersecurity risk at several levels. Our Board of Directors has overall oversight responsibility for our risk management, and delegates cybersecurity risk management oversight to the Audit Committee, which is responsible for ensuring that management has processes in place designed to identify and evaluate cybersecurity risks and implement processes and programs to manage cybersecurity risks and mitigate cybersecurity incidents.

Management is responsible for identifying, considering and assessing material cybersecurity risks on an ongoing basis, establishing processes to ensure that such potential cybersecurity risk exposures are monitored, putting in place appropriate mitigation measures and maintaining cybersecurity programs.

**Part III**

**Item 17. FINANCIAL STATEMENTS**

We have elected to provide financial statements pursuant to Item 18.

**Item 18. FINANCIAL STATEMENTS**

The consolidated and combined financial statements of the Company, and its operating entities are included at the end of this annual report.

**Item 19. EXHIBITS**

**EXHIBIT INDEX**

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 1.1 | [Second Amended and Restated Memorandum and Articles of Association of HomesToLife Ltd (incorporated by reference to Exhibit 1.1 to the Annual Report on Form 20-F filed with the SEC on April 7, 2025)](https://www.sec.gov/Archives/edgar/data/2023153/000164117225002928/ex1-1.htm) |
| 2.1 | [Registrant's Specimen Ordinary Share Certificate (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex4-1.htm) |
| 2.2 | [Description of Securities registered under Section 12 of the Exchange Act (incorporated by reference to Exhibit 2.2 to the Annual Report on Form 20-F filed with the SEC on March 23, 2026)](https://www.sec.gov/Archives/edgar/data/2023153/000149315226012071/ex2-2.htm) |
| 4.1^ | [Amended and Restated Products Supply Agreement dated May 20, 2024 between HomesToLife Pte. Ltd. and HTL Marketing Pte. Ltd. (incorporated by reference to Exhibit 10.3 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex10-3.htm) |
| 4.2^ | [Amended and Restated Exclusive Brand Distribution Agreement dated May 20, 2024 between HomesToLife Pte. Ltd. and HTL Marketing Pte. Ltd. (incorporated by reference to Exhibit 10.4 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex10-4.htm) |
| 4.3^ | [Employment Agreement of Phua Mei Ming, dated August 1, 2024 (incorporated by reference to Exhibit 10.1 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex10-1.htm) |
| 4.4^ | [Employment Agreement of Chew Kwang Yong, dated August 1, 2024 (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex10-2.htm) |
| 4.5 | [Form of Independent Director Appointment Letter (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex10-5.htm) |
| 4.6 | [Form of HomesToLife Ltd 2024 Incentive Securities Plan (incorporated by reference to Exhibit 99.2 to the Registration Statement on Form F-1 filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex99-2.htm) |
| 4.7 | [Contract Manufacturing Agreement dated November 1, 2024 between HTL FAR EAST PTE. LTD. and HTL FURNITURE (China) CO., LTD (incorporated by reference to Exhibit 4.7 to the Annual Report on Form 20-F filed with the SEC on April 7, 2025)](https://www.sec.gov/Archives/edgar/data/2023153/000164117225002928/ex4-7.htm) |
| 4.8 | [Contract Manufacturing Agreement dated January 4, 2021 between HTL MARKETING PTD LTD and HTL FURNITURE (China) CO., LTD (incorporated by reference to Exhibit 4.8 to the Annual Report on Form 20-F filed with the SEC on March 23, 2026)](https://www.sec.gov/Archives/edgar/data/2023153/000149315226012071/ex4-8.htm) |
| 8.1 | [List of Subsidiaries and Affiliated Entities (incorporated by reference to Exhibit 8.1 to the Annual Report on Form 20-F filed with the SEC on March 23, 2026)](https://www.sec.gov/Archives/edgar/data/2023153/000149315226012071/ex8-1.htm) |
| 11.1 | [Code of Business Conduct and Ethics (incorporated by reference to Exhibit 99.1 to the Registration Statement on Form F-1 (file No. 333-281693) filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex99-1.htm) |
| 11.2 | [Clawback Policy (incorporated by reference to Exhibit 99.6 to the Registration Statement on Form F-1 (file No. 333-281693) filed with the SEC on August 22, 2024)](https://www.sec.gov/Archives/edgar/data/2023153/000149315224033481/ex99-6.htm) |
| 11.3 | [Insider Trading Policy (incorporated by reference to Exhibit 11.3 to the Annual Report on Form 20-F filed with the SEC on April 7, 2025)](https://www.sec.gov/Archives/edgar/data/2023153/000164117225002928/ex11-3.htm) |
| 12.1\* | [Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex12-1.htm) |
| 12.2\* | [Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex12-2.htm) |
| 13.1\*\* | [Certification by Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex13-1.htm) |
| 101. INS\* | Inline XBRL Instance Document. |
| 101. SCH\* | Inline XBRL Taxonomy Extension Schema Document. |
| 101. CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
| 101. DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
| 101. LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document. |
| 101. PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
| 104\* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

---

| | |
|:---|:---|
| \* | Filed with this annual report on Form 20-F |
| \*\* | Furnished with this annual report on Form 20-F |
| ^ | Certain terms have been omitted pursuant to Item 601(b)(2)(ii) of Regulation S-K. The Registrant hereby undertakes to furnish copies of any of the terms upon request by the SEC. |

---

**SIGNATURES**

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

---

| | | |
|:---|:---|:---|
|  | HomesToLife Ltd | HomesToLife Ltd |
|  | By: | */s/ Phua Mei Ming* |
|  |  | Phua Mei Ming |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |
| Date: June 11, 2026 |  |  |

---

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**INDEX TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm](#px_01) (PCAOB ID: 3487) | F-2 |
| [Consolidated and Combined Balance Sheets](#px_02) | F-3 |
| [Consolidated and Combined Statements of Operations and Comprehensive Income (Loss)](#px_03) | F-4 |
| [Consolidated and Combined Statements of Changes in Shareholders' Equity](#px_04) | F-5 |
| [Consolidated and Combined Statements of Cash Flows](#px_05) | F-6 |
| [Notes to Consolidated and Combined Financial Statements](#px_06) | F-7 to F-34 |

---

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

***To The Shareholders and Board of Directors of***

***HOMESTOLIFE LTD AND SUBSIDIARIES***

***Opinion on the Financial Statements***

We have audited the accompanying consolidated and combined balance sheets of HomesToLife Ltd and its subsidiaries (collectively referred to as the "Company") as of December 31, 2025 and 2024, the related consolidated and combined statements of operations and comprehensive income, consolidated and combined statement of changes in shareholders' equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes to the financial statements and schedule (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024 and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

**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 audits. 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.

**March 23, 2026**

**CLA Global TS Public Accounting Corporation**

**Singapore**

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

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**CONSOLIDATED AND COMBINED BALANCE SHEETS**

**(Currency expressed in United States Dollars ("US$"), except for number of shares)**

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| **ASSETS** |  |  |
| Current assets: |  |  |
| Cash and cash equivalents | $24860621 | $27276091 |
| Accounts receivable, net (including receivable from related parties of $928,951 and $5,763,509 as of December 31, 2024 and 2025, respectively) | 66928602 | 76010709 |
| Inventories, net | 8032089 | 9599490 |
| Amounts due from related parties | 2807854 | 7026092 |
| Deposit, prepayments and other receivables | 5145372 | 5853470 |
| Total current assets | 107774538 | 125765852 |
| Non-current assets: |  |  |
| Property, plant and equipment, net | 3734157 | 4354206 |
| Right-of-use assets, net | 6632749 | 7363312 |
| Other non-current assets |  | 1000000 |
| Deferred tax asset, net | 636581 | 673416 |
| Total non-current assets | 11003487 | 13390934 |
| **TOTAL ASSETS** | $118778025 | $139156786 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| Current liabilities: |  |  |
| Accounts payable | $2701283 | $4475242 |
| Accounts payable, related parties | 72724799 | 74890989 |
| Customer deposits | 853626 | 1195989 |
| Accrued liabilities and other payables | 4428806 | 6065126 |
| Short-term borrowings | 15255874 | 10389094 |
| Amounts due to related parties | 292753 |  |
| Lease liabilities, current | 2100281 | 1924657 |
| Warranty liabilities | 2095842 | 2188814 |
| Derivatives financial instruments |  | 74765 |
| Income tax payable | 2467506 | 4156085 |
| Total current liabilities | 102920770 | 105360761 |
| Long-term liabilities: |  |  |
| Provision for reinstatement cost | 262479 | 382112 |
| Lease liabilities | 4883321 | 5572603 |
| Total long-term liabilities | 5145800 | 5954715 |
| **TOTAL LIABILITIES** | 108066570 | 111315476 |
| Commitments and contingencies |  |  |
| Shareholders' equity: |  |  |
| Ordinary share, $0.0001 par value, 500,000,000 shares authorized,89,687,500 and 89,687,500 shares issued and outstanding as of December 31, 2024 and 2025, respectively\* | 8969 | 8969 |
| Additional paid-in capital | 37179424 | 37179424 |
| Accumulated other comprehensive loss | (12686896) | (12111193) |
| (Accumulated losses) retained earnings | (13790042) | 2764110 |
| Total shareholders' equity | 10711455 | 27841310 |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | $118778025 | $139156786 |

---

\* The shares amounts are presented on a retroactive basis, giving the effect from the completion of common control acquisition.

See accompanying notes to the consolidated and combined financial statements.

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS AND**

**COMPREHENSIVE INCOME**

**(Currency expressed in United States Dollars ("US$"), except for number of shares)**

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| **Revenues, net** |  |  |  |
| &nbsp;&nbsp;&nbsp;From third parties | $316003465 | $315867933 | $356187074 |
| &nbsp;&nbsp;&nbsp;From related parties | 9981004 | 19192918 | 21689049 |
| Total revenues, net | 325984469 | 335060851 | 377876123 |
| Cost of goods sold | (239738076) | (252032836) | (272571322) |
| Gross profit | 86246393 | 83028015 | 105304801 |
| Operating expenses: |  |  |  |
| Sales and distribution expenses | (51622790) | (54727281) | (66331518) |
| General and administrative expenses | (17400101) | (17348952) | (18336882) |
| Listing expenses | - | (1440130) | (1265042) |
| Total operating expenses | (69022891) | (73516363) | (85933442) |
| **Income from operations** | 17223502 | 9511652 | 19371359 |
| Other income (expense): |  |  |  |
| Interest expense | (881717) | (1042888) | (1406903) |
| Interest income | 339351 | 119306 | 23134 |
| Government subsidies | 42339 | 28040 | 69994 |
| Foreign exchange (loss) gain, net | (8196633) | 2184854 | 3505118 |
| Professional fees on acquisition of HTL Marketing |  |  | (1261560) |
| Scrap sofa sale income | 696290 | 562310 | 414664 |
| Change in fair value of derivatives financial instruments | 2841215 | (403350) | (74765) |
| Gain on derecognition of right-of-use asset |  |  | 90368 |
| Sundry income (expense) | 117035 | (123411) | 22563 |
| Total other (expense) income, net | (5042120) | 1324861 | 1382613 |
| **Income before income taxes** | 12181382 | 10836513 | 20753972 |
| Income tax expense | (1864201) | (2415742) | (4199820) |
| **NET INCOME** | $10317181 | $8420771 | $16554152 |
| Other comprehensive income (loss): |  |  |  |
| – Foreign currency translation adjustments | (712497) | (1438060) | 575703 |
| **COMPREHENSIVE INCOME** | $9604684 | $6982711 | $17129855 |
| Weighted average number of ordinary shares: |  |  |  |
| Basic and diluted \* | 88250000 | 89687500 | 89687500 |
| **EARNINGS PER SHARE – BASIC AND DILUTED** | $0.12 | $0.09 | $0.18 |

---

\* The shares amounts are presented on a retroactive basis, giving the effect from the completion of common control acquisition.

