# EDGAR Filing Document

**Accession Number:** 0001593001
**File Stem:** 0001493152-25-024336
**Filing Date:** 2025-11
**Character Count:** 315673
**Document Hash:** a4c07ae784119ed9d072e8b56f851f52
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-25-024336.hdr.sgml**: 20251119

**ACCESSION NUMBER**: 0001493152-25-024336

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 95

**CONFORMED PERIOD OF REPORT**: 20250930

**FILED AS OF DATE**: 20251119

**DATE AS OF CHANGE**: 20251119

**FILER**: 

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

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-55406
- **FILM NUMBER:** 251500303

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

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

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

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

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

For the quarterly period ended: September 30, 2025

Or

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

For the Transition Period from ___________ to____________

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

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

(Exact name of registrant as specified in its charter)

---

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

---

---

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

---

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

(Registrant's telephone number, including area code)

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

---

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

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirement for the past 90 days. Yes ☒ No ☐

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

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

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

On November 19, 2025 the issuer had 173,941,136 shares of common stock outstanding.

**Table of Contents**

---

| | | |
|:---|:---|:---|
| [**PART I – FINANCIAL INFORMATION**](#a_001) | [**PART I – FINANCIAL INFORMATION**](#a_001) | [**PART I – FINANCIAL INFORMATION**](#a_001) |
| Item 1. | [Financial Statements (Unaudited)](#a_001) | 1 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations.](#AK_001) | 90 |
| Item 3. | [Quantitative and Qualitative Disclosures about Market Risk](#AK_002) | 112 |
| Item 4. | [Controls and Procedures](#AK_003) | 112 |
| [**PART II – OTHER INFORMATION**](#AK_004) | [**PART II – OTHER INFORMATION**](#AK_004) | [**PART II – OTHER INFORMATION**](#AK_004) |
| Item 1. | [Legal Proceedings.](#AK_005) | 114 |
| Item 1A. | [Risk Factors.](#AK_006) | 114 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds.](#AK_007) | 114 |
| Item 3. | [Defaults Upon Senior Securities.](#AK_008) | 114 |
| Item 4. | [Mine Safety Disclosures.](#AK_009) | 114 |
| Item 5. | [Other Information.](#AK_010) | 114 |
| Item 6. | [Exhibits](#AK_011). | 115 |
| [Signatures](#AK_012) | [Signatures](#AK_012) | 117 |

---

i

**Nightfood Holdings, Inc.**

**Item 1. Financial Statements**

---

| | |
|:---|:---|
|  | Page(s) |
| [Condensed Consolidated Balance Sheets](#J_003) | 2 |
| [Condensed Consolidated Statements of Operations](#J_004) | 3 |
| [Condensed Consolidated Statements of Changes in Stockholders' Deficit](#J_006) | 4 - 5 |
| [Condensed Consolidated Statements of Cash Flows](#J_007) | 6 |
| [Notes to Condensed Consolidated Financial Statements](#J_008) | 7 - 89 |

---

**Nightfood Holdings, Inc. and Subsidiaries**

**DBA Techforce Robotics**

**Condensed Consolidated Balance Sheets**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| **<u>Assets</u>** |  |  |
| **Current Assets** |  |  |
| Cash | $1337285 | $350231 |
| Accounts receivable - net | 97631 | 46215 |
| Inventory | 396673 | 319491 |
| Prepaids and other | 137173 | 61529 |
| **Total Current Assets** | 1968762 | 777466 |
| **Property and equipment - net** | 24774395 | 240824 |
| **Goodwill** | 95686177 | 4504177 |
| **Intangible assets - net** | 6364368 | 1802067 |
| **Total Assets** | $128793702 | $7324534 |
| **<u>Liabilities and Stockholders' Deficit</u>** |  |  |
| **Current Liabilities** |  |  |
| Accounts payable and accrued expenses | $5529306 | $3156258 |
| Accounts payable and accrued expenses - related parties | 2505539 | 322900 |
| Deferred revenue | 599204 | 557725 |
| Convertible notes payable - net | 4176251 | 4250954 |
| Mortgage notes payable | 386682 |  |
| Derivative liabilities | 1499804 | 805765 |
| Derivative liabilities - related parties | 553241 | 297227 |
| Notes payable- net | 5002385 | 1576250 |
| Liabilities of discontinued operations | 450495 | 479005 |
| **Total Current Liabilities** | 20702907 | 11446084 |
| **Long Term Liabilities** |  |  |
| Convertible notes payable - net | 510947 | 467390 |
| Convertible notes payable - related parties - net | 40298 | 20149 |
| Mortgage notes payable | 19095977 |  |
| Notes payable - net | - | 14024 |
| **Total Long Term Liabilities** | 19647222 | 501563 |
| **Total Liabilities** | 40350129 | 11947647 |
| **Commitments and Contingencies** |  |  |
| **Temporary Equity** |  |  |
| Seres B, Convertible Preferred stock - $0.001 par value; 5,000 shares designated 1,950issued and outstanding, respectively | 5065421 | 5065421 |
| Seres C, Convertible Preferred stock - $0.001 par value; 500,000 shares designated 548,850 and 145,966 issued and outstanding, respectively | 89105910 | 7415730 |
| Seres D, Convertible Preferred stock - $0.001 par value; 100,000 shares designated 3,334 and 3,334 issued and outstanding, respectively | 227910 | 227910 |
| Contingent consideration - acquisitions of Victorville and Rancho Mirage | 11925000 | - |
| **Total Temporary Equity** | 106324241 | 12709061 |
| **Stockholders' Deficit** |  |  |
| Preferred stock - $0.001 par value; 1,000,000 shares authorized |  |  |
| Seres A Preferred stock - $0.001 par value; 1,000 shares designated 1,000 issued and outstanding, respectively | 1 | 1 |
| Common stock - $0.001 par value, 200,000,000 shares authorized 151,941,922 and 136,961,021 shares outstanding, respectively | 151942 | 136961 |
| Additional paid-in capital | 32416768 | 29284708 |
| Accumulated deficit | (50449379) | (46753844) |
| **Total Stockholders' Deficit** | (17880668) | (17332174) |
| **Total Liabilities, Temporary Equity and Stockholders' Deficit** | $128793702 | $7324534 |

---

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

**Nightfood Holdings, Inc. and Subsidiaries**

**DBA Techforce Robotics**

**Condensed Consolidated Statements of Operations**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30,** | **For the Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Revenues - net** | $782027 | $- |
| **Costs and expenses** |  |  |
| Cost of sales | 475565 |  |
| Depreciation and amortization | 378109 |  |
| General and administrative expenses | 2094234 | 218461 |
| **Total costs and expenses** | 2947908 | 218461 |
| **Loss from operations** | (2165881) | (218461) |
| **Other income (expense)** |  |  |
| Interest income | 4925 | 15986 |
| Other income | 5001 |  |
| Loss on debt extinguishment |  | (127705) |
| Interest expense (including amortization of debt discount) | (588074) | (338605) |
| Change in fair value of derivative liabilities | (950053) | - |
| **Total other income (expense) - net** | (1528201) | (450324) |
| **Net loss from continuing operations** | (3694082) | (668785) |
| **Net loss from discontinued operations** | (1453) | (95826) |
| **Net loss before provision for income taxes** | (3695535) | (764611) |
| **Provision for income taxes** | - | - |
| **Net loss** | $(3695535) | $(764611) |
| Deemed dividend on Series B Preferred Stock | - | (11566) |
| **Net loss available to common stockholders** | $(3695535) | $(776177) |
| **Loss per share - basic and diluted - continuing operations** | $(0.03) | $(0.01) |
| **Loss per share - basic and diluted - discontinued operations** | $(0.00) | $(0.00) |
| **Loss per share - basic and diluted** | $(0.03) | $(0.01) |
| **Weighted average number of shares - basic and diluted** | 143351827 | 128920994 |

---

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

**Nightfood Holdings, Inc. and Subsidiaries**

**DBA Techforce Robotics**

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

**For the Three Months Ended September 30, 2024**

**(Unaudited)**

---

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

---

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

**Nightfood Holdings, Inc. and Subsidiaries**

**DBA Techforce Robotics**

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

**For the Three Months Ended September 30, 2025**

**(Unaudited)**

---

| | | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | **Preferred Stock - Classified as Temporary Equity** | | | | | | | | | |
|  | **Series B - Convertible** | **Series B - Convertible** | | | | | | | | | | | | | |
|  | **Preferred Stock - Classified as Temporary Equity**<br>Preferred Stock** | **Preferred Stock - Classified as Temporary Equity**<br>Preferred Stock** | **Series C - Convertible**<br> **Preferred Stock** | **Series C - Convertible**<br> **Preferred Stock** | **Series D - Convertible**<br> **Preferred Stock** | **Series D - Convertible**<br> **Preferred Stock** | | | **Series A**<br> **Preferred Stock** | **Series A**<br> **Preferred Stock** | **Common Stock** | **Common Stock** | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br> **Paid-in**<br>**Capital** |<br>**Total Temporary**<br>**Equity** | **Shares** | **Amount** | **Shares** | **Amount** |<br>**Additional**<br> **Paid-in**<br>**Capital** |<br>**Accumulated**<br>**Deficit** |<br>**Total**<br> **Stockholders'**<br>**Deficit** |
| **June 30, 2025** | **1950** | $**2** | **145966** | $**146** | **3334** | $**&nbsp;&nbsp;&nbsp;&nbsp; 3** | $**12708910** | $**12709061** | **1000** | $**1** | **136961021** | $**136961** | $**29284708** | $**(46753844)** | $**(17332174)** |
| Acquisition of Victorville |  |  | 216667 | 217 |  |  | 38999843 | 39000060 |  |  |  |  |  |  |  |
| Acquisition of Rancho Mirage |  |  | 176167 | 176 |  |  | 42279904 | 42280080 |  |  |  |  |  |  |  |
| Forgiveness of pre-existing relationship with target acquiree |  |  |  |  |  |  |  |  |  |  |  |  | 2652671 |  | 2652671 |
| Vesting of Series C - convertible preferred stock - issued as compensation |  |  | 10050 | 10 |  |  | 410030 | 410040 |  |  |  |  |  |  |  |
| Conversion of convertible debt into common stock |  |  |  |  |  |  |  |  |  |  | 14980901 | 14981 | 479389 |  | 494370 |
| Contingent consideration - acquisitions of Victorville |  |  |  |  |  |  | 7125000 | 7125000 |  |  |  |  |  |  |  |
| Contingent consideration - acquisitions of Rancho Mirage |  |  |  |  |  |  | 4800000 | 4800000 |  |  |  |  |  |  |  |
| Net loss | - | - | - | - | - | - | - | - | - | - | - | - | - | (3695535) | (3695535) |
| **September 30, 2025** | **1950** | $**2** | **548850** | $**549** | **3334** | $**3** | $**106323687** | $**106324241** | **1000** | $**1** | **151941922** | $**151942** | $**32416768** | $**(50449379)** | $**(17880668)** |

---

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

**Nightfood Holdings, Inc. and Subsidiaries**

**DBA Techforce Robotics**

**Condensed Consolidated Statements of Cash Flows**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30,** | **For the Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Operating activities** |  |  |
| Net loss | $(3695535) | $(764611) |
| Less: net loss - discontinued operations | (1453) | (95826) |
| Net loss - continuing operations | (3694082) | (668785) |
| Adjustments to reconcile net loss to net cash used in operating activities |  |  |
| &nbsp;&nbsp;&nbsp;Non-cash financing cost under contingent liability |  | 92000 |
| &nbsp;&nbsp;&nbsp;Interest income under acquisition note |  | (15986) |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 378109 |  |
| &nbsp;&nbsp;&nbsp;Loss on debt extinguishment |  | 127705 |
| &nbsp;&nbsp;&nbsp;Change in fair value of derivative liabilities | 950053 |  |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount | 138972 | 50372 |
| &nbsp;&nbsp;&nbsp;Bad debt expense | 61158 |  |
| &nbsp;&nbsp;&nbsp;Stock issued for services |  | 995 |
| &nbsp;&nbsp;&nbsp;Vesting of Series C - preferred stock - issued as compensation | 410040 |  |
| Changes in operating assets and liabilities |  |  |
| &nbsp;&nbsp;&nbsp;(Increase) decrease in |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (28574) | (5252) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | (30182) | 30921 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaids and other | 96356 | (52261) |
| &nbsp;&nbsp;&nbsp;Increase (decrease) in |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | (467393) | 175988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses - related party | 1942639 | 44200 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues | 29479 | - |
| Net cash used in operating activities - continuing operations | (213425) | (220103) |
| Net cash used in operating activities - discontinued operations | (29963) | 91862 |
| Net cash used in operating activities | (243388) | (128241) |
| **Investing activities** |  |  |
| Cash acquired in acquisitions | 1269000 |  |
| Acquisition of property and equipment | (33981) |  |
| Acquisition costs secured by debt | - | (128580) |
| **Net cash provided by (used in) investing activities** | 1235019 | (128580) |
| **Financing activities** |  |  |
| Proceeds from notes payable |  | 402050 |
| Repayments on notes payable | (3236) |  |
| Repayments on mortgage notes payable | (1341) | - |
| **Net cash provided by (used in) financing activities** | (4577) | 402050 |
| **Net increase in cash** | 987054 | 145229 |
| **Cash - beginning of period** | 350231 | 148294 |
| **Cash - end of period** | $1337285 | $293523 |
| **Supplemental disclosure of cash flow information** |  |  |
| Cash paid for interest | $32802 | $- |
| Cash paid for income tax | $- | $- |
| **Supplemental disclosure of non-cash investing and financing activities** |  |  |
| Common stock issued in connection with conversion of convertible notes payable | $494370 | $- |
| Issuance of Series C - convertible preferred stock in connection with acquisition of Victorville | $39000060 | $- |
| Issuance of Series C - convertible preferred stock in connection with acquisition of Rancho Mirage | $42280080 | $- |
| Contingent consideration liabilities | $11925000 |  |
| Net deficit of Victorville acquired | $4080000 | $- |
| Net equity of Rancho Mirage acquired | $(1463000) | $- |
| Forgiveness of pre-existing relationship with target acquiree | $2652671 | $- |
| Deemed dividend associated with Series B, convertible preferred stock - dilutive warrant adjustments | $- | $11566 |
| Series D, convertible preferred stock issued in connection with conversion of debt | $- | $113955 |
| Increase in debt principal and related accrued interest | $- | $15813 |

---

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

**Organization and Nature of Operations**

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

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

In addition, our subsidiary CarryOutSupplies provides complementary logistical and supply-chain capabilities that support both internal operations and market penetration for our robotics products. This integrated structure enhances deployment efficiency, reduces operating friction, and strengthens our overall commercialization platform.

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

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

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

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

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

This segment began operations in connection with the acquisition on March 31, 2025.

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

On February 2, 2024, FHVH began using a DBA – RoboOp365.

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

Business Model

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

Equipment and Ownership

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

Support and Maintenance

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

Operating Costs

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

Current Status

As of September 30, 2025, the Company had initiated early customer deployments under this model and commenced revenue-generating activities.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

The Company has expanded its business model to include the acquisition, ownership, and operation of hotel properties. These properties are intended to serve both as revenue-generating hospitality operations and as dedicated deployment sites for the Company's automation technologies, enabling the Company to test, validate, and scale operational efficiencies in live environments. The hospitality segment became active in connection with two business combinations completed during the fiscal year ended June 30, 2026.

Overview of Acquisitions

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

Strategic Purpose

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Franchise Operations

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

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

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

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

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

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

Integration and Operating Status

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Financial Statement Impact

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

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

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

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

Management's Decision

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

Discontinued Operations Assessment (ASC 205-20)

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

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

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

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

Segment Reporting (ASC 280) Considerations

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

Accounting and Financial Statement Impact

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

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

Future Business Operations

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

See Note 14 for summary of the Company's discontinued operations for the three months ended September 30, 2025 and 2024, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Fiscal Year**

The Company's fiscal year end is June 30.

**Organizational Structure**

Schedule of Organizational Structure

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;**Company Name** |  | &nbsp;&nbsp;**Incorporation Date** | &nbsp;&nbsp;**State of Incorporation** |
| &nbsp;&nbsp;Nightfood Holdings, Inc. ("NGTF") |  | &nbsp;&nbsp;November 22, 2022 | &nbsp;&nbsp;Nevada |
| &nbsp;&nbsp;Nightfood, Inc. ("Nightfood") | &nbsp;&nbsp;2 | &nbsp;&nbsp;January 14, 2010 | &nbsp;&nbsp;New York |
| &nbsp;&nbsp;Future Hospitality Ventures Holdings, Inc. ("FHVH") |  | &nbsp;&nbsp;October 25, 2024 | &nbsp;&nbsp;Nevada |
| &nbsp;&nbsp;SWC Group, Inc. ("SWC") | &nbsp;&nbsp;1 | &nbsp;&nbsp;July 19, 2004 | &nbsp;&nbsp;California |
| &nbsp;&nbsp;Skytech Automated Solutions, Inc. ("Skytech") | &nbsp;&nbsp;**1** | &nbsp;&nbsp;October 6, 2023 | &nbsp;&nbsp;Delaware |
| &nbsp;&nbsp;Holiday Inn Victorville ("VV") | &nbsp;&nbsp;**3** | &nbsp;&nbsp;February 26, 2014 | &nbsp;&nbsp;California |
| &nbsp;&nbsp;Hilton - Rancho Mirage ("RM") | &nbsp;&nbsp;**4** | &nbsp;&nbsp;July 5, 2013 | &nbsp;&nbsp;California |

---

1 Acquired on March 31, 2025.

2 Discontinued operations effective June 30, 2025.

3 Acquired August 27, 2025.

4 Acquired September 30, 2025.

**Basis of Presentation**

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements ("U.S. GAAP").

