EvoAir Holdings Inc 10-K for FY2026
EvoAir Holdings Inc. (EVOH)
About this 10-K
EvoAir Holdings Inc filed this 10-K on October 14, 2026, covering the fiscal year ended August 31, 2026 (FY2026).
Headline figures
Fiscal year ended August 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $319.05K
- up 12.1% from $284.67K a year earlier
- Net loss
- $4.09M
- compared with a net loss of $14.63M a year earlier
- Diluted EPS
- -$0.15
- compared with -$0.55 a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the financial year ended
For the transition period from ___________ to ___________
COMMISSION
FILE NO.
(Exact name of registrant as specified in its charter)
| 8713 | ||||
| (State or Other Jurisdiction of | IRS Employer | Primary Standard Industrial | ||
| Incorporation or Organization) | Identification Number | Classification Code Number |
EvoAir
Holdings Inc.
Tel. +
(Address and telephone number of registrant’s executive office)
Copies
to:
Lawrence Venick, Esq.
Loeb & Loeb LLP
2206-19 Jardine House
1 Connaught Place, Central
Hong Kong SAR
Tel: +852.3923.1111
Fax: +852.3923.1100
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate
by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐
Indicate by check mark
whether the registrant has submitted electronically every Interactive Data File required
to be submitted and posted 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 and post such files).
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 shorter period that the registrant as required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Yes ☐ No ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer ☐ | Accelerated filer ☐ | |
| Smaller
reporting company |
||
| 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 standards provided pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No
The registrant had shares of our Common Stock par value, $ issued and outstanding as of October 14, 2026.
The aggregate market value of the Company’s common stock held by
non-affiliates of 14,157,772 shares computed by reference to the closing price of the Company’s, common stock of $23.00, as of the
last business day of the registrant’s most recently completed second fiscal quarter, was approximately $
Table of Contents
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FORWARD-LOOKING STATEMENTS
This Annual Report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.
As used in this Annual Report, the terms “we”, “us”, “our”, “Company” or “EVOH”, mean EvoAir Holdings Inc., unless otherwise indicated.
As used in this Annual Report, the term “Group”, “EvoAir Group” means EvoAir Holdings Inc. and its subsidiaries, unless otherwise indicated.
All dollar amounts refer to US dollars unless otherwise indicated.
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PART I
| ITEM 1 | BUSINESS |
Organization and Business Background
EvoAir Holdings Inc. (formerly Unex Holdings Inc.) (the “Company”, “EVOH”, “we”, “us”, or “our”) is a corporation established under the corporation laws in the State of Nevada, United States of America (“U.S”) on February 17, 2017. The Company has adopted an August 31 fiscal year end.
On December 20, 2021, the Company and Low Wai Koon (“Dr. Low”) entered into a share transfer agreement, (the “EvoAir International Share Transfer Agreement”), pursuant to which Dr. Low agreed to sell all of his ordinary shares of EvoAir International Limited (“EvoAir International”) to the Company for a consideration of US$100 (“EvoAir Transaction”). EvoAir International, through its subsidiaries upon completion of the Transactions (defined hereunder), is engaged in the research and development (“R&D”), manufacturing, trading, sale of eco-friendly HVAC products and related services in Asia.
Pursuant to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company and the owner of 2,000,000 restricted shares of common stock, with par value of $0.001 per share (“Common Stock”) of the Company (“EvoAir Shares”) representing approximately 67.34% of the Company’s then issued and outstanding shares, sold his entire shareholding of the Company to WKL Global Limited (“WKL Global”) for an aggregate consideration of $100 (“Change of Control Transaction”). Upon completion of the Change of Control Transaction, WKL Global owned 2,000,000 shares, or approximately 67.34% of the then issued and outstanding ordinary shares of the Company, which resulted in a change of control of the Company.
On December 20, 2021, several transactions took place (together, the “Allotment Transactions”) whereby the Company issued and allotted in aggregate 98,809,323 EvoAir Shares to certain parties. On completion of the Allotment Transactions, the total number of issued and outstanding EvoAir Shares were 101,779,323 (“Then Enlarged Share Capital”):
(A) On December 20, 2021, Dr. Low and Chan Kok Wei entered into a share exchange agreement with WKL Eco Earth Holdings Pte Ltd (“WKL Eco Earth Holdings”), pursuant to which Dr. Low and Chan Kok Wei agreed to sell all their ordinary shares of WKL Green Energy Sdn Bhd (“WKL Green Energy”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global and Allegro Investment (BVI) Limited (“Allegro Investment”), a company incorporated in the British Virgin Islands (“BVI”) with 50% shareholdings held by Chan Kok Wei and Ong Bee Chen, respectively, of 24,000 EvoAir shares and 6,000 EvoAir Shares, respectively, or approximately 0.02% and 0.01% of the Then Enlarged Share Capital, respectively.
(B) On December 20, 2021, Dr. Low, Chan Kok Wei, Ong Bee Chen and certain sellers (“WKLEE Sellers”) entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which Dr. Low, Chan Kok Wei, Ong Bee Chen and WKLEE Sellers agreed to sell all their ordinary shares of WKL Eco Earth Sdn Bhd (“WKL Eco Earth”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global, Allegro Investment and WKLEE Sellers of 49,320 EvoAir Shares, 8,280 EvoAir Shares and in aggregate 14,400 shares, respectively, or approximately 0.05%, 0.009% and in aggregate 0.014%, respectively, of the Then Enlarged Share Capital.
(C) On December 20, 2021, Tan Soon Hock, Oh Ivan Joon Wern and certain relevant interest holders (“Relevant Interest Holders”) entered into an investment exchange agreement with WKL Eco Earth Holdings, pursuant to which Tan Soon Hock, Oh Ivan Joon Wern and the Relevant Interest Holders agreed to sell all relevant interests in the EvoAir Group to WKL Eco Earth Holdings in consideration for the allotment and issuance of 7,037,762 EvoAir Shares, 2,520,000 EvoAir Shares and in aggregate 6,001,794 EvoAir shares, respectively, or approximately 6.91%, 2.48% and in aggregate 5.90%, respectively, of the Then Enlarged Share Capital. The board of directors and majority shareholders of the Company have approved the transaction.
(D) On December 20, 2021, Dr. Low entered into two deeds of assignment of intellectual properties with WKL Eco Earth Holdings, in respect of Dr. Low’s patents and patent applications relating to eco-friendly air-conditioner condenser (external unit), EvoAirTM and the trademarks and trademark applications described in the deeds of assignment thereunder, and in respect of Dr. Low’s patents and patents applications relating to the portable air-conditioner, e-Cond EVOTM and the trademarks and trademark applications as described in the deeds of assignment thereunder (together, the “IP Assignments”). Pursuant to the IP Assignments, WKL Global, Allegro Investment and certain nominees shall be allotted and issued 63,362,756 EvoAir Shares, 14,297,259 EvoAir Shares and in aggregate 5,487,752 EvoAir Shares, respectively or approximately 62.25%, 14.05% and in aggregate 5.39%, respectively of the Then Enlarged Share Capital in consideration for the IP Assignments.
EvoAir Transaction, Change of Control Transaction and Allotment Transactions are collectively referred to as the “Transactions”. The closing of the Transactions (“Closing”) occurred on December 20, 2021 (the “Closing Date”).
From and after the Closing Date, at which time EvoAir International transferred its HVAC business to the Company, the Company’s primary operations will consist of the prior operations of EvoAir International and its subsidiaries.
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EvoAir International is a company incorporated in BVI on November 17, 2021. Effective from the December 20, 2021, it wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy, a Malaysian company incorporated on October 24, 2017. WKL Eco Earth Holdings acquired (c) EvoAir Manufacturing (M) Sdn Bhd (“EvoAir Manufacturing”) on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina Co Ltd (“WKL EcoEarth Indochina”), a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou Co Ltd (“WKL Guanzhe”), a Chinese company incorporated on April 6, 2021. EvoAir Manufacturing wholly owns (f) Evo Air Marketing (M) Sdn Bhd (“Evo Air Marketing”), a Malaysian company incorporated on February 2, 2021.
On June 15, 2022, the Company filed a Certificate of Amendment (the “Amendment”) to the Articles of Incorporation with Nevada’s Secretary of State to change the name of the Company from Unex Holdings Inc. to EvoAir Holdings Inc. (the “Name Change”), and the Name Change became market effective on November 4, 2022. Effective on November 11, 2022, the Company’s shares began trading under the new ticker symbol “EVOH”.
On November 21, 2023, the Company issued in aggregate, 52,107 shares of Common Stock to 15 referral agents (“Referral Agents”) in consideration for their referral to the Company of certain investors. Each Referral Agent is a “non-U.S. Persons” as defined in Regulation S.
On November 21, 2023, the Company issued, in aggregate, 5,500 shares of Common Stock to two individuals in consideration for marketing services provided to the Company by Artisan Creative Studio, a marketing entity based in Malaysia. Each of the individuals is a “non-U.S. Persons” as defined in Regulation S.
On August 14, 2024, the WKL Eco Earth Holdings has increased its investment in WKL Guanzhe Green Technology Guangzhou Co Ltd (China) by injecting an additional RMB2,000,000 into its registered capital. This investment has resulted in an increase in WKL Eco Earth Holding’s equity interest in WKL Guanzhe Green Technology to 62.5%.
On February 6, 2026, the WKL Eco Earth Holdings has increased its investment in WKL Guanzhe Green Technology Guangzhou Co Ltd (China) by injecting an additional RMB1,500,000 into its registered capital. This investment has resulted in an increase in WKL Eco Earth Holding’s equity interest in WKL Guanzhe Green Technology to 66.67%.
On May 31, 2026, WKL EcoEarth Indochina ceased its commercial operations as part of the Group’s efforts to streamline its international operations and reduce administrative costs. WKL EcoEarth Indochina operated primarily as an immaterial regional sales office and did not contribute materially to the Group’s consolidated revenue, assets or business operations. Applications for permanent closure and deregistration were submitted to the Cambodian General Department of Taxation and the Accounting and Auditing Regulator on June 6, 2026 and June 29, 2026, respectively. The formal dissolution of WKL EcoEarth Indochina remains subject to completion of the applicable regulatory procedures in Cambodia and is not expected to have a material impact on the Group’s consolidated financial position or results of operations.
Round 2 Stockholders
The Company entered into a series of offerings for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50, as follows:
| ● | On February 15, 2022, the Company entered into certain share subscription agreement with Ms. Ang Lee Kim Jane, who is a “non-U.S. Persons” as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company agreed to issue and sell 74,074 shares of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $185,185. | |
| ● | On June 3, 2022, the Company entered into certain share subscription agreement with Mr. Wong Hon Wai who is a “non-U.S. Persons” as defined in Regulation S of the Securities Act pursuant to which the Company agreed to issue and sell 5,000 shares of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $12,500. | |
| ● | On October 25, 2022, the Company entered into Regulation S share subscription agreements with eight investors, each of whom represented that it was a “non-U.S. Persons” as defined in Securities Act. On the same date, the Company entered into Regulation D share subscription agreements with two investors, each of whom represented that it was an “Accredited Investors” as defined in Regulation D of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 129,621 shares of Common Stock to the Regulation S investors, and (ii) 15,000 shares of Common Stock to the Regulation D investors, respectively, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were $361,553. | |
| ● | On February 20, 2023, the Company entered into Regulation S share subscription agreements with eleven investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 57,783 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were $144,443. | |
| ● | On July 13, 2023, the Company entered into Regulation S share subscription agreements with 31 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 250,132 shares of Common Stock to the Regulation S Investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $625,330. | |
| ● | On September 7, 2023, the Company entered into Regulation S share subscription agreements with 71 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, 365,164 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $912,889. | |
| ● | On November 21, 2023, the Company entered into a Regulation S share subscription agreement with Wong Chun Shoong who represented that he was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreement, the Company agreed to issue and sell in aggregate, 8,658 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $21,645. |
Reverse Stock Split
On April 12, 2024, the Company’s board of directors (the “Board”) unanimously resolved to effect a reverse stock split of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1-for-4. Following such resolution, on September 9, 2024, the Company filed a Certificate of Amendment (the “Certificate of Amendment”) with the Secretary of State of the State of Nevada to effect the reverse stock split, with an effective time of 9:00AM. Eastern Time on September 11, 2024 (the “Reverse Stock Split”).
Split Adjustment; Treatment of Fractional Shares
As a result of the 1:4 Reverse Stock Split, each 4 pre-split shares of Common Stock outstanding will automatically combine into one new share of Common Stock without any action on the part of the holders, and the number of outstanding shares of Common Stock was reduced from 102,742,362 shares to 25,685,591 shares (subject to rounding up of fractional shares to the nearest whole number). Following the rounding up of fractional shares, an additional 105 shares of Common Stock were issued, resulting in 25,685,696 shares of Common Stock issued and outstanding immediately following the Reverse Stock Split.
No fractional shares were issued in connection with the Reverse Stock Split. Fractional shares were rounded up to the nearest whole number.
Share Issuance
On November 25, 2024, the Company issued, in aggregate, 679,516 shares of Common Stock, representing 2.5% issued and outstanding shares of Common Stock to certain consultant in consideration for their services in relation to proposed initial public offering.
On November 25, 2024, the Company issued, in aggregate, 815,419 shares of Common Stock, representing 3.0% issued and outstanding shares of Common Stock to certain consultant in consideration for their consulting services.
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Details of the Company’s subsidiaries:
| Name | Place and date of incorporation | Principal activities | Ownership | |||
| EvoAir International Limited (“EvoAir International”) | British Virgin Islands, November 17, 2021 | Investment holding. | 100% | |||
| Subsidiary of EvoAir International | ||||||
| WKL Eco Earth Holdings Pte. Ltd. (“WKL Eco Earth Holdings”) | Singapore, July 12, 2018 | Investment holding and research and development (“R&D”), marketing and sale of eco-friendly heating, ventilation, and air conditioning (“HVAC”) products and related services. | 100% | |||
| Subsidiaries of WKL Eco Earth Holdings | ||||||
| WKL Eco Earth Sdn. Bhd. (“WKL Eco Earth”) | Malaysia, May 17, 2017 | R&D, manufacturing, marketing and sale of eco-friendly HVAC products, and the manufacture and sale of related services as well as food, pharmaceutical products, and orthopaedic goods. | 100% | |||
| WKL Green Energy Sdn Bhd (“WKL Green Energy”) | Malaysia, October 24, 2017 | R&D on biotechnology. | 100% | |||
| EvoAir Manufacturing (M) Sdn Bhd (“EvoAir Manufacturing”) | Malaysia, March 22, 2019 | Holding company, R&D, manufacturing, marketing and sale of eco-friendly HVAC products and related services. | 67.5% | |||
| WKL EcoEarth Indochina Co. Ltd (“WKL EcoEarth Indochina”)* | Cambodia, February 4, 2021 |
Marketing and sale of eco-friendly HVAC products and related services. | 55% | |||
| WKL Guanzhe Green Technology Guangzhou Co Ltd (“WKL Guanzhe”) | People’s Republic of China, April 6, 2021 | Manufacturing, marketing and sale of eco-friendly HVAC products and related services | 66.67% | |||
| Subsidiary of EvoAir Manufacturing | ||||||
| Evo Air Marketing (M) Sdn. Bhd. (“Evo Air Marketing”) | Malaysia, February 2, 2021 | Marketing and sale of eco-friendly HVAC products and related services | 100% | |||
The Company and its subsidiaries, collectively to be referred to as “EvoAir Group” or the “Group”.
* Our Cambodia subsidiary, WKL EcoEarth Indochina, is in the process of dissolution
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Our Future Strategies
We intend to pursue the following strategies to further develop and expand our business:
| ● | Continued investment in research and development in hybrid air-conditioning products |
The Group intends to continue development of its hybrid air-conditioning products to further increase its product offerings, as well as to expand its client base, especially with commercial and industrial clients. The Group plans to expand its distribution into other South East Asia markets, China and Asia markets, which has high potential demand for air-conditioning as their population gross domestic product (“GDP”) increases. Taking advantage of the global awareness and push to reduce harmful factors leading to global warming, the Group continues to market its EvoAirTM brand and e-Cond EvoTM as eco-friendly products aiming to reduce emission of waste heat from the air-conditioner condensing units and at the same time improving energy efficiency. The Group aims to continue innovation through investment into research and development, to further improve on its product lines, reduce its carbon emissions as it strives to become a leader in HVAC green inventions.
| ● | Continued promotion of air purifier and air-sanitizing products |
The Group is expanding usage and application of its INCU Technology, which acts as an effective disinfectant solution into more sectors and markets as the Group foresees growth in demand for air-sanitizing products as a must-have product in general consumer households in the near future. Besides household consumers, the Group also aims to expand its commercial and industrial customer base, as well as partake in public sanitation projects. In terms of sanitation products, the company aims to expand into personal healthcare products such as formulated toiletries cleansers incorporating the INCU ionic nano copper solution as an active ingredient | |
| ● | Geographical expansion |
| A key component of our strategy is to enter into and expand into new markets with high demand for HVAC. The Group intends to replicate the similar model, continue development of its product line and expand into other Southeast Asian countries and the Chinese market, with possible expansion into the Middle East, Indonesia and India in the future. A core milestone in the global deployment of our proprietary brand lines is the Group’s commercial entry into the North American market. In March 2026, we executed a milestone Master Distributor Agreement with an established regional distribution partner, establishing our presence in the United States. | |
| ● | Promoting importance of environmental-friendly technology |
The Group also advocates the importance of promoting environmentally friendly technology and creating awareness to the public to play a part in protecting the environment as well as creating synergy with the Group’s products and brand image.
On 5 May 2023, the Company launched ‘Cool the Earth Day’ which marks the birth of the environmental movement for HVAC industry. It was a movement launched by EvoAir Group advocating that (i) everyone can enhance his/her lifestyle through green inventions while preserving the Earth; and (ii) everyone can be the ‘Ambassador of the Earth’ - everyone can do a part, be it in the smallest way in protecting our environment. ‘Cool the Earth Day’ is a movement in line with the Company’s mission to contribute to the Earth and society amidst the alarming global warming and climate change issues confronting the world and its 8 billion population through green inventions and creating awareness. We hope that through this movement, people will raise their awareness that everyone can do a part, be it in the smallest way in protecting our environment. At EvoAir, every member is an Ambassador of the Earth, sharing the same mission of protecting the Earth. The Company believes that everyone around the globe can be an Ambassador of the Earth.