See accompanying notes to the consolidated and combined financial statements.

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**CONSOLIDATED AND COMBINED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY**

**(Currency expressed in United States Dollars ("US$"), except for number of shares)**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Ordinary shares | Ordinary shares | | | | |
|  | No. of <br>shares \* | Amount | Additional<br>paid-in <br>capital | Accumulated<br> other<br>comprehensive <br>loss |<br>Accumulated <br>losses | Total<br>shareholders' <br>equity |
| Balance as of January 1, 2023\* | 13250000 | 1325 | 33632957 | (10536339) | (7399993) | 15697950 |
| Retroactive application of common control acquisition | 75000000 | 7500 | (7500) |  | (13180994) | (13180994) |
| Adjusted opening balance | 88250000 | 8825 | 33625457 | (10536339) | (20580987) | 2516956 |
| Net income for the year | - | - | - | - | 10317181 | 10317181 |
| Foreign currency translation adjustment |  |  |  | (712497) |  | (712497) |
| Balance as of December 31, 2023 | 88250000 | 8825 | 33625457 | (11248836) | (10263806) | 12121640 |
| Retroactive application of common control acquisition |  |  |  |  | (11947007) | (11947007) |
| Adjusted opening balance | 88250000 | 8825 | 33625457 | (11248836) | (22210813) | 174633 |
| Proceeds from initial public offering, net of expenses | 1437500 | 144 | 3553967 |  |  | 3554111 |
| Net income for the year | - | - | - | - | 8420771 | 8420771 |
| Foreign currency translation adjustments |  |  |  | (1438060) |  | (1438060) |
| Balance as of December 31, 2024 | 89687500 | 8969 | 37179424 | (12686896) | (13790042) | 10711455 |
| Net income for the year | - | - | - | - | 16554152 | 16554152 |
| Foreign currency translation adjustments |  |  |  | 575703 |  | 575703 |
| Balance as of December 31, 2025 | 89687500 | 8969 | 37179424 | (12111193) | 2764110 | 27841310 |

---

\* The shares amounts are presented on a retroactive basis, giving the effect from the completion of common control acquisition.

See accompanying notes to the consolidated and combined financial statements.

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS**

**(Currency expressed in United States Dollars ("US$"))**

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| **Cash flows from operating activities:** |  |  |  |
| Net income | $10317181 | $8420771 | $16554152 |
| Adjustments to reconcile net income to net cash provided by operating activities |  |  |  |
| Depreciation of property, plant and equipment | 115831 | 208978 | 506379 |
| Amortization of operating right-of-use assets | 1450193 | 1942046 | 1963599 |
| Allowance for obsolete inventories | 434729 | 279203 | 84680 |
| Written-off inventories | (377485) | (54446) | (56420) |
| Provision (benefit) for deferred income taxes | 61716 | (147038) | (36952) |
| Provision for allowance for expected credit losses | 102010 | 3007 | 196075 |
| Written-off accounts receivable |  | (71667) |  |
| Provision for warranty liabilities | 4433892 | 6075365 | 6534757 |
| Provision for (reversal of) reinstatement cost | 251688 | (46657) | 119632 |
| Non-cash lease expense | (1650140) | (1892463) | (2079182) |
| Change in fair value of derivative financial instruments | (2841215) | 403350 | 74765 |
| Written-off property, plant and equipment | 2 | 14443 | 39798 |
| Loss on disposal of property, plant and equipment | 1236 |  |  |
| Change in operating assets and liabilities: |  |  |  |
| Accounts receivables | 10966279 | (9547307) | (9278182) |
| Inventories | 1962191 | (2076712) | (1601035) |
| Deposit, prepayments, and other receivables | (118810) | (135774) | (708101) |
| Accounts payable | (1746001) | 2036106 | 3940150 |
| Customer deposits | 854034 | (408) | 342363 |
| Accrued liabilities and other payables | (1239743) | (60821) | 1636320 |
| Warranty liabilities | (5202705) | (6279163) | (6441785) |
| Income tax payable | 1068847 | 1313725 | 1688579 |
| Net cash provided by operating activities | 18843730 | 384538 | 13479592 |
| **Cash flows from investing activities:** |  |  |  |
| Purchase of property, plant and equipment | (275742) | (515509) | (1136453) |
| Advance payment for acquisition of long-term investments | - | - | (1000000) |
| Net cash used in investing activities | (275742) | (515509) | (2136453) |
| **Cash flows from financing activities:** |  |  |  |
| Proceeds from short-term borrowings | 35403870 | 40767835 | 56879103 |
| Repayments of short-term borrowings | (54351782) | (26520262) | (61745882) |
| Repayments to related parties | (30692612) | (20352298) | (21060665) |
| Advances from related parties | 27742584 | 20769756 | 12251954 |
| Amounts due from related parties - Reorganization and scrapping | (1380994) | (11947007) | 4297720 |
| Dividend paid to common shareholders |  | (11800000) |  |
| Net proceeds from initial public offering | - | 3554110 | - |
| Net cash used in financing activities | (23278934) | (5527866) | (9377770) |
| Effect on exchange rate change on cash and cash equivalents | (74709) | (905513) | 450101 |
| **Net change in cash and cash equivalents** | (4785655) | (6564350) | 2415470 |
| **BEGINNING OF YEAR** | 36210626 | 31424971 | 24860621 |
| **END OF YEAR** | $31424971 | $24860621 | $27276091 |
| **SUPPLEMENTAL CASH FLOW INFORMATION:** |  |  |  |
| Cash paid for income taxes | $734001 | $1238497 | $2681286 |
| Cash paid for interest | $726886 | $836098 | $942617 |
| **SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:** |  |  |  |
| Shares issued for common control acquisition | $75000000 | $75000000 | $75000000 |
| Related parties balances under offsetting arrangement upon reorganization | $(712404) | $13963468 | $16798359 |

---

See accompanying notes to the consolidated and combined financial statements.

**HOMESTOLIFE LTD AND SUBSIDIARIES**

**NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS**

**(Currency expressed in United States Dollars ("US$"), except for number of shares)**

**NOTE 1 － ORGANIZATION AND PRINCIPAL ACTIVITIES**

HomesToLife Ltd (the "Company", "HTLM" or the "HomesToLife Cayman") was incorporated in the Cayman Islands with limited liability under the Companies Act on February 16, 2024.

The Company, through its subsidiaries, is principally engaged in the sale and distribution of leather upholstered furniture, such as, sofas, armchairs, recliners, and related accessories, with its unique design and craftmanship, throughout a network of retail stores in Europe, the North America, and Asia.

On May 5, 2025, the Company entered into a definitive sale and purchase agreement (the "Sale and Purchase Agreement") with New Century International Homes Pte Ltd ("New Century") to acquire 100% of equity interests in HTL Marketing Pte Ltd ("HTL Marketing"). Under the terms of the Sale and Purchase Agreement, in exchange for acquiring HTL Marketing, the Company issued 75,000,000 ordinary shares to New Century, par value US$0.0001 per share (the "Ordinary Shares"), which are subjected to two-year lock-up restrictions. This transaction was closed on May 19, 2025. As at the date of acquisition, HTL Marketing directly and indirectly holds the following eight subsidiaries:

- New Century Furniture Pte. Ltd.

- HTL (UK) Limited

- HTL France SAS

- HTL ANZ PTY LTD

- HTL Korea Co., Ltd

- Hwa Tat Lee Japan Co., Ltd

- Terasoh Co., Ltd

- HTL Taiwan Holding Pte. Ltd

On May 5, 2025, HTL Marketing and certain related parties entered into a deed of global settlement involving debt restructuring under the corporate reorganization exercise.

The Company and HTL Marketing were controlled by common shareholders prior to this acquisition. Accordingly, the transaction was accounted for as a transfer of business between entities under common control in accordance with Accounting Standards Codification ("ASC") 805-50. In accordance with ASC 805-50-45-5, the accompanying consolidated and combined financial statements have been retrospectively adjusted to present the results of the entities as if the current corporate structure had existed since the beginning of the earliest period presented. The consolidation and combination of the Company has been accounted for at historical cost at the beginning of the first period presented in the accompanying consolidated and combined financial statements. The number of outstanding shares in the consolidated and combined balance sheets, the consolidated and combined statements of changes in shareholders' equity, and per share information including the net earnings per share have been presented retrospectively as of the beginning of the earliest period presented on the consolidated and combined financial statements to reflect the final shares immediately after the acquisition on May 5, 2025.

Description of subsidiaries incorporated and controlled by the Company, as of December 31, 2025:

---

| | | | |
|:---|:---|:---|:---|
| Name |  | Background | Ownership |
| HomesToLife International Pte. Ltd. ("HIPL") | ● | Singaporean company | 100% owned by HTLM |
|  | ● | Incorporated on February 22, 2024 |  |
|  | ● | Issued and outstanding 20,001 ordinary shares for SGD1 and USD20,000 |  |
|  | ● | Investment holding |  |
| HomesToLife Pte. Ltd. ("HTL SG") | ● | Singaporean company | 100% owned by HIPL |
|  | ● | Incorporated on September 28, 1989 |  |
|  | ● | Issued and outstanding 38,800,000 ordinary shares for SGD38,800,000 |  |
|  | ● | Sale and distribution of furniture |  |
| HTL Far East Pte. Ltd. ("HTL FE") | ● | Singaporean company | 100% owned by HIPL |
|  | ● | Incorporated on October 28, 2024 |  |
|  | ● | Issued and outstanding 10,000 ordinary shares for USD10,000 |  |
|  | ● | Wholesale of furniture |  |
| HTL Marketing Pte. Ltd. ("HTL Marketing") | ● | Singaporean company | 100% owned by HTLM |
|  | ● | Incorporated on December 23, 2020 |  |
|  | ● | Issued and outstanding 10,000 ordinary shares for USD10,000 |  |
|  | ● | Wholesale of furniture |  |
| New Century Furniture Pte. Ltd. ("NCFTP") | ● | Singaporean company | 100% owned by HTL Marketing |
|  | ● | Incorporated on October 05, 2020 |  |
|  | ● | Issued and outstanding 1,310,000 ordinary shares for USD1,310,000 |  |
|  | ● | Investment holding |  |
| HTL France SAS ("HTLF") | ● | French company | 100% owned by NCFTP |
|  | ● | Incorporated on October 30, 2014 |  |
|  | ● | Issued and outstanding 298,960 ordinary shares for EUR298,960 |  |
|  | ● | Overseas sale office |  |
| HTL ANZ PTY LTD ("HTLA") | ● | Australian company | 100% owned by NCFTP |
|  | ● | Incorporated on September 20, 2023 |  |
|  | ● | Issued and outstanding 10,000 ordinary shares for AUD 10,000 |  |
|  | ● | Overseas sale office |  |
| HTL Korea Co., Ltd. ("HTLK") | ● | Korean company | 100% owned by NCFTP |
|  | ● | Incorporated on September 07, 2010 |  |
|  | ● | Issued and outstanding 291,080 ordinary shares for KRW1,455,400,000 |  |
|  | ● | Sale and distribution of furniture |  |
| Hwa Tat Lee Japan Co., Ltd. ("HTLJ") | ● | Japanese company | 100% owned by NCFTP |
|  | ● | Incorporated on April 03, 1996 |  |
|  | ● | Issued and outstanding 10,000 ordinary shares for JPY90,000,000 |  |
|  | ● | Wholesale of furniture |  |
| Terasoh Co., Ltd. ("TCL") | ● | Japanese company | 100% owned by NCFTP |
|  | ● | Incorporated on July 19, 1973 |  |
|  | ● | Issued and outstanding 160,000 ordinary shares for JPY67,000,000 |  |
|  | ● | Dormant, previously sales and manufacturing of furniture |  |
| HTL Taiwan Holding Pte. Ltd. ("HTLTW") | ● | Singaporean company | 100% owned by NCFTP |
|  | ● | Incorporated on April 02, 2024 |  |
|  | ● | Issued and outstanding 1 ordinary shares for SGD1 |  |
|  | ● | Investment holding |  |
| HTL (UK) Limited ("HTLUK") | ● | British company | 100% owned by NCFTP |
|  | ● | Incorporated on October 05, 2000 |  |
|  | ● | Issued and outstanding 3,050,000 ordinary shares for GBP3,050,000 |  |
|  | ● | Overseas sale office |  |

---

The Company and its subsidiaries are hereinafter referred to as (the "Company").