**Liquidity and Going Concern**

As reflected in the accompanying unaudited condensed consolidated financial statements, for the three months ended September 30, 2025, the Company had:

● Net
 loss available to common stockholders of $3,695,535 ; and

● Net
 cash used in operations was $243,388

Additionally, at September 30, 2025, the Company had:

● Accumulated deficit of $50,449,379

● Stockholders' deficit
 of $17,880,668

● Working capital deficit of
 $18,734,145 ; and

● Cash on hand of $1,337,285

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Similarly, after acquiring the Victorville and Rancho Mirage hotel properties during the fiscal year ended June 30, 2026, the Company began generating revenue within its hospitality segment. Although these hotels provide recurring operating revenue from lodging and related guest services, current levels of hotel revenue are also insufficient to support the Company's ongoing operating and development activities.

Liquidity Outlook

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

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

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

● Scaling RaaS deployments to new customers and markets;

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

● Funding working capital needs and ongoing operating activities.

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Going Concern

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

The consolidated financial statements do not include any adjustments that might result if the Company is unable to continue as a going concern and have been prepared on a basis that assumes the Company will continue as a going concern and realize assets and satisfy liabilities in the ordinary course of business.

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

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

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

● Pursuing strategic collaborations and partnerships; and

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

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

**Principles of Consolidation**

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Business Combinations and Asset Acquisitions**

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

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

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

Business Combinations

For transactions classified as business combinations, the Company:

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

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

● Expenses acquisition-related costs as incurred.

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

Significant judgments in fair value determinations include:

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

● Useful life assessments, impacting amortization and financial results.

● Contingent consideration, which is remeasured at fair value through earnings.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Asset Acquisitions

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

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

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

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

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

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

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

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

Regulatory and Financial Reporting Considerations

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

*Regulation S-X, Rule 3-14 (Real Estate Operations):*

Applies to acquisitions of real estate operations, including hotel properties. If the acquired property is significant under Rule 1-02(w), the registrant must provide audited property-level financial statements (typically one year) and related disclosures.

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

Applies to acquisitions of operating businesses. If significance thresholds are met, the registrant must provide separate business-level financial statements (up to three years), which are generally more extensive than Rule 3-14 requirements.

*Regulation S-X, Article 11:*

Requires pro forma financial information when an acquisition (under either Rule 3-05 or Rule 3-14) is significant, including adjustments reflecting the impact of the acquisition on the registrant's financial statements.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

*Regulation S-K, Item 101:*

Requires disclosure of material acquisitions that affect the nature or scope of the registrant's business.

*Regulation S-K, Item 303 (MD&A):*

Requires discussion of the impact of acquisitions on financial condition, liquidity, and results of operations, including expected future effects.

*Form 8-K, Item 2.01:*

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

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

Goodwill and Impairment

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

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

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

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

Significant judgments in goodwill impairment testing include:

● Determining the appropriate reporting units.

● Forecasting future cash flows.

● Selecting appropriate discount rates and market multiples.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Impairment Charges

**Fiscal Year End June 30, 2026**

The Company did not record any goodwill impairments during the three months ended September 30, 2025 and September 30, 2024, respectively.

**Fiscal Year End June 30, 2025**

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

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

**Business Segments and Expense Disclosure**

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

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

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

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

● Has discrete financial information available.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Reportable Segments

Beginning in fiscal year 2025, following the acquisition of SWC Group, Inc. (d/b/a CarryOutSupplies.com) and the commencement of commercial activities under the Robotics-as-a-Service (RaaS) model, management determined that the Company operates in three (3) reportable segments:

1. Foodservice Packaging Distribution

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

This segment provides wholesale distribution of disposable foodservice packaging products, including printed paper cups, plastic cups, food containers, bags, and related consumable items. Revenue is generated from the sale and shipment of products to customers.

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

Conducted through Skytech Automated Solutions, Inc. and Future Hospitality Venture Holdings, Inc.

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

3. Hotel Operations

Conducted through the Company's wholly owned hotel properties acquired in Victorville and Rancho Mirage.

This segment generates revenue from lodging and related guest services, including room rentals and ancillary offerings such as food, beverage, and other guest amenities. The hotels also serve as deployment and testing environments for the Company's automation technologies.

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

See Note 13 - Segment Information.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Discontinued Operations

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

Segment Expense Disclosure and ASU 2023-07

The Company adopted ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures*, effective for the current fiscal period. The amended guidance requires public entities to disclose:

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

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

● A description of other segment items included in that measure

● How expense amounts are allocated among segments

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

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

**Use of Estimates and Assumptions**

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Significant estimates for the three months ended September 30, 2025 and the year ended June 30, 2025, respectively, include:

● Allowance for doubtful accounts and other receivables

● Inventory valuation and obsolescence reserves

● Fair value measurements related to business combinations, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● identifiable intangible assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● acquired working capital (deficiencies)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● contingent consideration

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● property and equipment valuations

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;● allocation of the purchase price fair value to identifiable assets and liabilities, including the resulting goodwill and other intangible assets

● Valuation of goodwill and intangible assets

● Impairment losses related to goodwill and intangible assets

● Impairment of long-lived assets

● Valuation of loss contingencies

● Valuation of stock-based compensation

● Estimated useful lives of property and equipment

● Valuation of uncertain tax positions

● Valuation allowance on deferred tax assets

**Risks and Uncertainties**

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

In accordance with ASC 275, *Risks and Uncertainties*, the Company evaluates and discloses risks that could significantly affect near-term and long-term operations. Key factors contributing to variability in sales, margins, operating results, and liquidity include:

&nbsp;&nbsp;&nbsp;&nbsp;1. Industry
 Cyclicality and Market Demand

The Company's financial performance is influenced by fluctuations in consumer demand, customer ordering patterns, seasonality in hospitality operations, and competitive pressures within the foodservice packaging and automation industries.

&nbsp;&nbsp;&nbsp;&nbsp;2. Macroeconomic
 Conditions

Broader economic factors—including inflationary pressures, rising interest rates, labor market constraints, supply chain volatility, and geopolitical events—may adversely affect purchasing behavior, operating costs, and access to capital.

&nbsp;&nbsp;&nbsp;&nbsp;3. Pricing
 and Supply Chain Volatility

The cost and availability of raw materials, packaging products, robotics components, and hotel operating supplies may fluctuate due to supplier constraints, transportation disruptions, and commodity market changes, which may impact gross margins and operating results.

&nbsp;&nbsp;&nbsp;&nbsp;4. Technology
 Development and Adoption Risks

The success of the Company's RaaS model depends on continued development, deployment, and market acceptance of its automation technologies. Delays in product development, integration challenges at customer sites, or slower-than-expected adoption may impact revenue growth.

&nbsp;&nbsp;&nbsp;&nbsp;5. Hospitality
 Operating Risks

Hotel performance is subject to changes in travel patterns, competitive room pricing, brand standards compliance, and local economic conditions. Lodging demand may be negatively affected by economic downturns, adverse weather events, or public health concerns.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

&nbsp;&nbsp;&nbsp;&nbsp;6. Liquidity
 and Financing Needs

The Company's ability to continue operations and execute its strategic plans depends on access to sufficient capital. Fluctuations in cash flows or the inability to obtain additional financing on acceptable terms may affect the Company's liquidity and business continuity.

&nbsp;&nbsp;&nbsp;&nbsp;7. Regulatory
 and Compliance Risks

The Company is subject to federal, state, and local regulations related to manufacturing and distribution, automation equipment, franchise operations, hotel licensing, labor practices, and financial reporting requirements. Noncompliance could result in fines, penalties, or operational restrictions.

Given these uncertainties, the Company may experience variability in financial performance and operating cash flows, and actual results may differ materially from management's estimates and forecasts. The Company continually evaluates these risks and implements measures intended to mitigate their potential impact on operations and long-term strategic objectives.

**Fair Value of Financial Instruments**

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

Fair Value Hierarchy

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Fair Value Determination and Use of External Advisors

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

Financial Instruments Carried at Historical Cost

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

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Accounts Receivable**

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

Trade receivables primarily arise from:

● Foodservice Packaging Distribution – invoiced product sales

● RaaS – monthly service fees billed in advance

● Hotel Operations –

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

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

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

Allowance for Expected Credit Losses

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

● historical loss experience by revenue stream,

● customer aging and payment trends,

● current economic conditions, and

● reasonable and supportable forecasts.

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

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

Allowance for expected credit losses was $51,962 and $51,962, for the three months ended September 30, 2025 and the year ended June 30, 2025, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Accounts receivable | $149593 | $98177 |
| Less: allowance for credit losses | 51962 | 51962 |
| Accounts receivable - net | $97631 | $46215 |

---

Bad Debt Expense

For the three months ended September 30, 2025 and 2024, bad debt was as follows:

Schedule of Bad Debt

---

| | |
|:---|:---|
| **Three Months Ended September 30,** | **Three Months Ended September 30,** |
| **2025** | **2024** |
| $61518 | $- |

---

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

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

**Inventory**

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

Continuing Operations

As of September 30, 2025 and June 30, 2025, inventory consisted primarily of:

● Foodservice Packaging Distribution:

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

● Robotics-as-a-Service (RaaS):

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

● Hotel Operations:

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

Inventory Valuation and Reserves

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

● aging and turnover trends;

● expected future demand;

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

● current market and pricing conditions; and

● estimated net realizable value.

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

No inventory write-downs or adjustments to LCNRV were recorded during the three months ended September 30, 2025 or 2024, respectively.

At September 30, 2025 and June 30, 2025, inventory was as follows:

---

| | | |
|:---|:---|:---|
| **Classification** | **September 30, 2025** | **June 30, 2025** |
| Packaging and supplies | $350986 | $319491 |
| Food and beverage | 45687 | - |
| Total Inventory | $396673 | $319491 |

---

Included in these amounts were $15,000 and $92,513 of inventory in transit, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Concentrations**

The Company evaluates concentrations of risk in accordance with ASC 275, *Risks and Uncertainties*. A concentration exists when a single customer, supplier, geographic region, or other external factor represents a significant portion (generally over 10%) of revenues, receivables, or supply chain activity and could have a severe near-term impact on the Company's financial condition or results of operations.

For all periods presented, the Company reviewed its customer base, supplier relationships, and geographic exposures and determined that no such concentrations exist that meet the threshold for disclosure.

**Property and Equipment**

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

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

Property Improvement Plans ("PIPs")

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

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

● Capitalized PIP costs

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

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

● Expensed as incurred

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

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

Disposals

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

**Impairment of Long-lived Assets**

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

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

● Significant changes in expected performance compared to prior forecasts,

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

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

● Strategic shifts in the Company's business operations.

Impairment Assessment Process

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Impairment Results

For the three months ended September 30, 2025 and 2024, respectively, the Company did not record any impairment losses.

**Derivative Liabilities**

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

Accounting for Derivative Liabilities

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

Conversion and Extinguishment of Derivative Liabilities

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

● Records the newly issued shares at fair value;

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

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

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

Reclassification of Equity Instruments to Liabilities

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

Derivative Liability Balances

As of September 30, 2025 and June 30, 2025, the Company had derivative liabilities of $2,053,045 and $1,102,992, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Included in these totals are amounts to related parties of $553,241 and $297,227, respectively.

See Notes 11 and 12.

**Original Issue Discounts and Other Debt Discounts**

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

Original Issue Discounts (OID)

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

Stock and Other Equity Issued with Debt

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

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

Debt Issuance Costs

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

**Right of Use Assets and Lease Obligations**

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Short-Term Leases

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

Lease Term and Renewal Options

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

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

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

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

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

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

Discount Rate and Lease Liability Measurement

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

Lease Impairment

The Company evaluates ROU assets for impairment indicators whenever events or changes in circumstances suggest the carrying amount may not be recoverable. No impairments of ROU assets were recognized for the three months ended September 30, 2025 and 2024, respectively.

At September 30, 2025 and June 30, 2025, the Company did not have any long term leases requiring disclosure.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Revenue Recognition**

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, as amended. Revenue is recognized when control of promised goods or services transfers to customers, in an amount that reflects the consideration expected to be received.

Revenue Streams

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

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

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

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

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

To provide further clarity on the nature, timing, and recognition of revenue, the Company's revenue streams are discussed below:

**A. Foodservice Packaging Distribution**

Revenue from the distribution of disposable foodservice packaging products is derived exclusively from business customers on a wholesale basis through the Company's e-commerce platform and direct sales channels. Customer contracts typically contain a single performance obligation: delivery of the ordered products. Shipping and handling activities that occur after the customer obtains control are accounted for as fulfillment costs and not as separate performance obligations. Because sales are exclusively to registered businesses, the Company collects and remits sales taxes where required; sales to businesses are exempt only when valid resale/exemption certificates are obtained.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**B. Robotics as a Service**

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

The Company owns and deploys all robotic equipment, including hardware, software, and related components, which remain the property of the Company. Customers do not obtain control over the units; instead, the Company retains responsibility for operation, servicing, refurbishment, and replacement as necessary. Management evaluated these arrangements under ASC 842 *Leases* and concluded they do not contain a lease because customers do not control the use of the robotic units. Accordingly, revenue is recognized under ASC 606 *Revenue from Contracts with Customers*.

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

The Company generally invoices customers monthly, with payments due monthly. As a result, contract assets and contract liabilities (deferred revenue) are not significant.

**C. Hospitality Operations**

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

The Company acts as the principal in substantially all hospitality transactions, as it controls the goods and services prior to transfer to the customer. Revenues are presented net of any sales or occupancy taxes collected on behalf of governmental authorities. The timing of billing and payment for hotel operations typically coincides with the satisfaction of performance obligations; therefore, contract assets and contract liabilities related to hospitality revenues are not significant.

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

The Company follows the five-step revenue recognition model:

1. Identify the Contract with a Customer

A contract exists when:

● The agreement creates enforceable rights and obligations;

● It has commercial substance;

● Payment terms are defined and consideration is determinable;

● Collection is probable

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

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

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

2. Identify the Performance Obligations

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

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

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

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

3. Determine the Transaction Price

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

4. Allocate the Transaction Price

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

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

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

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

Hospitality Operations –

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

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

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

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

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

Principal vs. Agent Considerations

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

1. Foodservice Packaging Distribution

The Company acts as a principal in foodservice packaging sales.

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

● The Company has discretion in pricing.

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

● The Company bears inventory risk prior to transfer.

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

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

The Company acts as a principal in RaaS arrangements.

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

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

● The Company has discretion over pricing and contract terms.

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

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

3. Hospitality Operations

The Company acts as a principal in all hospitality operations.

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

4. Snacks and Beverages (Discontinued Operations)

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

● The Company controlled inventory prior to transfer.

● The Company set pricing at its discretion.

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

● The Company bore inventory risk until sale.

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

Summary of Compliance with ASC 606 and ASU Updates

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

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Contract Liabilities (Deferred Revenue)**

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

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

As of September 30, 2025 and June 30, 2025, the Company had deferred revenue of $599,204 and $557,725, respectively.

The following represents the Company's disaggregation of revenues for the years ended June 30, 2025 and 2024:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** |
|  | **2025** | **2025** | **2024** | **2024** |
|  | **Revenue** | **% of Revenues** | **Revenue** | **% of Revenues** |
| Foodservice Packaging | $418043 | 53.46% | $- | 0.00% |
| Robotics as a Service (RaaS) | 49800 | 6.37% |  | 0.00% |
| Hotels | 314184 | 40.18% | - | 0.00% |
| Total revenues - net | $782027 | 100.00% | $- | 0.00% |

---

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

The Company did not generate revenues from continuing operations during the three months ended September 30, 2024.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Cost of Sales**

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

**Foodservice Packaging**

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

Cost components primarily include:

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

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

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

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

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

Cost components primarily include:

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Hotel Operations**

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

Cost components primarily include:

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

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

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

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

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

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

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

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

**Income Taxes**

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Uncertain Tax Positions

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

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

The Company also recognizes interest and penalties related to uncertain tax positions in other expense in the consolidated statement of operations. No interest and penalties were recorded for the three months ended September 30, 2025 and 2024, respectively.

**Valuation of Deferred Tax Assets**

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

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

Factors Considered in Valuation Allowance Assessment

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

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

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Valuation Allowance Determination

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

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

**Advertising Costs**

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

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

The Company recognized marketing and advertising costs during the three months ended September 30, 2025 and 2024, respectively as follows:

Schedule of Marketing and Advertising Costs

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended September 30,** | **Three Months Ended September 30,** |
|  | **2025** | **2024** |
| Total Sales and Marketing | $95575 | $- |

---

**Stock-Based Compensation**

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

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

● Expected volatility – Based on historical stock price fluctuations.

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

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

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

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

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

● Cash flow classification for certain tax-related transactions.

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

**Stock Warrants**

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

The fair value of warrants issued for compensation purposes is measured using the Black-Scholes option pricing model. However, if warrants meet the definition of derivative liabilities under ASC 815, "Derivatives and Hedging," fair value is determined using a binomial pricing model or other appropriate valuation techniques.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Accounting Treatment of Warrants

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

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

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

**Basic and Diluted Earnings (Loss) per Share and Reverse Stock Split** 

The Company computes earnings per share ("EPS") in accordance with ASC 260, "Earnings Per Share." The calculation of basic EPS follows the two-class method and is determined by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding, including certain other shares committed to be issued.