In 2023, the Group collaborated with a university in Malaysia to study the effect of heat generated by outdoor condensing unit of traditional air-conditioning system towards surrounding environment, by studying the effects of air conditioning system on plant growth in a green-house setting. The study concludes that air produced by EvoAirTM outdoor condensing unit, Coolpressor, is lower in temperature and is more environmental friendly and favourable for the growth of green planted compared to hot air produced by conventional air-conditioner outdoor condensing unit. This positive outcome will surely path a new and sustainable direction in terms of energy savings. The Group looks to continue embracing such promotions and is committed to creating awareness and promoting environmental sustainability. We envision becoming an international player in HVAC sector focusing on environmental, social, governance (“ESG”) efforts and initiatives in the future. | |
| ● | Developing and distributing health and functional wellness products |
| The Group has launched an INCZN health supplement product and is partnering with OEM to manufacture the supplements. INCZN is designed to provide health benefits including improving immune system, protecting against diseases such as mouth, throat and lung cancer, regulate blood pressure and strengthening cardiovascular health, improve stomach digestion and gout repair through the benefit of zinc and copper. The Company intends to build on the further development and distribution of INCZN in order to diversify our product offerings in the future. | |
|
Building on this initiative, the Group is also expanding into the health and functional wellness product segment, including the development of botanical-based beverages and functional drinks formulated with natural ingredients aimed at supporting daily wellness and preventive self-care. |
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Product Lines
Hybrid Air Conditioners
e-Cond EVOTM
With the objective of embracing well-being of mankind through green living and preserving the Earth through green inventions e-Cond EVOTM is a breakthrough invention building on the research and development (“R&D”) of Dr Low Wai Koon (“Dr. Low”), our Director, Chairman and Chief Executive Officer and his team, it is the Group’s first invented its line of eco-friendly portable air-conditioners under its e-Cond EVOTM brand in 2017.
The unit is an eco-friendly air-conditioning system with patent pending heat emission control system (“HECS”) technology, which regulates the temperature and volume of heat transferred from the air-conditioning system into the environment. This product employs an innovative hydro-refrigeration system (“HRS”) integrating evaporative cooling process with refrigeration cycle, reducing temperature of the output air by approximately 30% while achieving an optimal cooling performance of approximately 25 to 28 degrees Celsius. The patent pending technology in the unit allows it to utilise substantially lower energy than its traditional air-conditioning units. The portable air-conditioning systems also incorporate ionizer technology producing high concentrations of negative ions to purify the surrounding air of mould spores, pollen, pet dander, odours, cigarette smoke, bacteria, viruses, dust and other hazardous airborne particles.
The Company markets two models of the e-Cond EVOTM units: the Super King and the Outdoor King.
EvoAirTM
The Group continued to research on incorporating its patent pending HECS Technology as well as various other patent pending technologies into its product line, subsequently launching its EvoAirTM hybrid air-conditioners in 2021.
The Group’s core product, EvoAirTM, is a first-of-its-kind eco-friendly air-conditioner with granted patent or utility model/ patent or utility model pending heat emission control system (“HECS”) proprietary technology, which turns waste heat released by conventional air-conditioner condenser (external unit) into cool and moisturised air at approximately 26oC to 32oC with a humidity of ±60%, operating under outdoor condition, which is optimal for human and living things. The re-engineering of the air-conditioning system has transformed the air-conditioner condenser (external unit) into a supplementary cooling unit or ‘Coolpressor’, which also functions as an air cooler. It also reduces energy consumption of at least 20% compared to conventional air-conditioning units. The significant decrease in waste heat and reduction in energy consumption play an important role in reducing harmful effects to the environment, in line with the Group’s mission of producing eco-friendly invention in protecting the Earth.
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Air-conditioning refrigerant is harmful to the environment. The EvoAirTM system utilizes the R32 refrigerant in its operation, which is 9% lower in density than the traditionally used R410A refrigerant found in various conventional air-conditioning systems, while maintaining approximately 43-50% higher latent heat vaporization and approximately 41% higher thermal conductivity when combined with the Group’s other patent-pending technologies. EvoAirTM’s system design also allows for a further reduction in refrigerant use of at least 30% compared to conventional air-conditioning systems with traditional long copper coils by increasing the efficiency of the heat transfer in the R32 refrigerant, in doing so, further increasing refrigerant efficiency.
The EvoAirTM hybrid air-conditioning system was awarded SGS International Certification in 2021.
The Group’s core product, EvoAirTM, is a first-of-its-kind eco-friendly air-conditioner with granted patent or utility model/ patent or utility model pending heat emission control system (“HECS”) proprietary technology, which turns waste heat released by conventional air-conditioner condenser (external unit) into cool and moisturised air at approximately 26oC to 32oC with a humidity of ±60%, operating under outdoor condition, which is optimal for human and living things. The re-engineering of the air-conditioning system has transformed the air-conditioner condenser (external unit) into a supplementary cooling unit or ‘Coolpressor’, which also functions as an air cooler. It also reduces energy consumption of at least 20% compared to conventional air-conditioning units. The significant decrease in waste heat and reduction in energy consumption play an important role in reducing harmful effects to the environment, in line with the Group’s mission of producing eco-friendly invention in protecting the Earth.
Residential Units
We offer a variety options of EvoAirTM hybrid air conditioner range from 1.0 HP to 2.5 HP, where indoor units of wall mounted and ceiling cassette (selected models) options are available for residential users. Our residential EvoAirTM units are all supplied by 220-240V, single phase and 50Hz of power supply, using R32 as refrigerant. While the dimension size for outdoor unit (Coolpressor) is 925mm x 355mm x 685mm, which comes with an LCD remote control to operate it individually. Each coolpressor is equipped with an up & down automatic louver.
Commercial Units
Aside from residential units, we also offer EvoAirTM commercial / industrial units range from 5HP to 25HP, where the placement of air conditioner unit in the ideal settings would be most cooling effective to the certain area. The application of commercial units are normally office buildings, retail stores, warehouses, or manufacturing facilities. Due to efficiency consideration, commercial units are using 3 phase power supply and R410A as refrigerant charge (instead of R32). Dimension size of Coolpressor comparing to residential units are larger and heavier too.
Retrofitting Service
We also provide retrofit service to commercial customers that wishes to keep their existing HVAC systems. Our retrofitting services include replacing the customers’ outdoor condensing unit with the patent-pending HECS technology. Retrofitting service allow for large saving of resources for our enterprise customers, who can avoid fully replacing their air conditioning units, which may be costly depending on the number of existing air conditioning unites already deployed.
Customization Services
We provide product customization services to meet the specific operational, environmental, regulatory, and technical requirements of our customers across various industries. Our engineering and manufacturing capabilities enable us to modify product designs, materials, and system configurations to suit unique applications and operating conditions.
Our customization services include, but are not limited to:
| ● | Corrosion-resistant solutions, including stainless-steel casings and protective coverings for installations in highly corrosive environments, such as coastal and offshore locations where equipment is exposed to salt-laden air. We have provided such customized solutions for customers in Malaysia and Thailand, where environmental conditions require enhanced corrosion resistance and long-term equipment durability. |
| ● | Customized portable air conditioning units designed to meet stringent technical specifications and performance requirements for government and institutional projects, including project in Singapore requiring compliance with customer-specific operational and quality standards. |
| ● | Customized heat exchanger systems, including condenser and hydro-curtain configurations, to optimize cooling performance, energy efficiency, installation constraints, and application-specific operating conditions. |
| ● | Application-specific modifications for customers operating in specialized industries, including food and beverage manufacturing facilities and restaurants, semiconductor manufacturing facilities, pharmaceutical manufacturing plants, and petrol stations, where environmental conditions, hygiene standards, safety requirements, space limitations, or continuous operation necessitate tailored air conditioning solutions. |
Through our in-house engineering, product development, and manufacturing capabilities, we work closely with customers throughout the design and development process to deliver customized solutions that address their specific operational requirements while maintaining product quality, reliability, and performance.
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Manufacturing
The Group manufactures its Coolpressor products under its EvoAir™ brand at its manufacturing facility in Malaysia, operated through its subsidiary, EvoAir Manufacturing. In addition, the Group collaborates with original equipment manufacturers (“OEMs”) to produce air-conditioning indoor units (blowers) that complement its EvoAir™ Coolpressor, as well as eco-friendly portable air-conditioning systems marketed under its e-Cond EVO™ brand. The Group’s manufacturing operations in Malaysia, together with its OEM partnerships, provide flexibility in production capacity and supply chain management to meet market demand across different regions.
Licensing, Supply and Maintenance Service
The Group commercializes its proprietary granted patent or utility model/ patent or utility model pending eco-friendly HVAC technologies through multi-tiered commercial channels. Our product offerings and operational capabilities are organized into two primary pillars: Proprietary Brand (EvoAir™) and Strategic Enterprise Frameworks.
We manufacture, distribute, and service our core energy-efficient cooling portfolio under our own brand names through the following channels:
| ● | Retail Distribution and Dealerships: We supply consumer retail markets through an expanding network of distribution and dealership channels. |
| ● | Commercial, Industrial, and Institutional Integrated Solutions: The Group caters directly to enterprise clients, industrial operations, and real estate developers by supplying our air-conditioning systems for factories, corporate offices, and sustainable property developments. Beyond equipment supply, we deliver turnkey energy-saving retrofits directly to enterprise and industrial clients as well as property owners looking to optimize existing premises. To ensure long-term performance integrity and lock in immediate operational cost reductions through energy conservation, these deployments are fully supported by installation, technical diagnostic, and ongoing maintenance services. |
To maximize the long-term market reach and scalability of our innovations, the Group’s commercialization strategy incorporates specialized frameworks designed to leverage third-party manufacturing and market infrastructure:
| ● | Original Design Manufacturing (ODM) & Private Labeling: We stand ready to design, manufacture, and supply our advanced HVAC solutions under private labels for third-party brand names seeking to expand their eco-friendly product suites. |
| ● | Technology Licensing: As a key component of our long-term scalability model, the Group intends to license its proprietary granted patents and pending utility models directly to external brands. This framework will allow partner brands to incorporate our eco-friendly technologies into their own HVAC product lines, expanding our global footprint by leveraging their existing internal manufacturing capabilities and distribution networks. |
Our footprint spans diverse geographical locations across Southeast Asia, including network in Malaysia, Singapore, and Thailand. We target property developers committed to sustainable, green-certified projects to naturally embed our systems into new infrastructure.
A core milestone in the global deployment of our proprietary brand lines is the Group’s commercial entry into the North American market. In March 2026, we executed a milestone Master Distributor Agreement with an established regional distribution partner, establishing our presence in the United States.
Air Purifier
E-CondLife
To address the spread of the Covid-19 pandemic which arose during the end of 2019, the EvoAir Group launched a new series of air-sanitizing products during the middle of 2020.
Partnering with its supplier, the Group became an exclusive authorized distributor of INCU technology, which involves the use of an ionic nano copper solution. The active ingredients of the solutions, Copper Sulphate Pentha-Hydrate, has a proven track record as well as having been certified and reported to inhibit larvidie, germicide, bactericide, fungicide, algaecide and virucide, while being non-toxic and safe for human and animal use. INCU (Ionic Nano Copper) has been recognized as being vital to health, as well as having proven to be effective against influenzas, bacteria such as E. Coli, bacteria groups such as MRSA as well as inhibiting against Covid-19.
The Group partnered with various OEMs to produce air-purifier products under its e-CondLife brand, in accordance to the Group’s specifications in terms of modifications to the micro-chips, magnetic control valves and systems flows to work with INCU technology. By disinfecting water in a water tank reserve through hydro-curtain technology, followed by purifying the output air in the form of water vapour or mist, E-CondLife products act as environmental disinfecting solutions for air sanitization.
The e-CondLife sanitizer system has been certified under the IECEE CB Scheme, while the INCU ionic nano copper solution used by the system has been certified by NSF International (USA) to be compliant with NSF / ANSI60 standards for all applicable requirements. The EvoAir Group has also obtained safety test reports from TUV SUD in Singapore and ICAS Shanghai for Cytotoxicity Testing.
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Ionic Nano Copper Zinc (INCZN)
In response to growing public health concerns and the increasing demand for environmental disinfectant solutions, the Group has introduced Ionic Nano Copper Zinc (INCZN), a new product developed for airborne sanitization through copper and zinc-based diffusion.
The Group produces the product in accordance with the technical and quality standards outlined by WKL Eco Earth. The Group authorized a sole distributor in Malaysia to retail the Ionic Nano Copper Zinc to be used in the Immune Air Purifier.
Designed to be used in conjunction with specialized diffusers, the solution works by releasing nanoparticles of copper (Cu) and zinc (Zn) into the air. These particles are scientifically recognized for their antimicrobial properties, effectively inhibiting airborne viruses, bacteria and other pathogens. Ionic Nano Copper Zinc is intended for continuous environmental disinfection in enclosed spaces such as offices, public facilities and residential environments.
This product further complements the Group’s ecosystem of air-purifying solutions, reinforcing its brand positioning as a provider of advanced, eco-conscious environmental health technologies.
Intellectual Property
The Group’s success and future revenue growth depend, in part, on our ability to protect our intellectual property. The Group relies primarily on patent and trademark laws, as well as confidentiality procedures, to protect our proprietary technologies and processes.
The Group believes that the core of its business is comprised of our proprietary technologies, including its granted patent or utility model/ patent or utility model pending patent HECS technology. As a result, the Group will strive to maintain a robust intellectual property portfolio. The Group’s success and future revenue growth may depend, in part, on its ability to protect its intellectual property as products and services that are material to its operating results incorporate patented technology.
The Group believes its rights to patents and trademark rights serve to distinguish and protect its products from infringement and contribute to our competitive advantages. The Group had patents and trademarks in various stages of the registration application process in Malaysia, Asian, Middle East, USA and United Kingdom.
We cannot assure you that any patents or copyrights will be issued from any of our pending applications. In addition, any rights granted under any of our existing or future patents, copyrights or trademarks may not provide meaningful protection or any commercial advantage to us. With respect to our other proprietary rights, it may be possible for third parties to copy or otherwise obtain and use proprietary technology without authorization or to develop similar technology independently. We may in the future initiate claims or litigation against third parties to determine the validity and scope of proprietary rights of others. In addition, we may in the future initiate litigation to enforce our intellectual property rights or to protect our trade secrets. Additional information about the risks relating to our intellectual property is provided under “Risk Factors—Risks Related to Intellectual Property.”
The Air Conditioner Industry
Growing demand for cooling
According to International Energy Agency (“IEA”) (https://www.iea.org/energy-system/buildings/space-cooling#tracking), there are currently about 2 billion air conditioning units operating worldwide, and by 2050, it is predicted that there will be 5.6 billion units. According to the statistics report published by the Japan Refrigeration and Air Conditioning Industry Association (“JRAIA”) (https://www.jraia.or.jp) in June 2025, the world’s total air conditioner demand in 2024 is estimated at 131,638 thousand units, which represents 106% of the world demand of 2023. Looking at the 2024 world demand in terms of Japan, China and other regions, the largest demand is from China, of which demand is estimated to have reached 49.726 million units, representing 105% of its 2024 demand. China’s demand accounts for 38% of the world’s total demand. Next to China, the Asian region (excluding Japan and China) stands at 25.249 million units, followed by North America with 19.199 million units, Japan with 10.187 million units, Europe with 9.533 million units and Latin America with 7.325 million units.
Air-conditioners vary in energy efficiency and their usage lead to a global consumption of approximately 2,000 terawatt hours of electricity annually. In addition, almost 20% of all the electricity used in buildings is for cooling, accounting for 14% of average peak residential electricity demand globally.
The emerging economies are expected to use more air-conditioners as income levels rise. Of the 2.8 billion people living in the hottest parts of the world, only 8% currently own air-conditioning units compared to approximately 90% ownership in the United States and Japan. By 2050, India, China and Indonesia may account for 50% of the projected growth in energy use for space cooling.
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Global Emissions from the use of Air Conditioners
The efficiency of air conditioners vary widely, in all major markets today, consumers are typically buying air conditioners whose average efficiencies are less than half of what is available. Carbon dioxide emissions from cooling systems have tripled since 1990 to 1,130 million tons in 2016, and local air pollutants caused by cooling systems have also increased. Greenhouse Gases produced include Carbon Dioxide and Climate Change:
| ● | Carbon dioxide is called a greenhouse gas because it absorbs infrared energy and remits this energy back in all directions. About half of that energy goes out into space and about half of it returns to Earth as heat, contributing to the greenhouse effect and climate change | |
| ● | The four main greenhouse gases are carbon dioxide, methane, nitrous oxide and fluorinated gases. Carbon dioxide accounts for about 75% of global greenhouse gas emissions. | |
| ● | About 30% of greenhouse gas emissions come from transportation, 25% come from the production of electricity, 23% comes from industrial production, 12% comes from commercial and residential sources and 10% comes from agriculture. | |
| ● | Climate change could increase the occurrence and severity of weather events, such as heat waves, droughts and floods. These changes are likely to increase losses to property and crops and affect economic activity. | |
| ● | The usage of air conditioners has a significant impact on the environment. Air-conditioners use chemical refrigerants, usually hydrofluorocarbons in their heat exchange systems. The hydrofluorocarbons contributes significantly to global warming if leaked to the atmosphere. | |
| ● | The generation of the electricity to power the air conditioners also contribute to significant emissions, especially when fossil fuels are burnt to produce electricity. |
Urbanized areas have higher temperatures than less urbanized areas, contributing to heat islands. This is because urban areas usually have less greenery. Roads and buildings absorb and re-emit daytime heat more than forests and water bodies. As a result, urban daytime temperatures can reach approximately 1 to 7 degrees higher in Fahrenheit than the outlying areas and night-time temperatures can reach approximately 2 to 5 degrees higher in Fahrenheit. The use of air conditioners extract hot air to the outside of buildings. On high temperature days, the hot air emitted by air-conditioner units increases the outdoor temperature. This in turn increases the need for more cooling and creates a feedback loop. The use of air conditioners can increase outdoor urban temperatures by more than approximately 1 degree Celsius in some cities
Global Efforts to combat Climate Change and Global Warming
If the current rate of growth of energy use by air conditioners continues, the U.S. Energy Information Administration (“EIA”) predicts that by 2050, global energy usage for space cooling would triple to 6,200 terra watts. This would triple the amount of carbon dioxide emissions and heavy investments in electricity infrastructure to meet peak electricity demand. This could cause severe financial strain on emerging economies.
Over the years, countries around the world have come together to support policies to combat climate change. However, obtaining consensus has been challenging because of political and national circumstances. The Kigali Amendment to the Montreal Protocol, which entered into force on 1 January 2019, help protect the climate by phasing down high global warming potential hydrofluorocarbons (HFCs), which are commonly used as refrigerants. Promoting the energy efficiency of cooling technology can also significantly increase climate benefits.
| ● | From October 31 to November 12, 2021, the 26th annual UN Climate Change Conference (COP26) was held in Glasgow, Scotland. The objectives of COP26 were: |
i. Countries were called out to reach net-zero carbon emissions by 2050 and to cap the increase in global temperatures below 1.5°C from current levels;
ii. To protect and restore ecosystems and habitats and build resilient infrastructures to withstand climate change;
iii. Developed nations to mobilize $100bn in climate finance per year for poorer nations; and
iv. Parties of COP26 to finalize the agreement and rules for action and monitoring.
The Role of Air conditioners Efficiency in combating Climate Change
Intuitively, the more energy efficient air-conditioners are, the less electricity they would consume, and less fossil fuels would be burnt to produce electricity. This would lead to less carbon dioxide emissions which could reduce global warming.