**NOTE 2 － SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

These accompanying consolidated and combined financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying consolidated and combined financial statements and notes.

● Basis of Presentation

The accompanying consolidated and combined financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and applicable rules and regulations of the U.S. Securities and Exchange Commission (the "SEC").

● Emerging Growth Company

The Company is an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"), and it may 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 independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company's financial statements with another public company which is not an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

● Principles of Consolidation

The consolidated and combined financial statements include the financial statements of the Company and its subsidiaries. All inter-company balances and transactions within the Company have been eliminated upon consolidation.

● Use of Estimates and Assumptions

The preparation of consolidated and combined financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated and combined financial statements and the reported amounts of revenues and expenses during the years presented. Significant accounting estimates reflected in the Company's consolidated and combined financial statements include the useful lives of property, plant and equipment, impairment of long-lived assets, allowance for expected credit losses, allowance for obsolete inventories, retirement plan cost, leases, warranty liabilities, provision for reinstatement cost, income tax provision, deferred taxes and uncertain tax position.

The inputs into the management's judgments and estimates consider the Company's critical and significant accounting estimates. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

● Foreign Currency Transaction

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the consolidated and combined statements of operations and comprehensive income.

The reporting currency of the Company is United States Dollar ("US$") and the accompanying consolidated and combined financial statements have been expressed in US$. The Company's major operating subsidiaries operating in Singapore maintains its books and record in US$, with the exception of HomesToLife Pte Ltd, which keeps its books in Singapore Dollars ("SGD") being the primary currency of the economic environment in which its business is conducted. However, other operating subsidiaries operating in overseas maintains their books and records in their respective local currencies, Australian Dollars ("AUD "), Euro ("EUR"), Japanese Yen ("JPY"), South Korean Won ("KRW") and British Pound ("GBP"), which is a functional currency as being the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with Accounting Standards Codification ("ASC") Topic 830-30, *Translation of Financial Statement* ("ASC 830"), using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the year. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income (loss) within the consolidated and combined statements of changes in shareholders' equity.

Translation of amounts has been made at the following exchange rates into US$1 for the years ended December 31, 2023, 2024 and 2025:

---

| | | | |
|:---|:---|:---|:---|
| US$ Exchange rate | 2023 | 2024 | 2025 |
| Year-end SGD:US$1 exchange rate | 1.3193 | 1.3662 | 1.2847 |
| Average SGD:US$1 exchange rate | 1.3428 | 1.3363 | 1.3056 |
| Year-end AUD:US$1 exchange rate | 0.6828 | 0.6185 | 0.6700 |
| Average AUD:US$1 exchange rate | 0.6644 | 0.6597 | 0.6453 |
| Year-end EUR:US$1 exchange rate | 0.9040 | 0.9661 | 0.8511 |
| Average EUR:US$1 exchange rate | 0.9245 | 0.9242 | 0.8859 |
| Year-end JPY:US$1 exchange rate | 141 | 157 | 156 |
| Average JPY:US$1 exchange rate | 141 | 151 | 150 |
| Year-end KRW:US$1 exchange rate | 1291 | 1478 | 1420 |
| Average KRW:US$1 exchange rate | 1307 | 1363 | 1399 |
| Year-end GBP:US$1 exchange rate | 0.7847 | 0.7987 | 0.7425 |
| Average GBP:US$1 exchange rate | 0.8039 | 0.7824 | 0.7573 |

---

The above currency exchange rates are derived from United Overseas Bank Limited as published at the above-mentioned dates.

● Cash and Cash Equivalents

Cash and cash equivalents consist primarily of cash in readily available checking and saving accounts with banks. They consist of highly liquid investments that are readily convertible to cash and that mature within twelve months or less from the date of purchase. The carrying amounts approximate fair value due to the short maturities of these instruments.

● Accounts Receivables

Accounts receivable due from credit card processors, as the cash proceeds from accounts receivables are received within the next 3 working days, which are recorded at the gross billing amounts, net of the fee charges by credit card processors.

Accounts receivable due from customers and related parties in export sales and leather trading, are generally received under credit terms ranging from 7 to 115 days, which are recorded at their original invoice amounts.

Account receivables are presented net of an allowance for expected credit losses. The allowance is measured in accordance with ASC 326, Financial Instruments—Credit Losses, and reflects expected losses based on a combination of individual (specific) provisions and collective (general) provisions. The Company reviews expected credit losses for accounts receivable based on assessments of the recoverability of the accounts receivable and individual account analysis, including the current creditworthiness and the past collection history of each credit card processors and customers, and current economic industry trends. For individual (specific) provisions, the Company performs individual assessment of the debtors that exhibit indicators of elevated credit risk, such as current creditworthiness, past collection history, known disputes, and other information relevant to the individual counterparty's ability to satisfy its obligations. For collective (general) provisions, the Company evaluates receivables on a pooled basis using historical collection experience adjusted for current conditions and anticipated future economic factors. These pooled estimates incorporate aging trends, historical loss rates, industry conditions, and macroeconomic forecasts relevant to the Company's credit exposure. Based on these analyses, management develops an estimate of the lifetime expected credit losses for the account receivables. The allowance for credit losses is recorded against accounts receivables balances, with a corresponding charge recorded in the consolidated and combined statements of operations and comprehensive income.

Account receivables are written off against the allowance when management concludes that the balance is uncollectible.

● Inventories

Inventories are finished goods for sales, such as sofa, armchairs, recliners, home accessories and other related products, which are stated at the lower of cost or net realizable value.

Cost of inventories is determined using the weighted average method or specific identification method, and includes all costs to acquire and other costs to bring the inventories to their present location and condition. The Company applies the specific identification method to inventory items, such as sofas, armchairs, recliners and customized furniture, for which individual unit costs can be directly tracked. Although products may be similar in design, each purchase batch is tracked separately due to differences in acquisition costs. Cost of goods sold is recognized based on the actual cost of the specific batch from which the item is sold. For other inventory items that are interchangeable in nature and not tracked by batch, such as home accessories and other related products, the Company uses the weighted average method. The Company takes ownership, risks, and rewards of the products purchased.

Inventories are written down to estimated net realizable value, which could be impacted by certain factors including historical usage, expected demand, anticipated sales price, and other factors. The Company continuously evaluates the recoverability of the Company's inventories, and inventory provisions are recorded in the consolidated and combined statements of operations and comprehensive income.

● Property, Plant and Equipment

Freehold land has an unlimited useful life and therefore is not depreciated.

Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values (in accordance with local regulatory requirements):

---

| | |
|:---|:---|
|  | Expected useful life |
| Leasehold improvements | The term of lease |
| Buildings | 26 – 35 years |
| Office equipment | 3-15 years |
| Furniture and fittings | 1-23 years |
| Motor vehicles | 5-6 years |

---

Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. When assets have retired or are sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

● Impairment of Long-Lived Assets

In accordance with the provisions of ASC 360, *Impairment or Disposal of Long-Lived Assets*, all long-lived assets such as property, plant and equipment owned and held by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets. No impairment losses were recognized for the years ended December 31, 2023, 2024 and 2025.

● Revenue Recognition

The Company receives revenue from contracts with customers, which are accounted for in accordance with Accounting Standards Update ("ASU") No. 2014-09, *Revenue from Contracts with Customers* (Topic 606) ("ASC 606").

ASC Topic 606 provided the following overview of how revenue is recognized from the Company's contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

Step 1: Identify the contract(s) with a customer.

Step 2: Identify the performance obligations in the contract.

Step 3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer.

Step 4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised in the contract.

Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises to transfer service to a customer).

The major portion of the Company's income is derived from contracts with customers, and as such, the revenue recognized depicts the transfer of promised goods to its customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company considers the terms of the contract and all relevant facts and circumstances when applying this guidance. The Company's revenue recognition policies are in compliance with ASC Topic 606, as follows, by business segments:

*Retail Sales*

 

The Company typically enters into a sale contract with its customers at the retail outlets in Singapore and Korea, where the rights of the parties, including payment terms, are identified and sales prices to the customers are fixed with separate sales rebate, discount, or other incentive and right of return exists on sales of merchandise. The Company's performance obligation is to deliver products according to contract specifications. The Company recognizes gross product revenue at a point in time when the control of products or services is transferred to customers.

The retail outlets will invoice the sale of products, and the revenue is recognized upon shipment or when the control of products is transferred to customers, which is the point at which the Company has satisfied its performance obligation. Payments received as deposits for the purchase orders made by the customers are recognized as customer deposits and included in current liabilities on the consolidated and combined balance sheets. Customer deposits are recognized as revenue when control over the ordered furniture is transferred to and accepted by the customer.

For the franchisee business in Korea, the Company signs franchise agreements with qualified franchisees, which clearly stipulate the scope of authorized product sales, brand usage standards, supply terms, and payment conditions. Under this model, the Company's performance obligation mainly involves providing qualified products to franchisees and offering necessary operational support, such as brand guidance, marketing assistance. Revenue is recognized when the control of products is transferred to franchisees (usually upon delivery and acceptance), as there is no subsequent right of return or price adjustment clause in the standard franchise agreement.

All revenues are reported net of any sales discounts or taxes. Refunds and returns, which are minimal, are recorded as a reduction of revenue.

In accordance with ASC Topic 606, *Revenue Recognition: Principal Agent Considerations*, the Company evaluates the terms in the agreements with its channels and independent contractors to determine whether or not the Company acts as the principal or as an agent in the arrangement with each party respectively. The determination of whether to record the revenue on a gross or net basis depends upon whether the Company has control over the goods prior to transferring it. In general, the Company controls the products as it has the obligation to (i) fulfil the products delivery and (ii) bear any inventory risk as legal owners. In addition, when establishing the selling prices for delivery of resale products, the Company has control to set its selling price to ensure it would generate profit for the products delivery arrangements. The Company believes that all these factors indicate that the Company is acting as a principal in this transaction. As a result, revenue from the sales of products is presented on a gross basis.

*Export Sales and Leather Trading*

The Company's export sales revenue and leather trading revenue are principally derived from the sale of products, including upholstered sofas, and sale of leather materials, to corporate customers in overseas. Revenue is recognized at the point in time when the performance obligation has been satisfied and control of the products have been transferred to the customers, which generally occurs when the goods are delivered to the customer and all criteria for acceptance have been satisfied.