Basic Earnings Per Share (EPS)

Basic EPS is calculated using the two-class method, and is computed as follows:

● Net earnings available to common shareholders represent net earnings to common shareholders, adjusted for the allocation of earnings to participating securities.

● Losses are not allocated to participating.

● The denominator includes common shares outstanding and certain other shares committed to be issued, such as restricted stock and restricted stock units ("RSUs"), for which no future service is required.

Diluted Earnings Per Share (EPS)

Diluted EPS is calculated under both the two-class method and the treasury stock method, and the more dilutive result is reported.

● Diluted EPS is computed by taking the sum of:

○ Net earnings available to common shareholders

○ Dividends on preferred shares

○ Dividends on dilutive mandatorily redeemable convertible preferred shares

○ Divided by the weighted average number of common shares outstanding and certain other shares committed to be issued, plus all dilutive common stock equivalents during the period, such as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ Stock
 options

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ Warrants

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ Convertible
 preferred stock

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ Convertible
 debt

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

● Preferred shares and unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) qualify as participating securities under the two-class method.

Net Loss Per Share Considerations

In computing net loss per share, unvested shares of common stock are excluded from the denominator.

Participating Securities & Share-Based Compensation

Restricted stock and RSUs granted as part of share-based compensation contain nonforfeitable rights to dividends and dividend equivalents, respectively. Therefore:

● Before the requisite service is rendered for the right to retain the award, these instruments meet the definition of a participating security.

● RSUs granted under an executive compensation plan, however, are not considered participating securities because the rights to dividend equivalents are forfeitable.

The following potentially dilutive equity securities outstanding for the three months ended September 30, 2025 and 2024, were as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **September 30, 2024** |
| Convertible debt | 149815948 | 123682424 |
| Series B, convertible preferred stock (5,000:1) | 9750000 | 9750000 |
| Series C, convertible preferred stock (6,000:1) | 3293100000 | 875796000 |
| Series D, convertible preferred stock (6,000:1) | 20004000 | 20004000 |
| Warrants | 191496343 | 191996343 |
| Total common stock equivalents | 3664166291 | 1221228767 |

---

Warrants included as common stock equivalents represent those that are fully vested and exercisable.

As of September 30, 2025, the total potential common stock equivalents (as shown above) exceeded the Company's 200,000,000 authorized common shares, resulting in an insufficiency of authorized shares to settle all potential conversions or exercises. Because certain instruments cannot currently be settled solely in shares, they are not entirely within the Company's control for share settlement.

In accordance with ASC 480-10-S99-3A and ASC 815-40-25, the Company has classified its Series B, Series C, and Series D Convertible Preferred Stock as temporary equity (mezzanine equity) in the consolidated balance sheets.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

These instruments are not redeemable, but are presented outside of permanent equity due to the Company's current lack of sufficient authorized shares to permit full conversion. The Company's convertible debt remains classified as a liability, and its warrants are classified within equity, each in accordance with the relevant accounting guidance.

The Company intends to seek stockholder approval to amend its Certificate of Incorporation to increase the number of authorized common shares. Upon approval and filing of the amendment with the Nevada Secretary of State, and provided no other provisions outside the Company's control exist, the Series B, Series C, and Series D Convertible Preferred Stock will be reclassified from temporary equity to permanent stockholders' equity.

(See also Note 8 — Stockholders' Deficit and Note 1 — Temporary Equity for additional information.)

Warrants included as common stock equivalents represent those that are fully vested and exercisable. See Note 8.

**Related Parties**

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

Related parties include, but are not limited to:

● Principal owners of the Company.

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

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

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

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

The Company discloses all material related party transactions, including:

● The nature of the relationship between the parties.

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

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

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

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

**Temporary Equity** 

The Company classifies certain equity instruments outside of permanent stockholders' equity when required by applicable accounting guidance. In accordance with ASC 480-10-S99-3A and ASC 815-40-25, instruments are presented as temporary equity (mezzanine equity) if they are redeemable or if settlement in the Company's common shares is not solely within the Company's control.

Temporary equity generally includes convertible or equity-linked instruments that, under certain conditions, may require cash settlement or cannot be fully settled in shares due to limitations such as insufficient authorized stock. Instruments classified as temporary equity are remeasured or reassessed each reporting period and are reclassified to permanent equity when the conditions requiring temporary presentation are resolved.

(See Note 8 — Stockholders' Deficit and Note 1 — Earnings Per Share for additional information.)

**Recent Accounting Standards** 

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Accounting Standards Not Yet Adopted**

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

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

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

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

Other Accounting Standards Updates

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

**Reclassifications**

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Property and equipment consisted of the following:

Schedule of Property and Equipment

---

| | | | |
|:---|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** | **Estimated Useful<br> Lives (Years)**  |
| Building and improvements | $17650000 |  | 4 - 30 |
| Land | 3550000 |  | N/A |
| Robots/Tray Bins | 226950 | 205650 | 5 |
| Office computers and equipment | 68063 | 36765 | 5 - 7 |
| Production molds | 145173 | 145173 | 5 |
| Vehicles | 107527 | 107527 | 5 |
| Office furniture and equipment | 3650732 | 50732 | 1 - 5 |
| Accumulated depreciation | (624050) | (305023) |  |
| Total property and equipment - net | $24774395 | $240824 |  |

---

Assets Acquired in Business Combinations

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

● On August 31, 2025, and September 30, 2025 (fiscal year ended June 30, 2026), the Company acquired Victorville and Rancho Mirage, respectively, obtaining land, buildings and improvements, and furniture and equipment with an aggregate fair value of approximately $24,800,000 as of the respective acquisition dates.

● On March 31, 2025 (fiscal year ended June 30, 2025), the Company acquired SWC and Skytech, obtaining property and equipment with an aggregate fair value of approximately $59,000 as of the acquisition date.

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

Depreciation and amortization expense was $300,410 and $0 for the three months ended September 30, 2025 and 2024, respectively. Depreciation and amortization are included within general and administrative expenses in the accompanying consolidated statements of operations.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

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

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

Accounts payable and accrued liabilities were as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Accounts payable and accrued liabilities | $5529306 | $3156258 |
| Accounts payable and accrued liabilities - related parties | 2505539 | 322900 |
| Total accounts payable and accrued liabilities (including related parties) | $8034845 | $3479158 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**<u>Note 5 – Debt</u>**

The following represents a summary of the Company's debt (convertible notes payable, notes payable, convertible notes payable – related parties and mortgage notes payable) at September 30, 2025 and June 30, 2025:

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Issue Date** | **Maturity Date** | **Interest Rate** | **Default Interest Rate** | **Collateral** | **Related Party** | **Conversion Price** | **Debt Type** |
| Loan #1 | September 22, 2022 | February 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #2 | September 22, 2022 | February 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #3 | February 28, 2023 | February 28, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #4 | March 24, 2023 | March 24, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #5 | April 17, 2023 | April 17, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #6 | June 1, 2023 | June 1, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #7 | October 5, 2023 | October 5, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #8 | November 17, 2023 | November 17, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #9 | December 6, 2023 | December 6, 2024 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #10 | January 24, 2024 | January 24, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #11 | March 13, 2024 | March 13, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #12 | May 5, 2024 | May 5, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #13 | September 24, 2024 | September 24, 2025 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #14 | February 19, 2025 | February 19, 2026 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #15 | March 13, 2025 | March 13, 2027 | 15.00% | 24.00% | All Assets | No | $0.0330 | Convertible Note Payable |
| Loan #16 | June 29, 2023 | June 29, 2024 | 15.00% | 16.00% | Unsecured | No | $0.0330 | Convertible Note Payable |
| Loan #17 | August 28, 2023 | August 28, 2024 | 15.00% | 16.00% | Unsecured | No | $0.0330 | Convertible Note Payable |
| Loan #18 | January 23, 2025 | August 31, 2025 | 17.50% | 4.5%/month | Unsecured | No | $- | Note Payable |
| Loan #19 | September 10, 2024 | September 10, 2027 | 15.00% | 15.00% | Unsecured | Yes | $0.0134 | Convertible Note Payable - Related Party |
| Loan #20 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #21 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #22 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #23 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #24 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #25 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | No | $0.0134 | Convertible Note Payable |
| Loan #26 | September 10, 2021 | September 10, 2026 | 8.99% | 20.00% | Vehicle | No | $- | Note Payable |
| Loan #27 | September 10, 2021 | September 10, 2026 | 8.99% | 20.00% | Vehicle | No | $- | Note Payable |
| Loan #28 | September 4, 2024 | September 4, 2027 | 15.00% | 15.00% | Unsecured | Yes | $0.0134 | Convertible Note Payable - Related Party |
| Loan #29 | June 15, 2018 | June 21, 2024 | 18.00% | 18.00% | Unsecured | No | $- | Note Payable |
| Loan #30 | April 18, 2025 | April 18, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Note Payable |
| Loan #31 | June 15, 2025 | June 15, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Note Payable |
| Loan #32 | July 14, 2025 | July 14, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Note Payable |
| Loan #33 | August 25, 2025 | August 25, 2026 | 15.00% | 15.00% | Unsecured | No | $- | Note Payable |
| Loan #34 | June 9, 2022 | June 9, 2029 | 5.00% | 0.00% | Building | No | $- | Mortgage Notes Payable |
| Loan #35 | June 9, 2022 | June 9, 2029 | 5.00% | 0.00% | Building | No | $- | Mortgage Notes Payable |
| Loan #36 | November 15, 2023 | October 1, 2025 | 1.00% | 1.00% | Building | No | $- | Note Payable |
| Loan #37 | April 15, 2025 | April 15, 2026 | 15.00% | 15.00% | All Assets | No | $- | Note Payable |
| Loan #38 | May 22, 2025 | May 22, 2026 | 15.00% | 15.00% | All Assets | No | $- | Note Payable |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Convertible Notes Payable**

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

---

| | |
|:---|:---|
| June 30, 2024 | $3442987 |
| Advances | 1104000 |
| Debt Discount | (674922) |
| Amortization of debt discount | 278382 |
| Conversions of debt to equity | (36425) |
| Non-cash increase of principal | 73750 |
| Debt acquired in acquisition - SWC | 530572 |
| June 30, 2025 | 4718344 |
| Amortization of debt discount | 90476 |
| Conversions of debt to equity | (121622) |
| September 30, 2025 | $4687198 |

---

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

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Lender #1**<br>**Notes #1 - #15** | **Lender #2**<br>**Notes #16 - #17** | **Various**<br>**Notes #20 - #25** |<br>**Total** |
| Date of Note | Sep 22, 2022 - Mar 13, 2025 | June 29, 2023 - August 28, 2023 | September 4, 2024 |  |
| Maturity Date of Note | Sep 22, 2023 - Mar 13, 2027 | November 1, 2025 | September 4, 2027 |  |
| Interest Rate | 15% | 15% | 15% |  |
| Default Interest Rate | 24% | 16% | 15% |  |
| Conversion Rate | $0.033 | $0.033 | $0.0134 \* |  |
| Equivalent Shares | 135664424 | 3109091 | 8035224 |  |
| In-Default | $3880874 | $- | $- | $3880874 |
| Collateral | All Assets | Unsecured | Unsecured |  |
| June 30, 2025 | $4489683 | $174825 | $53836 | $4718344 |
| Conversion to common stock | (49397) | (72225) |  | (121622) |
| Amortization of debt discount | 36640 | - | 53836 | 90476 |
| September 30, 2025 | 4476926 | 102600 | 107672 | 4687198 |
| Less: short term | 4073651 | 102600 | - | 4176251 |
| Long term | $403275 | $- | $107672 | $510947 |
| June 30, 2024 | $3305487 | $137500 | $- | $3442987 |
| Proceeds | 1104000 |  |  | 1104000 |
| Debt acquired - SWC |  |  | 530572 | 530572 |
| Debt discount | (144350) |  | (530572) | (674922) |
| Amortization of debt discount | 224546 |  | 53836 | 278382 |
| Non-cash increase of debt |  | 73750 |  | 73750 |
| Conversion to common stock | - | (36425) | - | (36425) |
| June 30, 2025 | 4489683 | 174825 | 53836 | 4718344 |
| Less: short term | 4096278 | 174825 | - | 4271103 |
| Long term | $393405 | $- | $53836 | $447241 |

---

\* These convertible notes convert at a 65% discount to the lowest market price during the prior 20 days. Due to this variable conversion feature, the notes are classified as derivative liabilities under ASC 815-40.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

In connection with the acquisition of SWC on March 31, 2025, the Company acquired convertible notes payable that became convertible as of the acquisition date, resulting in their classification as derivative liabilities. The aggregate fair value of these derivative liabilities at acquisition was $530,572.

The related debt discounts were measured using the commitment-date fair value of the embedded derivative liabilities. Consistent with ASC 470-20-25, each discount was limited to the face amount of the respective note, with any excess fair value recognized as derivative expense.

See Notes 11 and 12.

Loans #16/#17 – Amendments

On July 23, 2024 (fiscal year end June 30, 2025), the Company amended the terms of these notes to remove the right to adjust the conversion price. In exchange, the Company increased the amount due under the notes by 10%, and issue 1,667 shares of Series D, convertible preferred stock.

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

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

---

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

---

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

In April 2025, the maturity date of the notes was extended from April 2025 to November 2025. No additional consideration was paid in connection with the extensions. In accordance with ASC 470-50-40, the Company evaluated the terms of the modification and concluded that the changes did not result in a substantially different instrument. As a result, the modification was accounted for as a continuation of the existing debt arrangement, with no gain or loss recognized and no impact on the consolidated financial statements.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Debt Conversions

Fiscal Year End June 30, 2026

Loan #1

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

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

Loan #16

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

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

Fiscal Year End June 30, 2025

Loan #2

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Loan #16

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

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

Debt Extinguishments

The Company accounted for these debt conversions as debt extinguishments under ASC 470-50 and ASC 405-20. As the fair value of the equity issued equaled the carrying value of the extinguished debt, no gain or loss was recognized upon conversion.

**Notes Payable** 

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

---

| | |
|:---|:---|
| June 30, 2024 | $- |
| Proceeds | 1547000 |
| Repayments | (23988) |
| Debt acquired in acquisition | 67262 |
| June 30, 2025 | 1590274 |
| Repayments | (3236) |
| Debt acquired in acquisition - net - Victorville | 3223716 |
| Debt acquired in acquisition - net - Rancho Mirage | 1709673 |
| Settlement of pre-existing debt of target acquisition | (1547000) |
| Amortization of debt discount | 28958 |
| September 30, 2025 | $5002385 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Loans #26 and #27** | **Various Loans#18, #29, #30 and #31** | **Acquired Debt Loan #36** | **Acquired Debt Loan #37** | **Acquired Debt Loan #38** | **Total** |
| Date of Note | September 10, 2021 | June 15, 2018 - June 15, 2025 | November 15, 2023 | April 15, 2025 | May 22, 2025 |  |
| Maturity Date of Note | September 10, 2026 | June 21, 2024 - June 15, 2026 | Demand | April 15, 2026 | May 22, 2026 |  |
| Interest Rate | 8.99% | 15.00% - 18.00% | 1.00% | 15.00% | 15.00% |  |
| Default Interest Rate | 20.00% | 15.00% - 18.00%\* | 1.00% | 15.00% | 15.00% |  |
| In-Default | $- | $29250 | $- | $- | $- | $29250 |
| Collateral | Vehicle | Unsecured | Building/Hotel | All Assets | All Assets |  |
| June 30, 2025 | $14024 | $1576250 | $- | $- | $- | $1590274 |
| Settlement of pre-existing debt of target acquisition |  | (1547000) |  |  |  | (1547000) |
| Debt acquired in acquisition - Victorville |  |  |  | 1140000 | 2335000 | 3475000 |
| Debt discount |  |  |  | (66500) | (184784) | (251284) |
| Debt acquired in acquisition - Rancho Mirage |  |  | 1709673 |  |  | 1709673 |
| Amortization of debt discount |  |  |  | 9500 | 19458 | 28958 |
| Repayments | (3236) | - | - | - | - | (3236) |
| September 30, 2025 | 10788 | 29250 | 1709673 | 1083000 | 2169674 | 5002385 |
| Less: short term | 10788 | 29250 | 1709673 | 1083000 | 2169674 | 5002385 |
| Long term | $- | $- | $- | $- | $- | $- |
| June 30, 2024 | $- | $- | $- | $- | $- | $- |
| Proceeds |  | 1547000 |  |  |  | 1547000 |
| Debt acquired in acquisition - SWC | 17262 | 50000 |  |  |  | 67262 |
| Repayments | (3238) | (20750) | - | - | - | (23988) |
| June 30, 2025 | 14024 | 1576250 |  |  |  | 1590274 |
| Less: short term | - | 1576250 | - | - | - | 1576250 |
| Long term | $14024 | $- | $- | $- | $- | $14024 |

---

Loans #30/#31

**Notes Payable – Victorville Acquisition**

During April 2025 and June 2025, the Company also entered into two loan agreements (Loans #30 and #31) with the then–prospective seller of the Victorville hotel property (the "Target"). Under these agreements, the Target advanced the Company an aggregate of $1,547,000 for working capital purposes. The loans were unsecured and bore interest at an annual rate of 15%.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Pursuant to the loan terms:

● If the acquisition did not close, the loans would have become payable one year from their respective commitment dates; and

● If the acquisition did close, the outstanding principal and accrued interest would be forgiven in full.