The EIA highlighted one area where policy action could deliver substantial energy savings quickly — by making air conditioners equipment more efficient. Through stricter minimum energy performance standards and other measure such as labelling, the average energy efficiency of the stock of air conditioners globally could more than double in efficiency between now and 2050. This could reduce cooling-related energy demand to 3,400 terawatts in 2050 compared to 6,200 terawatts if efficiency remained at current levels. The 45% reduction in energy usage or 2,800 terawatts could reduce carbon dioxide emissions by 1,582 megatons annually. This scenario was called the Efficient Cooling Scenario by EIA.
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In addition, the use of less electricity because of more efficient air conditioners greatly reduces the need to build new generation capacity to meet peak electricity demand. In the Efficient Cooling Scenario, there would not be a need to build additional capacity deliver the 1,300 gigawatts of power with more efficient air conditioners. This is equivalent to all the coal-fired power generation in China and India today. In addition, the cumulative infrastructure, fuel and operating costs savings amounted to $2.9 trillion from 2017 to 2050. This means 45% lower electricity costs for everyone as well, compared to if there were no efficiency improvements in air conditioners
| Number of Aircon sold per Year (Thousands of units) | ||||||||||||||||||||||||||||
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | ||||||||||||||||||||||
| World | 115,872 | 107,447 | 110,041 | 117,770 | 123,932 | 131,638 | 139,815 | |||||||||||||||||||||
| Residential Aircon | 101,952 | 93,949 | 95,162 | 99,899 | 105,857 | 113,514 | 121,592 | |||||||||||||||||||||
| Commercial Aircon | 13,920 | 13,499 | 14,879 | 17,871 | 18,075 | 18,124 | 18,222 | |||||||||||||||||||||
| By Continent | ||||||||||||||||||||||||||||
| North America | 14,226 | 15,029 | 16,515 | 19,026 | 18,416 | 19,199 | 19,778 | |||||||||||||||||||||
| Asia (Ex-Japan and China) | 19,245 | 16,196 | 17,983 | 20,066 | 22,464 | 25,249 | 24,404 | |||||||||||||||||||||
| Europe | 7,991 | 7,604 | 8,885 | 9,517 | 9,650 | 9,533 | 9,561 | |||||||||||||||||||||
| Latin America | 8,254 | 7,423 | 6,547 | 7,016 | 7,288 | 7,329 | 7,401 | |||||||||||||||||||||
| Middle East | 4,194 | 3,992 | 3,684 | 4,227 | 4,009 | 5,189 | 5,581 | |||||||||||||||||||||
| Africa | 3,125 | 2,981 | 3,489 | 3,572 | 3,699 | 3,791 | 3,993 | |||||||||||||||||||||
| Ocenia | 1,319 | 1,396 | 1,432 | 1,464 | 1,376 | 1,435 | 1,450 | |||||||||||||||||||||
| 58,354 | 54,621 | 58,535 | 64,888 | 66,902 | 71,725 | 72,168 | ||||||||||||||||||||||
| By Country (Standalone) | ||||||||||||||||||||||||||||
| Japan | 10,768 | 10,687 | 10,201 | 9,885 | 9,589 | 10,187 | 10,573 | |||||||||||||||||||||
| China | 46,751 | 42,142 | 41,305 | 42,998 | 47,440 | 49,726 | 57,075 | |||||||||||||||||||||
| 57,519 | 52,829 | 51,506 | 52,883 | 57,029 | 59,913 | 67,648 | ||||||||||||||||||||||
| 115,873 | 107,450 | 110,041 | 117,771 | 123,931 | 131,638 | 139,816 | ||||||||||||||||||||||
| Selected South East Asia | ||||||||||||||||||||||||||||
| Malaysia | 1,001 | 902 | 867 | 889 | 913 | 954 | 910 | |||||||||||||||||||||
| Singapore | 135 | 113 | 121 | 129 | 127 | 129 | 122 | |||||||||||||||||||||
| Thailand | 1,635 | 1,515 | 1,962 | 1,496 | 1,584 | 1,707 | 1,559 | |||||||||||||||||||||
| Vietnam | 2,432 | 2,153 | 1,877 | 1,826 | 1,929 | 2,199 | 2,136 | |||||||||||||||||||||
Source: Estimates of World Air Conditioner Demand (July 2024, June 2025 and August 2026) - The Japan Refrigeration and Airconditioning Industry Association (JRAIA). * Values have been rounded, so the total of “2. Residential Air Conditioners” and “3. Commercial Air Conditioners” may not match the reported overall total. * In sections “2. Residential Air Conditioners” and “3. Commercial Air Conditioners”, values marked with the “–” symbol are included under the region’s “Other” or “Regional Total” categories. For this reason, the sum of these sections may not equal the overall total.
As derived from the JRAIA report, in 2025, approximately 139 million units of air conditioners were sold globally of which approximately 87% were residential units and approximately 13% were commercial units.
Based on statistics available in the JRAIA report, we calculated both CAGR of residential and commercial air conditioners from 2019 to 2025 increased to approximately 2.98% and 4.59% respectively. China was the largest consumer of air conditioners globally and it accounted for approximately 41% of all air conditioners sales. By continent, North America had the highest CAGR of approximately 5.65% from 2019 to 2025 followed by Middle East at approximately 4.88% CAGR.
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| No. | Major Aircon Brands Globally | Company | Securities Exchange(1) | Principal Activities (2) | Market Capitalisation (USD’bn) (3) |
Revenue (ttm) (USD’bn) (3) | ||||||
| 1 | Daikin | Daikin Industries Ltd | Tokyo Stock Exchange | Daikin Industries Ltd manufactures air conditioners and refrigerants. The company provides an array of products and technologies related to air-conditioning, refrigeration systems, oil hydraulics, defense systems, chemicals, and other electronics. The company’s air conditioners are widely used in residential, commercial, and industrial applications. It also offers chemical products such as fluoroplastics, chemical engineering machinery, fluorocarbons, and fine chemical products. The company offers industrial hydraulic equipment and machinery, mobile hydraulic equipment, components for guided missiles and oxygen therapy equipment. | 36.16 | 31.78 | ||||||
| 2 | Midea | Midea Group Co | Shenzhen Stock Exchange | Midea Group Co Ltd is a manufacturer, marketer, and seller of diversified products, including consumer appliances, HVAC (heating, ventilation and air-conditioning) systems, robotics and industrial automation and smart supply chain. The company’s major products include both residential and commercial air-conditioners, laundry appliances, kitchen appliances, refrigerators, smart logistics, components, and various small home appliances. It also provides installation, maintenance, after-sale and professional services. | 83.41(4) | 69.40 | ||||||
| 3 | Trane | Trane Technologies PLC | New York Stock Exchange | Trane Technologies Plc is a manufacturer of industrial goods. It designs, manufactures, and sells a portfolio of industrial and commercial products. The company’s products enhance the quality, energy efficiency and comfort of air in homes and buildings, transport and protect food, and perishables; and increase industrial productivity and efficiency. | 103.57 | 22.21 | ||||||
| 4 | Carrier | Carrier Global Corp | New York Stock Exchange | Carrier Global Corp is a provider of heating, ventilating, air-conditioning, refrigeration systems, building automation, and fire and security technologies. The company’s products comprise furnaces, air conditioners, heat pumps, ductless systems, refrigeration equipment, boilers, indoor air quality products, compressors, thermostats, and refrigeration equipment. It also offers design, maintenance, and installation services. | 45.94 | 22.11 | ||||||
| 5 | LG | LG Electronics Inc | Korean Exchange | LG Electronics Inc manufactures and distributes consumer electronics and home appliances. The company’s product portfolio comprises televisions, monitors, personal computers, refrigerators, audio and beauty appliances, video equipment, washing machines, dishwashers, air purifiers, dehumidifiers, residential and commercial air conditioners, and vacuum cleaners. It also offers vehicle components, smartphones, information displays, solar panels, substrate and material, motor and sensor components, optic solutions, automotive components and camera modules. | 26.08(5) | 69.39 | ||||||
| 6 | Panasonic | Panasonic Corp | Tokyo Stock Exchange | Panasonic Holdings Corp develops, produces, sells and services a range of electric and electronic products. Panasonic’s product portfolio includes room air-conditioners, TVs, fixed-phones, digital cameras, video equipment, home audio equipment, rice cookers, lamps, wiring devices, air-conditioning equipment, air purifiers and bicycles. It also offers electronic components, mounting machines, welding equipment, PCs and tablets, projectors, batteries, electric motors, electronic components, electronic materials, semiconductors and LCD panels. It provides consumer, logistics, automotive, aviation, entertainment, manufacturing and housing solutions, among others. | 69.48 | 50.84 | ||||||
| 7 | Mitsubishi Electric | Mitsubishi Electric Corp | Tokyo Stock Exchange | Mitsubishi Electric Corp develops, manufactures, and markets electrical and electronics products. The companys product portfolio comprises of air conditioning systems, home products, factory automation systems, automotive equipment, building systems, energy systems, visual information systems, transportation systems, semiconductors and devices, information and communication systems, space systems and public systems. It also offers maintenance services, it infrastructure services and network services. Mitsubishi Electric serves information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation, and building equipment sectors. | 69.66 | 35.52 |
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| 8 | Haier | Haier Smart Home Co Ltd | Shanghai Stock Exchange | Haier Group is involved in the manufacturing, marketing and selling of a wide range of home appliances and consumer electronic products such as refrigerators, air conditioners, washing machines, water heaters, TVs, kitchen electric appliances, digital and home appliances, and computers. | 18.85(4) | 44.44 | ||||||
| 9 | Lennox | Lennox International Inc | New York Stock Exchange | Lennox International Inc is a climate control solutions provider. The company designs, manufactures and markets a wide range of products for the heating, ventilation, air conditioning and refrigeration (HVACR) markets. Its heating and cooling products comprise a broad range of heat pumps, furnaces, packaged heating and cooling systems, accessories to improve indoor air quality, air conditioners, comfort control products, installation and services of commercial heating and cooling equipment, replacement parts and supplies. | 12.50 | 5.30 | ||||||
| 10 | Johnson Controls | Johnson Controls International PLC | New York Stock Exchange | Johnson Controls International Plc is a technology and multi-industrial company. It engineers, develops, manufactures, and installs building products and systems. The company offers HVAC equipment, fire suppression, distributed energy storage, fire detection, industrial refrigeration, building automation and controls, digital solutions, residential and smart home security, and retail solutions, among others. | 95.00 | 25.00 | ||||||
| 11 | Samsung | Samsung Electronics Co. Ltd | Korean Exchange | Samsung Electronics Co Ltd is a manufacturer of consumer electronics, information technology and mobile communications, and device solutions. The company’s product portfolio includes televisions, refrigerators, washing machines, air conditioners, medical devices, printers, monitors, computers, network systems, and digital cameras. It also manufactures LCD and LED panels, mobile phones and smartphones, tablets, and related accessories. Samsung provides solutions to retail, hospitality, healthcare institutions, finance, education, transportation, and government sectors. | 1182.59(5) | 288.87 | ||||||
| 12 | Whirlpool | Whirlpool Corp | New York Stock Exchange | Whirlpool Corp is a designer, manufacturer, and supplier of home and kitchen appliances. Its product portfolio includes laundry appliances, refrigerators and freezers, cooking appliances, dishwashers, mixers, washing machines, air conditioners, heating and cooling products, water filters, and other portable household appliances. | 1.96 | 14.92 | ||||||
| 13 | Sharp | Sharp Corp | Tokyo Stock Exchange | Sharp Corp (Sharp) designs, develops, and markets digital information equipment, health and environmental equipment, energy, and business solutions. The company’s major products include refrigerators, microwave ovens, electric fans, beauty appliances, LED lights, air conditioners, washing machines, televisions, projectors, mobile phones, tablets, calculators, telephones, thin-film solar cells, solar cells, and storage battery. It also provides sensors, office solutions, humidifiers, dehumidifiers, business projectors, information displays, options and consumables, software, and ultrasonic cleaners. The company serves to original equipment manufacturers, electronics industries, solar industries, and household customers. | 2.68 | 11.97 |
(1) Source: https://finance.yahoo.com/
(2) Source: https://www.globaldata.com/
(3) Source: https://finance.yahoo.com/ (5 October 2026); foreign exchange rate: https://www.oanda.com/currency-converter/en/ (6 October 2026)
(4) Source: https://finance.yahoo.com/ (30 September 2026); foreign exchange rate: https://www.oanda.com/currency-converter/en/ (6 October 2026)
(5) Source: https://finance.yahoo.com/ (2 October 2026); foreign exchange rate: https://www.oanda.com/currency-converter/en/ (6 October 2026)
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Intellectual Property
As reflected in the table below, we currently have registered trademarks, several granted patents or utility models / patents or utility models pending for our proprietary HECS technologies and air-conditioning system designs filed in the United States and certain jurisdictions abroad. As of October 14, 2026, our trademark portfolio includes granted patent or utility model/ patent or utility model pending in various countries and stages. We also consider our manufacturing processes to be trade secrets and have non-disclosure agreements with current employees and business partners to protect those and other trade secrets held by the Company. Risks related to the protection and exploitation of IP rights are set forth in “Risk Factors.”
| Trademarks | ||||||||
| Mark | Country | Application No. | Filing Date | Status | ||||
 |
Malaysia | TM2021004997 | 24.02.2021 | Registered | ||||
 |
Singapore |
40202113590Q |
09.06.2021 |
Registered | ||||
| QCOV | Malaysia | TM2021004999 | 24.02.2021 | Registered | ||||
 |
Singapore | 40202113589T | 09.06.2021 | Registered | ||||
 |
Malaysia | TM2021025558 | 14.09.2021 | Registered | ||||
 |
Malaysia | TM2021018495 | 07.07.2021 | Registered | ||||
 |
Malaysia | TM2021012892 | 04.05.2021 | Registered | ||||
| EvoAir | Malaysia | TM2021002685 | 29.01.2021 | Registered | ||||
| We Cha | Malaysia | TM2020000453 | 09.01.2020 | Registered | ||||
| 回球 | Malaysia | TM2020000455 | 09.01.2020 | Registered | ||||
| 回球 | China | 43752514 | 13.01.2020 | Registered | ||||
 |
Malaysia | 2017076420 | 27.12.2017 | Registered | ||||
 |
Malaysia |
TM2020007202 | 20.04.2020 | Registered | ||||
 |
Singapore | 40202022969Y | 02.11.2020 |
Registered | ||||
 |
Malaysia | TM2025039315 | 11.11.2025 | Registered | ||||
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| Grated Patents or Utility Models and Pending Patents or Utility Models | ||||||||||||
| Invention Name | Country Code | Status | Application No. | Filing Date | Publication No. | Publication Date | ||||||
| Condensing Unit (E-coil) | PCT | Completed | PCT/MY2020/050038 | 30.06.2020 | WO/2020/246871 | 10.12.2020 | ||||||
| Condensing Unit (E-coil) | Thailand | Granted | 2103003569 | 03.12.2021 | 20596 | 23.12.2022 | ||||||
| Condensing Unit (E-coil) | Philippines | Granted |
22021550009 | 02.12.2021 | N/A | 10.12.2020 | ||||||
| Condensing Unit (E-pad) | PCT | Completed | PCT/MY2020/050070 | 18.08.2020 | WO/2021/034185 | 25.02.2021 | ||||||
| Condensing Unit (E-ball 1) | Malaysia | Granted | PI2019007957 | 31.12.2019 | N/A | 21.02.2024 | ||||||
| Condensing Unit (E-ball 1) | PCT | Completed | PCT/MY2020/050207 | 29.12.2020 | WO/2021/137695 | 08/07/2021 | ||||||
| Condensing Unit (E-ball 1) | China | Granted | 202090001025.2 | 30.06.2022 | CN 218846310 U | 11.04.2023 | ||||||
| Condensing Unit (E-ball 1) | Japan | Granted | 2022-600153 | 29.06.2022 | 3240103 | 21.11.2023 | ||||||
| Condensing Unit (E-ball 2) | Malaysia | Granted | UI2020006990 | 23.12.2020 | N/A | 23.06.2022 | ||||||
| Condensing Unit (E-ball 2) | PCT | Completed | PCT/MY2021/050119 | 14.12.2021 | WO/2022/139572 | 30.06.2022 | ||||||
| Condensing Unit (E-ball 2) | Taiwan | Granted | 110148426 | 23.12.2021 | 202209780 | 01.08.2022 | ||||||
| Condensing Unit (E-ball 2) | China | Granted | 202190000952.7 | 21.06.2023 | 202190000952.7 | 26.12.2023 | ||||||
| Condensing Unit (E-ball 2) | Thailand | Granted | 2303001671 | 14.12.2021 | 24046 | 04.07.2024 | ||||||
| Condensing Unit (E-ball 2) | Philippines | Granted | 22023550013 | 20.06.2023 | N/A | 30.06.2022 | ||||||
| Condensing Unit (E-ball 2) | Japan | Granted | 2023-600140 | 22.06.2023 | N/A | 21.11.2023 | ||||||
| Condensing Unit (E-ball 2) | UAE | Pending | P6001550/2023 | 19.06.2023 | - | - | ||||||
| Condensing Unit (E-ball 2) | Cambodia | Pending | KH/UM/2023/00003 | 19.06.2023 | - | - | ||||||
| Condensing Unit (E-ball 2) | USA | Granted | 18/258,525 | 20.06.2023 | US 2024/032084 A1 | 12.09.2024 | ||||||
| Condensing Unit (E-ball 2) | Indonesia | Pending | P00202306541 | 20.07.2023 | - | - | ||||||
| Condensing Unit (E-ball 2) | Vietnam | Granted | 2-2023-00377 | 17.07.2023 | N/A | 27.11.2023 | ||||||
| Condensing Unit (E-ball 2) | UK | Granted | 2310921.8 | 17.07.2023 | GB2617967 | 25.10.2023 | ||||||
| Condensing Unit (E-ball 2) | India | Pending | 202347048973 | 20.07.2023 | - | - | ||||||
| Portable Air Cooler | Malaysia | Granted | PI 2017704572 | 28.11.2017 | N/A | 28.05.2019 | ||||||
| Portable Air Cooler | PCT | Completed | PCT/MY2018/050076 | 15.11.2018 | WO/2019/108053 | 06.06.2019 | ||||||
| Portable Air Cooler | Thailand | Pending | 2001002798 | 15.11.2018 | ||||||||
| System Heating and Cooling Air | Malaysia | Granted | UI2020003656 | 15.07.2020 | N/A | 15.01.2022 | ||||||
| A new type of air conditioner outdoor unit | China | Granted | 2022200638879 | 25.12.2021 | CN216667840U | 03.06.2022 | ||||||
| Water pump bracket and air conditioner with the water pump bracket | China | Granted | 2022200416765 | 07.01.2022 | CN216665887U | 03.06.2022 | ||||||
| A water curtain structure | China | Granted | 2022200417471 | 07.01.2022 | CN216667874U | 03.06.2022 | ||||||
| A fan air guide frame assembly | China | Granted | 2022200452850 | 07.01.2022 | CN216667843U | 03.06.2022 | ||||||
| An air conditioner | China | Granted | 2021233235910 | 25.12.2021 | CN216620015U | 27.05.2022 | ||||||
| A water distributor damping groove and an air conditioner having the water distributor damping groove | China | Granted | 2021233235696 | 25.12.2021 | CN216620215U | 27.05.2022 | ||||||
| Wind board device | China | Granted | 2021233216873 | 25.12.2021 | CN216620075U | 27.05.2022 | ||||||
| A water tank structure | China | Granted | 2021233215851 | 25.12.2021 | CN216620214U | 27.05.2022 | ||||||
| Air conditioner outdoor unit | China | Granted | 2021308587838 | 25.12.2021 | CN307226419S | 01.04.2022 | ||||||
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Employees
As of October 14, 2026, the Group has approximately 22 employees, 20 of whom are full-time employees and 2 of whom are part-time located in Malaysia, Singapore and China.
| Function | Number of Full-Time Employees | Office | ||
| Senior Management | 3 | Malaysia, Singapore | ||
| Finance and Accounting | 4 | Malaysia, China | ||
| Sales & Marketing | 5 | Malaysia | ||
| Human Resources & Administrative | 3 | Malaysia | ||
| Production & Operation | 5 | Malaysia, China | ||
| Research & Development | 2 | Malaysia |
Principal Executive Offices
Our principal executive office is located at 31-A2, Jalan 5/32A, 6 ½ Miles off Jalan Kepong, 52000 Kuala Lumpur, Malaysia. We also have an office located in China at Shunde Western Ecological Industry Startup Zone D-08-01 (Foshan City, Shunde District, Xingtan Town, Depin Road no.1, Level 3).
| ITEM 1A. | RISK FACTORS |
Risks Related to Our Business and Industry
We have substantial doubt about our ability to continue as a going concern.