Generally, the Company enters into order confirmation with its customers which specify the rights of the parties, including product specifications, shipment term and payment terms and sales prices to the customers are fixed. The performance obligations in a given transaction are determined by the individual order confirmation with revenue recognized at the time that the performance obligations have been satisfied. All revenues are recognized based on the price specified in the order confirmation, net of any sales discounts or taxes. Refunds and returns, which are minimal, are recorded as a reduction of revenue.

The summary of sales tax rate (including value added tax and goods and service tax) by the governing countries is as follows:-

SCHEDULE OF SALES TAX RATE

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| | | | |
|:---|:---|:---|:---|
|  | Sales tax rate | Sales tax rate | Sales tax rate |
| Jurisdiction | 2023 | 2024 | 2025 |
| France | 20% | 20% | 20% |
| Australia | 10% | 10% | 10% |
| South Korea | 10% | 10% | 10% |
| Japan | 10% | 10% | 10% |
| United Kingdom | 20% | 20% | 20% |
| Singapore | 8% | 9% | 9% |

---

*Product Return Policies*

Among these segments, the Company only accepts the return of products that are defective or non-conforming due to defects in manufacturing and/or workmanship.

For retail business, the Company only accepts the return of products that are defective or non-conforming due to defects in manufacturing and/or workmanship within 3 to 14 days upon the receipt of products by the customers.

For export business, the Company does not accept product returns and instead provides a five-year warranty covering defects in manufacturing and/or workmanship.

The Company's obligation to provide a refund for products that are defective or non-conforming due to defects in manufacturing and/or workmanship is recognized as a provision for warranty liabilities. Refer to "Warranty Liabilities" for disclosure of warranty liabilities.

 

*Disaggregation of Revenue*

The Company has disaggregated its net revenue from contracts with customers into categories based on business segments, as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |  | For the years ended December 31, | For the years ended December 31, | For the years ended December 31, |
| Product sales, by business segments: | Point of recognition | 2023 | 2024 | 2025 |
| Export sales | At a point in time | $311098665 | $312043186 | $349599092 |
| Retail sales | At a point in time | 5072320 | 4563729 | 9115672 |
| Leather trading | At a point in time | 9813484 | 18453936 | 19161359 |
| Total |  | $325984469 | $335060851 | $377876123 |

---

● Cost of Goods Sold

Cost of goods sold primarily consists of purchase costs of merchandizes from the vendors, inbound shipping and fulfilment costs necessary to bring inventory to its present location and condition, and inventory write-downs, which consist of allowance for obsolete and slow-moving inventories.

● Sales and distribution expenses

Sales and distribution expenses consist primarily of ocean freights, outwards land transports, salaries of our sales persons, sales commissions, and warranty expenses.

● General and administrative expenses

General and administrative expenses consist primarily of salaries of our office staff, depreciation of right-of-use assets of our office, professional fees, and traveling expenses.

● Advertising Costs

The Company recognizes advertising costs as incurred. Advertising costs for the years ended December 31, 2023, 2024 and 2025 were $4,267,033, $5,074,554 and $5,461,605, respectively.

● Shipping and Fulfilment Costs

Shipping and fulfilment costs incurred to deliver the products from the warehouse to the customers and recorded in sales and distribution expenses in the consolidated and combined statements of operations and comprehensive income.

For the years ended December 31, 2023, 2024 and 2025, the aggregate shipping and fulfilment costs were $15,342,361, $16,372,753 and $24,977,264, respectively.

● Listing expenses

Listing expenses consist primarily of audit fee for our IPO, statutory and legal expenses, and insurance expenses.

● Comprehensive Income (Loss)

ASC Topic 220, *Comprehensive Income*, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income (loss) as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income (loss), as presented in the accompanying consolidated and combined statements of changes in shareholders' equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income (loss) is not included in the computation of income tax expense or benefit.

● Segment Reporting

ASC Topic 280, *Segment Reporting* ("ASC 280"), establishes standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company's business segments.

The Company's chief operating decision maker ("CODM") is the Chief Executive Officer, who has determined that it operates in three reportable segments, Retail, Export sales and Leather Trading segments for the periods presented.

The CODM evaluates the performance of each segment based on the regularly reviewed net sales, gross profit and income from operations (excluding intercompany charges) of the segment. The CODM uses net sales, gross profit and income from operations when evaluating each segment during the budget and forecasting processes. The CODM considers actual-to-budget variances for both profit measures when assessing segment performance and making decisions about the allocation of operating and capital resources to each segment. General corporate expenses include expenses incurred and directed by the corporate office that are not allocated to segments.

● Retirement Plan Costs

Contributions to retirement plans (which are defined contribution plans) are charged to general and administrative expenses in the accompanying consolidated and combined statements of operations and comprehensive income as the related employee services are provided.

● Leases

The Company adopts the Financial Accounting Standard Board ("FASB") ASU 2016-02 "Leases (Topic 842)." for the years presented. This standard requires lessees to recognize lease assets ("right-of-use") and related lease obligations ("lease liabilities") on the consolidated and combined balance sheets for leases with terms in excess of twelve months. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in the consolidated and combined balance sheets. The Company does not have any finance lease for the years presented.

ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease and finance lease ROU assets and liabilities are recognized, based on the present value of lease payments over the lease term discounted using the rate implicit in the lease. In cases where the implicit rate is not readily determinable, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate that the Company would have to pay to borrow, on a collateralized basis, an amount equal to the lease payments, in a similar economic environment and over a similar term. For operating leases, lease expense for lease payments is recognized on a straight-line basis over the lease term.

All of the Company's real estate leases with recognized lease assets ("right-of-use") and related lease obligations ("lease liabilities") are classified as operating leases. The Company has elected to not separate lease and non-lease component for property leases and account for them as one single lease component.

● Warranty Liabilities

The Company offers a product warranty to its customers for repairs and replacements, generally twelve (12) months to 10 years, from the date of shipment accepted by the customers, in accordance with applicable law or industry standard, which is limited to the original equipment manufacturers' warranties on the defective or non-conforming products. Historically, the Company experienced a low rate of repairs and replacements on product claims. The provision for the expected warranty claims is estimated based on the past experience requested by the customers.

Warranty expense was $4,433,892, $6,075,365 and $6,534,757 for the years ended December 31, 2023, 2024 and 2025, respectively.

● Provision for Reinstatement Cost

Provisions for the costs to reinstate leased properties to their original condition, as required by the terms and conditions of the leases, are recognized at the date of inception of the leases at the Company's best estimate of the expenditure that would be required to reinstate the leased properties. Estimates are regularly reviewed and adjusted as appropriate for new circumstances. The provision for reinstatement costs will be expected to be materialized in 0.3 to 4.4 years in accordance with the lease terms.

During the years ended December 31, 2023, 2024 and 2025, the Company made provision (reversal) for reinstatement cost of $251,688, $(46,657), and $119,632, respectively.

● Income Taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, *Income Taxes* ("ASC 740"). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

For the years ended December 31, 2023, 2024 and 2025, the Company did not have any interest and penalties associated with tax positions. As of December 31, 2024 and 2025, the Company did not have any significant unrecognized uncertain tax positions.

The Company is subject to income tax in both local and foreign jurisdictions. In connection with its business activities, the Company files tax returns that are subject to examination by the applicable tax authorities. As of December 31, 2025, the 2024 tax returns for all of the Company's entities have been filed with local and foreign tax authorities.

● Net Income Per Share

The Company computes earnings per share ("EPS") in accordance with ASC Topic 260, *Earnings per Share ("ASC 260")*. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the year. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

● Related Parties

The Company follows the ASC Topic 850-10, *Related Party* ("ASC 850") for the identification of related parties and disclosure of related party transactions.

Pursuant to ASC 850, the related parties include: a) affiliates of the Company; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of ASC Topic 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and income-sharing trusts that are managed by or under the trusteeship of management; d) principal owners of the Company; e) management of the Company; f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The consolidated and combined financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated and combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which statements of operations are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which statements of operations are presented; and d) amount due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

● Commitments and Contingencies

The Company follows the ASC Topic 450-20, *Commitments* to report accounting for contingencies. Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Management does not believe, based upon information available at this time that these matters will have a material adverse effect on the Company's financial position, results of operations or cash flows. However, there is no assurance that such matters will not materially and adversely affect the Company's business, financial position, and results of operations or cash flows.

● Fair Value Measurement

The Company follows the guidance of the ASC Topic 820-10, *Fair Value Measurements and Disclosures* ("ASC 820-10"), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

● *Level 1*: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;

● *Level 2 :* Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments
 in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant
 inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets
 or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using
 market-based observable inputs; and

● Level
 3 : Inputs are generally unobservable and typically reflect management's estimates of assumptions that market participants
 would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option
 pricing models and discounted cash flow models.

The Company does not have any non-financial assets or liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis.

The Company's financial instruments consist of cash and cash equivalents, accounts receivable, amounts due from related parties, deposit, prepayments and other receivables, accounts payable, accrued liabilities and other payables and amounts due to related parties. As at December 31, 2023, 2024 and 2025, the carrying value of these financial instruments approximate at their fair values because of the short-term nature of these financial instruments.

The Company measures its derivative financial instruments at fair value on a recurring basis. See Note 9 for fair value measurement disclosure of derivative financial instruments.

● Reclassifications

Certain reclassifications and adjustments have been made to the prior year's financial statements to conform to the current year's presentation and to ensure consistency throughout the financial statements.

● Recently Issued Accounting Pronouncements

From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.

Recently adopted accounting pronouncements

In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280)" ("ASU 2023-07"). The amendments in ASU 2023-07 improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision useful financial analyses. Topic 280 requires a public entity to report a measure of segment profit or loss that the CODM uses to assess segment performance and make decisions about allocating resources. Topic 280 also requires other specified segment items and amounts, such as depreciation, amortization, and depletion expense, to be disclosed under certain circumstances. The amendments in ASU 2023-07 do not change or remove those disclosure requirements. The amendments in ASU 2023-07 also do not change how a public entity identifies its operating segments, aggregates those operating segments, or applies the quantitative thresholds to determine its reportable segments. The amendments in ASU 2023-07 are effective for years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, adopted retrospectively. The Company adopted this standard effective January 1, 2025 retrospectively for all periods presented.

Recently issued accounting pronouncements not yet adopted

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires that an entity disclose, in the notes to consolidated financial statements, specified information about certain costs and expenses. The amendment in the ASU is intended to enhance the transparency and decision usefulness to better understand the major components of an entity's income statement. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of the new standards on its consolidated and combined financial statements which is expected to result in enhanced disclosures.

In July 2025, the FASB issued 2025-05 to improve the measurement of credit losses for accounts receivable and contract assets. The guidance provides a practical expedient for all entities to assume that current conditions as of the balance sheet date remain unchanged for the remaining life of the assets. The update aims to reduce the cost and complexity of estimating credit losses while maintaining decision-useful information for financial statement users. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025. Management is currently evaluating the impact that the adoption of this update may have on its financial statements.

In December 2025, the FASB issued ASU 2025-11 to amend the guidance in "Interim Reporting" (Topic 270). The update provides clarifications intended to improve the consistency and usability of interim disclosure requirements, including a comprehensive listing of required interim disclosures and a new disclosure principle for reporting material events occurring after the most recent annual period. The amendments do not change the underlying objectives of interim reporting but are designed to enhance clarity in application. The ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years. Management is currently evaluating the effects impact that the adoption of this update may have on its financial statements.

Except for the above-mentioned pronouncements, there are no new recently issued accounting standards that will have a material impact on the consolidated and combined balance sheets, statements of operations and cash flows.