The Victorville acquisition closed on August 31, 2025, and, accordingly, the related $1,547,000 balance (including accrued interest) was eliminated in consolidation as an intercompany amount. As a result, this balance has been removed from the current-year notes payable schedule.

The Company did not recognize any gain on forgiveness, as the elimination represented an intercompany transaction rather than income from extinguishment of debt.

**Convertible Notes Payable – Related Parties**

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

---

| | |
|:---|:---|
|  | $- |
| Debt acquired in acquisition - SWC | 229204 |
| Debt Discount | (229204) |
| Amortization of debt discount | 53639 |
| Repayments | (33490) |
| June 30, 2025 | 20149 |
| Amortization of debt discount | 20149 |
| September 30, 2025 | $40298 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

---

| | | | |
|:---|:---|:---|:---|
|  | **Loan #19** | **Loan #28** | **Total** |
| Holder | Chief Executive Officer | Chief Revenue Officer |  |
|  |  | Board Director |  |
| Date of Note | September 10, 2024 | September 10, 2024 |  |
| Maturity Date of Note | September 10, 2027 | September 4, 2027 |  |
| Interest Rate | 15.00% | 15.00% |  |
| Conversion Rate | $0.0134 \* | $0.0134 \* |  |
| Equivalent Shares | 2264478 | 742836 | 3007313 |
| In-Default | $- | $- | $- |
| Collateral | Unsecured | Unsecured |  |

---

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

---

| | | | |
|:---|:---|:---|:---|
| June 30, 2025 | $15172 | $4977 | $20149 |
| Amortization of debt discount | 15172 | 4977 | 20149 |
| September 30, 2025 | 30344 | 9954 | 40298 |
| Less: short term | - | - | - |
| Long term | $30344 | $9954 | $40298 |
| June 30, 2024 | $- | $- | $- |
| Debt acquired in acquisition - SWC | 180154 | 49050 | 229204 |
| Debt discount | (180154) | (49050) | (229204) |
| Amortization of debt discount | 48662 | 4977 | 53639 |
| Repayments | (33490) | - | (33490) |
| June 30, 2025 | 15172 | 4977 | 20149 |
| Less: short term | - | - | - |
| Long term | $15172 | $4977 | $20149 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

---

| | |
|:---|:---|
| June 30, 2025 | $- |
| Debt acquired in acquisition - Victorville | 9492000 |
| Debt acquired in acquisition - Rancho Mirage | &nbsp;&nbsp;&nbsp;&nbsp;9992000 |
| Repayments | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1341) |
| September 30, 2025 | $19482659 |

---

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

As part of the required purchase price allocations under ASC 805, the assumed mortgage notes were recorded at their estimated fair values as of the respective acquisition dates. The fair value measurements reflected market-based assumptions regarding interest rates and credit spreads for comparable debt instruments at the time of acquisition. As a result, the carrying amounts of the assumed mortgage obligations include a step-up adjustment from the contractual principal balances to reflect their fair value at acquisition.

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

Accordingly, the Company's total mortgage notes payable were $19,482,659 as of September 30, 2025. The assumed mortgage notes remain secured by the respective hotel properties and contain customary covenants and repayment terms.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Loan #34** | **Loan #34** | **Loan #35** | **Loan #35** | **Total** |
| Property Name | Victorville |  | Rancho Mirage |  |  |
| Date of Note | June 9, 2022 |  | June 9, 2022 |  |  |
| Maturity Date of Note | June 9, 2029 |  | June 9, 2029 |  |  |
| Interest Rate | 7.50 | %\* | 7.50 | %\* |  |
| In-Default | $- |  | $- |  | $- |
| Collateral | Property |  | Property |  |  |

---

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

---

| | | | |
|:---|:---|:---|:---|
| June 30, 2025 | $- |  | $- |
| Debt acquired in acquisition | 9492000 | &nbsp;&nbsp;&nbsp;&nbsp;9992000 | 19484000 |
| Repayments | (1341) | - | (1341) |
| September 30, 2025 | 9490659 | 9992000 | 19482659 |
| Less: short term | 188373 | 198309 | 386682 |
| Long term | $9302556 | $9793421 | $19095977 |

---

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

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

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **For the Year Ended June 30,** | **Convertible<br> Notes Payable** | **Convertible<br> Notes Payable - Related Parties** | **Notes<br> Payable** | **Mortgage<br> Notes Payable** | **Total** |
| 2026 (9 Months) | $4176250 | $- | $3704372 | $290236 | $8170858 |
| 2027 | 403275 |  | 1298013 | 408920 | 2110208 |
| 2028 | 107673 | 40298 |  | 436763 | 584734 |
| 2029 |  |  |  | 474576 | 474576 |
| 2030 | - | - | - | 17872164 | 17872164 |
| Total | 4687198 | 40298 | 5002385 | 19482659 | 29212540 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. This determination requires significant judgments to be made. See Note 12 for derivative liabilities.

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

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

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

As of September 30, 2025, the Company is not aware of any litigation, pending litigation, or other transactions that require accrual or disclosure.

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

As of September 30, 2025, the Company had six (6) classes of stock, detailed as follows:

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

**Preferred Stock**

The Company's preferred stock is as follows.

● Authorized Shares: 1,000,000

● Par Value: $0.001 per share

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

● Designated Shares: 1,000

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

● Par Value: $0.001 per share

● Stated Value: None

● Conversion Terms: None

● Dividend Provisions: None

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

● Liquidation Preference: None

● Redemption Rights: None

● Derivative Liability Assessment:

---

| | |
|:---|:---|
| ◌ | Evaluated under ASC 815 ("Derivatives and Hedging") |
| ◌ | The Series A Convertible Preferred Stock does not meet the definition of a derivative liability because it does not contain any variable equity conversion features or other contingent provisions that would require derivative accounting. |

---

**Series B, Convertible Preferred Stock**

● Designated Shares: 5,000

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

● Par Value: $0.001 per share

● Stated Value: None

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

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

● Derivative Liability Assessment:

---

| | |
|:---|:---|
| ◌ | Evaluated under ASC 815 ("Derivatives and Hedging") |
| ◌ | The Series B Convertible Preferred Stock and the related warrants do not meet the definition of derivative liabilities because they contain fixed conversion terms and do not include any variable equity conversion features or other contingent provisions requiring derivative accounting. |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Deemed Dividends – Series B Convertible Preferred Stock

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

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

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

**Series C, Convertible Preferred Stock**

● Designated Shares: 500,000

● Issued & Outstanding: 145,966 and 13,333 shares as of September 30, 2025 and June 30, 2025, respectively

● Par Value: $0.001 per share

● Stated Value: None

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

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

● Rank junior to Series B, convertible preferred stock

● Derivative Liability Assessment:

---

| | |
|:---|:---|
| ◌ | Evaluated under ASC 815 ("Derivatives and Hedging") |
| ◌ | The Series C Convertible Preferred Stock does not meet the definition of a derivative liability because it does not contain any variable equity conversion features or other contingent provisions that would require derivative accounting. |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

Shares Issued in Acquisitions

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

In accordance with ASC 805, Business Combinations, the Series C shares issued in connection with the VV and RM acquisitions were measured at their estimated fair values of $39,000,060 and $52,000,080, respectively, as of the applicable acquisition dates. These fair value amounts have been included in the preliminary purchase price allocations and will be updated, if necessary, during the measurement period as additional information becomes available.

See Note 9.

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

Series C, Convertible Preferred Shares Issued for Services

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

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

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

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

Unvested Series C, Convertible Preferred Stock – Compensation

---

| | | |
|:---|:---|:---|
| <br>**Non-Vested Shares** |<br>**Number of**<br>**Shares** | **Weighted Average**<br>**Gant Date**<br>**Fair Value** |
| June 30, 2024 |  | $- |
| Granted | 94250 | 0.0068 |
| Vested | (37300) | 0.0068 |
| Cancelled/Forfeited | - | - |
| June 30, 2025 | 56950 | $0.0068 |
| Granted |  |  |
| Vested | (10050) |  |
| Cancelled/Forfeited | - |  |
| September 30, 2025 | 46900 | $0.0068 |
| Unrecognized compensation | $1913520 |  |
| Weighted average remaining period (years) | 1.17 |  |

---

During the three months ended September 30, 2025 and 2024, respectively, the Company recognized $410,040 and $0 of compensation expense related to vesting.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Shares Issued in Acquisitions

On March 31, 2025, the Company completed the acquisitions of SWC and Skytech. In connection with these transactions, the Company issued 83,333 and 10,000 shares of Series C, convertible preferred stock, respectively, as part of the purchase consideration.

Contingent Compensation Related to the Skytech Acquisition

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

Performance-Based Equity Awards

These awards are each to be granted once, are independent and cumulative, and are to be measured based on a 30-day volume-weighted average price (VWAP) of the Company's common stock as of the applicable measurement date.

The Company will evaluate the fair value of these awards and recognize compensation expense over the requisite service periods in accordance with ASC 718, based on the probability of achieving the specified performance conditions.

Revenue-Based Equity Awards

Sellers are eligible to receive awards of restricted stock with an aggregate maximum value of $35 million, based on the following revenue milestones:

---

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

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

EBITDA-Based Equity Awards

Sellers are eligible to receive additional restricted stock with an aggregate maximum value of $18.11 million, based on the following EBITDA thresholds:

---

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

---

These awards will be allocated pro rata among eligible recipients and are subject to continued service through each measurement date. The Company will recognize compensation expense over the vesting periods based on the estimated fair value of awards deemed probable of vesting.

As of September 30, 2025, none of these award milestones have been met.

Lock-Up Restrictions

Pursuant to the acquisition agreement, each Seller is subject to a lock-up period restricting the sale, transfer, pledge, or other disposition of any equity securities received as part of the transaction ("Restricted Buyer Securities") for a period of six (6) months following the closing date. During this period, Sellers are prohibited from transferring or encumbering such securities or entering into agreements that would transfer economic ownership, except in limited circumstances where transferees agree to be bound by the same restrictions.

The Company and its transfer agent are authorized to block any transfer in violation of this restriction. The lock-up may be terminated earlier at the sole discretion of the Company.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Seniority of Series B, Convertible Preferred Stock to Series C, Convertible Preferred Stock

The Sellers acknowledged that the Series C, convertible preferred stock issued in connection with the acquisition is subordinate to the Company's Series B preferred stock in terms of liquidation preference, dividend rights, and any other rights or entitlements. This subordination may affect the timing or amount of future distributions or conversions for the holders of Series C shares. See Note 9 for acquisitions of SWC and Skytech.

**Series D, Convertible Preferred Stock**

● Designated Shares: 100,000

● Issued & Outstanding: 3,334 shares as of September 30, 2025 and June 30, 2025, respectively

● Par Value: $0.001 per share

● Stated Value: None

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

● Dividend Provisions: None

● Voting Rights: None

● Liquidation Preference: None

● Redemption Rights: None

● Rank junior to Series B, convertible preferred stock

● Derivative Liability Assessment:

---

| | |
|:---|:---|
| ◌ | Evaluated under ASC 815 ("Derivatives and Hedging") |
| ◌ | The Series D Convertible Preferred Stock and the related warrants do not meet the definition of derivative liabilities because they contain fixed conversion terms and do not include any variable equity conversion features or other contingent provisions requiring derivative accounting. |

---

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

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

**Common Stock**

● Authorized Shares: 200,000,000

● Issued & Outstanding:

◌ 151,941,922 shares as of September 30, 2025 <br> ◌ 136,961,021 shares as of June 30, 2025 <br>

● Par Value: $0.001 per share

● Voting Rights: 1 vote per share

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

**Common Stock Issued in connection with Conversion of Convertible Notes Payable**

The Company issued an aggregate of 14,980,901 shares of common stock to certain convertible debt holders upon conversion of their outstanding notes and related accrued interest payable. The shares had a total fair value of $494,370 (approximately $0.033 per share), determined in accordance with the conversion terms set forth in the underlying lending agreement. See Note 5 for additional information.

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

**Stock Issued for Services** 

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

**Common Stock Issued in connection with Conversion of Convertible Notes Payable**

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

**Warrants**

Warrant activity for the three months ended September 30, 2025 and the year ended June 30, 2025 are summarized as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| <br>**Warrants** |<br><br>**Number of**<br>**Warrants** |<br>**Weighted**<br>**Average**<br>**Exercise Price** | **Weighted**<br>**Average**<br>**Remaining**<br>**Contractual**<br>**Term (Years)** |<br>**Aggregate**<br>**Intrinsic**<br>**Value** |
| Outstanding - June 30, 2024 | 191799274 | $0.24 | 3.21 | $6140000 |
| Exercisable - June 30, 2024 | 191799274 | $0.24 | 3.21 | $6140000 |
| Granted | 2068869 | $0.10 |  |  |
| Exercised |  |  |  |  |
| Cancelled/Forfeited | (1871800) | $0.16 |  |  |
| Outstanding - June 30, 2025 | 191996343 | $0.05 | 2.21 | $- |
| Exercisable - June 30, 2025 | 191996343 | $0.05 | 2.21 | $- |
| Granted |  | $0.10 |  |  |
| Exercised |  |  |  |  |
| Cancelled/Forfeited | (500000) | $0.50 |  |  |
| Outstanding - September 30, 2025 | 191496343 | $0.05 | 1.97 | $999404 |
| Exercisable - September 30, 2025 | 191496343 | $0.05 | 1.97 | $999404 |

---

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

**Year Ended June 30, 2026**

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

Overview and Date of Acquisition

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

Purchase Consideration

As consideration, the Company issued 216,667 shares of its Series C Convertible Preferred Stock, having an estimated fair value of $39,000,060, based on the as-converted value of the underlying common shares using the $0.03 closing stock price on the acquisition date.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Primary Reasons for the Acquisition

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

● Strengthening its presence in key hospitality markets;

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

● Immediate revenue contribution from ongoing hotel operations;

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

● Access to franchise-branding opportunities following planned
renovations.

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

Contingent Consideration - Victorville

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

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

In accordance with ASC 805, these contingent consideration arrangements are included in the preliminary purchase price allocation at their estimated fair value and will be remeasured at each reporting date until the contingencies are resolved, with changes recognized in earnings.

Acquisition-Related Costs

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

<u>Forgiveness of Pre-Existing Relationship</u>

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

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

Preliminary Purchase Price Allocation

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Schedule of Estimated Fair Value of Assets Acquired and Liabilities

---

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

---

Measurement Period

The Company expects to finalize the purchase price allocation no later than August 27, 2026. During this period, provisional amounts may be adjusted retrospectively if new information becomes available about facts and circumstances that existed at the acquisition date.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Supplemental Pro-Forma Information (Unaudited)

The unaudited pro-forma information for the periods set forth below gives effect to the acquisition had the transaction occurred on July 1, 2023 (1st day of the fiscal year ended June 30, 2024) as well as for the year ended June 30, 2025. This pro-forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the transactions been consummated as of that time. The unaudited pro forma financial results do not reflect potential cost savings, integration synergies, or non-recurring charges that may result from the transactions.

---

| | | |
|:---|:---|:---|
|  | **Year Ended**<br>**June 30, 2025** | **Year Ended**<br>**June 30, 2024** |
| Revenues - net | $2515319 | $4035763 |
| Net loss | $(8615343) | $(4230077) |
| Loss per share - basic | $(0.07) | $(0.03) |
| Loss per share - diluted | $(0.07) | $(0.03) |
| Weighted average number of shares - basic | 130384336 | 126540836 |
| Weighted average number of shares - diluted | 130384336 | 126540836 |

---

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

Overview and Date of Acquisition

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Purchase Consideration

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

Primary Reasons for the Acquisition

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

● Strengthening its presence in key hospitality markets;

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

● Immediate revenue contribution from ongoing hotel operations;

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

● Access to franchise-branding opportunities following planned
renovations.

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

Contingent Consideration – Rancho Mirage

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

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

In accordance with ASC 805, these contingent consideration arrangements are included in the preliminary purchase price allocation at their estimated fair value and will be remeasured at each reporting date until the contingencies are resolved, with changes recognized in earnings.

Acquisition-Related Costs

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

Preliminary Purchase Price Allocation

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

Schedule of Estimated Fair Value of Assets Acquired and Liabilities

---

| | |
|:---|:---|
| Consideration |  |
| &nbsp;&nbsp;&nbsp;Series C - convertible preferred stock - 176,167 shares | $42280000 |
| &nbsp;&nbsp;&nbsp;Series C - contingent consideration - 20,000 shares | 4800000 |
| &nbsp;&nbsp;&nbsp;Fair value of consideration transferred | $47080000 |
| Recognized amounts of identifiable assets acquired and liabilities assumed: |  |
| &nbsp;&nbsp;&nbsp;Cash | 968000 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 11000 |
| &nbsp;&nbsp;&nbsp;Prepaids and other | 7000 |
| &nbsp;&nbsp;&nbsp;Inventory | 7000 |
| &nbsp;&nbsp;&nbsp;Land | 2800000 |
| &nbsp;&nbsp;&nbsp;Property and equipment - net | 12000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets acquired | 15793000 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | 2376000 |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses - related party | 240000 |
| &nbsp;&nbsp;&nbsp;Deferred revenue/customer deposits | 12000 |
| &nbsp;&nbsp;&nbsp;Notes payable | 1710000 |
| &nbsp;&nbsp;&nbsp;Mortgage note payable | 9992000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities assumed | 14330000 |
| Total identifiable net assets assumed | 1463000 |
| Allocation required for identifiable intangible assets and goodwill | 45617000 |
| Intangible asset (liquor license) | 20000 |
| Intangible asset (franchise agreement) | 1400000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total identifiable intangible assets | 1420000 |
| Goodwill (including assembled workforce) | $44197000 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Measurement Period

The Company expects to finalize the purchase price allocation no later than September 30, 2026. During this period, provisional amounts may be adjusted retrospectively if new information becomes available about facts and circumstances that existed at the acquisition date.