We need to raise additional capital to continue our normal and planned operations. For the fiscal years ended August 31, 2026 and August 31, 2025, we incurred a net loss of $4,351,484 and $14,968,005 respectively. In addition, as of August 31, 2026, we had an accumulated deficit of $58,123,258. The audited financial statements as of, and for the year ended, August 31, 2026, in this Annual Report have been prepared on a going-concern basis.
To address these challenges and the Company’s long-term viability, Management has developed a strategic plan focused on the continued development and expansion of its HVAC business. Key initiatives include:
| ● | Expansion of Product Offerings: Broadening the range of HVAC products to meet diverse market needs. |
| ● | Geographical Expansion: Penetrating new markets to drive revenue growth. |
| ● | Revenue Diversification: Expanding customer segments across retail, commercial, industrial, and project-based clients, as well as private label and licensing opportunities. |
| ● | Achieve Profitability: Achieving economies of scale through operational efficiencies and growth. |
Additionally, the Company is actively pursuing plans to raise additional funding to support operations and business expansion. This includes preparations to uplist on the Nasdaq Capital Market, which is expected to enhance access to capital and further strengthen the Company’s financial position.
There can be no assurance that these initiatives will be successful, that we will generate sufficient revenues or positive operating cash flows, or that additional financing will be available on acceptable terms, or at all. If we are unable to successfully implement our business strategy or obtain the capital necessary to support our operations and growth, our business, financial condition, results of operations and ability to continue as a going concern could be materially and adversely affected
If we are unable to continue to innovate, meet evolving market trends, adapt to changing customer demands and maintain our culture of innovation, our ability to sustain and grow our business may suffer.
The ongoing success of our business depends on our ability to continue to introduce innovative eco-friendly HVAC products to meet evolving market trends and satisfy changing customer demands. We must continue to adapt by innovating, improving our products and modifying our strategies, which could cause us to incur substantial costs. We may not be able to continue to innovate or adapt to changing market and customer needs in a timely and cost-effective manner, if at all. This could adversely impact our ability to expand our ecosystem and grow our business. Failure to develop new products to meet evolving market demands through innovation could cause us to lose current and potential customers and harm our operating results and financial condition.
In addition, we may not be able to maintain our culture of innovation, which has been critical to our success and has helped us create value for our shareholders, succeed as a leader in eco-friendly HVAC products, attract, retain and motivate employees and other ecosystem participants. Among other challenges, we may not be able to identify and promote people into leadership positions who share our culture and also focus on technology and innovation. Competitive pressure may also cause us to move in directions that may divert us from our mission, vision and values. If we cannot maintain our culture of innovation, our long-term business prospects could be materially and adversely affected.
We operate in a competitive industry, and if we fail to compete effectively, our business could suffer.
The air-conditioning and air purifying industry in Asia is highly competitive. Competition in our HVAC products includes several multinational, regional and local companies, the largest players of which include Daikin Industries, Gree Electric, Trane Technologies, Johnson Controls, Lennox International, Midea Group and Mitsubishi Electric. Sales depend on price, product availability, delivery schedule, product performance, product line breadth, brand reputation, design, technical expertise and service. In addition to established players, we face competition from new market entrants. Increased competition may lead to a loss of market share, increased difficulty in launching new service offerings, reduction in revenue or increase in loss, any one of which could harm our business, financial condition and results of operations.
In certain of our businesses, our contracts are typically awarded on a competitive basis. Our bids are based upon, among other factors, the cost to timely provide the products and services. To generate an acceptable return, we must accurately estimate our costs and schedule. If we fail to do so, the profitability of contracts may be materially and adversely affected – including because some of our contracts provide for liquidated damages if we do not perform on time – which could have a material adverse effect on our competitive position, results of operations, cash flows or financial condition.
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If we are unable to create brand influence, we may not be able to maintain current or attract new users and customers for our products.
Our operational and financial performance is highly dependent on the strength of our brand. We believe brand familiarity and preference will continue to have a significant role in winning over customers. In order to further expand our customer base, we may need to substantially increase our marketing expenditures to enhance brand awareness through various online and offline means. Moreover, negative coverage in the media of our company could threaten the perception of our brand, and we cannot assure you that we will be able to defuse negative press coverage about our company to the satisfaction of our investors, customers and suppliers. If we are unable to defuse negative press coverage about our company, our brand may suffer in the marketplace, our operational and financial performance may be negatively impacted.
Currently, we sell our products, under our various product line brands, to domestic customers in Malaysia and to overseas customers. However, while the management does not consider the likelihood to be high, if our competitors initiate a lawsuit against us for infringing their trademarks, we may be forced to adopt a new brand name for our products. As a result, we may incur additional marketing costs to raise awareness of such new brand name. We may also be ordered to pay a significant amount of damages, and our business, results of operations and financial condition could be materially and adversely affected. We operate in a competitive environment and our profitability and competitive position depend on our ability to accurately estimate the costs and timing of providing our products and services.
Climate change and regulations associated with climate change could adversely affect our business.
The effects of climate change, including extreme weather conditions, create financial risks to our business. The effects of climate change could disrupt our operations by impacting the availability and cost of materials and by increasing insurance and other operating costs. The effects of climate change also may impact our decisions to construct new facilities or maintain existing facilities in the areas most prone to physical risks, which could similarly increase our operating and material costs. We could also face indirect financial risks passing through the supply chain that could result in higher prices for our products and the resources needed to produce them.
There is a general consensus that greenhouse gas emissions are linked to climate change, and that these emissions must be reduced dramatically to avert its worst effects. As a result, increased public awareness and concern about climate change will likely continue to (1) generate more international, regional and/or national concerns and result in the implementation of further requirements and restrictions at international, regional and/or national level to curtail the use of high global warming potential refrigerants (which are essential to many of our products); (2) encourage increase in building energy efficiency; and (3) cause a shift away from the use of fossil fuels as an energy source. While our products are focused on being eco-friendly, these requirements may render some of the existing technology, particularly some of our products that require refrigerant use, non-compliant or obsolete. While we continue to be committed to developing eco-friendly sustainable solutions for our products, there can be no assurance that our development efforts will be successful, that our products will be accepted by the market, that proposed regulations or deregulation will not have an adverse effect on our competitive position, or that economic returns will reflect our investments in new product development.
The inconsistent international, regional and/or national requirements associated with climate change regulations also create economic and regulatory uncertainty. There is also regulatory and budgetary uncertainty associated with government incentives, which, if discontinued, could adversely impact the demand for energy-efficient buildings and could increase costs of compliance.
Our business and financial performance depend on continued and substantial investments in our information technology infrastructure, which may not yield anticipated benefits and which may be vulnerable to cyber-attacks.
The efficient operation of our business requires continued and substantial investments in information technology (“IT”) infrastructure systems. The failure to design, develop and implement new IT technology infrastructure systems in an effective and timely manner or to maintain existing systems could divert management’s attention and resources. Our information systems may also become obsolete because of inadequate investments, requiring an unplanned transition to a new platform that could be time consuming, costly, and damaging to our competitive position and could require additional management attention. Repeated or prolonged interruptions of service because of poor execution, inadequate investments or obsolescence could have a significant adverse impact on our reputation and our ability to sell products and services.
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In addition, our business may be impacted by disruptions to our or third-party IT infrastructure, which could result from (among other causes) cyber-attacks, infrastructure failures or compromises to our physical security. Cyber-based risks are evolving and include attacks: (i) on our IT infrastructure (ii) targeting the security, integrity and/or availability of hardware and software; (iii) on information installed, stored or transmitted in our products (including after the purchase of those products and when they are installed into third-party products); and (iv) on facilities or similar infrastructure. Such attacks could disrupt our systems (or those of third parties) and business operations, impact the ability of our products to work as intended or result in the unauthorized access, use, disclosure, modification, or destruction of information in violation of applicable law and/or contractual obligations. We have experienced cyber-based attacks and, due to the evolving threat landscape, may continue to experience them going forward, potentially with more frequency or severity. We continue to make investments and adopt measures to enhance our protection, detection, response and recovery capabilities, and to mitigate potential risks to our technology, products, services, operations and confidential data. However, depending on the nature, sophistication and scope of cyber-attacks, it is possible that potential vulnerabilities could go undetected for an extended period. As a result, we could potentially experience: (i) production downtimes; (ii) operational delays or other detrimental impacts on our operations; (iii) destruction or corruption of data; (iv) security breaches; (v) manipulation or improper use of our or third-party systems, networks or products; and (vi) financial losses from remedial actions, loss of business, liability, penalties, fines and/or damage to our reputation—any of which could have a material adverse effect on our competitive position, results of operations, cash flows or financial condition. Due to the evolving nature of such risks, the impact of any potential incident cannot be predicted. In addition, because of the global nature of our business, our internal systems and products must comply with applicable laws, regulations and standards in a number of jurisdictions, and government enforcement actions and violations of data privacy and cybersecurity laws could be costly or interrupt our business operations. Any disruption to our business arising from such issues, or an increase in our costs to cover these issues that is greater than what we have anticipated, could have an adverse effect on our competitive position, reputation, results of operations, cash flows or financial condition.
We are in the process of winding down operations in Cambodia, which will take time and/or create financial risks.
On May 31, 2026, WKL EcoEarth Indochina ceased its commercial operations as part of the Group’s efforts to streamline its international operations and reduce administrative costs. WKL EcoEarth Indochina operated primarily as an immaterial regional sales office and did not contribute materially to the Group’s consolidated revenue, assets or business operations. Applications for permanent closure and deregistration were submitted to the Cambodian General Department of Taxation and the Accounting and Auditing Regulator on June 6, 2026 and June 29, 2026, respectively. The formal dissolution of WKL EcoEarth Indochina remains subject to completion of the applicable regulatory procedures in Cambodia and is not expected to have a material impact on the Group’s consolidated financial position or results of operations. However, if the formal dissolution process is prolonged, this could result in higher expenses and litigation or regulatory risks for us on behalf of WKL EcoEarth Indochina.
We depend on our intellectual property and have access to certain intellectual property and information of our customers and suppliers. Infringement of or the failure to protect that intellectual property could adversely affect our future growth and success.
The Company’s intellectual property rights are important to our business and include numerous patents, trademarks, proprietary technology, technical data, business processes and other confidential information. Although we consider our intellectual property rights in the aggregate to be valuable, we do not believe that our business is materially dependent on a single intellectual property right or any group of them. We nonetheless rely on a combination of patents, trademarks, nondisclosure agreements, customer and supplier agreements, licence agreements, information technology security systems, internal controls and compliance systems and other measures to protect our intellectual property. We also rely on nondisclosure agreements, information technology security systems and other measures to protect certain customer and supplier information and intellectual property that we have in our possession or to which we have access. Our efforts to protect such intellectual property and proprietary information may not be sufficient, however.
We cannot be sure that our pending patent applications will result in the issuance of patents, that patents issued to or licensed by us in the past or in the future will not be challenged or circumvented by competitors, or that these patents will found to be valid or sufficiently broad to preclude our competitors from introducing technologies similar to those covered by our patents and patent applications.
In addition, we may be the target of competitor or other third-party patent enforcement actions seeking substantial monetary damages or seeking to prevent the sale and marketing of certain of our products. Our competitive position also may be adversely impacted by limitations on our ability to obtain possession, ownership or necessary licenses concerning data important to the development or sale of our products or service offerings, or by limitations on our ability to restrict the use by others of data related to our products or services. Any of these events or factors could subject us to judgments, penalties and significant litigation costs or temporarily or permanently disrupt our sales and marketing of the affected products or services and could have a material adverse effect on our competitive position, results of operations, cash flows or financial condition.
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We use a variety of raw materials and supplier-provided parts in our business. Significant shortages, supplier capacity constraints or production disruptions, price increases, or tariffs could increase our operating costs and adversely impact the competitive positions of our products.
Our reliance on suppliers and commodity markets to secure components and raw materials (such as copper and steel as well as INCU ionic copper solution), and on service providers to deliver our products, exposes us to volatility in the prices and availability of these materials and services. That potential volatility is particularly acute in certain instances where we depend upon a single source. Issues with suppliers (such as delivery or production disruptions, capacity constraints, quality issues, consolidations, closings or bankruptcies), price increases, raw material shortages, or the decreased availability of trucks and other delivery services could have a material adverse effect on our ability to meet our commitments to customers or increase our operating costs.
We use various strategies to lock in prices of expected purchases of certain raw materials; however, these efforts could cause us to pay higher prices for a commodity when compared with the market price at the time the commodity is actually purchased or delivered. Tariffs can also increase our costs, the impact of which is difficult to predict. However, we believe that our supply management and production practices appropriately balance the foreseeable risks and the costs of alternative practices. Nonetheless, these risks may have a material adverse effect on our competitive position, results of operations, cash flows or financial condition.
We design, manufacture and service products that incorporate advanced technologies. The introduction of new products and technologies involves risks, and we may not realize the degree or timing of benefits initially anticipated.
Our future success depends on designing, developing, producing, selling and supporting innovative products that incorporate advanced technologies. The regulations applicable to our products, as well as our customers’ product and service needs, change from time to time. Moreover, regulatory changes may render our products and technologies non-compliant. Our ability to realize the anticipated benefits of our technological advancements or product improvements – including those associated with regulatory changes – depends on a variety of factors, including: meeting development, production, and regulatory approval schedules; meeting performance plans and expectations; the availability of raw materials and parts; our suppliers’ performance; the hiring, training and deployment of qualified personnel; achieving efficiencies; identifying emerging regulatory and technological trends; validating innovative technologies; the level of customer interest in new technologies and products; and the costs and customer acceptance of our new or improved products.
Failure to achieve and maintain a high level of product and service quality could damage our reputation with customers and negatively impact our results.
Product and service quality issues could harm customer confidence in our company and our brands. If certain of our product offerings do not meet applicable safety standards or our customers’ expectations regarding safety or quality, we can experience lost sales and increased costs and we can and have been exposed to legal, financial and reputational risks. Actual, potential or perceived product safety concerns could expose us to litigation as well as government enforcement actions, which has also occurred in certain instances. In addition, when our products fail to perform as expected, we are exposed to warranty, product liability claims, personal injury and other claims.
We maintain strict quality controls and procedures. However, we cannot be certain that these controls and procedures will reveal defects in our products or their raw materials, which may not become apparent until after the products have been placed in use in the market. Accordingly, there is a risk that products will have defects, which could require a product recall. Product recalls can be expensive to implement, and may damage our reputation, customer relationships and market share.
In many jurisdictions, product liability claims are not limited to any specified amount of recovery. If any such claims or contribution requests or requirements exceed our available insurance or if there is a product recall, there could be an adverse impact on our results of operations. In addition, a recall or claim could require us to review our entire product portfolio to assess whether similar issues are present in other products, which could result in a significant disruption to our business and which could have a further adverse impact on our business, financial condition, results of operations and cash flows. There can be no assurance that we will not experience any material warranty or product liability claim losses in the future, that we will not incur significant costs to defend such claims or that we will have adequate reserves to cover any recalls, repair and replacement costs.
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We are subject to litigation, environmental, and other legal and compliance risks.
We are subject to a variety of litigation, legal and compliance risks. These risks relate to, among other things, personal injuries, intellectual property rights, contract-related claims, taxes, environmental matters, employee health and safety, competition laws and laws governing improper business practices. If found responsible in connection with such matters, we could be subject to significant fines, penalties, repayments and other damages (in certain cases, treble damages), and experience reputational harm.
As a global business, we are subject to complex laws and regulations in Malaysia. and other countries in which we operate. Those laws and regulations may be interpreted in different ways. They may also change from time to time, as may related interpretations and other guidance. Changes in laws or regulations could result in higher expenses. Uncertainty relating to laws or regulations may also affect how we operate, structure our investments and enforce our rights.
Changes in environmental and climate change related-laws could require additional investments in product designs, which may be more expensive or difficult to manufacture, qualify and sell and/or may involve additional product safety risks and could increase environmental compliance expenditures.
At times we are involved in disputes with private parties over environmental issues, including litigation over the allocation of cleanup costs, alleged personal injuries and property damage. Existing and future asbestos-related claims could adversely affect our financial condition, results of operations and cash flow. Personal injury lawsuits may involve individual and purported class actions alleging that contaminants originating from our current or former products or operating facilities caused or contributed to medical conditions. Property damage lawsuits may involve claims relating to environmental damage or diminution of real estate values. Even in litigation where we believe our liability is remote, there is a risk that a negative finding or decision could have a material adverse effect on our competitive position, results of operations, cash flows or financial condition, in particular with respect to environmental claims in regions where we have, or previously had, significant operations or where certain of our products have been manufactured and used.
Our failure to comply with anti-corruption laws and regulations, or effectively manage our employees, customers and business partners, could severely damage our reputation, and materially and adversely affect our business, financial condition, results of operations and prospects.
We are subject to risks in relation to actions taken by us, our employees, third-party customers or third-party suppliers that constitute violations of the anti-corruption laws and regulations. While we adopt strict internal procedures and work closely with relevant government agencies to ensure compliance of our business operations with relevant laws and regulations, our efforts may not be sufficient to ensure that we comply with relevant laws and regulations at all times. If we, our employees, third-party customers or third-party suppliers violate these laws, rules or regulations, we could be subject to fines and/or other penalties. Actions by Malaysia regulatory authorities or the courts to provide an alternative interpretation of the laws and regulations or to adopt additional anti-bribery or anti-corruption related regulations could also require us to make changes to our operations. Our reputation, corporate image, and business operations may be materially and adversely affected if we fail to comply with these measures or become the target of any negative publicity as a result of actions taken by us, our employees, third-party customers or third-party suppliers.