**NOTE 3 －SEGMENT INFORMATION**

The Company manages its operations under three segments for the purpose of assessing performance and making operating decisions – Retail Business ("Retails"), Export Sales Business ("Export Sales") and Leather Trading ("Leather Trading"). The Company's CODM is Chief Executive Officer ("CEO"). The CODM allocates resources and evaluates the performance of the Company using information about combined net income from operations. All significant operating decisions are based upon an analysis of the Company as three operating segments, which are the same as its reporting segments.

The Company organizes its business segments based on the nature of products and services offered, and the economic characteristics of each segment.

Following is a brief description of the activities of the Company's business segments.

**Retail**

The Retail segment of the Company includes the results of operations of HTL SG and HTLK. These entities share characteristics such as the end customers being individual consumers, and sales being more focused on product sales in Singapore and Korea. For Singapore's retail sale, it has digital platform sales. For Korea's retail business, it further encompasses two specific models: franchisee business and department sale, which supplement the direct retail operations and expand the reach to local consumers.

**Export Sales**

The Export Sales segment of the Company includes the results of operations of HTL FE, HTLF, HTLA, HTLJ, HTLUK, and HTL Marketing in relation to export sales. These entities share similar characteristics such as customers being businesses and being primarily product-related businesses.

**Leather Trading**

The Leather Trading segment of the Company includes the results of operations of HTL Marketing in relation to leather trading. These entities share characteristics such as the end customers being corporate consumers, and sales being more focused on leather materials.

**Selected Financial Data by Business Segment**

Net sales and operating profit of the Company's business segments exclude intersegment sales, cost of sales and profit as these activities are eliminated in consolidation and thus are not included in management's evaluation of performance of each segment. The Company's CEO serves as the CODM and is responsible for reviewing segment performance and making decisions regarding resource allocation. The Company's CODM evaluates each segment's performance based on metrics such as net sales, operating profit, and other key financial indicators, guiding strategic decisions to align with company-wide goals.

***Summary Operating Results***

The operating results of each business segment were as follows:

SCHEDULE OF SEGMENTAL OPERATING RESULTS

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 |
|  | Retails Sales | Export Sales | Leather Trading | Corporate and unallocated | Total |
| Revenues, net |  |  |  |  |  |
| From third party | $5072103 | $310931362 | $- | $- | $316003465 |
| From related parties | 217 | 167303 | 9813484 | - | 9981004 |
|  | 5072320 | 311098665 | 9813484 |  | 325984469 |
| Cost of goods sold | (1784687) | (228577666) | (9375723) | - | (239738076) |
| Gross profit | 3287633 | 82520999 | 437761 |  | 86246393 |
| Operating expenses: |  |  |  |  |  |
| Sales and distribution expenses | (2293149) | (49195624) | (134017) |  | (51622790) |
| General and administrative expenses | (1033897) | (16230978) | (9018) | (126208) | (17400101) |
| Total operating expenses | (3327046) | (65426602) | (143035) | (126208) | (69022891) |
| Operating income (loss) | (39413) | 17094397 | 294726 | (126208) | 17223502 |
| Other income (expenses): |  |  |  |  |  |
| Interest expense | (156409) | (459766) | (265542) |  | (881717) |
| Interest income |  | 339246 | 105 |  | 339351 |
| Government subsidies | 9851 | 32488 |  |  | 42339 |
| Foreign exchange gain (loss), net | 22788 | (8194956) | (25505) | 1040 | (8196633) |
| Scrap sofa sale income |  | 696290 |  |  | 696290 |
| Change in fair value of derivatives financial instruments |  | 2841215 |  |  | 2841215 |
| Sundry income | 49207 | 67828 | - | - | 117035 |
| Total other income (expenses), net | (74563) | (4677655) | (290942) | 1040 | (5042120) |
| Income (loss) before income taxes | (113976) | 12416742 | 3784 | (125168) | 12181382 |
| Income tax expense | - | (1863558) | (643) | - | (1864201) |
| Segment income (loss) | $(113976) | $10553184 | $3141 | $(125168) | $10317181 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2024 | Year ended December 31, 2024 | Year ended December 31, 2024 | Year ended December 31, 2024 | Year ended December 31, 2024 |
|  | Retails Sales | Export Sales | Leather Trading | Corporate and unallocated | Total |
| Revenues, net |  |  |  |  |  |
| From third party | $4563729 | $309556945 | $1747259 | $- | $315867933 |
| From related parties | - | 2486241 | 16706677 | - | 19192918 |
| Revenues | 4563729 | 312043186 | 18453936 |  | 335060851 |
| Cost of goods sold | (1832485) | (232617863) | (17582488) | - | (252032836) |
| Gross profit | 2731244 | 79425323 | 871448 |  | 83028015 |
| Operating expenses: |  |  |  |  |  |
| Sales and distribution expenses | (3604012) | (50895743) | (227526) |  | (54727281) |
| General and administrative expenses | (1474739) | (16109737) | (14509) | 250033 | (17348952) |
| Listing expenses | - | - | - | (1440130) | (1440130) |
| Total operating expenses | (5078751) | (67005480) | (242035) | (1190097) | (73516363) |
| Operating income (loss) | (2347507) | 12419843 | 629413 | (1190097) | 9511652 |
| Other income (expenses): |  |  |  |  |  |
| Interest expense | (211323) | (430231) | (401334) |  | (1042888) |
| Interest income | 111 | 118637 | 558 |  | 119306 |
| Government subsidies | 15552 | 12488 |  |  | 28040 |
| Foreign exchange gain (loss), net | (8874) | 2283833 | (63947) | (26158) | 2184854 |
| Scrap sofa sale income |  | 562310 |  |  | 562310 |
| Change in fair value of derivatives financial instruments |  | (403350) |  |  | (403350) |
| Sundry income (expense) | 108361 | 53734 | 20 | (285526) | (123411) |
| Total other income (expense), net | (96173) | 2197421 | (464703) | (311684) | 1324861 |
| Income (loss) before income taxes | (2443680) | 14617264 | 164710 | (1501781) | 10836513 |
| Income tax expense | - | (2387742) | (28000) | - | (2415742) |
| Segment income (loss) | $(2443680) | $12229522 | $136710 | $(1501781) | $8420771 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2025 | Year ended December 31, 2025 | Year ended December 31, 2025 | Year ended December 31, 2025 | Year ended December 31, 2025 |
|  | Retails Sales | Export Sales | Leather Trading | Corporate and unallocated | Total |
| Revenues, net |  |  |  |  |  |
| From third party | $9115672 | $346795003 | $276399 | $- | $356187074 |
| From related parties | - | 2804089 | 18884960 | - | 21689049 |
| Revenues | 9115672 | 349599092 | 19161359 |  | 377876123 |
| Cost of goods sold | (3302812) | (250842924) | (18425586) | - | (272571322) |
| Gross profit | 5812860 | 98756168 | 735773 |  | 105304801 |
| Operating expenses: |  |  |  |  |  |
| Sales and distribution expenses | (5857596) | (60388019) | (85903) |  | (66331518) |
| General and administrative expenses | (1117431) | (17110481) | (5982) | (102988) | (18336882) |
| Listing expenses | - | - | - | (1265042) | (1265042) |
| Total operating expenses | (6975027) | (77498500) | (91885) | (1368030) | (85933442) |
| Operating income (loss) | (1162167) | 21257668 | 643888 | (1368030) | 19371359 |
| Other income (expenses): |  |  |  |  |  |
| Interest expense | (396990) | (480328) | (529585) |  | (1406903) |
| Interest income | 524 | 22189 | 421 |  | 23134 |
| Government subsidies | 60215 | 9779 |  |  | 69994 |
| Foreign exchange gain (loss), net | (17920) | 3416737 | 101532 | 4769 | 3505118 |
| Professional fees on acquisition of HTL Marketing |  |  |  | (1261560) | (1261560) |
| Scrap sofa sale income |  | 414664 |  |  | 414664 |
| Change in fair value of derivatives financial instruments |  | (74765) |  |  | (74765) |
| Gain on derecognition of right-of-use asset | 90368 |  |  |  | 90368 |
| Sundry income (expense) | (237) | (262733) | 7 | 285526 | 22563 |
| Total other income (expense), net | (264040) | 3045543 | (427625) | (971265) | 1382613 |
| Income (loss) before income taxes | (1426207) | 24303211 | 216263 | (2339295) | 20753972 |
| Income tax expense |  | (4163055) | (36765) |  | (4199820) |
| Segment income (loss) | $(1426207) | $20140156 | $179498 | $(2339295) | $16554152 |

---

By geographic regions:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 | Year ended December 31, 2023 |
| By geographic locations | Retails | Export sales | Leather trading | Total |
| Asia Pacific | $5072320 | $65187230 | $9813484 | $80073034 |
| Europe |  | 194139405 |  | 194139405 |
| North America | - | 51772030 | - | 51772030 |
| Total | $5072320 | $311098665 | $9813484 | $325984469 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2024 | Year ended December 31, 2024 | Year ended December 31, 2024 | Year ended December 31, 2024 |
| By geographic locations | Retails | Export sales | Leather trading | Total |
| Asia Pacific | $4563729 | $72830753 | $18453936 | $95848418 |
| Europe |  | 196591871 |  | 196591871 |
| North America | - | 42620562 | - | 42620562 |
| Total | $4563729 | $312043186 | $18453936 | $335060851 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Year ended December 31, 2025 | Year ended December 31, 2025 | Year ended December 31, 2025 | Year ended December 31, 2025 |
| By geographic locations | Retails | Export sales | Leather trading | Total |
| Asia Pacific | $9115672 | $73328887 | $19161359 | $101605918 |
| Europe |  | 225547377 |  | 225547377 |
| North America | - | 50722828 | - | 50722828 |
| Total | $9115672 | $349599092 | $19161359 | $377876123 |

---

The following tables present the summary of identifiable long-lived assets as of December 31, 2024 and 2025:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | As of December 31, 2024 | As of December 31, 2024 | As of December 31, 2024 | As of December 31, 2024 |
|  | Retail Sales | Export Sales | Leather Trading | Total |
| Property, plant and equipment, net | 220603 | 3512311 | 1243 | 3734157 |
| Right-of-use assets, net | 5064993 | 1567756 | - | 6632749 |
| Identifiable long-lived assets | 5285596 | 5080067 | 1243 | 10366906 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | As of December 31, 2025 | As of December 31, 2025 | As of December 31, 2025 | As of December 31, 2025 |
|  | Retail Sales | Export Sales | Leather Trading | Total |
| Property, plant and equipment, net | 776528 | 3577555 | 123 | 4354206 |
| Right-of-use assets, net | 6216681 | 1146631 | - | 7363312 |
|  | 6993209 | 4724186 | 123 | 11717518 |

---

**NOTE 4 －ACCOUNTS RECEIVABLE, NET**

Accounts receivable, net consisted of the following:

SCHEDULE OF ACCOUNTS RECEIVABLE

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Accounts receivable | $66058775 | $70502399 |
| Accounts receivable, related parties | 928951 | 5763509 |
| Accounts receivable, gross | 66987726 | 76265908 |
| Less: allowance for expected credit losses | (59124) | (255199) |
| Accounts receivable, net | $66928602 | $76010709 |

---

The following table presents the activities in the allowance for expected credit losses:

SCHEDULE OF ALLOWANCE FOR EXPECTED CREDIT LOSSES

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Balance at beginning of year | $128312 | $59124 |
| Allowance for expected credit losses | 3007 | 196075 |
| Written-off allowance during the year | (71667) |  |
| Foreign translation adjustment | (528) | - |
| Balance at end of year | $59124 | $255199 |

---

The Company generally conducts its business with creditworthy third parties in export sales and leather trading, by offering the credit terms ranging from 7 to 115 days. The Company determines, on a continuing basis, the probable losses and an allowance of expected credit losses, based on several factors including internal risk ratings, customer credit quality, payment history, historical bad debt/write-off experience and forecasted economic and market conditions. Accounts receivables are written off after exhaustive collection efforts occur and the receivable is deemed uncollectible. In addition, receivable balances are monitored on an ongoing basis and its exposure to bad debts is not significant.