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

Supplemental Pro-Forma Information (Unaudited)

The unaudited pro-forma information for the periods set forth below gives effect to the acquisition had the transaction occurred on July 1, 2024 (1st day of the fiscal year ended June 30, 2025) as well as for the three months ended September 30, 2025. This pro-forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the transactions been consummated as of that time. The unaudited pro forma financial results do not reflect potential cost savings, integration synergies, or non-recurring charges that may result from the transactions.

Schedule of Supplemental Proforma Information

---

| | | |
|:---|:---|:---|
|  | <br>**Three Months Ended**<br>**September 30, 2025** | <br>**Year Ended**<br>**June 30, 2025** |
| Revenues - net | $2373373 | $3263075 |
| Net loss | $(2851297) | $(7779858) |
| Loss per share - basic | $(0.02) | $(0.06) |
| Loss per share - diluted | $(0.02) | $(0.06) |
| Weighted average number of shares - basic | 143351827 | 130384336 |
| Weighted average number of shares - diluted | 143351827 | 130384336 |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Goodwill Summary

**** 

---

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

---

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

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

****

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Classification** | **September 30, 2025** | **June 30, 2025** | **Estimated Useful<br> Lives (Years)** | **Weighted Average Remaining Life (Years)** |
| Tradenames/trademarks | $786800 | $786800 | N/A | N/A |
| Customer relationships | 1041300 | 1041300 | 10 | 9.50 |
| Franchise agreements | 4600000 |  | 10 | 9.92 - 10 |
| Liquor licenses | 40000 |  | N/A |  |
| Less: accumulated amortization | (103732) | (26033) |  |  |
| Intangibles - net | $6364368 | $1802067 |  |  |

---

Amortization expense for the three months ended September 30, 2025 and 2024 was $77,699 and $0, respectively.

There were no impairment losses for the three months ended September 30, 2025 and 2024, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

**Schedule of Estimated Amortization Expense** 

---

| | |
|:---|:---|
| For the Years Ended June 30, |  |
| 2026 (9 Months) | $423098 |
| 2027 | $564130 |
| 2028 | $564130 |
| 2029 | $564130 |
| 2030 | $564130 |
| Thereafter | $2856284 |
| Total | $5535902 |

---

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

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

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

Valuation Methodology

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

The initial day-1 fair value of the derivative liabilities was $1,413,568. These liabilities were remeasured to $1,102,992 at June 30, 2025 and to $2,053,045 at September 30, 2025.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

The model utilized the following key assumptions:

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| Expected term (years) | 1.93 | 2.18 - 2.43 |
| Expected volatility | 238% | 207.70% - 233.30 |
| Expected dividends | 0.00% | 0.00% - 0.00 |
| Risk free interest rate | 3.60% | 3.72% - 3.89 |

---

 

Derivative Liability Activity

Changes in the fair value of derivative liabilities are recognized in other income (expense) in the consolidated statements of operations. For the three months ended September 30, 2025 and 2024, the Company recorded a change in fair value of $950,053 and $0, respectively.

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

Schedule of Activity in Derivative Liabilities Account

---

| | | | |
|:---|:---|:---|:---|
|  | **Third Party** | **Related Party** | **Total** |
| Derivative liabilities – June 30, 2024 | $- | $- | $- |
| Fair value at commitment date | 987131 | 426437 | 1413568 |
| Gain on debt extinguishment |  | (500678) | (500678) |
| Fair value mark to market adjustment | (181366) | 371468 | 190102 |
| Derivative liabilities – June 30, 2025 | 805765 | 297227 | 1102992 |
| Fair value mark to market adjustment | 694039 | 256014 | 950053 |
| Derivative liabilities – September 30, 2025 | $1499804 | $553241 | $2053045 |

---

Debt Extinguishment and Related Impacts

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

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

For the three months ended September 30, 2025 and 2024, the Company recognized $0 and $0 of derivative expense, respectively.

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Related Party Component

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

See Note 12 for additional fair value disclosures.

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

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

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

Schedule of Financial Instruments at Fair Value on a Recurring Basis

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **September 30, 2025** | **September 30, 2025** | **September 30, 2025** | **September 30, 2025** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
| Liabilities |  |  |  |  |
| Derivative liabilities | $- | $- | $2053045 | $2053045 |
| Total | $- | $- | $2053045 | $2053045 |

---

---

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

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

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

General

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

Reportable Segments

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

&nbsp;&nbsp;&nbsp;&nbsp;1. Foodservice
 Packaging Distribution

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

3. Hotel
 Operations

The Hotel Operations segment was established following the Company's acquisitions of the Victorville and Rancho Mirage hotel businesses during the first quarter of fiscal 2026. This segment includes the results of operations from the Company's owned hotel properties, including lodging, food and beverage, and related hospitality services.

Other Corporate Overhead represents corporate-level activities and shared services (e.g., public company compliance, executive, finance, legal, IT, and other centralized functions). These activities are not included in the CODM's evaluation of segment performance, are not considered reportable operating segments, and are presented solely for reconciliation to the consolidated financial statements.

Basis of Presentation

The CODM evaluates segment performance primarily on revenues and operating income (loss) and also reviews segment assets and liabilities. Segment information is prepared on the same basis as the consolidated financial statements and includes intercompany eliminations.

Continuing vs. Discontinued Operations

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

Reconciliations

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Schedule of Segment Reporting for Reconciliation of Revenue

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30,** | **For the Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Revenues** |  |  |
| Foodservice Packaging | $418043 | $- |
| RaaS | 49800 |  |
| Hotel | 314184 |  |
| Other Corporate Overhead | - | - |
| Revenues - continuing operations | 782027 |  |
| Revenues - discontinued operations | - | 24454 |
| Total | $782027 | $24454 |
| **Costs and expenses** |  |  |
| Foodservice Packaging | $630153 | $- |
| RaaS | 440287 | 33258 |
| Hotel | 604925 |  |
| Other Corporate Overhead | 1272543 | 185203 |
| Costs and expenses - continuing operations | 2947908 | 218461 |
| Costs and expenses - discontinued operations | 1453 | 120280 |
| **Total** | $2949361 | $338741 |
| **Income (loss) from operations** |  |  |
| Foodservice Packaging | $(212110) | $- |
| RaaS | (390487) | (33258) |
| Hotel | (290741) |  |
| Other Corporate Overhead | (1272543) | (185203) |
| Loss from continuing operations | (2165881) | (218461) |
| Loss from discontinued operations | (1453) | (95826) |
| **Total** | $(2167334) | $(314287) |
| **Other income (expense) - net** |  |  |
| Foodservice Packaging | $3159 | $- |
| RaaS | 4925 | 17872 |
| Hotel | (133268) |  |
| Other Corporate Overhead | (1403017) | (468196) |
| Other expense - continuing operations | (1528201) | (450324) |
| Other expense - discontinued operations | - | - |
| **Total** | $(1528201) | $(450324) |
| **Net loss** |  |  |
| Foodservice Packaging | $(208951) | $- |
| RaaS | (385562) | (15386) |
| Hotel | (424009) |  |
| Other Corporate Overhead | (2675560) | (653399) |
| Net loss from continuing operations | (3694082) | (668785) |
| Net loss from discontinued operations | (1453) | (95826) |
| Total | $(3695535) | $(764611) |

---

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| **Total Assets** |  |  |
| Foodservice Packaging | $5929979 | $5986956 |
| RaaS | 1261666 | 1299198 |
| Hotel | 121512986 |  |
| Other Corporate Overhead | 89071 | 38380 |
| Assets - continuing operations | 128793702 | 7324534 |
| Assets - discontinued operations | - | - |
| Total | $128793702 | $7324534 |
| **Total Liabilities** |  |  |
| Foodservice Packaging | $1644393 | $1642420 |
| RaaS | 309230 | 275801 |
| Hotel | 28997037 |  |
| Other Corporate Overhead | 20874011 | 9550421 |
| Liabilities - continuing operations | 51824671 | 11468642 |
| Liabilities - discontinued operations | 450458 | 479005 |
| Total | $40350129 | $11947647 |

---

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

On June 30, 2025, management elected to discontinue the Company's legacy Snacks and Beverages business, which historically involved the sale of packaged snack products through wholesale and distribution channels. This decision was part of a broader strategic realignment to focus resources on the Company's continuing operations, including foodservice packaging distribution, Robotics-as-a-Service ("RaaS"), and hotel operations.

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

**NIGHTFOOD HOLDINGS, INC. AND SUBSIDIARIES**

**DBA TECHFORCE ROBOTICS**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**SEPTEMBER 30, 2025**

Results of Discontinued Operations

The operating results of discontinued operations for the three months ended September 30, 2025 and 2024 were as follows:

Schedule of Discontinued Operations

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30,** | **For the Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Revenues - net** | $- | $24454 |
| Costs and expenses | 156 | 118299 |
| Loss from operations | (156) | (93845) |
| General and administrative expenses | (1297) | (1981) |
| **Net loss from discontinued operations** | $(1453) | $(95826) |

---

Liabilities of Discontinued Operations

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

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **June 30, 2025** |
| **Current liabilities** |  |  |
| Accounts payable and accrued expenses | $450495 | $479005 |
| **Total liabilities** | $450495 | $479005 |

---

**<u>Note 15 – Subsequent Events</u>**

Subsequent to September 30, 2025, the Company had the following transactions:

Debt Conversions

Loan #17

The Company issued 4,285,994 shares of common stock in connection with the settlement of outstanding amounts due to a single lender under loan #17, consisting of principal of $102,600, accrued interest of $33,589, and fees of $5,250, for a total conversion amount of $141,439. Pursuant to the debt agreement, the shares were converted at a fixed rate of $0.033 per share. Accordingly, no gain or loss was recorded upon debt conversion, and the note was fully settled upon completion of these conversions.

Cashless Warrant

The Company issued 1,399,521 shares of common stock in connection with the cashless exercise of 1,969,697 warrants.

Conversion of Series B, Convertible Preferred Stock

Effective October 28, 2025, the Company increased the conversion ratio applicable to its Series B Convertible Preferred Stock from 5,000:1 to 8,366:1. This adjustment was made pursuant to the original contractual provisions governing the Series B Preferred Stock, which permitted changes to the conversion ratio under specified conditions. Because the conversion occurred in accordance with these original terms, the modification and subsequent conversion are accounted for as equity transactions, and do not result in the recognition of any gain or loss.

Using the revised conversion ratio, the Company issued 16,313,700 shares of common stock upon the conversion of 1,950 shares of Series B Preferred Stock. As the Series B Preferred Stock was equity-classified and the conversion represented a reclassification within equity, the transaction did not give rise to any income-statement impact. Following these conversions, no shares of Series B Preferred Stock remain outstanding.

<u>Increase in Authorized Shares</u>

On October 7, 2025, the Company's majority voting stockholder approved an increase in the Company's authorized common stock from 200,000,000 to 900,000,000 shares. The Board approved the change on the same date. In accordance with SEC requirements, the amendment became effective 20 days after the Company mailed an information statement to stockholders. This change increased only the number of authorized shares and had no impact on the number of shares outstanding or on the rights of existing stockholders.

Equity Purchase Agreement and Warrant

On October 8, 2025, the Company entered into an Equity Purchase Agreement with Mast Hill Fund, L.P., allowing the Company to sell up to $25,000,000 of common stock at its discretion over a 24-month period. In connection with the agreement, the Company issued Mast Hill a warrant to purchase 6,000,000 shares at $0.10 per share. The warrant is immediately exercisable and expires in five years.

Convertible Note Payable

On October 8, 2025, the Company entered into a one-year (1) Securities Purchase Agreement with Mast Hill Fund, L.P. and issued a senior secured convertible note with a principal amount of $2,270,000 for net proceeds of $1,929,500. The note includes an original issue discount of $340,500 and is secured by the Company's existing security and guaranty agreements.

The note is convertible into common stock at a fixed conversion price of $0.033 per share.

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**FORWARD LOOKING STATEMENT INFORMATION**

Certain statements made in this Quarterly Report on Form 10-Q involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts, and use words such as "anticipate," "believe," "estimate," "expect," "forecast," "may," "should," "plan," "project," "will" and other words of similar meaning. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. Our plans and objectives are based, in part, on assumptions involving judgments with respect to, among other things, future economic, competitive and market conditions, technological developments related to business support services and outsourced business processes, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control.

Although we believe that our assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Quarterly Report on Form 10-Q will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein particularly in view of the current state of our operations, the inclusion of such information should not be regarded as a statement by us or any other person that our objectives and plans will be achieved. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, the factors set forth under the headings "Business" and "Risk Factors" within our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 as filed with the Securities and Exchange Commission (the "SEC") on October 14, 2025, as well as the other information set forth herein.

**Business Overview**

Nightfood Holdings, Inc., dba TechForce Robotics ("Nightfood," "NGTF," "TechForce Robotics," or the "Company"), is evolving into an integrated AI-driven service-robotics and hospitality-technology platform. Our core mission is the development, deployment, and commercialization of AI-powered autonomous robots designed to improve operational efficiency across the hospitality, foodservice, and facilities-management industries.

**Present Operations**

The Company is structured around three synergistic pillars:

&nbsp;&nbsp;&nbsp;&nbsp;1. AI
 robotics and automation

&nbsp;&nbsp;&nbsp;&nbsp;2. Hospitality
 real estate assets serving as robotics testbeds

&nbsp;&nbsp;&nbsp;&nbsp;3. Packaging
 and supply-chain logistics through CarryOutSupplies

This vertically aligned ecosystem is designed to accelerate adoption of automation technologies while providing asset-backed stability, operational data, and cross-selling opportunities across the hospitality sector.

**Core Robotics Division (TechForce Robotics / FHVH)**

The Company's primary operations center on its robotics division, comprised of Future Hospitality Ventures Holdings Inc. ("FHVH"), acquired February 2, 2024, and Skytech Automated Solutions, Inc., operating as TechForce Robotics, acquired March 25, 2025. Collectively branded as **TechForce Robotics**, this division develops and commercializes Robots-as-a-Service ("RaaS") solutions for hotels, restaurants, and commercial facilities.

**Current activities include:**

● Robots-as-a-Service (RaaS): Deployment of autonomous service robots under multi-year subscription agreements, typically initiated through 30-day pilot programs. These robots focus on high-frequency, labor-intensive tasks—such as trash and linen transport, housekeeping assistance, food and item delivery, and other back-of-house workflows. In the kitchen environment, the Company is expanding automation into high-intensity labor functions, including food-preparation support, ingredient handling, repetitive cooking processes, and hot-zone tasks that traditionally require substantial staffing and present elevated safety risks. These deployments are designed to reduce labor strain, improve consistency, and increase overall operational throughput.

● AI Systems Integration: Ongoing development of advanced autonomous navigation, task-automation workflows, and cloud-connected fleet-management software. These systems are engineered specifically for hotel, kitchen, and foodservice environments, enabling coordinated task execution, real-time monitoring, and continuous optimization using operational data collected across the Company's deployment network.

**Hospitality Real Estate Platform (Live Robotics Testbeds)**

To support real-world deployment and validation of its robotics technologies, the Company has begun acquiring strategic hospitality real estate. These properties operate as controlled, commercial-scale testing and demonstration environments, enabling continuous refinement and proof-of-concept deployment of AI automation systems.

**Victorville Treasure Holdings, LLC – 155-Room Holiday Inn (Victorville, CA)**

Acquired in August 2025 for approximately $31 million via share-exchange transaction.

This hotel serves as the Company's first dedicated Robotics Innovation Hub. The Skytech Laundry Helper robot is currently deployed, with additional automation phases planned across housekeeping, foodservice, guest-services, and front-of-house operations.

**Treasure Mountain Holdings, LLC – 120-Room Hilton Garden Inn (Rancho Mirage, CA)**

Acquired on September 30, 2025 in a transaction valued at approximately $52.8 million.

This property is positioned as a flagship technology-enabled hotel, contributing both traditional hospitality revenue and a robust, real-world environment for scaled deployment of AI-connected robotics solutions.

These hotel assets add significant asset-backed equity to the Company's balance sheet and serve as scalable, customer-facing demonstration sites for future RaaS rollout.

**Packaging and Supply-Chain Operations (CarryOutSupplies.com)**

Through SWC Group Inc. (CarryOutSupplies.com), acquired March 31, 2025, the Company operates a packaging and distribution platform serving more than 7,000 small and mid-sized foodservice customers across North America. CarryOutSupplies provides branded and customizable disposable foodservice items, including cups, lids, utensils, and biodegradable options.

Its role within the Company's integrated platform includes:

● Providing a logistical and supply-chain layer that supports hospitality customers

● Enabling cross-promotion of RaaS solutions to existing CarryOut customer accounts

● Enhancing platform efficiency through shared back-office functions

CarryOut's established customer footprint and recurring consumable revenues complement the robotics division and strengthen the Company's overall go-to-market ecosystem.