Our business depends on the continued contributions made by Low Wai Koon (“Dr. Low”), as our founder and chief executive officer, the loss of who may result in a severe impediment to our business, results of operation and financial condition.
Our success is dependent upon the continued contributions made by founder, chief executive officer and chairman of the board, Dr. Low. We rely on his expertise in business operations when we are developing our business. We have no “Key Man” insurance to cover the resulting losses in the event that Dr. Low should die or resign. In order to mitigate this risk, the Group has continued to invest in its personnel training as well as investment into its research and development department.
However, if Dr. Low cannot serve the Company or is no longer willing to do so, the Company may not be able to find alternatives in a timely manner or at all. This would likely result in severe damage to our business operations and would have an adverse material impact on our financial position and operating results. To sustain our operations, the Company may have to recruit and train replacement personnel at a higher cost. In addition, if Dr. Low joins our competitors or develops similar businesses that are in competition with our Company, our business, results of operation and financial conditions may also be negatively impacted.
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Risks Related to Doing Business in Malaysia
Developments in the social, political, regulatory and economic environment in Malaysia may have a material adverse impact on us.
Our business, prospects, financial condition and results of operations may be adversely affected by social, political, regulatory and economic developments in Malaysia. Such political and economic uncertainties include, but are not limited to, the risks of war, terrorism, nationalism, nullification of contract, changes in interest rates, imposition of capital controls and methods of taxation.
According to Economy Outlook 2026 from Ministry of Finance Malaysia, geopolitical tensions intensify, trade frictions multiply, climate breakdown accelerates and financial markets oscillate. Although recent clarity on the United States tariff policies offers some reprieve, yet the risks of sector specific and reciprocal measures still loom and may disrupt the global trading system further and weigh on growth. Increased tariffs could elevate import costs, contribute to inflationary pressures, and diminish real household income. Over the long-term, concerns about the sustainability of public debt and the pace of fiscal consolidation may further impact investment decisions. The fading impact of tariff-related trade front-loading, the possibility of renewed tariff measures, rising geopolitical tensions, and fiscal imbalances pose substantial risks to stability in 2026. At the same time, tighter global financial conditions and high public debt in some economies add to the vulnerability. Any negative impact on the economy of Malaysia, as well as global economy as a whole, may in turn negatively impact our performance, and result in a substantial in a partial or entire loss of an investment in our Company.
We are subject to foreign exchange control policies in Malaysia.
The ability of our subsidiaries to pay dividends or make other payments to us may be restricted by the foreign exchange control policies in the countries where we operate. For example, there are foreign exchange policies in Malaysia which support the monitoring of capital flows into and out of the country in order to preserve its financial and economic stability. The foreign exchange policies are administered by the Foreign Exchange Administration, an arm of Bank Negara Malaysia (“BNM”), the central bank of Malaysia. The foreign exchange policies monitor and regulate both residents and non-residents. Under the current Foreign Exchange Administration rules issued by BNM, non-residents are free to repatriate any amount of funds from Malaysia in foreign currency other than the currency of Israel at any time (subject to limited exceptions), including capital, divestment proceeds, profits, dividends, rental, fees and interest arising from investment in Malaysia, subject to any withholding tax. In the event BNM or any other country where we operate introduces any restrictions in the future, we may be affected in our ability to repatriate dividends or other payments from our subsidiaries in Malaysia or in such other countries. Since we are a holding company and rely principally on dividends and other payments from our subsidiaries for our cash requirements, any restrictions on such dividends or other payments could materially and adversely affect our liquidity, financial condition and results of operation.
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Many of the economies in Asia, including Malaysia, are experiencing substantial inflationary pressures which may prompt the governments to take action to control the growth of the economy and inflation that could lead to a significant decrease in our profitability in the future.
While many of the economies in Asia have experienced rapid growth over the last two decades, they currently are experiencing inflationary pressures. Headline inflation, as measured by the Consumer Price Index (“CPI”), eased to an average of 1.4% in the first eight months of 2025, down from 1.8% over the same period in 2024, following favourable cost environment and sustained demand. Headline inflation is expected to remain contained within the 1% – 2% range in 2025. (source: Economic Outlook 2026, Ministry of Finance Malaysia)
While this inflationary trend will result in higher operational costs, we believe that this also strengthens our value proposition by emphasizing potential savings to customers through improved productivity and workflow efficiency derived from our technology solutions. To mitigate inflationary pressures, we will regularly review our pricing structure to ensure sustainable profitability.
As governments take steps to address the current inflationary pressures, there may be significant changes in the availability of bank credit, interest rate increases, limitations on loans, or restrictions on currency conversions and foreign investment. There also may be imposition of price controls. If these or other similar restrictions are imposed by a government to influence the economy, it may lead to a slowing of economic growth. If prices for the products we source or if wages rise at a rate that is insufficient to compensate for the rise in these costs, it may have an adverse effect on our profitability, and result in a substantial in a partial or entire loss of an investment in our Company.
Unauthorized disclosure, destruction or modification of data, through cybersecurity breaches, computer viruses or otherwise or disruption of our services could expose us to liability, protracted and costly litigation and damage our reputation.
Our business involves the collection, storage, processing and transmission of customers’ business data. An increasing number of organizations, including large merchants and businesses, other large technology companies, financial institutions and government institutions, have disclosed breaches of their information technology, or IT, systems, some of which have involved sophisticated and highly targeted cybersecurity attacks, including on portions of their websites or infrastructure. We may also be subjected to breaches of cybersecurity by hackers. Threats may derive from human error, fraud or malice on the part of employees or third parties, or may result from accidental technological failure. Concerns about cybersecurity are increased when we transmit information. Electronic transmissions can also be subjected to cybersecurity attacks, interception or loss. Also, computer viruses and malware can be distributed and spread rapidly over the internet and could infiltrate our systems or those of our associated participants, which can impact the confidentiality, integrity and availability of information, and the integrity and availability of our products, services and systems, among other effects. Denial of service or other cybersecurity attacks could be targeted against us for a variety of purposes, including interfering with our products and services or creating a diversion for other malicious activities. These types of actions and attacks could disrupt our delivery of products and services or make them unavailable, which could damage our reputation, force us to incur significant expenses in remediating the resulting impacts, expose us to uninsured liabilities, subject us to lawsuits, fines or sanctions, distract our management or increase our costs of doing business.
Our encryption of data and other protective measures may not prevent unauthorized access or use of sensitive data. A breach of our system or that of one of our associated participants may subject us to material losses or liability. A misuse of such data or a cybersecurity breach could harm our reputation and deter customers from using our products and services, thus reducing our revenue. In addition, any such misuse or breach could cause us to incur costs to correct the breaches or failures, expose us to uninsured liabilities, increase our risk of regulatory scrutiny, subject us to lawsuits, result in the imposition of material penalties and fines under applying laws or regulations.
We cannot assure that there are written agreements in place with every associated participant or that such written agreements will prevent the unauthorized use, modification, destruction or disclosure of data or enable us or our customers to obtain reimbursement in the event we should suffer incidents resulting in unauthorized use, modification, destruction or disclosure of data. Any unauthorized use, modification, destruction or disclosure of data could result in protracted and costly litigation, which could have a material and adverse effect on our business, financial condition and results of operations.
Cybersecurity attack incidents are increasing in frequency and evolving in nature and include, but are not limited to, installation of malicious software, unauthorized access to data and other electronic security breaches that could lead to disruptions in systems, unauthorized release of confidential or otherwise protected information and the corruption of data. Given the unpredictability of the timing, nature and scope of information technology disruptions, there can be no assurance that the procedures and controls we employ will be sufficient to prevent security breaches from occurring and we could be subject to manipulation or improper use of our systems and networks or financial losses from remedial actions, any of which could have a material and adverse effect on our business, financial condition and results of operations.
Risks Related to Intellectual Property
If we are not able to adequately protect our proprietary intellectual property and information, and protect against third party claims that we are infringing on their intellectual property rights, our results of operations could be adversely affected.
The value of our business depends in part on our ability to protect our intellectual property including our patents applications and trademarks, as well as our customer, employee, and customer data. Third parties may try to challenge our ownership of our intellectual property in Asia and around the world. In addition, intellectual property rights and protections in Malaysia may be insufficient to protect material intellectual property rights. Further, our business is subject to the risk of third parties counterfeiting our products or infringing on our intellectual property rights. The steps we have taken may not prevent unauthorized use of our intellectual property. We may need to resort to litigation to protect our intellectual property rights, which could result in substantial costs and diversion of resources. If we fail to protect our proprietary intellectual property and information, including with respect to any successful challenge to our ownership of intellectual property or material infringements of our intellectual property, this failure could have a significant adverse effect on our business, financial condition, and results of operations.
If we are unable to adequately protect our intellectual property rights, or if we are accused of infringing on the intellectual property rights of others, our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend our rights.
Our commercial success will depend in part on our success in obtaining and maintaining patents, copyrights, trademarks, trade secrets and other intellectual property rights in Malaysia and elsewhere and protecting our proprietary technology. If we do not adequately protect our intellectual property and proprietary technology, competitors may be able to use our technologies or the goodwill we have acquired in the marketplace and erode or negate any competitive advantage we may have, which could harm our business and ability to achieve profitability.
We cannot provide any assurances that any of our pending patent applications that mature into issued patents will include a scope sufficient to protect our products, any additional features we develop for our products or any new products. Other parties may have developed technologies that may be related or competitive to our system, may have filed or may file patent applications and may have received or may receive patents that overlap or conflict with our patent applications, either by claiming the same methods or devices or by claiming subject matter that could dominate our patent position. Our patent position may involve complex legal and factual questions, and, therefore, the scope, validity and enforceability of any patent claims that we may obtain cannot be predicted with certainty. Patents, if issued, may be challenged, deemed unenforceable, invalidated or circumvented. Proceedings challenging our patents could result in either loss of the patent or denial of the patent application or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such proceedings may be costly. Thus, any patents that we may own may not provide any protection against competitors. Furthermore, an adverse decision in an interference proceeding can result in a third party receiving the patent right sought by us, which in turn could affect our ability to commercialize our products.
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Though an issued patent is presumed valid and enforceable, its issuance is not conclusive as to its validity or its enforceability and it may not provide us with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors could purchase our products and attempt to replicate some or all of the competitive advantages we derive from our development efforts, willfully infringe our intellectual property rights, design around our patents, or develop and obtain patent protection for more effective technologies, designs or methods.
We may be unable to prevent the unauthorized disclosure or use of our technical knowledge or trade secrets by consultants, suppliers, vendors, former employees and current employees.
Our ability to enforce our patent rights depends on our ability to detect infringement. It may be difficult to detect infringers who do not advertise the components that are used in their products. Moreover, it may be difficult or impossible to obtain evidence of infringement in a competitor’s or potential competitor’s product. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded if we were to prevail may not be commercially meaningful.
In addition, proceedings to enforce or defend our patents could put our patents at risk of being invalidated, held unenforceable or interpreted narrowly. Such proceedings could also provoke third parties to assert claims against us, including that some or all of the claims in one or more of our patents are invalid or otherwise unenforceable. If any of our patents covering our products are invalidated or found unenforceable, or if a court found that valid, enforceable patents held by third parties covered one or more of our products, our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend our rights.
The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that:
● any of our granted patent or utility model/ patent or utility model pending applications, if issued, will include claims having a scope sufficient to protect our products;
● any of our granted patent or utility model/ patent or utility model pending applications will be issued as patents;
● we were the first to file patent applications for these inventions;
● others will not develop similar or alternative technologies that do not infringe our patents; any of our patents will be found to ultimately be valid and enforceable;
● any patents issued to us will provide a basis for an exclusive market for our commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties;
● we will develop additional proprietary technologies or products that are separately patentable; or
● our commercial activities or products will not infringe upon the patents of others.
We rely, in part, upon unpatented know-how and continuing technological innovation to develop and maintain our competitive position. Further, our trade secrets could otherwise become known or be independently discovered by our competitors.
Risks Related to our Common Stock and this Offering
Volatility in our shares price may subject us to securities litigation.
The market for our shares may have, when compared to seasoned issuers, significant price volatility and we expect that our share price may continue to be more volatile than that of a seasoned issuer for the indefinite future. In the past, plaintiffs have often initiated securities class action litigation against a company following periods of volatility in the market price of its securities. We may, in the future, be the target of similar litigation. Securities litigation could result in substantial costs and liabilities and could divert management’s attention and resources.
We may never be able to pay dividends and are unlikely to do so.
To date, we have not paid, nor do we intend to pay in the foreseeable future, dividends on our common stock, even if we become profitable. Earnings, if any, are expected to be used to advance our activities and for working capital and general corporate purposes, rather than to make distributions to stockholders. Since we are not in a financial position to pay dividends on our common stock and future dividends are not presently being contemplated, investors are advised that return on investment in our common stock is restricted to an appreciation in the share price. The potential or likelihood of an increase in share price is uncertain.
In addition, under Nevada law, we may only pay dividends subject to our ability to service our debts as they become due and provided that our assets will exceed our liabilities after the dividend. Our ability to pay dividends will therefore depend on our ability to generate sufficient profits. Furthermore, because of the various rules applicable to our operations in Malaysia and the regulations on foreign investments as well as the applicable tax law, we may be subject to further limitations on our ability to declare and pay dividends to our stockholders.
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Stockholders may be diluted significantly through our efforts to obtain financing and satisfy obligations through the issuance of securities.
Wherever possible, our board of directors will attempt to use non-cash consideration to satisfy obligations. In many instances, we believe that the non-cash consideration will consist of shares of our common stock, warrants to purchase shares of our common stock or other securities. In the future, we may issue our authorized but previously unissued equity securities, resulting in the dilution of the ownership interests of our stockholders. We are authorized to issue an aggregate of 250,000,000 shares of common stock. We may issue additional shares of common stock or other securities that are convertible into or exercisable for our common stock in connection with hiring or retaining employees, future acquisitions, future sales of our securities for capital raising purposes, or for other business purposes. The future issuance of any such additional shares of our common stock may create downward pressure on the trading price of the common stock. We expect we will need to raise additional capital in the near future to meet our working capital needs, and there can be no assurance that we will not be required to issue additional shares, warrants or other convertible securities in the future in conjunction with these capital raising efforts, including at a price (or exercise prices) below the price you paid for your stock.
We are a “smaller reporting company,” and we cannot be certain if the reduced disclosure requirements applicable to smaller reporting companies will make our common stock less attractive to investors.
We are currently a “smaller reporting company”, meaning that we are not an investment company, an asset- backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and annual revenues of less than $50.0 million during the most recently completed fiscal year. “Smaller reporting companies” are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; and have certain other decreased disclosure obligations in their SEC filings, including, among other things, only being required to provide two years of audited financial statements in annual reports. Decreased disclosures in our SEC filings due to our status as a “smaller reporting company” may make it harder for investors to analyze our results of operations and financial prospects.
We plan to list our common stock on Nasdaq Capital Market. We may not be able to maintain our listing on Nasdaq Capital Market which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.
We will apply to list our common stock on Nasdaq Capital Market under the symbol “EVOH”. Even if our common stock is approved to be listed on Nasdaq Capital Market, we cannot assure you that our common stock will continue to be listed on Nasdaq Capital Market in the future. In order to continue listing our securities on Nasdaq Capital Market, we must maintain certain financial, distribution and share price levels. Moreover, we must comply with certain listing standards regarding the independence of our board of directors and members of our audit committee. We intend to fully comply with these requirements, but we may not continue to be able to meet these requirements in the future.
If Nasdaq Capital Market delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
| ● | a limited availability of market quotations for our securities; | |
| ● | reduced liquidity for our securities; | |
| ● | a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; | |
| ● | a limited amount of news and analyst coverage; and | |
| ● | a decreased ability to issue additional securities or obtain additional financing in the future. |
The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because we expect that our common stock will be listed on Nasdaq Capital Market, such securities will be covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Furthermore, if we were no longer listed on Nasdaq Capital Market, our securities would not be covered securities and we would be subject to regulations in each state in which we offer our securities.
The price of our common stock may rapidly fluctuate or may decline regardless of our operating performance, resulting in substantial losses for investors.
The trading price of our common stock following this offering may be subject to instances of extreme stock price run-ups followed by rapid price declines and stock price volatility unrelated to both our actual and expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our stock. Further, the trading price of our common stock following this offering is likely to be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control, including limited trading volume, actual or anticipated fluctuations in our results of operations; the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; failure of securities analysts to initiate or maintain coverage of our Company, changes in financial estimates or ratings by any securities analysts who follow our Company or our failure to meet these estimates or the expectations of investors; announcements by us or our competitors of significant innovations, acquisitions, strategic partnerships, joint ventures, operating results or capital commitments; changes in operating performance and stock market valuations of other companies in our industry; price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; changes in our Board or management; sales of large blocks of our common stock, including sales by our executive officers, directors and significant stockholders; lawsuits threatened or filed against us; changes in laws or regulations applicable to our business; the expiration of lock-up agreements; changes in our capital structure, such as future issuances of debt or equity securities; short sales, hedging and other derivative transactions involving our capital stock; general economic and geopolitical conditions, including the current or anticipated impact of military conflict and related sanctions imposed on Russia by the United States and other countries due to Russia’s recent invasion of Ukraine; and the other factors described in this section of the prospectus captioned “Risk Factors.”
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Certain recent initial public offerings of companies with relatively small public floats have experienced extreme volatility that was seemingly unrelated to the underlying performance of the respective company. Our common stock may potentially experience rapid and substantial price volatility, which may make it difficult for prospective investors to assess the value of our common stock.
In addition to the risks addressed above under “the price of our common stock may rapidly fluctuate or may decline regardless of our operating performance, resulting in substantial losses for investors,” our common stock may be subject to rapid and substantial price volatility. We may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common stock. Recently, there have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with a number of recent initial public offerings, especially among companies with relatively smaller public floats. As a relatively small-capitalization company, we may experience greater stock price volatility, extreme price run-ups, lower trading volume and less liquidity than large-capitalization companies. In particular, our common stock may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices. Such volatility, including any stock-run up, may be unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common stock.
In addition, if the trading volumes of our common stock are low, persons buying or selling in relatively small quantities may easily influence prices of our common stock. This low volume of trades could also cause the price of our common stock to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Holders of our common stock may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our common stock. As a result of this volatility, investors may experience losses on their investment in our common stock. A decline in the market price of our common stock also could adversely affect our ability to issue additional common stock or other securities and our ability to obtain additional financing in the future. No assurance can be given that an active market in our common stock will develop or be sustained. If an active market does not develop, holders of our common stock may be unable to readily sell the shares they hold or may not be able to sell their shares at all.