For the years ended December 31, 2023, 2024 and 2025, the Company evaluated the probable losses on accounts receivable and recorded the provision for allowance for expected credit losses of $102,010, $3,007 and $196,075, respectively.

**NOTE 5** － **INVENTORIES, NET**

**** 

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Inventories at warehouses | $1736280 | $2003528 |
| Inventories at showrooms | 484236 | 481389 |
| Inventories, gross | 2220516 | 2484917 |
| Less: allowance for obsolete inventories | (973838) | (1007472) |
| Goods in transit | 6785411 | 8122045 |
| Total | $8032089 | $9599490 |

---

The following table presents the activities in the allowance for obsolete inventories:

SCHEDULE OF ALLOWANCE FOR OBSOLETE INVENTORIES

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Balance at beginning of year | $757613 | $973838 |
| Allowance for obsolete inventories | 279203 | 84680 |
| Write-offs during the year | (54446) | (56420) |
| Foreign translation adjustment | (8532) | 5374 |
| Balance at end of year | $973838 | $1007472 |

---

For the years ended December 31, 2023, 2024 and 2025, the Company evaluated the probable losses on inventories and recorded the provision for allowance for obsolete inventories of $434,729, $279,203 and $84,680, respectively.

**NOTE 6 － PROPERTY, PLANT AND EQUIPMENT, NET**

Property, plant and equipment consisted of the followings:

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| At cost: |  |  |
| Leasehold improvements | $1024258 | $1265243 |
| Freehold land | 2777723 | 2794950 |
| Freehold buildings | 2665452 | 2681984 |
| Office equipment | 207862 | 350335 |
| Furniture and fixtures | 674198 | 1234330 |
| Motor vehicles | 74473 | 74935 |
| Property and equipment, gross | 7423966 | 8401777 |
| Less: accumulated depreciation | (3689809) | (4047571) |
| Property, plant and equipment, net | $3734157 | $4354206 |

---

Depreciation expense for the years ended December 31, 2023, 2024 and 2025 were $115,831, $208,978 and $506,379, respectively.

**NOTE 7** － **SHORT-TERM BORROWINGS**

Short-term borrowings comprised of the followings:

SCHEDULE OF SHORT TERM DEBT

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Bank borrowings, secured |  |  |
| - Trade financing loans | $15255874 | $10389094 |

---

HTL Marketing obtained the trade financing revolving and factoring facilities among various financial institutions in Singapore, in the aggregate principal amount of up to $33 million for the years ended December 31, 2024 and 2025, which bear annual interest at the effective average rate ranging from 5.52% to 5.94% with maturity of 90 days to 180 days. The purpose of these banking facilities is to support the furniture export and leather trading operations of HTL Marketing.

The loans contain financial covenants requiring HTL Marketing to maintain defined financial ratios throughout the term of the facilities. HTL Marketing evaluated compliance with these covenants and determined that HTL Marketing was in compliance with all such requirements as of the reporting date*.*

 

These banking facilities are secured by an irrevocable corporate guarantee provided by one of the Company's major shareholders, Golden Hill Capital Pte. Ltd. with a maximum amount of $50 million and certain assignments of accounts receivable. The corporate guarantee expires six months after the full repayment of all loans (see Note 15).

**NOTE 8 － LEASES**

Operating lease right-of-use ("ROU") assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Generally, the implicit rate of interest ("discount rate") in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The Company's incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating would be. The operating lease ROU asset includes any lease payments made and excludes lease incentives.

The Company has entered into commercial operating leases with various third parties for the use of offices, retail stores and warehouse in various countries. These leases have original terms exceeding 1 year, but not more than 10 years. These operating leases are included in "Right-of-use Assets" on the balance sheet and represent the Company's right to use the underlying assets during the lease term. The Company's obligation to make lease payments are included in "Lease liabilities" on the balance sheet.

Supplemental balance sheet information related to operating leases was as follows:

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Operating lease: |  |  |
| Right-of-use assets, net | 6632749 | $7363312 |
| Lease liabilities: |  |  |
| Current lease liabilities | 2100281 | $1924657 |
| Non-current lease liabilities | 4883321 | 5572603 |
| Total lease liabilities | 6983602 | $7497260 |

---

A summary of operating lease expenses recognized in the Company's consolidated and combined statements of operations and comprehensive income is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Amortization of right-of-use assets | $1450193 | $1942046 | $1963599 |
| Interest of lease liabilities | 182305 | 230629 | 464286 |
| Total operating lease expenses | $1632498 | $2172675 | $2427885 |

---

Cash flow information related to leases consists of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |
| Operating cash flows from operating leases | $1384311 | $1947163 | $3547697 |

---

Other supplemental information about the Company's operating leases as of December 31,

---

| | | |
|:---|:---|:---|
|  | **2024** | **2025** |
| Weighted average discount rate | 2.15-7.59% | 1.2-7.59% |
| Weighted average remaining lease term (years) | 0.09-10 years | 0.08-9 years |

---

Operating lease commitments:

The following table summarizes the future minimum lease payments due under the Company's operating leases as of December 31, 2025:

---

| | |
|:---|:---|
| For the year ending December 31, | Amount |
| 2026 | $2457149 |
| 2027 | 2010737 |
| 2028 | 1368241 |
| 2029 | 745115 |
| 2030 | 452222 |
| Thereafter | 1438312 |
| Total minimum lease payments | 8471776 |
| Less: imputed interest | (974516) |
| Future minimum lease payments | $7497260 |

---

**NOTE 9 －DERIVATIVES FINANCIAL INSTRUMENTS**

The Company enters into foreign currency derivative contracts to economically hedge the exposure to foreign currency fluctuations associated with the forecasted sale and purchase of inventories, the foreign exchange risk associated with certain receivables denominated in foreign currencies and certain future commitments for foreign expenditures.

Contracts to buy or sell a non-financial item that can be settled net in cash are accounted for as financial instruments, with the exception of those contracts that were entered into and continue to be held for the purpose of the receipt or delivery of a non-financial item in accordance with the Company's expected purchase, sale or usage requirements.

Instruments are typically entered into to align with the timing and amount of underlying exposures, generally with maturities of 1 to 12 months. The Company does not apply hedge accounting under ASC 815 to these instruments. All the foreign currency derivative contracts are recognized at fair value on the consolidated and combined balance sheets with the changes in fair value recognized in the consolidated and combined statements of operations and comprehensive income as "change in fair value of derivatives financial instruments". Derivative financial instruments assets and liabilities are presented as current or non-current based on the expected settlement date.

Foreign currency derivative contracts are measured using quoted forward currency rates at the balance sheet date. These instruments are classified as Level 2 within the fair value hierarchy. There was no transfers between levels during the years presented.

The foreign currency forward contracts are recorded at fair value of $0 and $74,765 under current liabilities in the consolidated and combined balance sheets as of December 31, 2024 and 2025, respectively. The Company recognized the change in fair value of derivatives financial instruments of $2,841,215, $(403,350) and $(74,765) for the years ended December 31, 2023, 2024 and 2025, respectively in the consolidated and combined statements of operations and comprehensive income.

SCHEDULE OF DERIVATIVE INSTRUMENTS IN CONSOLIDATED AND COMBINED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

---

| | | | |
|:---|:---|:---|:---|
| | | **Fair value** | **Fair value** |
| <br>**As of December 31, 2025** | **Contract notional**<br>**amount** | **Assets** | **Liabilities** |
| Derivatives not held for hedging: |  |  |  |
| - Currency forwards | $126231800 | $- | $74765 |

---

All foreign currency forward contracts held by the Company as of December 31, 2025 are classified as current liabilities.

The Company did not have any foreign currency forward contracts outstanding as of December 31, 2024.

For all the derivatives instruments entered, the forecasted transactions (settlement dates) are expected to occur within 12 months from the end of the reporting period.

The net fair values of the derivatives as of December 31, 2024 and 2025 are denominated in the following currencies:

---

| | | |
|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** |
|  | **2024** | **2025** |
| Chinese Yuan | $- | $143631 |
| Sterling Pound |  | (133674) |
| Euro | - | (84722) |
|  | $- | $(74765) |

---

**NOTE 10 － SHAREHOLDERS' EQUITY**

*<u>Ordinary Shares</u>*

The Company was established under the laws of Cayman Islands on February 16, 2024 with the authorized share of 100,000,000 shares of ordinary share.

On August 22, 2025, the Company increased authorized shares from 100,000,000 to 500,000,000 shares of ordinary share, with a par value of $0.0001 per share.

The Company is authorized to issue one class of ordinary share.

On May 5, 2025, the Company entered into the Sale and Purchase Agreement with New Century to acquire 100% of equity interests in HTL Marketing. Under the terms of the Sale and Purchase Agreement, in exchange for acquiring HTL Marketing, the Company issued 75,000,000 shares of ordinary share to New Century, which are subject to two-year lock-up restrictions. This transaction was closed on May 19, 2025.

The Company and HTL Marketing are controlled by common shareholders prior to this acquisition. Hence, this acquisition was accounted for as common control acquisition in accordance with ASC 805-50-45-5. Under the guidance, the current corporate structure has been retroactively presented in prior periods as if such structure existed as of the beginning of the first period presented in the accompanying consolidated and combined financial statements.

As of December 31, 2025 and 2024, 89,687,500 and 89,687,500 (retroactively restated) shares of ordinary share were issued and outstanding, respectively.

**NOTE 11 － NET INCOME PER SHARE**

**** 

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Numerator: |  |  |  |
| Net income attributable to the Company's shareholders | $10317181 | $8420771 | $16554152 |
| Denominator: |  |  |  |
| Weighted average ordinary shares outstanding |  |  |  |
| Basic and diluted\* | 88250000 | 89687500 | 89687500 |
| Net income per share |  |  |  |
| Basic and diluted | $0.12 | $0.09 | $0.18 |

---

\* The shares amounts are presented on a retroactive basis, after giving the effect form the completion of common control acquisition (see Note 1).

**NOTE 12 － OPERATING EXPENSES**

*<u>Sales and distribution expenses</u>*

Sales and distribution expenses mainly consisted of ocean freights, outwards land transport costs, salaries paid and payable to salespersons, sales commissions, and provision for warranty expenses.

During the years ended December 31, 2023, 2024 and 2025, the Company recorded $51,622,790, $54,727,281, and $66,331,518 sales and distribution expenses, respectively.

*<u>General and administrative expenses</u>*

The Company incurred different types of expenditures under general and administrative expenses. They primarily consist of depreciation and amortization, salaries paid and payable to office staff, professional fees, and travelling expenses.

During the years ended December 31, 2023, 2024 and 2025, the Company recorded $17,400,101, $17,348,952, and 18,336,882 general and administrative expenses, respectively.