**Development Plans**

The Company intends to continue expanding its AI-driven robotics and hospitality-technology platform through the following initiatives:

● **Scaling RaaS Deployments:** Increase commercial installations of autonomous service robots across hotels, restaurants, and foodservice operators, with continued emphasis on automating high-intensity kitchen and back-of-house tasks.

● **Expanding Production Capacity:** Scale manufacturing and assembly capabilities to meet anticipated customer demand over the next five years and support broader market rollout.

● **Strategic Technology and Talent Acquisition:** Pursue targeted acquisitions of complementary technologies and key personnel to enhance the Company's robotics, AI, and operational capabilities.

● **Balance-Sheet Optimization:** Strengthen capitalization and improve the Company's financial structure to support future growth initiatives, including preparation for a potential uplisting to a national securities exchange.

These initiatives are intended to reinforce the Company's vertically integrated model and position the platform for sustainable long-term expansion.

 ****

**<u>RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024</u>**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** | **Period Change** | **Period Change** |
|  | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
|  | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Revenues - net | $782027 | $- | $782027 | 0% **A** |
| Cost of sales | 475565 |  | 475565 | 0% **B** |
| Depreciation and amortization | 378109 |  | 378109 | 0% **C** |
| General and administrative expenses | 2094234 | 218461 | 1875773 | 859% **D** |
| Loss from operations | (2165881) | (218461) | (1947420) | 891% **E** |
| Other income (expense) - net | (1528201) | (450324) | (1077877) | 239% **F** |
| Loss from continuing operations | (3694082) | (668785) | (3025297) | 452% **G** |
| Loss from discontinued operations | (1453) | (95826) | 94373 | -98% **H** |
| Net Loss | $(3695535) | $(764611) | $(2930924) | 383% **I** |

---

A. Revenues – net

Revenues were $782,027 for the three months ended September 30, 2025, compared to no revenues from continuing operations in the three months ended September 30, 2024.

The increase reflects the Company's transition from a pre-revenue development stage to an operating company with multiple revenue-generating activities, including:

● Hotel operations – During 2025, the Company acquired hotel properties that generated room revenues, food and beverage revenues, and other ancillary income in the current-year quarter. These hotels are being operated under the Company's strategic plan to leverage lodging assets and hospitality channels for future brand initiatives. Operations from these activities only reflect those since there acquisition dates.

● Foodservice Packaging Distribution and related services – Revenues were also generated from the sale and distribution of foodservice packaging and related supplies to commercial customers, including hotels and other institutional clients.

● Robotics-as-a-Service ("RaaS") and technology-enabled services – To a lesser extent, revenues include service billings from early deployments of robotics and automation solutions.

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

B. Cost of Sales

Cost of sales was $475,565 in the three months ended September 30, 2025, compared to $0 in the prior-year quarter.

Cost of sales in 2025 primarily consists of:

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

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

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

Because the Company had not yet commenced these operations during the 2024 quarter, there were no comparable cost of sales in that period.

C. Depreciation and Amortization

Depreciation and amortization expense was $378,109 for the three months ended September 30, 2025, compared to none in the same period of 2024.

The increase is driven by:

● Depreciation of hotel buildings, land improvements, and furniture, fixtures and equipment acquired in connection with the Company's hotel acquisitions.

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

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

These assets were placed in service after the 2024 quarter, so there was no depreciation or amortization recorded in that earlier period.

D. General and Administrative Expenses

General and administrative ("G&A") expenses were $2,094,234 in the three months ended September 30, 2025, compared to $218,461 in the three months ended September 30, 2024, an increase of $1,875,773, or 859%.

Key drivers of the increase include:

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

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

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

● Inflationary impacts on compensation, insurance, professional services and other overhead expenses.

The Company expects G&A to remain elevated in the near term as hotel operations are stabilized, systems are integrated and additional regulatory requirements—such as evolving SEC guidance on cybersecurity, climate-related and other risk disclosures—are incorporated into the Company's compliance framework.

E. Loss from Operations

Loss from operations was $(2,165,881) for the three months ended September 30, 2025, compared to $(218,461) in the prior-year quarter, an unfavorable change of $(1,947,420), or 891%.

The higher operating loss is attributable to:

● The ramp-up of hotel operations (acquisitions occurring August 27, 2025 and September 30, 2025, respectively), which, while contributing to revenues, also added significant property-level operating costs and depreciation. Newly acquired or repositioned hotels often operate below targeted occupancy and rate levels during the initial stabilization period, resulting in lower margins.

● The addition of cost of sales and depreciation in the foodservice packaging and RaaS businesses.

● Substantially higher G&A expenses as described under item D above.

These factors more than offset the benefit of current-year revenues.

F. Other Income (Expense) – net

Other expense, net, was $(1,528,201) in the three months ended September 30, 2025, compared to $(450,324) in the prior-year quarter, an unfavorable change of $(1,077,877), or 239%.

The components of this change are discussed in detail in the "Other Income (Expense) – Net" section below (items A–F), but primarily reflect:

● Increased interest expense on notes and mortgage debt used to finance hotel acquisitions and working capital; and

● A new non-cash loss on the change in fair value of derivative liabilities associated with certain convertible and other structured financing instruments.

G. Net Loss from Continuing Operations

Net loss from continuing operations increased to $(3,694,082) in the three months ended September 30, 2025, from $(668,785) in the three months ended September 30, 2024, an unfavorable change of $(3,025,297), or 452%.

The increase primarily reflects:

● The higher operating loss from hotel operations, foodservice packaging, and RaaS (items A–E); and

● The increased non-operating expense discussed under item F.

These factors were only partially offset by the benefit of current-year revenues.

H. Net Loss from Discontinued Operations

Net loss from discontinued operations, which continues to relate to the wind-down of the legacy Snacks and Beverages business, was $(1,453) for the three months ended September 30, 2025, compared to $(95,826) in the prior-year quarter, an improvement of $94,373, or 98%.

The improvement reflects the near completion of exit and wind-down activities, resulting in minimal residual expenses in the 2025 quarter.

I. Net Loss

Net loss was $(3,695,535) for the three months ended September 30, 2025, compared to $(764,611) in the prior-year quarter, an unfavorable change of $(2,930,924), or 383%.

The increase in net loss was driven by:

&nbsp;&nbsp;&nbsp;&nbsp;1. Expansion
 of operations and acquisitions – The Company incurred significant new operating expenses
 related to hotel operations, foodservice packaging distribution, and RaaS, along with associated
 depreciation and integration costs, which exceeded revenues during the early ramp-up phase.

&nbsp;&nbsp;&nbsp;&nbsp;2. Higher
 non-operating expenses – Increased interest expense on new and existing debt and the
 recognition of non-cash fair value losses on derivative liabilities contributed to the year-over-year
 increase in other expense, net (item F).

&nbsp;&nbsp;&nbsp;&nbsp;3. Partially
 offsetting factors – The increase in net loss was partially offset by (i) the Company's
 first quarter of revenues from hotel operations and other continuing businesses (item A),
 and (ii) a substantial reduction in loss from discontinued operations (item H).

**Other Income (Expense)**

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended<br> September 30,** | **Three Months Ended<br> September 30,** | **Period Change** | **Period Change** |
| | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| <br>**Other income (expense) - net** | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Interest income | $4925 | $15986 | $(11061) | -69% **A** |
| Other income | 5001 |  | 5001 | 0% **B** |
| Loss on debt extinguishment |  | (127705) | 127705 | -100% **C** |
| Interest expense (including amortization of debt discount) | (588074) | (338605) | (249469) | 74% **D** |
| Change in fair value of derivative liabilities | (950053) | - | (950053) | 0% **E** |
| **Total other income (expense) - net** | $(1528201) | $(450324) | $(1077877) | 239% **F** |

---

A — Interest income

Interest income decreased $11,061, or 69%, to $4,925 in the 2025 quarter from $15,986 in the 2024 quarter. The decrease primarily reflects lower average balances of interest-bearing notes receivable and advances as certain pre-acquisition and development-stage notes were repaid or restructured in connection with acquisitions. This activity was insignificant.

B — Other income

Other income was $5,001 in the three months ended September 30, 2025, compared to none in the prior-year quarter. This increase is attributable to miscellaneous non-recurring items, which did not occur in 2024. This activity was insignificant.

C — Loss on debt extinguishment

No loss on debt extinguishment was recognized in the 2025 quarter, compared to a $(127,705) loss in the 2024 quarter. The prior-year loss related to one-time non-cash charges on the modification or settlement of certain debt instruments. There were no comparable transactions in the current-year quarter.

D — Interest expense (including amortization of debt discount)

Interest expense, including amortization of debt discounts, increased $249,469, or 74%, to $(588,074) in the 2025 quarter from $(338,605) in the 2024 quarter.

The increase reflects:

● Higher average outstanding notes payable and mortgage debt, including loans associated with the acquisition and operation of hotel properties.

● Incremental convertible and other structured debt used to fund working capital, integration costs, and capital investments.

● Higher amortization of debt discounts and deferred financing costs related to these instruments.

E — Change in fair value of derivative liabilities

In the 2025 quarter, the Company recognized a non-cash loss of $(950,053) related to the change in fair value of derivative liabilities associated with certain convertible notes. No comparable fair value adjustments were recorded in the 2024 quarter as no such instruments existed.

The loss reflects the required remeasurement of derivative features at each reporting date under applicable accounting guidance, using updated assumptions for the Company's stock price, volatility, and other valuation inputs.

F — Total other income (expense) – net

As a result of the items described above, total other expense, net, increased to $(1,528,201) in the 2025 quarter from $(450,324) in the 2024 quarter, an unfavorable change of $(1,077,877), or 239%. The increase is primarily attributable to higher interest expense (D) and the new non-cash fair value loss on derivative liabilities (E), partially offset by the absence of a current-period loss on debt extinguishment (C).

**Hotel Operations Discussion**

During 2025, the Company completed hotel acquisitions that transformed Nightfood Holdings into an owner and operator of lodging properties in addition to its existing packaging and RaaS businesses. The three months ended September 30, 2025 represents the Company's first partial quarter of consolidated hotel operations, which had a significant impact on the consolidated financial statements:

● Revenue mix – A substantial portion of current-year revenues was generated by hotel room nights, food and beverage outlets, and other property-level services. The Company is implementing revenue-management strategies, updated reservation systems and targeted marketing efforts intended to grow occupancy and average daily rate over time.

● Cost structure – Hotel operations added significant property-level operating expenses (captured in cost of sales) and depreciation on hotel buildings and equipment, contributing to the increase in total costs and expenses compared to 2024.

● Financing and liquidity – The acquisition of hotel properties introduced mortgage debt and related financing costs, reflected in higher interest expense and repayments on mortgage notes payable in the 2025 quarter. The Company is focused on optimizing capital structure and property-level performance to improve cash flows from these assets.

● Integration and brand strategy – Management is actively integrating hotel operations with the Company's broader strategic objectives, including potential branded product placement, amenity programs, and cross-marketing initiatives that leverage the lodging footprint.

Hotel properties often experience a stabilization period after acquisition or repositioning, during which occupancy and rate levels may be below long-term expectations while operating costs and capital requirements remain high. Management expects hotel-level performance and cash flows to improve as integration progresses, revenue-management initiatives take hold and capital improvements are completed. However, there can be no assurance that these efforts will be successful or that the hotels will achieve targeted returns.

**LIQUIDITY AND CAPITAL RESOURCES**

**<u>Liquidity and Going Concern</u>**

As reflected in the accompanying consolidated financial statements, for the nine months ended September 30, 2025, the Company had:

● Net
 loss available to common stockholders of $3,695,535; and

● Net
 cash used in operations was $243,388

Additionally, at September 30, 2025, the Company had:

● Accumulated
 deficit of $50,449,379

● Stockholders'
 deficit of $17,880,668; and

● Working
 capital deficit of $18,734,145

For the three months ended September 30, 2025, the Company incurred a net loss of $(3,695,535) and used net cash in operating activities of $(243,388). The Company continues to have a significant accumulated deficit and stockholders' deficit and relies on external financing to fund operations and acquisitions.

At September 30, 2025, the Company had cash of $1,337,285, compared to $350,231 at June 30, 2025. While the recent hotel and business acquisitions have begun to generate revenues, they have not yet produced sufficient positive cash flow to fund all operating costs, debt service and planned capital expenditures.

These factors—recurring losses from continuing operations, limited operating cash flows, and dependence on debt and equity financing—continue to raise substantial doubt about the Company's ability to continue as a going concern within one year after the date the accompanying financial statements are issued. The financial statements do not include any adjustments that might result from the outcome of this uncertainty and have been prepared assuming the Company will continue as a going concern.

Management's plans to address these conditions include:

● Increasing revenue and improving profitability of hotel operations, including through revenue-management initiatives, cost controls, and selective capital investments intended to enhance property performance.

● Scaling foodservice packaging and RaaS revenues, including cross-selling into the Company's hotel customer base.

● Seeking additional debt and/or equity financing, including mortgage refinancings, working capital facilities and potential equity issuances, to support operations, fund capital projects and pursue strategic opportunities.

● Maintaining a disciplined approach to capital allocation and operating expenses, including reviewing underperforming assets or business lines and considering asset sales, restructurings or partnership arrangements where appropriate.

● Continuing to monitor evolving regulatory and disclosure requirements applicable to smaller reporting companies, including SEC rules related to liquidity, cybersecurity and climate-related risks, and integrating those requirements into its risk management and internal control framework.

There can be no assurance that these plans will be successful or that additional financing will be available on acceptable terms or in sufficient amounts, if at all. If the Company is unable to obtain the necessary financing or improve cash flows from operations, it may be required to delay or curtail expansion plans, sell assets, restructure obligations or pursue other strategic alternatives.

Cash

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | | **Period Change** | **Period Change** |
|  | | | **Increase (Decrease)** | **Increase (Decrease)** |
|  |<br>**September 30, 2025** |<br>**June 30, 2025** | **$ Amount** | **% Change** |
| Cash | $1337285 | $350231 | $987054 | 281.83% |

---

Cash increased $987,054, or approximately 282%, to $1,337,285 at September 30, 2025 from $350,231 at June 30, 2025. The increase primarily reflects:

● Net cash provided by investing activities associated with the acquisition of businesses (including hotel properties) where the cash acquired exceeded cash outflows, and

● Modest net cash used in operating activities and cash used in financing activities, as discussed below.

The Company does not have any cash equivalents.

Summary of cash flow activities:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** | **Period Change** | **Period Change** |
| | **2025** | **2024** | **Increase (Decrease)** | **Increase (Decrease)** |
| <br>**Net Cash Provided by (Used in)** | **Amount** | **Amount** | **$ Amount** | **% Change** |
| Operating activities | $(243388) | $(128241) | $(115147) | 89.79% |
| Investing activities | 1235019 | (128580) | $1363599 | -1060.51% |
| Financing activities | (4577) | 402050 | $(406627) | -101.14% |
| Net change in cash | $987054 | $145229 | $841825 | 579.65% |

---

**Cash Flow from Operating Activities**

---

| | | | |
|:---|:---|:---|:---|
|  | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** |  |
|  | **2025** | **2024** |  |
| **Operating activities** |  |  |  |
| Net loss | $(3695535) | $(764611) |  |
| Less: net loss - discontinued operations | (1453) | (95826) |  |
| Net loss - continuing operations | (3694082) | (668785) |  |
| Adjustments to reconcile net loss to net cash used in operating activities |  |  |  |
| Non-cash financing cost under contingent liability |  | 92000 | **A** |
| Interest income under acquisition note |  | (15986) | **B** |
| Depreciation and amortization | 378109 |  | **C** |
| Loss on debt extinguishment |  | 127705 | **D** |
| Change in fair value of derivative liabilities | 950053 |  | **E** |
| Amortization of debt discount | 138972 | 50372 | **F** |
| Bad debt expense | 61158 |  | **G** |
| Stock issued for services |  | 995 | **H** |
| Vesting of Series C - preferred stock - issued as compensation | 410040 |  | **I** |
| Changes in operating assets and liabilities |  |  |  |
| (Increase) decrease in |  |  |  |
| Accounts receivable | (28574) | (5252) | **J** |
| Inventory | (30182) | 30921 | **K** |
| Prepaids and other | 96356 | (52261) | **L** |
| Increase (decrease) in |  |  |  |
| Accounts payable and accrued expenses | (467393) | 175988 | **M** |
| Accounts payable and accrued expenses - related party | 1942639 | 44200 | **N** |
| Deferred revenues | 29479 | - | **O** |
| Net cash used in operating activities - continuing operations | (213425) | (220103) |  |
| Net cash used in operating activities - discontinued operations | (29963) | 91862 | **P** |
| Net cash used in operating activities | (243388) | (128241) |  |

---

Operating activities used $(243,388) of cash in the three months ended September 30, 2025, compared to $(60,899) used in the three months ended September 30, 2024, an decline of $115,147.

Starting from net loss from continuing operations of $(3,694,082), key non-cash adjustments and working capital changes for the 2025 quarter included:

● Non-cash financing cost under contingent liability (A) – Decreased $92,000, as no contingent liability financing costs were recorded in 2025 compared to 2024.

● Interest income under acquisition note (B) – Decreased $15,986, reflecting no comparable non-cash interest income in the current year.

● Depreciation and amortization (C) – Increased $378,109 due to the depreciation of hotel and other acquired assets discussed above.

● Loss on debt extinguishment (D) – Decreased $127,705, as no loss was recorded in 2025.

● Change in fair value of derivative liabilities (E) – New non-cash loss of $950,053 in 2025 related to remeasurement of derivative liabilities.