General Risks
Natural disasters, epidemics or other unexpected events may disrupt our operations, adversely affect our results of operations, financial condition and may not be fully covered by insurance.
The occurrence of one or more natural disasters, power outages or other unexpected events, including hurricanes, fires, earthquakes, volcanic eruptions, tsunamis, floods and other forms of severe weather, health epidemics, pandemics (including COVID-19) or other contagious outbreaks, conflicts, wars or terrorist acts, in the U.S. or in other countries in which we or our suppliers or customers operate could adversely affect our operations and financial performance. Natural disasters, power outages or other unexpected events could damage or close one or more of our facilities or disrupt our operations temporarily or long-term, such as by causing business interruptions or by affecting the availability and/or cost of materials needed for manufacturing. We have only one factory that can manufacture a specific product or product line. As a result, damage to or the closure of that factory may disrupt or prevent us from manufacturing certain products. Existing insurance arrangements may not cover all of the costs or lost cash flows that may arise from such events. The occurrence of any of these events could also increase our insurance and other operating costs or harm our sales.
We may be affected by global economic, capital market and political conditions, and conditions in the construction, transportation and infrastructure industries in particular.
Our business, financial condition, operating results and cash flows may be adversely affected by changes in global economic conditions and geopolitical risks and conditions, including credit market conditions, levels of consumer and business confidence, fluctuations in residential, commercial and industrial construction activity, pandemic health issues (including COVID-19 and its effects), natural disasters, commodity prices, energy costs, interest rates, foreign exchange rates, levels of government spending and deficits, trade policies (including tariffs, boycotts and sanctions), regulatory changes, actual or anticipated default on sovereign debt and other challenges that could affect the global economy.
These economic and political conditions affect our business in a number of ways. Additionally, the tightening of credit in the capital markets could adversely affect the ability of our customers, including individual end-customers and businesses, to obtain financing for significant purchases and operations, which could result in a decrease in or cancellation of orders for our products and services. Similarly, tightening credit may adversely affect our supply base and increase the potential for one or more of our suppliers to experience financial distress or bankruptcy. Additionally, because we have a number of factories and suppliers in foreign countries, the imposition of tariffs or sanctions or unusually restrictive border crossing rules could adversely affect our supply chain, operations and overall business.
Our business and financial performance is also adversely affected by decreases in the general level of economic activity, such as decreases in business and consumer spending and construction (both residential and commercial as well as remodelling).
Our business success depends on attracting and retaining qualified personnel.
Our ability to sustain and grow our business requires us to hire, retain and develop a highly skilled and diverse management team and workforce. Failure to ensure that we have leadership with the necessary skill sets and experience could impede our ability to deliver our growth objectives, execute our strategic plan and effectively transition our leadership.
| ITEM 1B. | UNRESOLVED STAFF COMMENTS |
None.
ITEM 1C. CYBERSECURITY
We
are
Our
Board of Directors holds oversight responsibility over our Group’s risk management and strategy, including material risks
related to cybersecurity threats.
As of the date hereof, the Company has not encountered cybersecurity incidents that the company believes to have been material to the Company taken as a whole.
| ITEM 2. | PROPERTIES |
Our principal executive office is located at 31-A2, Jalan 5/32A, 6 ½ Miles off Jalan Kepong, 52000 Kuala Lumpur, Malaysia. Our manufacturing plant and assembly lines are located at the leased factory and office premises of EvoAir Manufacturing, Malaysia, under a lease expiring in 2027. We also have an office in China at Shunde Western Ecological Industry Startup Zone D-08-01 (Foshan City, Shunde District, Xingtan Town, Depin Road no.1, Level 3).
| ITEM 3 | LEGAL PROCEEDINGS |
We are not currently subject to any legal proceedings, and to the best of our knowledge, no such proceeding is threatened, the results of which would have a material impact on the Company’s properties, results of operations, or financial condition. Nor, to the best of our knowledge, are any of the Company’s officers or directors involved in any legal proceedings in which we are an adverse party.
| ITEM 4. | MINE SAFETY DISCLOSURES |
No report required.
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PART II
| ITEM 5. | MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |
MARKET INFORMATION
The registrant had 27,180,631 shares of our Common Stock par value, $0.001 issued and outstanding as of October 14, 2026. There were 315 record holders of our common stock.
DIVIDENDS
We have never paid or declared any dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
We currently do not have any equity compensation plans.
| ITEM 6. | SELECTED FINANCIAL DATA |
Not Applicable.
| ITEM 7. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
General Overview
EvoAir Holdings Inc (formerly Unex Holdings Inc.) (the “Company”, “EVOH”, “we”, “us”, or “our”) is a corporation established under the corporation laws in the State of Nevada, U.S. on February 17, 2017. The Company has adopted an August 31 fiscal year end.
On December 20, 2021, the Company and Dr. Low entered into the EvoAir Transaction. EvoAir International, through its subsidiaries upon completion of the Transactions contemplated under Note 1 to Financial Statements, is engaged in the R&D, manufacturing, trading, sale of HVAC products and related services in Asia.
Pursuant to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company and the owner of 2,000,000 restricted shares of Common Stock of the Company representing approximately 67.34% of the Company’s then issued and outstanding shares of Common Stock, sold his entire shareholding of the Company to WKL Global for an aggregate consideration of $100. Upon completion of the Change of Control Transaction, WKL Global owned 2,000,000 shares, or approximately 67.34% of the then issued and shares of Common Stock of the Company, which resulted in a change of control of the Company.
On December 20, 2021, several transactions took place (together, the “Allotment Transactions”) whereby the Company issued and allotted in aggregate 98,809,323 EvoAir Shares to certain parties. On completion of the Allotment Transactions, the total number of issued and outstanding EvoAir Shares were 101,779,323 (“Then Enlarged Share Capital”):
(A) On December 20, 2021, Dr. Low and Chan Kok Wei entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which Dr. Low and Chan Kok Wei agreed to sell all their ordinary shares of WKL Green Energy to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global and Allegro Investment (BVI) Limited (“Allegro Investment”), a company incorporated in the British Virgin Islands with 50% shareholding held by Chan Kok Wei and Ong Bee Chen, respectively, of 24,000 EvoAir Shares and 6,000 EvoAir Shares, respectively, or approximately 0.02% and 0.01% of the Then Enlarged Share Capital, respectively.
(B) On December 20, 2021, Dr. Low, Chan Kok Wei, Ong Bee Chen and certain sellers (“WKLEE Sellers”) entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which the WKLEE Sellers agreed to sell all their ordinary shares, of WKL Eco Earth to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global, Allegro Investment and WKLEE Sellers of 49,320 EvoAir Shares, 8,280 EvoAir Shares and in aggregate 14,400 EvoAir Shares, respectively, or approximately 0.05%, 0.009% and in aggregate 0.014%, respectively, of the Then Enlarged Share Capital.
(C) On December 20, 2021, Tan Soon Hock, Oh Ivan Joon Wern and certain relevant interest holders (“Relevant Interest Holders”) entered into an investment exchange agreement with WKL Eco Earth Holdings, pursuant to which the Tan Soon Hock, Oh Ivan Joon Wern and the Relevant Interest Holders agreed to sell all relevant interests in the EvoAir Group to WKL Eco Earth Holdings in consideration for the allotment and issuance of 7,037,762 EvoAir shares, 2,520,000 EvoAir shares and in aggregate 6,001,794 EvoAir shares, respectively, or approximately 6.91%, 2.48% and in aggregate 5.90%, respectively, of the Then Enlarged Share Capital. The board of directors and majority shareholders of the Company have approved the transaction.
(D) On December 20, 2021, Dr. Low entered into two deeds of assignment of intellectual properties with WKL Eco Earth Holdings, in respect of Dr. Low’s patents and patent applications relating to eco-friendly air-conditioner condenser (external unit), EvoAirTM and the trademarks described in the deed of assignment thereunder, and in respect of Dr. Low’s patents and patent applications relating to the portable air-conditioner, e-Cond EVOTM and the trademarks and trademark applications as described in the deed of assignments thereunder (together, the “IP Assignments”). Pursuant to the IP Assignments, WKL Global, Allegro Investment and certain nominees shall be allotted and issued 63,362,756 EvoAir Shares, 14,297,259 EvoAir Shares and in aggregate 5,487,752 EvoAir Shares, respectively or approximately 62.25%, 14.05% and in aggregate 5.39%, respectively of the Then Enlarged Share Capital in consideration for the IP Assignments.
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EvoAir Transaction, Change of Control Transaction and Allotment Transactions are collectively to be referred to as the “Transactions”. The closing of the Transactions (the “Closing”) occurred on December 20, 2021 (the “Closing Date”).
From and after the Closing Date, at which time EvoAir International transferred its HVAC business to the Company, the Company’s primary operations consisted of the prior operations of EvoAir International.
EvoAir International is a company incorporated in BVI on November 17, 2021. Effective from the December 20, 2021, it wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy a Malaysian company incorporated on October 24, 2017. WKL Eco Earth Holdings acquired (c) EvoAir Manufacturing (M) Sdn bhd (“EvoAir Manufacturing”) on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina Co Ltd (“WKL EcoEarth Indochina”), a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou Co Ltd (“WKL Guanzhe”), a Chinese company incorporated on April 6, 2021. EvoAir Manufacturing wholly owns (f) Evo Air Marketing (M) Sdn Bhd (“Evo Air Marketing”), a Malaysian company incorporated on February 2, 2021.
On June 15, 2022, the Company filed a Certificate of Amendment (the “Amendment”) to the Articles of Incorporation with Nevada’s Secretary of State to change the name of the Company from Unex Holdings Inc. to EvoAir Holdings Inc. (the “Name Change”), and the Name Change became market effective on November 4, 2022. Effective on November 11, 2022, the Company’s shares began trading under the new ticker symbol “EVOH”.
On November 21, 2023, the Company issued in aggregate, 52,107 shares of Common Stock to 15 referral agents (“Referral Agents”) in consideration for their referral to the Company of certain investors. Each Referral Agent is a “non-U.S. Persons” as defined in Regulation S.
On November 21, 2023, the Company issued, in aggregate, 5,500 shares of Common Stock to two individuals in consideration for marketing services provided to the Company by Artisan Creative Studio, a marketing entity based in Malaysia. Each of the individuals is a “non-U.S. Persons” as defined in Regulation S.
On August 14, 2024, the WKL Eco Earth Holdings has increased its investment in WKL Guanzhe Green Technology Guangzhou Co Ltd (China) by injecting an additional RMB2,000,000 into its registered capital. This investment has resulted in an increase in WKL Eco Earth Holding’s equity interest in WKL Guanzhe Green Technology to 62.5%.
On February 6, 2026, the WKL Eco Earth Holdings has increased its investment in WKL Guanzhe Green Technology Guangzhou Co Ltd (China) by injecting an additional RMB1,500,000 into its registered capital. This investment has resulted in an increase in WKL Eco Earth Holding’s equity interest in WKL Guanzhe Green Technology to 66.67%.
On May 31, 2026, WKL EcoEarth Indochina ceased its commercial operations as part of the Group’s efforts to streamline its international operations and reduce administrative costs. WKL EcoEarth Indochina operated primarily as an immaterial regional sales office and did not contribute materially to the Group’s consolidated revenue, assets or business operations. Applications for permanent closure and deregistration were submitted to the Cambodian General Department of Taxation and the Accounting and Auditing Regulator on June 6, 2026 and June 29, 2026, respectively. The formal dissolution of WKL EcoEarth Indochina remains subject to completion of the applicable regulatory procedures in Cambodia and is not expected to have a material impact on the Group’s consolidated financial position or results of operations.
Round 2 Stockholders
The Company entered into a series of offerings for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50, as follows:
| ● | On February 15, 2022, the Company entered into certain share subscription agreement with Ms. Ang Lee Kim Jane, who is a “non-U.S. Persons” (the “Investor”) as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company agreed to issue and sell 74,074 Shares, of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $185,185. | |
| ● | On June 3, 2022, the Company entered into certain share subscription agreement with Mr. Wong Hon Wai who is a “non-U.S. Persons” (the “Investor”) as defined in Regulation S of the Securities Act pursuant to which the Company agreed to issue and sell 5,000 shares of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $12,500. |
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| ● | On October 25, 2022, the Company entered into Regulation S share subscription agreements with eight investors, each of whom represented that it was a “non-U.S. Persons” as defined in Securities Act. On the same date, the Company entered into Regulation D share subscription agreements with two investors, each of whom represented that it was an “Accredited Investors” as defined in Regulation D of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 129,621 shares of Common Stock, to the Regulation S investors, and (ii) 15,000 shares of Common Stock to the Regulation D investors, respectively, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were $361,553. | |
| ● | On February 20, 2023, the Company entered into Regulation S share subscription agreements with eleven investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 57,783 shares of Common Stock, to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were $144,443. | |
| ● | On July 13, 2023, the Company entered into Regulation S share subscription agreements with 31 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 250,132 shares of Common Stock, to the Regulation S Investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $625,330. | |
| ● | On September 7, 2023, the Company entered into Regulation S share subscription agreements with 71 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, 365,164 shares of Common Stock, to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate was approximately $912,889. | |
| ● | On November 21, 2023, the Company entered into a Regulation S share subscription agreement with Wong Chun Shoong who represented that he was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreement, the Company agreed to issue and sell in aggregate, 8,658 shares of Common Stock, to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the private by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate was approximately $21,645. |
Reverse Stock Split
On April 12, 2024, the Company’s board of directors (the “Board”) unanimously resolved to effect a reverse stock split of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at a ratio of 1-for-4. Following such resolution, on September 9, 2024, the Company filed a Certificate of Amendment (the “Certificate of Amendment”) with the Secretary of State of the State of Nevada to effect the reverse stock split, with an effective time of 9:00AM. Eastern Time on September 11, 2024 (the “Reverse Stock Split”).
Split Adjustment; Treatment of Fractional Shares
As a result of the 1:4 Reverse Stock Split, each 4 pre-split shares of Common Stock outstanding will automatically combine into one new share of Common Stock without any action on the part of the holders, and the number of outstanding shares of Common Stock was reduced from 102,742,362 shares to 25,685,591 shares (subject to rounding up of fractional shares to the nearest whole number). Following the rounding up of fractional shares, an additional 105 shares of Common Stock were issued, resulting in 25,685,696 shares of Common Stock issued and outstanding immediately following the Reverse Stock Split.
No fractional shares were issued in connection with the Reverse Stock Split. Fractional shares were rounded up to the nearest whole number.
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Share Issuance
On November 25, 2024, the Company issued, in aggregate, 679,516 shares of Common Stock, representing 2.5% of the issued and outstanding shares of Common Stock to certain consultant in consideration for their services in relation to proposed initial public offering.
On November 25, 2024, the Company issued, in aggregate, 815,419 shares of Common Stock, representing 3.0% of the issued and outstanding shares of Common Stock to certain consultant in consideration for their consulting services.
No shares of Common Stock were issued during the year ended August 31, 2026. As of August 31, 2026, the Company had 27,180,631 shares of Common Stock issued and outstanding.
Plan of Operation and Funding
We expect that our working capital requirements will continue to be funded primarily through internally generated funds, shareholder advances, short-term borrowings and proceeds from the issuance of securities. Our working capital requirements are expected to increase in line with the development and growth of our business.
As of August 31, 2026, the Company had cash and cash equivalents of $277,547 and a working capital deficit of $4,541,379. Historically, the Company has financed its operations through internally generated funds, advances from shareholders and proceeds from the issuance of securities. During the year ended August 31, 2026, amounts due to related parties and other shareholders increased by $1,237,234 to $3,673,641. In addition, the Company obtained short-term borrowings totaling SGD 700,000 (approximately $549,163) from unrelated third-party lenders during the year, one of which was subsequently extended (see Note 10 to the consolidated financial statements). As of August 31, 2026, the Company had no lines of credit or other bank financing arrangements.
Management continues to evaluate and pursue various financing alternatives to strengthen the Company’s working capital position and support its ongoing operations and planned business expansion. These include the proposed securities offering in connection with the Company’s planned uplisting to the Nasdaq Capital Market, as well as alternative financing arrangements such as private placements, other equity capital-raising opportunities, additional shareholder advances and extensions or refinancing of existing financing arrangements. Certain shareholders have extended the maturities of their existing advances, while others have requested renewal options. Management believes that the successful implementation of these financing initiatives would provide additional liquidity to support the Company’s operational requirements and strategic growth plans.
In connection with its business plan, the Company anticipates additional operating expenses and capital expenditures relating to (i) research and development; (ii) expansion of product offerings; (iii) geographical expansion; and (iv) sales and marketing activities. Management intends to pursue these initiatives progressively, taking into consideration available financial resources, business priorities and market conditions.
The Company’s existing cash resources and anticipated operating cash flows are not sufficient, on a standalone basis, to meet its expected funding requirements over the next twelve months, including obligations arising from existing financing arrangements. Accordingly, the Company will continue to pursue additional financing to support its operations and planned expansion. Although certain existing advances and borrowings have been extended, shareholders and other lenders are not contractually committed to provide additional funding or further extensions.
The availability and timing of additional financing remain subject to uncertainties, including market conditions and other factors beyond the Company’s control. Any issuance of additional equity securities may result in dilution to existing shareholders, and such securities may carry rights, preferences or privileges senior to those of the Company’s common stock. There can be no assurance that the proposed offering will be completed or that additional financing will be obtained on acceptable terms, or at all. If sufficient funding is not available, the Company may need to adjust the timing or scope of its planned business initiatives and capital expenditures, which could adversely affect its business operations and growth prospects.
Results of Operations
The following table sets forth certain selected statement of operations data for the financial year indicated in U.S. Dollars. In addition, we note that the year-to-year comparison may not be indicative of future performance. Interest expense for the year ended August 31, 2025 of $53,146, previously included in operating expenses, has been reclassified to other income/(expense) to conform to the current-year presentation. The reclassification had no effect on net loss.