**NOTE 13 － INCOME TAX EXPENSE**

The components of income before income taxes were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Domestic (Cayman Islands) | $- | $(1062815) | $(1490142) |
| Foreign | 12181382 | 11899328 | 22244114 |
| Income before income taxes | $12181382 | $10836513 | $20753972 |

---

The components of the provision for income tax expense were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Current income tax expense: |  |  |  |
| Domestic | $- | $- | $- |
| Foreign | 1767811 | 2410265 | 4206889 |
| Total | 1767811 | 2410265 | 4206889 |
| Deferred income tax expense (benefit): |  |  |  |
| Domestic |  |  |  |
| Foreign | 96390 | 5477 | (7069) |
| Total | 96390 | 5477 | (7069) |
| Total income tax expense | $1864201 | $2415742 | $4199820 |

---

The effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. The Company is subject to taxes in the jurisdictions in which it operates, as follows:

*Cayman Islands*

Under the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed.

The summary of effective income tax rates by the governing countries is as follows:-

SCHEDULE OF EFFECTIVE INCOME TAX RATE

---

| | | | |
|:---|:---|:---|:---|
|  | Income Tax Rate | Income Tax Rate | Income Tax Rate |
| Jurisdiction | 2023 | 2024 | 2025 |
| France | 25% | 25% | 25% |
| Australia | 30% | 30% | 30% |
| South Korea | 9.9% | 9.9% | 9.9% |
| Japan | 34% | 34% | 34% |
| United Kingdom | 25% | 25% | 25% |
| Singapore | 17% | 17% | 17% |

---

The reconciliation of the actual income taxes to the amount of tax computed by the applying Singapore tax rate (17% for 2023, 2024 and 2025) to pre-tax income is as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2023 | 2024 | 2024 | 2025 | 2025 |
| Income tax expense at statutory tax rate | $2070835 | 17% | $1842207 | 17% | $3528175 | 17% |
| Effect of differences between statutory tax rates and foreign effective tax rates (i) | (44903) | 0% | 242191 | 2% | (32887) | (0)% |
| Income not subject to taxes | (935003) | (8)% | (3263) | (0)% | (2053981) | (10)% |
| Expenses not subject to tax deduction | 258086 | 2% | 239505 | 2% | 546262 | 3% |
| Net operating losses | 1060 | 0% | 241212 | 2% | 2129290 | 10% |
| Other tax adjustments | 514126 | 4% | (146110) | (1)% | 82961 | 0% |
| Income tax expense and effective income tax rate | $1864201 | 15% | $2415742 | 22% | $4199820 | 20% |

---

(i) Certain operations were conducted out of Singapore. The effect represents the foreign income tax rate differential when compared to Singapore statutory income tax rate for the years ended
December 31, 2023, 2024, and 2025.

*<u>Deferred taxes</u>*

Deferred income taxes reflect 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. The Company's deferred tax assets are comprised of operating loss carryforwards and other temporary differences. Significant components of the Company's deferred tax assets are as follows:

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Deferred tax assets: |  |  |
| &nbsp;&nbsp;&nbsp;Allowance for obsolete stocks | $162108 | $164589 |
| &nbsp;&nbsp;&nbsp;Allowance for expected credit losses | 2363 |  |
| &nbsp;&nbsp;&nbsp;Provision for warranty liabilities | 356140 | 366562 |
| &nbsp;&nbsp;&nbsp;Depreciation |  | 3409 |
| &nbsp;&nbsp;&nbsp;Provision for employee related obligations | 112406 | 158573 |
| &nbsp;&nbsp;&nbsp;Other items | 19042 | 10678 |
| Total deferred tax assets | 652059 | 703811 |
| Deferred tax liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Property, plant and equipment | (15478) | (19683) |
| &nbsp;&nbsp;&nbsp;Other items | - | (10712) |
| Total deferred tax liabilities | (15478) | (30395) |
| Non-current deferred tax assets, net | $636581 | $673416 |

---

As of December 31, 2025, the cumulative net operating losses which can be carried forward to offset future taxable income are as follows:

---

| | | |
|:---|:---|:---|
| Tax regimes of the country | Expiration date | Amount |
| &nbsp;&nbsp;&nbsp;Singapore | Indefinite | $7135877 |
| &nbsp;&nbsp;&nbsp;United Kingdom | Indefinite | 116879 |
| &nbsp;&nbsp;&nbsp;Japan | 2035 | 1878109 |
| &nbsp;&nbsp;&nbsp;South Korea | 2035 | 1001991 |
| Total |  | $10132856 |

---

These cumulative net operating losses can be carried forward to offset future taxable income, subject to the statutory requirements applicable to the operations in their respective countries of incorporations.

The following table presents supplemental cash flow information related to income taxes paid (net of refunds received):

---

| | |
|:---|:---|
|  | Year ended December 31, 2025 |
| Domestic | $- |
| Foreign: |  |
| &nbsp;&nbsp;&nbsp;Japan | 342990 |
| &nbsp;&nbsp;&nbsp;Singapore | 2362347 |
| &nbsp;&nbsp;&nbsp;Other countries | (24051) |
| Total | $2681286 |

---

Income taxes paid (net of refunds received) for the years ended December 31, 2023 and 2024 were $734,001 and $1,238,497, respectively.

Uncertain tax positions

The Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. As of December 31, 2023, 2024 and 2025, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the years ended December 31, 2023, 2024 and 2025 and also does not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from December 31, 2025.

The Company remains subject to examination by the respective governing authorities on its tax returns for the tax periods of 2025.

**NOTE 14 － PENSION COSTS**

The Company is required to make contribution to their employees under a government-mandated defined contribution pension schemes for its eligible full-times employees in Singapore as well as various defined contribution plans in South Korea and United Kingdom. The Company is required to contribute a specified percentage of the participants' relevant income based on their ages and wages level.

For the years ended December 31, 2023, 2024 and 2025, the aggregate contributions to defined contribution plan were $321,776, $429,843 and $464,614, respectively.

**NOTE 15 － RELATED PARTY BALANCES AND TRANSACTIONS**

Nature of relationships with related parties:

---

| | |
|:---|:---|
| Name of related party | Relationship with the Company |
| New Century International Homes Pte. Ltd. | Controlling shareholder |
| Golden Hill Capital Pte. Ltd. ("GHC") | Major shareholder |
| Golden Hill Capital Ltd. | Indirect major shareholder |
| Gruppo 8 S.R.L. | Entity controlled by two common controlling beneficial shareholders |
| H.T.L. Furniture, Inc. | Entity controlled by two common controlling beneficial shareholders |
| Corium Italia S.R.L. | Entity controlled by two common controlling beneficial shareholders |
| HTL Global Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Trading (India) Private Limited | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (China) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Changshu) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Sofa (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture (Huaian) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Furniture Vietnam Company Limited. | Entity controlled by two common controlling beneficial shareholders |
| HTL Product Design (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Import/Export Trading (Kunshan) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Sofa India Private Limited | Entity controlled by two common controlling beneficial shareholders |
| Trends Leather (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Middle East Furniture LLC | Entity controlled by two common controlling beneficial shareholders |
| New Century Overseas Investments Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| New Century Home Pte. Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Leather Trading (Yangzhou) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders, closed on January 10, 2025 |
| HTL Leather (China) Co., Ltd. | Entity controlled by two common controlling beneficial shareholders |
| HTL Manufacturing Pte Ltd. | Entity controlled by two common controlling beneficial shareholders, sold out on April 22, 2025 |

---

Related party balances consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  |  | As of December 31, | As of December 31, |
|  |  | 2024 | 2025 |
| Name | Nature |  |  |
| Gruppo 8 S.R.L. | Accounts receivable – related parties (a) | $26025 | $101783 |
| Corium Italia S.R.L | Accounts receivable – related parties (a) | 287910 | 154660 |
| Trends Leather (Yangzhou) Co., Ltd | Accounts receivable – related parties (a) | 615016 | 5507066 |
| Accounts receivables |  | $928951 | $5763509 |
| HTL Global Pte. Ltd. | Amount due from related party (b) | $996316 | $2708435 |
| New Century International Homes Pte Ltd | Amount due from related party (b) | 1811538 | 1571817 |
| Golden Hill Capital Pte Ltd | Amount due from related party (b) | - | 2745840 |
| Amounts due from related parties |  | $2807854 | $7026092 |
| HTL Furniture (China) Co., Ltd. | Accounts payable – related parties (c) | $10998808 | $4587578 |
| HTL Furniture (Changshu) Co., Ltd | Accounts payable – related parties (c) | 32467504 | 32088012 |
| HTL Furniture (Kunshan) Co., Ltd | Accounts payable – related parties (c) | 18118921 | 16747618 |
| HTL Furniture (Huai An) Co., Ltd | Accounts payable – related parties (c) | 9031916 | 8173680 |
| HTL Import/Export Trading (Kunshan) Co., Ltd | Accounts payable – related parties (c) | 22885 | 176533 |
| HTL Furniture Vietnam Company Limited. | Accounts payable – related parties (c) | 1398608 | 12017175 |
| HTL Furniture (Yangzhou) Co. Ltd | Accounts payable – related parties (c) |  | 85458 |
| HTL Product Design (Kunshan) Co., Ltd | Accounts payable – related parties (c) | 659510 | 845404 |
| HTL Middle East Furniture L.L.C | Accounts payable – related parties (c) | 26647 | 29900 |
| Corium Italia S.R.L | Accounts payable – related parties (c) |  | 45215 |
| Gruppo 8 S.R.L. | Accounts payable – related parties (c) | - | 94416 |
| Accounts payable, related parties |  | $72724799 | $74890989 |
| HTL Global Pte. Ltd. | Amount due to related party (d) | $292753 | $- |

---

(a) Accounts
 receivable due from related parties represented trade receivables from the sale of goods with the Company in the normal course of
 business, which are unsecured, interest-free, and grant with credit terms ranging from 60 to 90 days from the issue date of invoice.

(b) These
 balances represented non-trade temporary advances made by the Company, which are unsecured, interest-free and repayable on demand.

(c) Accounts
 payable due to related parties represented trade payables from the purchase of goods by the Company in the normal course of business,
 which are unsecured, interest-free and repayable on demand.

(d) These
 balances represented non-trade temporary advances, which are unsecured, interest-free and has no fixed terms of repayment.

On May 5, 2025, HTL Marketing and certain related parties entered a deed of global settlement involving debt restructuring under the corporate reorganization exercise.

For the year ended December 31, 2024, the application of these settlement arrangements decreased the gross accounts receivable, related parties, accounts payable, related parties, amounts due from related parties, and amounts due to related parties by $10,829,065, $83,709, $9,753,843, and $478,872, respectively with no gain or loss impact on the consolidated and combined statements of operations and comprehensive income.

For the year ended December 31, 2025, the application of these settlement arrangements decreased the gross accounts receivable, related parties, accounts payable, related parties, and amounts due from related parties by $4,189,728, $0, and $15,973,753, respectively with no gain or loss impact on the consolidated and combined statements of operations and comprehensive income.

As of December 31, 2024, the net balance of accounts receivable, related parties, accounts payable, related parties, amounts due from related parties, and amounts due to related parties were $928,951, $72,724,799, $2,807,854, and $292,753, respectively.

As of December 31, 2025, the net balance of accounts receivable, related parties, accounts payable, related parties, and amounts due from related parties were $5,763,509, $74,890,989, and $7,026,092, respectively.