● Amortization of debt discount (F) – Increased to $138,972 in 2025 from $50,372 in 2024, reflecting a higher balance of discounted debt.

● Bad debt expense (G) – Increased to $61,158, reflecting higher allowances on receivables from new operations.

● Stock issued for services (H) – Decreased $995, as no stock was issued for services in 2025.

● Vesting of Series C preferred stock – issued as compensation (I) – Non-cash charge of $410,040 in 2025 related to vesting of previously issued preferred shares.

Changes in operating assets and liabilities included:

● Accounts receivable (J) – Increased $28,574 in 2025 versus a decrease of $1,745 in 2024, reflecting growth primarily in hotel and packaging receivables.

● Inventory (K) – Increased $30,182 in 2025 compared to a decrease of $4,926 in 2024, as the Company built inventory to support packaging and hotel operations.

● Prepaids and other (L) – Decreased $96,356 in 2025 versus a $6,069 decrease in 2024, primarily due to the timing of prepaid insurance/taxes, franchise fees and other costs.

● Accounts payable and accrued expenses (M) – Decreased $161,393 in 2025 versus an increase of $275,734 in 2024, reflecting the timing of vendor and professional-fee payments.

● Accounts payable and accrued expenses – related party (N) – Increased $1,862,639 in 2025 versus $44,200 in 2024, primarily due to additional advances and accrued amounts owed to related-party lenders and affiliates.

● Deferred revenues (O) – Increased $29,479 in 2025, reflecting advance billings for packaging.

● Net cash from discontinued operations (P) – Operating activities of discontinued operations used $(29,963) of cash in 2025 compared to providing $20,126 in 2024, reflecting the timing of final wind-down expenditures.

Collectively, these non-cash items and working capital changes largely offset the net loss, resulting in a relatively small net use of cash in operating activities for the quarter.

**Cash Flow from Investing Activities**

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| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Investing activities** |  |  |
| Cash acquired in acquisitions | $1269000 | $- **A** |
| Acquisition of property and equipment | (33981) | - **B** |
| Acquisition costs secured by debt | - | (128580) **C** |
| **Net cash provided by (used in) investing activities** | $1235019 | $(128580) |

---

Net cash provided by investing activities was $1,235,019 for the three months ended September 30, 2025, compared to net cash used of $(128,580) in the prior-year quarter, an improvement of $1,363,599.

● Cash acquired in acquisitions (A) – Net inflow of $1,269,000 in 2025, representing cash acquired in business acquisitions from our two (2) new hotel properties. There was no comparable inflow in 2024.

● Acquisition of property and equipment (B) – Cash outflows of $(33,981) in 2025 primarily for new robots and related trays/bins. No comparable purchases occurred in 2024.

● Acquisition costs secured by debt (C) – In 2024, the Company recorded $(128,580) of acquisition costs financed directly with debt; no such amounts were recorded in 2025.

**Cash Flow from Financing Activities**

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| | | |
|:---|:---|:---|
|  | **Three Months Ended <br> September 30,** | **Three Months Ended <br> September 30,** |
|  | **2025** | **2024** |
| **Financing activities** |  |  |
| Proceeds from notes payable | $- | $402050 **A** |
| Repayments on notes payable | (3236) | - **B** |
| Repayments on mortgage notes payable | (1341) | - **C** |
| **Net cash provided by (used in) financing activities** | $(4577) | $402050 |
| Net change in cash and cash equivalents | $987054 | $145229 |

---

Net cash used in financing activities was $(4,577) in the three months ended September 30, 2025, compared to net cash provided of $402,050 in the prior-year quarter, a decrease of $632,627.

● Proceeds from notes payable (A) – The Company received no new cash proceeds from notes payable in 2025, compared to $402,050 of proceeds in 2024.

● Repayments on notes payable (B) – Cash repayments of $(3,236) were made in 2025 on notes payable; there were no comparable repayments in 2024.

● Repayments on mortgage notes payable (C) – In 2025, the Company repaid $(1,341) of principal on mortgage notes payable associated with hotel properties. No such repayments occurred in 2024.

The shift from net cash provided by financing activities in 2024 to net cash used in 2025 reflects the Company's transition from raising new debt to funding operations and acquisitions, to making scheduled principal payments on existing notes and mortgage debt without obtaining comparable new financing during the quarter.

**Critical Accounting Policies and Estimates**

Our discussion and analysis of financial condition and results of operations is based upon our unaudited consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses, as well as related disclosures of contingent assets and liabilities.

These estimates are based on historical experience and on various other factors believed to be reasonable under the circumstances, including current economic conditions and information available at the time the financial statements are prepared. Actual results may differ materially from those estimates, and such differences could have a material impact on our financial position or results of operations.

We define our critical accounting policies as those that require significant judgment or complexity in their application and that are most important to the portrayal of our financial condition and results of operations. These policies typically require assumptions about matters that are uncertain at the time the estimate is made and could change materially in subsequent periods.

**Business Combinations and Asset Acquisitions**

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

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

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

Business Combinations

For transactions classified as business combinations, the Company:

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

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

● Expenses acquisition-related costs as incurred.

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

Significant judgments in fair value determinations include:

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

● Useful life assessments, impacting amortization and financial results.

● Contingent consideration, which is remeasured at fair value through earnings.

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

Asset Acquisitions

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

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

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

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

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

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

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

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

Regulatory and Financial Reporting Considerations

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

Regulation S-X, Rule 3-14 (Real Estate Operations):

Applies to acquisitions of real estate operations, including hotel properties. If the acquired property is significant under Rule 1-02(w), the registrant must provide audited property-level financial statements (typically one year) and related disclosures.

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

Applies to acquisitions of operating businesses. If significance thresholds are met, the registrant must provide separate business-level financial statements (up to three years), which are generally more extensive than Rule 3-14 requirements.

Regulation S-X, Article 11:

Requires pro forma financial information when an acquisition (under either Rule 3-05 or Rule 3-14) is significant, including adjustments reflecting the impact of the acquisition on the registrant's financial statements.

Regulation S-K, Item 101:

Requires disclosure of material acquisitions that affect the nature or scope of the registrant's business.

Regulation S-K, Item 303 (MD&A):

Requires discussion of the impact of acquisitions on financial condition, liquidity, and results of operations, including expected future effects.

Form 8-K, Item 2.01:

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

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

Goodwill and Impairment

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

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

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

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

Significant judgments in goodwill impairment testing include:

● Determining the appropriate reporting units.

● Forecasting future cash flows.

● Selecting appropriate discount rates and market multiples.

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

**Business Segments and Expense Disclosure**

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

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

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

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

● Has discrete financial information available.

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

Reportable Segments

Beginning in fiscal year 2025, following the acquisition of SWC Group, Inc. (d/b/a CarryOutSupplies.com) and the commencement of commercial activities under the Robotics-as-a-Service (RaaS) model, management determined that the Company operates in two reportable segments:

1. Foodservice Packaging Distribution

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

This segment provides wholesale distribution of disposable foodservice packaging products, including printed paper cups, plastic cups, food containers, bags, and related consumable items. Revenue is generated from the sale and shipment of products to customers.

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

Conducted through Skytech Automated Solutions, Inc. and Future Hospitality Venture Holdings, Inc.

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

3. Hotel Operations

Conducted through the Company's wholly owned hotel properties acquired in Victorville and Rancho Mirage.

This segment generates revenue from lodging and related guest services, including room rentals and ancillary offerings such as food, beverage, and other guest amenities. The hotels also serve as deployment and testing environments for the Company's automation technologies.

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

Segment Expense Disclosure and ASU 2023-07

The Company adopted ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, effective for the current fiscal period. The amended guidance requires public entities to disclose:

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

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

● A description of other segment items included in that measure

● How expense amounts are allocated among segments

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

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

Use of Estimates

The preparation of our consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. These estimates are based on historical experience, current conditions, expectations of future events, and other factors management believes to be reasonable. Actual results may differ from these estimates. Significant estimates for the three months ended September 30, 2025 and the year ended June 30, 2025 include, but are not limited to, the following:

● Allowance for Doubtful Accounts and Other Receivables – We evaluate the collectability of customer and tenant receivables based on historical collection trends, specific customer credit risks, aging, and current economic conditions. Adjustments to the allowance are recorded to reflect expected credit losses.

● Inventory Valuation and Obsolescence Reserves – Inventories are reviewed for excess quantities, obsolescence, and net realizable value considerations. Changes in demand forecasts, product condition, or expected selling prices may result in required write-downs.

● Fair Value Measurements Related to Business Combinations – We apply fair value principles in allocating purchase consideration to acquired assets and liabilities. This includes the valuation of identifiable intangible assets, assumed working capital deficiencies, contingent consideration, and acquired property and equipment. These valuations often require the use of discounted cash flow models, market-based assumptions, and independent third-party appraisals.

● Valuation of Goodwill and Intangible Assets – Goodwill and indefinite-lived intangible assets are tested for impairment at least annually, or more frequently when triggering events occur. The impairment analysis involves estimating future discounted cash flows, evaluating property-level performance for hotel operations, and considering market participant assumptions.

● Impairment Losses Related to Goodwill, Intangible Assets, and Long-Lived Assets – Long-lived assets, including hotel property and equipment, are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable. Recoverability is assessed using future undiscounted cash flows, with any impairment measured at fair value.

● Valuation of Loss Contingencies – We assess potential liabilities arising from legal, regulatory, and contractual matters and record a liability when a loss is both probable and reasonably estimable.

● Valuation of Stock-Based Compensation – The fair value of stock-based awards, including common stock, warrants, and preferred stock issued as compensation, is estimated using valuation models such as Black-Scholes or market-based approaches. Determining fair value requires management to estimate assumptions including volatility, expected term, and risk-free interest rates.

● Estimated Useful Lives of Property and Equipment – Depreciation is recorded over estimated useful lives based on management's judgment about the period in which assets, including hotel-related assets and RaaS equipment, are expected to provide economic benefit. Useful lives are reviewed periodically and adjusted when necessary.

● Valuation of Uncertain Tax Positions – We evaluate tax positions under ASC 740, recognizing a liability when it is more likely than not that a tax position will not be sustained upon examination. Estimates are updated as new information becomes available.

● Valuation Allowance on Deferred Tax Assets – Deferred tax assets are recorded only to the extent they are expected to be realized. Given historical operating losses, a full valuation allowance remains in place. The assessment considers projections of future taxable income, tax planning strategies, and cumulative losses.

<u>Risks and Uncertainties</u>

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

In accordance with ASC 275, Risks and Uncertainties, the Company evaluates and discloses risks that could significantly affect near-term and long-term operations. Key factors contributing to variability in sales, margins, operating results, and liquidity include:

&nbsp;&nbsp;&nbsp;&nbsp;1. Industry Cyclicality and Market Demand

The Company's financial performance is influenced by fluctuations in consumer demand, customer ordering patterns, seasonality in hospitality operations, and competitive pressures within the foodservice packaging and automation industries.

&nbsp;&nbsp;&nbsp;&nbsp;2. Macroeconomic Conditions

Broader economic factors—including inflationary pressures, rising interest rates, labor market constraints, supply chain volatility, and geopolitical events—may adversely affect purchasing behavior, operating costs, and access to capital.

&nbsp;&nbsp;&nbsp;&nbsp;3. Pricing and Supply Chain Volatility

The cost and availability of raw materials, packaging products, robotics components, and hotel operating supplies may fluctuate due to supplier constraints, transportation disruptions, and commodity market changes, which may impact gross margins and operating results.

&nbsp;&nbsp;&nbsp;&nbsp;4. Technology Development and Adoption Risks

The success of the Company's RaaS model depends on continued development, deployment, and market acceptance of its automation technologies. Delays in product development, integration challenges at customer sites, or slower-than-expected adoption may impact revenue growth.

&nbsp;&nbsp;&nbsp;&nbsp;5. Hospitality Operating Risks

Hotel performance is subject to changes in travel patterns, competitive room pricing, brand standards compliance, and local economic conditions. Lodging demand may be negatively affected by economic downturns, adverse weather events, or public health concerns.

&nbsp;&nbsp;&nbsp;&nbsp;6. Liquidity and Financing Needs

The Company's ability to continue operations and execute its strategic plans depends on access to sufficient capital. Fluctuations in cash flows or the inability to obtain additional financing on acceptable terms may affect the Company's liquidity and business continuity.

&nbsp;&nbsp;&nbsp;&nbsp;7. Regulatory and Compliance Risks

The Company is subject to federal, state, and local regulations related to manufacturing and distribution, automation equipment, franchise operations, hotel licensing, labor practices, and financial reporting requirements. Noncompliance could result in fines, penalties, or operational restrictions.

Given these uncertainties, the Company may experience variability in financial performance and operating cash flows, and actual results may differ materially from management's estimates and forecasts. The Company continually evaluates these risks and implements measures intended to mitigate their potential impact on operations and long-term strategic objectives.

<u>Derivative Liabilities</u>

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

<u>Accounting for Derivative Liabilities</u>

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

<u>Conversion and Extinguishment of Derivative Liabilities</u>

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

● Records the newly issued shares at fair value;

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

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

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

<u>Reclassification of Equity Instruments to Liabilities</u>

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

**Revenue Recognition**

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, as amended. Revenue is recognized when control of promised goods or services transfers to customers, in an amount that reflects the consideration expected to be received.

<u>Revenue Streams</u>

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

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

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

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

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

To provide further clarity on the nature, timing, and recognition of revenue, the Company's revenue streams are discussed below:

A. Foodservice Packaging Distribution

Revenue from the distribution of disposable foodservice packaging products is derived exclusively from business customers on a wholesale basis through the Company's e-commerce platform and direct sales channels. Customer contracts typically contain a single performance obligation: delivery of the ordered products. Shipping and handling activities that occur after the customer obtains control are accounted for as fulfillment costs and not as separate performance obligations. Because sales are exclusively to registered businesses, the Company collects and remits sales taxes where required; sales to businesses are exempt only when valid resale/exemption certificates are obtained.

B. Robotics as a Service

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

The Company owns and deploys all robotic equipment, including hardware, software, and related components, which remain the property of the Company. Customers do not obtain control over the units; instead, the Company retains responsibility for operation, servicing, refurbishment, and replacement as necessary. Management evaluated these arrangements under ASC 842 Leases and concluded they do not contain a lease because customers do not control the use of the robotic units. Accordingly, revenue is recognized under ASC 606 Revenue from Contracts with Customers.

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

The Company generally invoices customers monthly, with payments due monthly. As a result, contract assets and contract liabilities (deferred revenue) are not significant.

C. Hospitality Operations

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

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

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

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

The Company acts as the principal in substantially all hospitality transactions, as it controls the goods and services prior to transfer to the customer. Revenues are presented net of any sales or occupancy taxes collected on behalf of governmental authorities. The timing of billing and payment for hotel operations typically coincides with the satisfaction of performance obligations; therefore, contract assets and contract liabilities related to hospitality revenues are not significant.

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

D. Snacks and Beverages (Discontinued Operations)

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

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

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

The Company follows the five-step revenue recognition model:

1. Identify the Contract with a Customer

A contract exists when:

● The agreement creates enforceable rights and obligations;

● It has commercial substance;

● Payment terms are defined and consideration is determinable;

● Collection is probable

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

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

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

2. Identify the Performance Obligations

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

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

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

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

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

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

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

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

3. Determine the Transaction Price

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

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

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

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

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

4. Allocate the Transaction Price

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

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

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

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

Hospitality Operations –

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

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

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

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

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

Principal vs. Agent Considerations

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

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

1. Foodservice Packaging Distribution

The Company acts as a principal in foodservice packaging sales.

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

● The Company has discretion in pricing.

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

● The Company bears inventory risk prior to transfer.

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

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

The Company acts as a principal in RaaS arrangements.

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

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

● The Company has discretion over pricing and contract terms.

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

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

3. Hospitality Operations

The Company acts as a principal in all hospitality operations.

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

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

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

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

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

4. Snacks and Beverages (Discontinued Operations)

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

● The Company controlled inventory prior to transfer.

● The Company set pricing at its discretion.

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

● The Company bore inventory risk until sale.

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

**Contract Liabilities (Deferred Revenue)**

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

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

**Income Taxes**

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

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

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

<u>Uncertain Tax Positions</u>

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

The Company also recognizes interest and penalties related to uncertain tax positions in other expense in the consolidated statement of operations.

<u>Valuation of Deferred Tax Assets</u>

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

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

<u>Factors Considered in Valuation Allowance Assessment</u>

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

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

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

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

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

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

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

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

**Stock-Based Compensation**

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

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

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

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

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

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

● Expected volatility – Based on historical stock price fluctuations.

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

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

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

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

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

● Cash flow classification for certain tax-related transactions.

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

**Related Parties**

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

Related parties include, but are not limited to:

● Principal owners of the Company.

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

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

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

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

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

The Company discloses all material related party transactions, including:

● The nature of the relationship between the parties.

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

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

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

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

**Temporary Equity** 

The Company classifies certain equity instruments outside of permanent stockholders' equity when required by applicable accounting guidance. In accordance with ASC 480-10-S99-3A and ASC 815-40-25, instruments are presented as temporary equity (mezzanine equity) if they are redeemable or if settlement in the Company's common shares is not solely within the Company's control.

Temporary equity generally includes convertible or equity-linked instruments that, under certain conditions, may require cash settlement or cannot be fully settled in shares due to limitations such as insufficient authorized stock. Instruments classified as temporary equity are remeasured or reassessed each reporting period and are reclassified to permanent equity when the conditions requiring temporary presentation are resolved.