The following summary of our operations should be read in conjunction with our audited financial statements for the financial years ended August 31 (“FYE”), 2026, and 2025, which are included herein.
| Year Ended August 31, | ||||||||||||||||
| 2026 | 2025 | Changes | % | |||||||||||||
| Revenue | $ | 319,052 | $ | 284,666 | $ | 34,386 | 12.1 | % | ||||||||
| Cost of revenue | 297,521 | 304,433 | (6,912 | ) | (2.3 | )% | ||||||||||
| Gross profit/(loss) | 21,531 | (19,767 | ) | 41,298 | 208.9 | % | ||||||||||
| Operating expenses | 4,229,481 | 14,916,838 | (10,687,357 | ) | (71.6 | )% | ||||||||||
| Loss from operations | (4,207,950 | ) | (14,936,605 | ) | 10,728,655 | 71.8 | % | |||||||||
| Other expense | (143,534 | ) | (31,400 | ) | (112,134 | ) | (357.1 | )% | ||||||||
| Net Loss | (4,351,484 | ) | (14,968,005 | ) | 10,616,521 | 70.9 | % | |||||||||
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Revenue
The Group generated revenue of $319,052 for the year ended August 31, 2026, as compared to $284,666 for the year ended August 31, 2025, an increase of $34,386 or 12.1%. The increase was mainly attributable to higher sales of air-conditioners and related installation services. Sales of air-conditioners and HVAC products increased by $118,371 or 119.5%, and installation and related services revenue increased by $60,468 as more air-conditioner sales included installation. The increase was partially offset by a decrease of $131,097 or 97.7% in sales of the Ionic Nano Copper Zinc products, and a decrease of $20,578 in retrofitting sales. Revenue by product and service line was as follows:
| 2026 | 2025 | Changes | % | |||||||||||||
| Air-conditioners and HVAC products | $ | 217,416 | $ | 99,045 | $ | 118,371 | 119.5 | % | ||||||||
| Installation and related services | 79,748 | 19,280 | 60,468 | 313.6 | % | |||||||||||
| Components and parts | 14,741 | 6,847 | 7,894 | 115.3 | % | |||||||||||
| Retrofitting | 4,112 | 24,690 | (20,578 | ) | (83.3 | )% | ||||||||||
| Ionic Nano Copper Zinc products | 3,035 | 134,132 | (131,097 | ) | (97.7 | )% | ||||||||||
| Other | - | 672 | (672 | ) | (100.0 | )% | ||||||||||
| Total revenue | $ | 319,052 | $ | 284,666 | $ | 34,386 | 12.1 | % | ||||||||
We are steadily building momentum and expanding the product’s reach across various markets, including residential, commercial, and industrial sectors. This is being achieved through the development of strategic distribution channels, project collaborations, and private labelling and licensing models. The Group remains committed to strengthening the traction of EvoAir™ air-conditioner and driving its adoption across diverse market segments, positioning ourselves for future growth in the emerging eco-friendly air-conditioning space.
We remain confident in the long-term prospects of EvoAir™ and are focused on continuing to innovate and address challenges, with a view to establishing the product as a leading solution in the sustainable cooling market. However, our revenue base remains small and may fluctuate significantly from period to period depending on the timing of individual projects.
Cost of revenue
For the year ended August 31, 2026, cost of revenue decreased to $297,521, or 93.3% of revenue, compared to $304,433, or 106.9% of revenue in the year ended August 31, 2025, a decrease of $6,912 or 2.3%. The decrease in cost of revenue as a percentage of revenue was primarily attributable to lower production costs for HVAC products and better absorption of fixed manufacturing costs at EvoAir Manufacturing on higher sales volumes of air-conditioners and installation services.
The cost of revenue encompasses production costs and purchase of goods. The Company remains focused on further optimizing its cost structure and maintaining efficiencies as it continues to scale its operations and expand its product offering.
The Company remains focused on optimizing its cost structure and enhancing operational efficiencies. As we continue to scale operations and expand our product offerings, we are positive that these efforts will improve gross margins and position the Company for profitability in the future.
Gross profit/(loss)
For the year ended August 31, 2026, the Company reported a gross profit of $21,531, or a gross margin of 6.7%, compared to a gross loss of $19,767, or a negative gross margin of 6.9%, in the year ended August 31, 2025, an improvement of $41,298. The turnaround from gross loss to gross profit was largely achieved through reduced production costs combined with higher sales volumes of HVAC products and installation services, partially offset by the decline in sales of the higher-margin Ionic Nano Copper Zinc products.
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Operating expenses
For the year ended August 31, 2026, operating expenses amounted to $4,229,481, compared to $14,916,838 in the year ended August 31, 2025, reflecting a decrease of $10,687,357 or 71.6%. The reduction was mainly attributable to (i) the absence in fiscal year 2026 of the intangible asset impairment charge of $6,931,502 recognized in fiscal year 2025; (ii) the absence of the non-cash stock based consulting expense of $3,261,676 for 815,419 shares of Common Stock issued to a business development consultant in November 2024; and (iii) a decrease of $424,377 in amortization of intangible assets, reflecting the lower carrying amount following the fiscal year 2025 impairment. The components of operating expenses were as follows:
| 2026 | 2025 | Changes | % | |||||||||||||
| Amortization of intangible assets | $ | 2,545,701 | $ | 2,970,078 | $ | (424,377 | ) | (14.3 | )% | |||||||
| Impairment of intangible assets | - | 6,931,502 | (6,931,502 | ) | (100.0 | )% | ||||||||||
| Stock based consulting expense | - | 3,261,676 | (3,261,676 | ) | (100.0 | )% | ||||||||||
| Other general and administrative expenses | 1,672,221 | 1,731,533 | (59,312 | ) | (3.4 | )% | ||||||||||
| Selling and marketing expenses | 11,559 | 22,049 | (10,490 | ) | (47.6 | )% | ||||||||||
| Total operating expenses | $ | 4,229,481 | $ | 14,916,838 | $ | (10,687,357 | ) | (71.6 | )% | |||||||
Other general and administrative expenses, which decreased by $59,312 or 3.4%, mainly included salaries and related expenses, commissions, rental costs, depreciation of non-factory assets, patent and trademark application/renewal fees, and professional and compliance fees. Selling and marketing expenses decreased by $10,490 or 47.6%.
The Company remains focused on prudent cost management to maintain operational efficiency while supporting strategic initiatives for growth and value creation.
Other income/(expense)
Other expense, net for the year ended August 31, 2026, was $143,534, compared to $31,400 in the year ended August 31, 2025, an increase of $112,134. Interest expense, net increased by $92,363 to $145,356, from $52,993. Interest expense on amounts due to related parties and other shareholders increased by $85,309 to $138,455, from $53,146, primarily due to higher average balances of interest-bearing advances. In addition, we incurred interest expense of $7,009 on the short-term borrowings obtained in July and August 2026, which bear interest at 3% per month. Interest income was $108, compared to $153. Other income decreased by $19,771 to $1,822, from $21,593, primarily due to lower foreign exchange gains.
Loss before income taxes
The Company reported a loss before income taxes of $4,351,484 for the year ended August 31, 2026, compared to $14,968,005 in the year ended August 31, 2025, an improvement of $10,616,521 or 70.9%. Net loss attributable to equity holders of the Company was $4,094,539, or $0.15 per share, compared to $14,626,862, or $0.55 per share, in the year ended August 31, 2025.
The improvement in net loss is primarily attributable to the absence of the intangible asset impairment and the stock based consulting expense recognized in fiscal year 2025, lower amortization of intangible assets, and the turnaround from gross loss to gross profit, partially offset by higher interest expense on shareholder advances and short-term borrowings. The net loss continues to include significant non-cash amortization of intangible assets of $2,545,701 and depreciation of $73,171. However, ongoing investments in building the necessary infrastructure and resources to support business expansion objectives continue to impact profitability. Additionally, the lack of economies of scale during this growth phase has affected the bottom line.
Management remains confident that these investments will position the Company for long-term growth and profitability as it scales operations and capitalizes on emerging opportunities. Strategies to enhance operational efficiencies and achieve economies of scale are key priorities moving forward.
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Liquidity and Capital Resources
Working Capital
| As of | As of | |||||||||||||||
| August 31, 2026 | August 31, 2025 | Changes | % | |||||||||||||
| Current assets | $ | 747,141 | $ | 527,748 | $ | 219,393 | 41.6 | % | ||||||||
| Current liabilities | 5,288,520 | 3,212,754 | 2,075,766 | 64.6 | % | |||||||||||
| Working capital | (4,541,379 | ) | (2,685,006 | ) | (1,856,373 | ) | (69.1 | )% | ||||||||
As of August 31, 2026, the increase in current assets was primarily attributable to higher balances in cash and cash equivalents of $184,218 and accounts receivable of $48,088, reflecting higher sales. Conversely, the increase in current liabilities was mainly due to higher amounts due to related parties and other shareholders of $1,237,234, short-term borrowings of $549,163, other payables of $126,031, and accounts payable and accruals of $274,965.
As a result, the Company recorded a working capital deficit of $4,541,379 as of August 31, 2026, compared to $2,685,006 as of August 31, 2025. The widening deficit reflects the impact of continued operational losses and ongoing investments in business development and growth initiatives, which were financed principally through shareholder advances and short-term borrowings. Amounts due to related parties and other shareholders of $3,673,641, which represent 69.5% of current liabilities, are repayable in three or six months from drawdown or upon the successful uplisting, or on terms mutually agreed between the parties. Maturities have been extended at the lenders’ discretion, and there is no written commitment from the lenders to provide continued financing. Short-term borrowings of $549,163 (SGD 700,000), which represent 10.4% of current liabilities, mature in November 2026 (SGD 400,000) and January 2027 (SGD 300,000, following an extension agreed in October 2026).
Cash Flows
FYE 2026, versus FYE 2025
| August 31, 2026 | August 31, 2025 | $ Change | % Change | |||||||||||||
| Net cash used in operating activities | $ | (1,359,890 | ) | $ | (1,109,151 | ) | $ | (250,739 | ) | (22.6 | )% | |||||
| Net cash used in investing activities | (1,247 | ) | (16,991 | ) | 15,744 | 92.7 | % | |||||||||
| Net cash provided by financing activities | 1,674,690 | 1,118,056 | 556,634 | 49.8 | % | |||||||||||
| Net increase/(decrease) in cash and cash equivalents | 313,553 | (8,086 | ) | 321,639 | 3,977.7 | % | ||||||||||
The Company’s cash and cash equivalents stood at $277,547 as of August 31, 2026, of which $47,948 was held by WKL Guanzhe in the PRC and is subject to PRC foreign exchange controls.
Net cash used in operating activities for the year ended August 31, 2026 was $1,359,890, compared to $1,109,151 for the year ended August 31, 2025, an increase of $250,739 or 22.6%. Net cash used in operating activities in fiscal year 2026 reflected the net loss of $4,351,484, adjusted for non-cash amortization of intangible assets of $2,545,701 and depreciation of $73,171, and a net cash inflow from changes in operating assets and liabilities of $372,722. That inflow comprised increases in accounts payable and accruals of $274,965, other payables of $126,031 and deferred revenue of $10,747, and decreases in deposits, prepayments and other receivables of $10,704 and inventories of $2,209, partially offset by an increase in accounts receivable of $48,088 and operating lease payments exceeding right-of-use asset amortization by $3,846.
Cash used in investing activities for the year ended August 31, 2026, was $1,247, compared to $16,991 for the year ended August 31, 2025, and related to purchases of property, plant, and equipment.
Cash provided by financing activities for the year ended August 31, 2026, was $1,674,690, primarily from net loans from related parties and other shareholders of $1,146,485 and proceeds from short-term borrowings of $549,163, partially offset by final payments of hire purchase of $4,852 and payment of deferred offering costs of $16,106.
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As a result, cash and cash equivalents increased by $313,553 before the effect of exchange rate changes of $(129,335), resulting in a net increase in cash and cash equivalents of $184,218 from $93,329 as of August 31, 2025 to $277,547 as of August 31, 2026.
Material Cash Requirements
Our material cash requirements from known contractual and other obligations as of August 31, 2026 consist of (i) amounts due to related parties and other shareholders of $3,673,641, repayable within twelve months or upon the successful uplisting; (ii) short-term borrowings of $549,163 (SGD 700,000), which bear interest at 3% per month and mature in November 2026 (SGD 400,000) and January 2027 (SGD 300,000); (iii) accounts payable, accruals and other payables of $1,007,475; and (iv) operating lease liabilities of $36,489 (undiscounted lease payments of $37,558) due within twelve months. We have no material commitments for capital expenditures. We intend to meet these requirements through continued shareholder advances, the extension or refinancing of the short-term borrowings and the proceeds of future equity financing, including our proposed uplisting to the Nasdaq Capital Market.
Seasonality
The Company’s business is not subject to seasonality.
Off-Balance Sheet Arrangements
As of the date of this Annual Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Critical Accounting Policies and Estimates
Revenue recognition
Our revenue recognition policy is in compliance with ASC 606, Revenue from Contracts with Customers that revenue is recognized when a customer obtains control of promised goods and is recognized in an amount that reflects the consideration that we expect to receive in exchange for those goods. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that we expect to receive in exchange for those goods.
We apply the following five-step model in order to determine this amount:
| (i) | identification of the promised goods and services in the contract; |
| (ii) | determination of whether the promised goods and services are performance obligations, including whether they are distinct in the context of the contract; |
| (iii) | measurement of the transaction price, including the constraint on variable consideration; |
| (iv) | allocation of the transaction price to the performance obligations; and |
| (v) | recognition of revenue when (or as) the Company satisfies each performance obligation. |
We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, we review the contract to determine which performance obligations we must deliver and which of these performance obligations are distinct. We recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, our performance obligations are transferred to customers at a point in time, typically upon delivery for local sales to the customer when control passes to the customer under the agreed shipping terms.
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For all reporting periods, we have not disclosed the value of unsatisfied performance obligations for all product revenue contracts with an original expected length of one year or less, which is an optional exemption that is permitted under the adopted rules.
Estimates and Assumptions
The preparation of financial statements in conformity with U.S. GAAP requires the Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reporting periods. Key estimates in the accompanying consolidated financial statements include, among others, the allowance for credit losses, the allowance for obsolete inventory, the useful lives and recoverability of technology-related intangible assets and other long-lived assets, the lease terms and incremental borrowing rates used to measure operating lease liabilities and right-of-use (“ROU”) assets, and the valuation allowance for deferred income tax assets. The actual results could differ materially from these estimates.
Impairment of Technology-Related Intangible Assets
Our technology-related intangible assets had a net carrying amount of $39,034,077 as of August 31, 2026, representing approximately 90% of our total assets, and are amortized on a straight-line basis over a 20-year useful life. We review these assets for recoverability whenever events or changes in circumstances indicate that their carrying amount may not be recoverable, which requires us to estimate undiscounted future cash flows from the related asset group, including assumptions about revenue growth, market adoption of the EvoAir™ technology, gross margins, royalty and licensing income, operating costs and the remaining useful life. These assumptions are inherently uncertain given our limited revenue history. We recognized impairment charges of $6,931,502 in fiscal year 2025 and $20,580,040 in fiscal year 2024; no impairment was recognized in fiscal year 2026. If our revenue does not grow in line with our projections, we may be required to recognize additional impairment charges, which could be material. A reduction of one year in the estimated remaining useful life of the intangible assets would increase annual amortization expense by approximately $178,000.
Deferred Offering Costs
We have deferred $3,241,570 of costs directly attributable to our proposed initial public offering and uplisting, including $2,718,064 relating to shares of Common Stock issued to a consultant. Continued deferral requires judgment as to whether the offering remains probable of completion. If we abandon the offering, or it is postponed for an extended period, the entire balance would be charged to operations.
Going Concern
The Company’s consolidated financial statements as of August 31, 2026, have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business.
As of August 31, 2026 and August 31, 2025, the Company had accumulated deficits of $58,123,258 and $54,028,719, respectively, and working capital deficits of $4,541,379 and $2,685,006, respectively. The Company incurred net losses of $4,351,484 and $14,968,005 for the years ended August 31, 2026 and 2025, respectively. Net cash used in operating activities increased to $1,359,890 for the year ended August 31, 2026, compared with $1,109,151 for the preceding fiscal year. The Company has continued to receive financial support through shareholder advances, which amounted to $3,673,641 as of August 31, 2026. The Company also has short-term financing obligations, which, together with its ongoing operating requirements, contribute to its working capital and liquidity needs.
Management remains focused on strengthening the Company’s financial position and advancing its business development and expansion strategies. The Company has developed a strategic plan aimed at enhancing its market presence, diversifying revenue streams and improving operational efficiencies to support sustainable business growth.
Key initiatives include:
| ● | Expansion of Product Offerings: Broadening the range of HVAC products to address evolving market demands and customer requirements. |
| ● | Geographical Expansion: Developing new markets and strengthening distribution channels to expand the Company’s geographical presence and revenue opportunities. |
| ● | Revenue Diversification: Expanding customer segments across retail, commercial, industrial and project-based clients, as well as exploring private-label and licensing opportunities. |
| ● | Improved Profitability: Pursuing operational efficiencies and economies of scale through business growth and improved resource utilization. |
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In support of these initiatives, the Company is actively pursuing financing opportunities to strengthen its working capital position and facilitate the execution of its business plans. These include its proposed uplisting to the Nasdaq Capital Market and associated securities offering, as well as alternative financing arrangements, including private placements, other capital-raising opportunities, continued shareholder advances and extensions of existing financing arrangements. Management believes that the successful implementation of these financing initiatives would provide additional financial resources to support ongoing operations, accelerate business development activities and facilitate the Company’s planned expansion.
Management continues to evaluate its funding requirements and implement measures to support the Company’s operations and long-term growth objectives. However, the successful implementation of these plans, particularly the availability of additional financing, remains subject to factors beyond the Company’s control. Accordingly, management has concluded that these conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued. See Note 3 to the consolidated financial statements.
Material Commitments
We have no material commitments as of August 31, 2026, other than the obligations described under “Material Cash Requirements” above.
Recent Accounting Pronouncements
In November 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, by introducing key amendments to enhance disclosures in public entities’ reportable segments. Notable changes include the mandatory disclosure of significant segment expenses regularly provided to the chief operating decision maker (“CODM”), disclosure of other segment items, and requirements for consistency in reporting measures used by the CODM. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Accordingly, the Company adopted the provisions of ASU 2023-07 for its fiscal year beginning September 1, 2024 (fiscal year 2025) on a retrospective basis, and the interim disclosure requirements apply from fiscal year 2026. The adoption of the new standard had no impact on the Company’s financial position, results of operations or cash flows on the date of transition.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires enhanced disaggregation of the income tax rate reconciliation and income taxes paid. We adopted this standard retrospectively effective September 1, 2025. The adoption affected disclosures only.
In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses. This standard requires disclosures of additional information about specific expense categories in the notes to the financial statements for interim and annual reporting periods. This standard, as clarified by ASU No. 2025-01, is effective for us in the annual period beginning in fiscal 2028 and interim periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements.
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This standard amends guidance on measuring expected credit losses for current accounts receivable and contract assets arising from revenue contracts. This amended guidance requires to estimate credit losses for these short-term assets based on the economic conditions that exist as of the balance sheet date, without forecasting future economic conditions. We will adopt this standard effective beginning fiscal 2027. We do not expect the adoption to have a material impact on our consolidated financial statements.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This standard is intended to make targeted improvements to the accounting and application of guidance related to costs incurred to develop software for internal use. This standard is effective for us in the interim and annual periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements.
In December 2025, the FASB issued ASU No. 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This standard is effective for us in the annual period beginning in fiscal 2030. Early adoption is permitted. We do not currently receive material government grants and do not expect the adoption to have a material impact on our consolidated financial statements.
In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, and ASU No. 2025-12, Codification Improvements. ASU No. 2025-11 is effective for our interim periods beginning in the first quarter of fiscal 2029, and ASU No. 2025-12 is effective for us in the annual period beginning in fiscal 2028. We are currently evaluating the potential impact of these standards on our consolidated financial statements.
There are no other recently issued accounting pronouncements that have not yet been adopted that the Company considers material to its consolidated financial statements.
| ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Not Applicable.