In the ordinary course of business, during the years ended December 31, 2023, 2024 and 2025, the Company has involved with transactions, either at cost or current market prices and on normal commercial terms among related parties. The following table provides the transactions with these parties for the years, as presented (for the portion of such period that they were considered related):

---

| | | | | |
|:---|:---|:---|:---|:---|
| | | Years ended December 31, | Years ended December 31, | Years ended December 31, |
| | | 2023 | 2024 | 2025 |
| Name of related parties | Nature |  |  |  |
| HTL Furniture Inc | Sale of sofa | $168910 | $212654 | $143808 |
| New Century Trading（India）Private Limited | Sale of sofa | 217 | 2273588 | 2660281 |
| Corium Italia S.R.L | Sale of sofa | (1607) |  |  |
| HTL Leather Trading (Yangzhou) Co., Ltd. | Sale of leather | 7015330 |  |  |
| Trends Leather (Yangzhou) Co., Ltd. | Sale of leather | 2105669 | 16706676 | 18884960 |
| HTL Leather (China) Co., Ltd. | Sale of leather | 692485 | - | - |
|  |  | $9981004 | $19192918 | $21689049 |
| Corium Italia S.R.L | Purchase of goods | $28008 | $14410 | $- |
| HTL Import/Export Trading (Kunshan) Co. Ltd. | Purchase of goods | 132563 | 92165 | 461824 |
| Gruppo 8 S.R.L. | Purchase of goods |  | 105344 | 835250 |
| New Century Sofa India Private Limited | Purchase of goods | 1217589 | 8044440 | 7910832 |
| HTL Furniture (Huai An) Co., Ltd. | Purchase of goods | 17289382 | 10967375 | 9797106 |
| HTL Furniture Vietnam Company Limited. | Purchase of goods |  | 3901169 | 21255119 |
| HTL Furniture (Kunshan) Co., Ltd. | Purchase of goods | 33666337 | 32054553 | 28965947 |
| HTL Furniture (Changshu) Co., Ltd. | Purchase of goods | 68735988 | 74784827 | 83491944 |
| HTL Furniture (China) Co., Ltd. | Purchase of goods | 107277084 | 107053182 | 104218558 |
| Trends Leather Yangzhou Co Ltd | Purchase of sample leather | 3288 | 1182 | 1231 |
|  |  | $228350239 | $237018647 | $256937811 |
| HTL Global Pte. Ltd. | Commission income | $- | $- | $14573 |
| Gruppo 8 S.R.L. | Commission income |  | 27205 | 69409 |
| Corium Italia S.R.L | Commission income | 240662 | 107049 | - |
|  |  | $240662 | $134254 | $83982 |
| New Century Trading（India）Private Limited - Mumbai | Commission expense | $55358 | $253695 | $377863 |
| HTL Furniture Inc | Commission expense | 2193852 | 1979659 | 2038722 |
| HTL Furniture Inc | Service fee | - | 453795 | 395290 |
| Other expense |  | $2249210 | $2687149 | $2811875 |
| HTL Furniture (Yangzhou) Co. Ltd | Professional fee | $- | $- | $522234 |
| HTL Import/Export Trading (Kunshan) Co. Ltd | Professional fee |  | 110392 | 560638 |
| HTL Product Design (Kunshan) Co. Ltd | Professional fee | 4200561 | 5411696 | 5178857 |
|  |  | $4200561 | $5522088 | $6261729 |
| HTL Global Pte. Ltd. (SG) | Recharge of costs | $- | $104381 | $6905 |
| HTL MIDDLE EAST FURNITURE L.L.C | Recharge of costs |  |  | 119015 |
| New Century Trading（India）Private Limited | Recharge of costs | 1045600 | - | - |
|  |  | $1045600 | $104381 | $125920 |
| H.T.L. Furniture, Inc. | Showroom expense | $494660 | $552824 | $524897 |
| New Century International Homes Pte Ltd | Office rental income | $- | $- | $4609 |
| New Century Trading（India）Private Limited | Ocean freight recharge | $- | $- | $242249 |
| HTL Furniture Inc | Customers' claims | $- | $- | $40426 |
| HTL Global Pte. Ltd. (SG) | Management fees | $- | $- | $3452 |
| HTL Manufacturing Pte Ltd | Other income - Service fee | $114657 | $- | $- |

---

Apart from the transactions and balances detailed above and elsewhere in these accompanying consolidated and combined financial statements, the Company has no other significant or material related party transactions during the years presented.

**Corporate guarantee from GHC**

As of December 31, 2024 and 2025, GHC provided an irrevocable corporate guarantee with a maximum aggregate amount of $50 million to various financial institutions in Singapore to secure the banking facilities borrowed by HTL Marketing. The corporate guarantee expires six months after the full repayment of all loans (see Note 7).

**NOTE 16 －RISK AND UNCERTAINTIES**

The Company is exposed to the following concentration of risk:

(a) Major
 customers

For the years ended December 31, 2023, 2024 and 2025, the customers who accounted for more than 10% of the Company's total revenues are presented as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Customer A | 24% | 25% | 25% |
| Customer B | 12% | 10% | 8% |

---

As of December 31, 2024 and 2025, accounts receivable due from these customers which accounted for more than 10% of the total consolidated accounts receivable, respectively are presented as follows:

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Customer A | 38% | 32% |
| Customer B | 19% | 15% |

---

(b) Major
 vendors

For the years ended December 31, 2023, 2024 and 2025, the vendors, being related parties, who accounted for 10% or more of the Company's purchases and its outstanding payable balances at year-end dates, are presented as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | Years ended December 31, | Years ended December 31, | Years ended December 31, |
|  | 2023 | 2024 | 2025 |
| Vendor A, related party | 45% | 42% | 38% |
| Vendor B, related party | 29% | 30% | 31% |
| Vendor C, related party | 14% | 13% | 11% |

---

As of December 31, 2024 and 2025, accounts payable due to these vendors which accounted for more than 10% of the total consolidated accounts payable, respectively are presented as follows:

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2024 | 2025 |
| Vendor A, related party | 15% | 6% |
| Vendor B, related party | 43% | 40% |
| Vendor C, related party | 24% | 21% |

---

The major vendors of the Company are located in China.

(c) Credit
 risk

Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents. The Company places its cash with high credit quality institutions in Singapore and other countries, the composition and maturities of which are regularly monitored by the management. At times, cash amounts may be in excess of the Singapore Deposit Protection Board and other countries insurance limits. The Company has not experienced any losses in such account and believes that it is not exposed to any significant credit risk on the account. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

The Company is also exposed to risk from its accounts receivable and advances to vendors. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

(d) Exchange
 rate risk

The Company has significant exposure to exchange rate fluctuations, both due to translation and transaction exposures. Translation exposures arise from measuring income statements of foreign subsidiaries with functional currencies other than the U.S. dollar. Transaction exposures involve impact from (i) input costs that are denominated in currencies other than the local reporting currency and (ii) revaluation of working capital balances denominated in currencies other than the functional currency. The Company leverages its diversified portfolio of exposures as a natural hedge. In certain cases, the Company enters into non-qualifying foreign currency contracts to hedge certain balance sheet items subject to revaluation. The change in fair value of these instruments and the underlying exposure are both immediately recognized in earnings, substantially offsetting the foreign currency mark-to-market impact of the related exposure.

The management monitors its foreign currency exposures on an ongoing basis. The Company enters into foreign currency forward contracts from time to time to economically manage its exposure to foreign exchange fluctuations. These contracts are not designated as hedging instruments under ASC 815 (see Note 9).

(e) Interest rate risk

The Company is exposed to interest rate risk primarily relating to the fixed-rate trading financing and factoring facility. The Company has not used any derivative instruments to mitigate its exposure associated with interest rate risk. However, the management monitors interest rate exposure and will consider other necessary actions when significant interest rate exposure is anticipated.

(f) Global
 economic and political risk

The Company's products are sold in numerous countries worldwide and as a result, the Company is exposed to global macroeconomic factors, geopolitical tensions and government policies. The Company is also exposed to various risks due to economic, political and social instabilities, market volatility, natural disasters, debt and credit issues, currency controls, new or increased tariffs, foreign exchange and interest rate changes. These risks can negatively impact the Company's net revenues, net earnings and cash flows.

**NOTE 17 － COMMITMENTS AND CONTINGENCIES**

From time to time, the Company may be involved in various legal proceedings and claims in the ordinary course of business. The Company currently is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material adverse effect on its business, financial condition, operating results, or cash flows.

As of December 31, 2024 and 2025, the Company did not have any significant commitments and contingencies involved.

**NOTE 18－ SUBSEQUENT EVENTS**

In accordance with ASC Topic 855, *Subsequent Events*, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the combined financial statements are issued, the Company has evaluated all events or transactions that occurred after the balance sheet date up to the date that the consolidated and combined financial statements were available to be issued.

On January 15, 2026, the Company acquired 10% equity interest of Zeica Labs Pte. Ltd. ("Zeica Labs") for a consideration of $1,000,000. Zeica Labs is a technology start-up company incorporated in Singapore in July 2025, which owns the spatial-audio intellectual property and engineering capabilities behind Super X-Fi, a patented audio technology that delivers immersive, personalized sound experiences. The Company fully settled the consideration in cash in December 2025 and recorded as other non-current assets in the consolidated and combined balance sheets.

## Exhibit 12.1

**Exhibit 12.1**

**Certification of Principal Executive Officer**

**Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a)**

**Under the Securities Exchange Act of 1934, as Amended**

**as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

I, Phua Mei Ming, certify that:

1. I
 have reviewed this Annual Report on Form 20-F for the fiscal year ended December 31, 2025 of HomesToLife Ltd;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer 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;a. Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

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

c. Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d. Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the 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

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;a. All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b. Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | |
|:---|:---|
| Date: June 11, 2026 | */s/ Phua Mei Ming* |
|  | Phua Mei Ming |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |

---

## Exhibit 12.2

**Exhibit 12.2**

**Certification of Principal Accounting and Financial Officer**

**Pursuant to Exchange Act Rule 13a-14(a)/15d-14(a)**

**Under the Securities Exchange Act of 1934, as Amended**

**as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

I, Chai Zhengjie "Jeff", certify that:

1. I
 have reviewed this Annual Report on Form 20-F for the fiscal year ended December 31, 2025 of HomesToLife Ltd;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer 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;a. Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

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

c. Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d. Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the 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

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;a. All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b. Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | |
|:---|:---|
| Date: June 11, 2026 | */s/ Chai Zhengjie "Jeff"* |
|  | Chai Zhengjie "Jeff" |
|  | Chief Financial Officer |
|  | (Principal Accounting and Financial Officer) |

---

## Exhibit 13.1

**Exhibit 13.1**

**CERTIFICATIONS OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER**

**PURSUANT TO**

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

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

I, Phua Mei Ming, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Annual Report on Form 20-F of HomesToLife Ltd for the fiscal year ended December 31, 2025, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Annual Report on Form 20-F fairly presents, in all material respects, the financial condition and results of operations of HomesToLife Ltd.

---

| | |
|:---|:---|
| Date: June 11, 2026 | */s/ Phua Mei Ming* |
|  | Phua Mei Ming |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |

---

I, Chai Zhengjie "Jeff", certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Annual Report on Form 20-F of HomesToLife Ltd for the fiscal year ended December 31, 2025, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Annual Report on Form 20-F fairly presents, in all material respects, the financial condition and results of operations of HomesToLife Ltd.

---

| | |
|:---|:---|
| Date: June 11, 2026 | */s/ Chai Zhengjie "Jeff"* |
|  | Chai Zhengjie "Jeff" |
|  | Chief Financial Officer |
|  | (Principal Accounting and Financial Officer) |

---

*The foregoing certifications are not deemed filed with the Securities and Exchange Commission for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), and are not to be incorporated by reference into any filing of HomesToLife Ltd. under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, regardless of any general incorporation language in such filing.*