**Recent Accounting Standards** 

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

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

**Accounting Standards Not Yet Adopted**

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

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

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

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

**Other Accounting Standards Updates**

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

**Reclassifications**

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

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

Please refer to Note 2 – Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, for a comprehensive description of these policies. There were no material changes in our critical accounting policies or estimates during the three months ended September 30, 2025, though the Company continues to monitor the impact of business combinations, evolving market conditions, and financing transactions (including convertible debt and stock-based compensation) on the valuation of assets, liabilities, and equity-based instruments.

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

Smaller reporting companies are not required to provide this information.

**ITEM 4. CONTROLS AND PROCEDURES**

**Evaluation of Disclosure Controls and Procedures**

Our Chief Executive Officer, with the participation of management, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2025, as required by Rule 13a-15(b) under the Exchange Act. This evaluation considered the design and operational effectiveness of both manual and automated controls intended to ensure the reliability and timeliness of disclosures.

Based on this evaluation, our Chief Executive Officer concluded that our disclosure controls and procedures were not effective as of September 30, 2025. The primary deficiencies contributing to this conclusion include:

● **Insufficient Personnel:** We lack full-time accounting and financial reporting staff with appropriate U.S. GAAP and SEC reporting expertise. This resource constraint limits segregation of duties and reduces independent review over financial close processes.

● **Over-Reliance on Senior Management:** Due to the small size of our finance function, certain control activities rely disproportionately on our Chief Executive Officer, limiting independent checks and balances.

● **Manual Processes:** Our financial reporting systems are heavily dependent on manual entries and reconciliations, increasing the risk of undetected error.

● **Limited Disclosure Review Process:** We do not currently have a robust multi-level disclosure committee structure in place, which constrains our ability to independently challenge and validate disclosure judgments.

**Management's Plan to Address Deficiencies**

Management intends to remediate these deficiencies as financial resources permit by:

● Hiring or contracting additional accounting and financial reporting personnel;

● Expanding the use of external consultants to review complex accounting areas and SEC filings;

● Enhancing procedures for disclosure review and establishing a formal disclosure committee; and

● Investing in systems and tools to reduce reliance on manual processes.

Until these steps are completed, management cannot conclude that our disclosure controls and procedures are effective.

 

 

**Management's Annual Report on Internal Control over Financial Reporting**

 

**Responsibility for Internal Control**

Our management is responsible for establishing and maintaining adequate internal control over financial reporting ("ICFR") for the Company, as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. ICFR is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles ("U.S. GAAP").

Management recognizes that a sound system of internal controls requires oversight by the Board of Directors, clear policies and procedures, segregation of duties, independent review, and continuous monitoring. Our system of ICFR is intended to ensure that:

● Records are maintained in sufficient detail to accurately and fairly reflect transactions and dispositions of assets;

● Transactions are recorded in conformity with U.S. GAAP to permit the preparation of timely and reliable financial statements;

● Receipts and expenditures are made only with appropriate authorization of management and the Board of Directors; and

● Unauthorized acquisition, use, or disposition of Company assets that could have a material effect on the financial statements is prevented or detected on a timely basis.

**Inherent Limitations of Internal Control**

Because of inherent limitations, ICFR cannot provide absolute assurance of preventing or detecting misstatements. Limitations include human error, management override, collusion, and the cost of controls relative to expected benefits. Further, conditions may change over time, causing controls to become less effective, and compliance with procedures may deteriorate. Accordingly, even effective ICFR can provide only "reasonable assurance" of achieving its objectives.

**Framework and Evaluation Methodology**

Management conducted its assessment of the effectiveness of our ICFR as of September 30, 2025, using the Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

This framework evaluates internal control across five integrated components:

&nbsp;&nbsp;&nbsp;&nbsp;1. Control Environment –
 tone at the top, integrity, and governance;

2. Risk Assessment –
 identification and analysis of risks relevant to financial reporting;

3. Control Activities –
 policies and procedures designed to mitigate risks;

4. Information and Communication
 – systems to capture and communicate relevant financial information; and

5. Monitoring Activities –
 ongoing evaluations of the effectiveness of controls.

**Results of Management's Assessment**

Based on this evaluation, management concluded that our ICFR was not effective as of September 30, 2025 due to the existence of material weaknesses, including:

● **Insufficient Financial Reporting Personnel:** We have a limited number of employees dedicated to accounting and financial reporting. This lack of resources restricts segregation of duties and increases reliance on senior management for multiple review and approval functions.

● **Complex Financial Instruments:** We have issued convertible debt, preferred stock, and derivative instruments requiring complex accounting and valuation. Our reliance on third-party consultants and limited internal expertise creates a heightened risk of misstatement.

● **Acquisition Accounting and Goodwill Valuation:** Recent acquisitions required complex purchase price allocations and valuation of goodwill and intangibles.

● **Information Technology and Systems Limitations:** Our financial reporting systems are not fully automated and rely heavily on manual processes, increasing the risk of error and limiting timely monitoring activities.

● **Resource Constraints:** Our working capital deficit and limited liquidity impair our ability to invest in strengthening our ICFR framework, including recruitment of qualified personnel, implementation of enhanced financial systems, and engagement of external advisors on a recurring basis.

Because of these material weaknesses, management cannot conclude that our ICFR was effective as of September 30, 2025.

**PART II – OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS.**

We are not engaged in any litigation at the present time, and management is unaware of any claims or complaints that could result in future litigation. Management will seek to minimize disputes with its customers but recognizes the inevitability of legal action in today's business environment as an unfortunate price of conducting business.

**ITEM 1A. RISK FACTORS.**

Not required for smaller reporting companies.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.**

Other than as set out below, there were no other sales of equity securities during the three months covered by this Report that were not registered under the Securities Act and/or were not previously reported in a Current Report on Form 8-K or Form 10-Q filed by the Company.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES.**

Not applicable.

**ITEM 4. MINE SAFETY DISCLOSURES.**

Not applicable.

**ITEM 5. OTHER INFORMATION.**

**ITEM 6. EXHIBITS.**

---

| | |
|:---|:---|
| **Exhibit** | **Exhibit Description** |
| 3.1 | [Articles of Incorporation (Incorporated by reference to Exhibit 3.1 to the Registrant's Registration Statement on Form S-1 (333-193347) filed with the Commission on January 13, 2014)](https://www.sec.gov/Archives/edgar/data/1593001/000146970914000003/ex3_1apg.htm) |
| 3.2 | [Articles of Amendment (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on September 20, 2017)](https://www.sec.gov/Archives/edgar/data/1593001/000121390017009851/f8k091317ex3-1_nightfoodhold.htm) |
| 3.3 | [Bylaws (Incorporated by reference to Exhibit 3.2 to the Registrant's Registration Statement on Form S-1 (333-193347) filed with the Commission on January 13, 2014)](https://www.sec.gov/Archives/edgar/data/1593001/000146970914000003/ex3_2apg.htm) |
| 3.4 | [Certificate of Designation – Series A Preferred Stock (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on July 17, 2018)](https://www.sec.gov/Archives/edgar/data/1593001/000121390018009309/f8k071118ex3-1_nightfood.htm) |
| 3.5 | [Amendment to Certificate of Designation – Series B Preferred Stock (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K filed with the Commission on October 31, 2025)](https://www.sec.gov/Archives/edgar/data/1593001/000149315225020458/ex3-1.htm) |
| 3.6 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series A Super Voting Preferred Stock(incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K/A filed with the Commission on January 31, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024008435/ea192564ex3-1_nightfood.htm) |
| 3.7 | [Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock(incorporated by reference to Exhibit 3.2 on the Registrant's Current Report on Form 8-K/A filed with the Commission on January 31, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024008435/ea192564ex3-2_nightfood.htm) |
| 3.8 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series C Convertible Preferred Stock(incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K/A filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex3-1_nightfood.htm) |
| 3.9 | [Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock(incorporated by reference to Exhibit 3.2 on the Registrant's Current Report on Form 8-K/A filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex3-2_nightfood.htm) |
| 3.10 | [Amendment to the Certificate of Designation of Preferences, Rights and Limitations of Series B Preferred Stock (incorporated by reference to Exhibit 3.1 on the Registrant's Current Report on Form 8-K filed with the Commission on October 31, 2025)](https://www.sec.gov/Archives/edgar/data/1593001/000149315225020458/ex3-1.htm) |
| 4.1 | [Common Stock Purchase Warrant issued to Fourth Man, LLC dated as of June 29, 2023 (Incorporated by reference to Exhibit 10.47 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-47_nightfood.htm) |
| 4.2 | [Common Stock Purchase Warrant issued to Fourth Man, LLC dated as of August 28, 2023 (Incorporated by reference to Exhibit 10.52 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-52_nightfood.htm) |
| 4.3 | [Warrants issued to J.H. Darbie & Co., Inc. dated as of June 29, 2023 (incorporated by reference to Exhibit 4.3 on the Registrant's Quarterly Report on Form10-Q filed with the Commission on December 29, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023099837/f10q0923ex4-3_nightfood.htm) |
| 4.4 | [Warrants issued to J.H. Darbie & Co., Inc. dated as of August 28, 2023 (incorporated by reference to Exhibit 4.6 on the Registrant's Quarterly Report on Form10-Q filed with the Commission on December 29, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023099837/f10q0923ex4-6_nightfood.htm) |
| 4.5 | Warrant issued to Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025). |
| 10.1 | [Promissory Note issued to Fourth Man, LLC dated as of June 29, 2023 (Incorporated by reference to Exhibit 10.46 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-46_nightfood.htm) |
| 10.2 | [Promissory Note issued to Fourth Man, LLC dated as of August 28, 2023 (Incorporated by reference to Exhibit 10.51 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-51_nightfood.htm) |
| 10.3 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the Commission on November 20, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023088732/ea188739ex10-1_nightfood.htm) |
| 10.4 | [Promissory Note dated with Mast Hill Fund, L.P. (Incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed with the Commission on November 20, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023088732/ea188739ex10-2_nightfood.htm) |
| 10.5 | [Securities Purchase Agreement dated as of June 29, 2023 between the Company and Fourth Man, LLC (Incorporated by reference to Exhibit 10.45 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-45_nightfood.htm) |
| 10.6 | [Securities Purchase Agreement dated as of August 28, 2023 between the Company and Fourth Man, LLC (Incorporated by reference to Exhibit 10.50 on the Registrant's Annual Report on Form 10-K filed with the Commission on October 13, 2023).](https://www.sec.gov/Archives/edgar/data/1593001/000101376223003824/f10k2023ex10-50_nightfood.htm) |
| 10.7 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on December 12, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023095171/ea189938ex10-1_nightfood.htm) |
| 10.8 | [Promissory Note with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on December 12, 2023)](https://www.sec.gov/Archives/edgar/data/1593001/000121390023095171/ea189938ex10-2_nightfood.htm) |
| 10.9 | [Share Exchange Agreement by and among Nightfood Holdings, Inc., Future Hospitality Ventures Holdings Inc., Sean Folkson as the holder of the Series A Preferred Stock of NGTF and the sole shareholder of FHVH dated January 22, 2024. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on January 26, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007066/ea192227ex10-1_nightfood.htm) |

---

---

| | |
|:---|:---|
| 10.10 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on January 29, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007190/ea192344ex10-1_nightfood.htm) |
| 10.11 | [Promissory Note dated January 24, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on January 29, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024007190/ea192344ex10-2_nightfood.htm) |
| 10.12++ | [Consulting Agreement between Nightfood Holdings, Inc. and Sean Folkson, dated February 2, 2024. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on February 2, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024009701/ea192651ex10-1_nightfood.htm) |
| 10.13++ | [Employment Agreement between Nightfood Holdings, Inc. and Lei Sonny Wang, dated February 2, 2024. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on February 2, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024009701/ea192651ex10-2_nightfood.htm) |
| 10.14 | [Letter Agreement between Fourth Man, LLC and Nightfood Holdings, Inc. dated February 1, 2024 (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on March 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024030/ea020195601ex10-1_nightfood.htm) |
| 10.15 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on March 20, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024334/ea020218401ex10-1_night.htm) |
| 10.16 | [Promissory Note dated March 12, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on March 20, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024024334/ea020218401ex10-2_night.htm) |
| 10.17 | [Securities Purchase Agreement with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.1 on the Registrant's Current Report on Form 8-K filed with the Commission on May 15, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024043534/ea020625801ex10-1_nightfo.htm) |
| 10.18 | [Promissory Note dated May 5, 2024 with Mast Hill Fund, L.P. (incorporated by reference to Exhibit 10.2 on the Registrant's Current Report on Form 8-K filed with the Commission on May 15, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024043534/ea020625801ex10-2_nightfo.htm) |
| 10.19 | [Letter Agreement dated July 22, 2024 with Fourth Man, LLC amending the right to adjustment of the conversion price of certain promissory notes (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-19_nightfood.htm) |
| 10.20 | [Share Exchange Agreement dated September 4, 2024 with Nightfood Holdings, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc. and Sugarmade, Inc. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on September 10, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024077127/ea021385301ex2-1_nightfood.htm) |
| 10.21 | [Promissory Note dated September 23, 2024 with Mast Hill Fund, L.P (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-21_nightfood.htm) |
| 10.22 | [Securities Purchase agreement dated September 23, 2024 with Mast Hill Fund LP (incorporated by reference to the Registrant's Form 10K filed with the Commission on December 27, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024113166/ea022106001ex10-22_nightfood.htm) |
| 10.23 | [First Amendment to the Share Exchange Agreement dated December 10, 2024. (incorporated by reference to the Registrant's Current Report on Form 8-K/A filed with the Commission on December 19, 2024)](https://www.sec.gov/Archives/edgar/data/1593001/000121390024110563/ea022531001ex10-1_nightfood.htm) |
| 10.24 | [Securities Purchase Agreement, dated October 8, 2025, by and between Nightfood Holdings, Inc. and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-1.htm) |
| 10.25 | [Senior Secured Promissory Note, dated October 8, 2025, issued by Nightfood Holdings, Inc. in favor of Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-2.htm) |
| 10.26 | [Tenth Amendment to Security Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Nightfood, Inc., MJ Munchies, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc., TechForce Robotics, Inc., Victorville Treasure Holdings, LLC, Treasure Mountain Holdings, LLC and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-3.htm) |
| 10.27 | [Tenth Amendment to Pledge Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Jimmy Chan, and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-4.htm) |
| 10.28 | [Tenth Amendment to Guarantee Agreement, dated October 8, 2025, by and among Nightfood Holdings, Inc., Nightfood, Inc., MJ Munchies, Inc., Future Hospitality Ventures Holdings Inc., SWC Group, Inc., TechForce Robotics, Inc., Victorville Treasure Holdings, LLC, Treasure Mountain Holdings, LLC and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018782/ex10-5.htm) |
| 10.29 | [Equity Purchase Agreement dated October 8, 2025 between Nightfood Holdings, Inc., and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018737/ex10-1.htm) |
| 10.30 | [Registration Rights Agreement dated October 8, 2025 between Nightfood Holdings, Inc., and Mast Hill Fund, L.P. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 21, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225018737/ex10-2.htm) |
| 10.31 | [Share Exchange Agreement dated September 30, 2025. (incorporated by reference to the Registrant's Current Report on Form 8-K filed with the Commission on October 6, 2025).](https://www.sec.gov/Archives/edgar/data/1593001/000149315225017045/ex2-1.htm) |
| 31.1\* | [Certification of the Chief Executive and Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex31-1.htm) |
| 32.1\* | [Certification of the Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)](ex32-1.htm) |
| 101.INS\* | Inline XBRL Instance Document |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104\* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |

---

\* Filed herewith <br> ++ Indicates a management contract or compensatory plan.

**SIGNATURES**

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **Nightfood Holdings, Inc.** | **Nightfood Holdings, Inc.** |
| Dated: November 19, 2025 | By: | */s/ Jimmy Chan* |
|  |  | Jimmy Chan |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive, Financial and Accounting Officer) |

---

## Exhibit 31.1

**Exhibit 31.1**

**Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended**

I, Jimmy Chan (Principal Executive Officer and Principal Financial and Accounting Officer), certify that:

1. I
 have reviewed this quarterly report on Form 10-Q of Nightfood Holdings, Inc.;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. As
 the registrant's certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as
 defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
 Rules 13a-15(f) and 15-d-15 (f) for the registrant and I have:

&nbsp;&nbsp;&nbsp;&nbsp;a) designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

b) designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

c) evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

d) disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the period covered
 by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control
 over financial reporting.

5. As
 the registrant's certifying officer, I have disclosed, based on my most recent evaluation of internal control over financial
 reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing
 the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;a) all
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

b) any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

---

| | | |
|:---|:---|:---|
| Date: November 19, 2025 | By: | */s/ Jimmy Chan* |
|  |  | Jimmy Chan |
|  |  | Chief Executive Officer and Chief Financial Officer<br> (Principal Executive Officer and Principal Financial and Accounting Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

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

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

The undersigned, Jimmy Chan, Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial and Accounting Officer) of Nightfood Holdings, Inc. (the "Company"), certifies, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350) that, to his knowledge, the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (the "Report"):

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

(2) the
 information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of
 the Company.

---

| |
|:---|
| */s/ Jimmy Chan* |
| Jimmy Chan |
| Chief Executive Officer and Chief Financial Officer<br> (Principal Executive Officer and Principal Financial and Accounting Officer) |
| Date: November 19, 2025 |

---