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| ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To The Shareholders and Board of Directors of
EVOAIR HOLDINGS INC
Opinion on the Financial Statements
Substantial doubt about the Company’s ability to continue as a going concern
The accompanying consolidated financial statements have been prepared on the assumption that the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company had an accumulated deficit of $58,123,258. The Company incurred a net loss of $4,351,484 for the year ended August 31, 2026. The cash used in operating activities was $1,359,890 for the year ended August 31, 2026. The Company has accumulated losses since inception, which raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with PCAOB standards. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not to express an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we do not express such an opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
| 38 | Page |
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the Board of Directors and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Going Concern Assessment
Description of the Matter
As discussed in Note 3 to the consolidated financial statements, the Company had an accumulated deficit of $58,123,258 as of August 31, 2026, and incurred a net loss of $4,351,484 and used cash in operating activities of $1,359,890 for the year then ended. The Company has incurred recurring losses since inception and has depended on additional financing to fund operations. In accordance with ASC 205-40, management evaluated whether there were conditions or events, considered in the aggregate, that raised substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements were issued, and whether its plans to mitigate those conditions were probable of being effectively implemented. Management’s plans, as described in Note 3, included improving operating performance, the proposed uplisting on the Nasdaq Capital Market and associated securities offering, as well as alternative financing arrangements, including continued shareholder advances and extensions or refinancing of existing financing arrangements. Management concluded that substantial doubt about the Company’s ability to continue as a going concern remained after consideration of these plans.
We identified the evaluation of the Company’s ability to continue as a going concern as a critical audit matter because of the significant judgment exercised by management in forecasting cash requirements over the twelve-month look-forward period and in assessing the probability that its plans would be effectively implemented, as well as the adequacy of the related disclosures. The cash flow forecast was sensitive to significant assumptions, including projected revenue and operating expenditure, the timing and amount of proceeds from the proposed offering, and the availability of continued financial support, which depended on factors outside the Company’s control. Auditing these assumptions and management’s plans involved especially challenging and subjective auditor judgment.
| 39 | Page |
How We Addressed the Matter in Our Audit
We performed the following principal audit procedures, among others:
| - | Obtained an understanding of management’s process for evaluating the Company’s ability to continue as a going concern, including the preparation of the cash flow forecast for the look-forward period; | |
| - | Evaluated the reasonableness of the significant assumptions in the cash flow forecast by comparing projected revenue and expenditure with historical results and results subsequent to year-end, and assessing consistency with the forecast used in the impairment assessment of intangible assets; | |
| - | Evaluated the status and feasibility of the proposed uplisting and offering, including inspecting the underwriting engagement letter, regulatory filings and correspondence with the exchange; | |
| - | Read minutes of meetings of the board of directors and made inquiries regarding events or conditions subsequent to year-end that may affect the Company’s liquidity; | |
| - | Tested the mathematical accuracy of the cash flow forecast; and | |
| - | Evaluated the adequacy of the going concern disclosures in Note 3 to the consolidated financial statements. |
Impairment Assessment of Intangible Assets
Description of the Matter
As disclosed in Notes 4 and 8 to the consolidated financial statements, the Company’s technology-related intangible assets, comprising Technology 1 – Portable Air Cooler and Technology 2 – Condensing Unit, had a net carrying amount of $39,034,077 as of August 31, 2026, representing approximately 90% of the Company’s total assets. The intangible assets are amortized on a straight-line basis over an estimated useful life of 20 years, and an impairment loss of $6,931,502 was recognized on these assets for the year ended August 31, 2025.
The Company’s continued operating losses indicated that the carrying amount of the technology-related intangible assets may not be recoverable. Management performed a recoverability test as of August 31, 2026, in accordance with ASC 360-10, by comparing the asset group’s carrying amount with the estimated undiscounted future cash flows expected from its use and eventual disposition. Management concluded that the estimated undiscounted future cash flows exceeded the asset group’s carrying amount and, accordingly, recognized no impairment loss for the year ended August 31, 2026.
We identified the impairment assessment of technology-related intangible assets as a critical audit matter because of the significance of the carrying amount to the consolidated financial statements and the significant judgment exercised by management in estimating the undiscounted future cash flows, given the Company’s limited revenue history and the impairment losses recognized in prior years. The undiscounted future cash flows were based on the remaining licensed patents life of 12 years forecasted period for the Company’s Malaysian retail and projects channels and were sensitive to significant assumptions, including the probability of a successful uplisting on the Nasdaq Capital Market and the related deployment of offering proceeds, projected market share and sales volumes, average selling prices, gross and EBITDA margins, and the remaining economic life of the Company’s Malaysian patents. Auditing these assumptions involves especially challenging and subjective auditor judgment.
| 40 | Page |
How We Addressed the Matter in Our Audit
We performed the following principal audit procedures, among others:
| - | Obtained an understanding of management’s process for identifying impairment indicators and performing the recoverability test; | |
| - | Evaluated the identification of the asset group and the appropriateness of the recoverability test under ASC 360-10; | |
| - | Evaluated the reasonableness of the significant assumptions by comparing projected sales volumes, average selling prices and margins with historical results, comparable-company data and available market information; | |
| - | Evaluated management’s assessment of the probability of a successful uplisting, including the status of the proposed offering; | |
| - | Assessed the forecast period against the remaining statutory life of the Malaysian patents; | |
| - | Tested the mathematical accuracy of the undiscounted cash flow calculations; | |
| - | Performed sensitivity analyses over the significant assumptions to evaluate the extent to which changes in those assumptions would cause the carrying amount of the asset group to exceed the undiscounted future cash flows; and | |
| - | Evaluated the adequacy of the related disclosures in the consolidated financial statements; | |
| - | Evaluated the remaining economic useful life of the technology-related intangible assets; | |
| - | Evaluated management’s probability assessment of a successful uplisting by examining each stage of the assessment; | |
| - | Evaluated the work of management’s valuation specialist, including their professional qualifications and objectivity, the appropriateness of the methodology and the reasonableness of the significant assumptions used in the undiscounted cash flow forecast; | |
| - | Performed reliability testing on the 3rd party data sources used by the management for their inputs. |
| /s/ |
|
| We have served as the Company’s auditor since 2021. | |
| October 14, 2026 | |
| (PCAOB
ID No. |
| 41 | Page |
EVOAIR HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(In U.S. Dollars, except share data or otherwise stated)
AS OF AUGUST 31, 2026 AND 2025
| August 31, 2026 | August 31, 2025 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Inventories | ||||||||
| Deposit, prepayments and other receivables | ||||||||
| Total current assets | ||||||||
| Non-current assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Operating lease right-of-use assets | ||||||||
| Deferred offering cost | ||||||||
| Technology-related intangible assets, net | ||||||||
| Total non-current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable and accruals | $ | $ | ||||||
| Other payables | ||||||||
| Short-term borrowings | ||||||||
| Deferred revenue | ||||||||
| Hire purchase creditor | ||||||||
| Amounts due to related parties and other shareholders, including amounts due to related parties of $ and $, respectively | ||||||||
| Operating lease liability - current | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Operating lease liabilities | ||||||||
| Total non-current liabilities | ||||||||
| TOTAL LIABILITIES | ||||||||
| Commitments and contingencies (Note 15) | ||||||||
| Shareholders’ equity | ||||||||
| Common stock, authorized; $ par value, and shares issued and outstanding as at August 31, 2026 and 2025* | ||||||||
| Additional paid in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total EvoAir Holdings Inc. shareholders’ equity | ||||||||
| Non-controlling interest | ( | ) | ( | ) | ||||
| Total shareholders’ equity | ||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | $ | ||||||
| * | |
The accompanying footnotes are an integral part of these consolidated financial statements.
| 42 | Page |
EVOAIR HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In U.S. Dollars, except share data or otherwise stated)
FOR THE YEARS ENDED AUGUST 31, 2026 AND 2025
| August 31, 2026 | August 31, 2025 | |||||||
| Revenue | $ | $ | ||||||
| Cost of revenue | ||||||||
| Gross profit/(loss) | ( | ) | ||||||
| Operating expenses: | ||||||||
| Selling and marketing expenses | ||||||||
| General and administrative expenses | ||||||||
| Total operating expenses | ||||||||
| Loss from operation | ( | ) | ( | ) | ||||
| Other income/(expense) | ||||||||
| Interest expense, net | ( | ) | ( | ) | ||||
| Other income | ||||||||
| Total other expense | ( | ) | ( | ) | ||||
| Loss before income taxes | ( | ) | ( | ) | ||||
| Income tax expenses | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Less: Net loss attributable to non-controlling interests | ( | ) | ( | ) | ||||
| Net loss attributable to equity holders of the Company | ( | ) | ( | ) | ||||
| Other comprehensive loss: | ||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||
| Total comprehensive loss | ( | ) | ( | ) | ||||
| Less: net comprehensive loss attributable to non-controlling interests | ( | ) | ( | ) | ||||
| Net comprehensive loss attributable to equity holders of the Company | ( | ) | ( | ) | ||||
| Net loss attributable to equity holders of the Company per common share: | ||||||||
| Basic and diluted | ) | ) | ||||||
| Weighted average number of common shares outstanding: | ||||||||
| Basic and diluted* | ||||||||
| * |
The
accompanying footnotes are an integral part of these consolidated financial statements.
| 43 | Page |
EVOAIR HOLDINGS INC.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (DEFICIT)
(In U.S. Dollars, except share data or otherwise stated)
FOR THE YEARS ENDED AUGUST 31, 2026 AND 2025
| Common Stock | Additional paid in | Accumulated | Accumulated other comprehensive | Non-controlling | ||||||||||||||||||||||||
| Shares* | Amount | capital | deficit | loss | interests | Total | ||||||||||||||||||||||
| Balance as of August 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||
| Issuance of common stock for consulting service | ||||||||||||||||||||||||||||
| Fractional shares issued due to reverse stock split | ||||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Balance as of August 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||
| Foreign currency translation adjustment | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||
| Balance as of August 31, 2026 | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| * |
The accompanying footnotes are an integral part of these consolidated financial statements.
| 44 | Page |
EVOAIR HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. Dollars, except share data or otherwise stated)
FOR THE YEARS ENDED AUGUST 31, 2026 AND 2025
| August 31, 2026 | August 31, 2025 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | ( | ) | ( | ) | |||
| Adjustments for non-cash income and expenses: | ||||||||
| Depreciation | ||||||||
| Amortization | ||||||||
| Loss on lease modification | ||||||||
| Intangible asset impairment | ||||||||
| Stock based expense | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivables | ( | ) | ||||||
| Inventories | ||||||||
| Deposit, prepayments and other receivables | ||||||||
| Operating lease right-of-use assets and liabilities, net | ( | ) | ( | ) | ||||
| Accounts payable and accruals | ||||||||
| Deferred revenue | ||||||||
| Other payables | ||||||||
| Net cash used in operations | $ | ( | ) | $ | ( | ) | ||
| Cash flows from investing activity | ||||||||
| Purchase of property, plant and equipment | ( | ) | ( | ) | ||||
| Cash used in investing activity | $ | ( | ) | $ | ( | ) | ||
| Cash flows from financing activities | ||||||||
| Loans
from related parties and other shareholders, net (including related parties of $ | ||||||||
| Proceeds from issuing short-term borrowing | ||||||||
| Payments of hire purchase | ( | ) | ( | ) | ||||
| Payment of deferred offering costs | ( | ) | ( | ) | ||||
| Net cash provided by financing activities | $ | $ | ||||||
| Net increase/(decrease) in cash and cash equivalents | ( | ) | ||||||
| Effect of exchange rate changes on cash and cash equivalents | ( | ) | ( | ) | ||||
| Cash and cash equivalents at beginning of year | ||||||||
| Cash and cash equivalents at end of year | ||||||||
Supplemental cash flow information: | ||||||||
| Cash paid for interest | ||||||||
| Supplemental disclosure of non-cash investing and financing activities: | ||||||||
| Common stock issued for consulting service in related to Initial public offering | ||||||||
The accompanying footnotes are an integral part of these consolidated financial statements.
| 45 | Page |
EVOAIR HOLDINGS INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 2026, AND 2025
NOTE 1 – ORGANIZATION AND BUSINESS OPERATIONS
EvoAir Holdings Inc. (formerly Unex Holdings Inc.) (the “Company”, “EVOH”, “we”, “us”, or “our”) is a corporation established under the corporation laws in the State of Nevada, United States of America (“U.S”) on February 17, 2017. The Company has adopted an August 31 fiscal year end.
On December 20, 2021, the Company and Low Wai Koon (“Dr. Low”) entered into a share transfer agreement, (the “EvoAir International Share Transfer Agreement”), pursuant to which Dr. Low agreed to sell all of his ordinary shares of EvoAir International Limited (“EvoAir International”) to the Company for a consideration of US$ (“EvoAir Transaction”). EvoAir International, through its subsidiaries upon completion of the Transactions (defined hereunder), is engaged in the research and development (“R&D”), manufacturing, trading, sale of heating, ventilation and air conditioning (“HVAC”) products and related services in Asia.
Pursuant
to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company
and the owner of restricted shares of common stock, with par value of $ per share (“Common Stock”) of the
Company (“EvoAir Shares”) representing approximately
On December 20, 2021, several transactions took place (together, the “Allotment Transactions”) whereby the Company issued and allotted in aggregate ordinary shares of common stock to certain parties. On completion of the Allotment Transactions, the total number of issued and outstanding shares of common stock of the Company were (“Then Enlarged Share Capital”):
| (A) | On December 20, 2021, Dr. Low and Chan Kok Wei entered into a share exchange agreement with WKL Eco Earth Holdings Pte Ltd (“WKL Eco Earth Holdings”), pursuant to which Dr. Low and Chan Kok Wei agreed to sell all their ordinary shares of WKL Green Energy Sdn Bhd (“WKL Green Energy”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global and Allegro Investment (BVI) Limited (“Allegro Investment”), a company incorporated in the British Virgin Islands (“BVI”) with % shareholdings held by Chan Kok Wei and Ong Bee Chen, respectively, of shares and EvoAir Shares, respectively, or approximately % and % of the Then Enlarged Share Capital, respectively. |
| (B) | On December 20, 2021, Dr. Low, Chan Kok Wei, Ong Bee Chen and certain sellers (“WKLEE Sellers”) entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which Dr. Low, Chan Kok Wei, Ong Bee Chen and WKLEE Sellers agreed to sell all their ordinary shares of WKL Eco Earth Sdn Bhd (“WKL Eco Earth”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global, Allegro Investment and WKLEE Sellers of EvoAir Shares, EvoAir Shares and in aggregate shares, respectively, or approximately %, % and in aggregate %, respectively, of the Then Enlarged Share Capital. |
| (C) | On December 20, 2021, Tan
Soon Hock, Ivan Oh Joon Wern and certain relevant interest holders (“Relevant Interest Holders”) entered into an investment
exchange agreement with WKL Eco Earth Holdings, pursuant to which Tan Soon Hock, Ivan Oh Joon Wern and the Relevant Interest Holders
agreed to sell all relevant interests in the EVOH and its subsidiaries (“EvoAir Group” or the “Group”) to
WKL Eco Earth Holdings in consideration for the allotment and issuance of EvoAir Shares, EvoAir Shares and in
aggregate EvoAir shares, respectively, or approximately |
| 46 | Page |
| (D) | On
December 20, 2021, Dr. Low entered into two deeds of assignment of intellectual properties with WKL Eco Earth Holdings, in respect
of Dr. Low’s patents and patent applications relating to eco-friendly air-conditioner condenser (external unit), evoairTM
and the trademarks and trademark applications described in the deeds of assignment thereunder, and in respect of Dr. Low’s
patents and patents applications relating to the portable air-conditioner, e-Cond EVOTM and the trademarks and trademark
applications as described in the deeds of assignment thereunder (together, the “IP Assignments”). Pursuant to the IP
Assignments, WKL Global, Allegro Investment and certain nominees shall be allotted and issued EvoAir Shares,
EvoAir Shares and in aggregate EvoAir Shares, respectively or approximately |
EvoAir Transaction, Change of Control Transaction and Allotment Transactions are collectively to be referred to as the “Transactions”. The closing of the Transactions (“Closing”) occurred on December 20, 2021 (the “Closing Date”).
From and after the Closing Date, at which time EvoAir International transferred its HVAC business to the Company, the Company’s primary operations will consist of the prior operations of EvoAir International and its subsidiaries.
EvoAir International is a company incorporated in BVI on November 17, 2021. Effective from the December 20, 2021, it wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy, a Malaysian company incorporated on October 24, 2017. WKL Eco Earth Holdings acquired (c) EvoAir Manufacturing (M) Sdn Bhd (“EvoAir Manufacturing”) on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina Co Ltd (“WKL EcoEarth Indochina”), a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou Co Ltd (“WKL Guanzhe”), a Chinese company incorporated on April 6, 2021. EvoAir Manufacturing wholly owns (f) Evo Air Marketing (M) Sdn Bhd (“Evo Air Marketing”), a Malaysian company incorporated on February 2, 2021.
On June 15, 2022, the Company filed a Certificate of Amendment (the “Amendment”) to the Articles of Incorporation with Nevada’s Secretary of State to change the name of the Company from Unex Holdings Inc. to EvoAir Holdings Inc. (the “Name Change”), and the Name Change became market effective on November 4, 2022. Effective on November 11, 2022, the Company’s shares began trading under the new ticker symbol “EVOH”.
On November 21, 2023, the Company issued in aggregate, shares of Common Stock to 15 referral agents (“Referral Agents”) in consideration for their referral to the Company of certain investors. Each Referral Agent is a “non-U.S. Persons” as defined in Regulation S.
On November 21, 2023, the Company issued, in aggregate, shares of Common Stock to two individuals in consideration for marketing services provided to the Company by Artisan Creative Studio, a marketing entity based in Malaysia. Each of the individuals is a “non-U.S. Persons” as defined in Regulation S.
On
August 14, 2024, the WKL Eco Earth Holdings has increased its investment in WKL Guanzhe Green Technology Guangzhou Co Ltd (China) by
injecting an additional RMB
On
February 6, 2026, WKL Eco Earth Holdings made a further capital contribution of RMB
On May 31, 2026, WKL EcoEarth Indochina ceased its commercial operations as part of the Group’s efforts to streamline its international operations and reduce administrative costs. WKL EcoEarth Indochina operated primarily as an immaterial regional sales office and did not contribute materially to the Group’s consolidated revenue, assets or business operations. Applications for permanent closure and deregistration were submitted to the Cambodian General Department of Taxation and the Accounting and Auditing Regulator on June 6, 2026 and June 29, 2026, respectively. The formal dissolution of WKL EcoEarth Indochina remains subject to completion of the applicable regulatory procedures in Cambodia and is not expected to have a material impact on the Group’s consolidated financial position or results of operations.
Round 2 Stockholders
The Company entered into a series of offerings for an aggregate of up to shares of Common Stock at a per share purchase price of $, as follows:
| ● | On February
15, 2022, the Company entered into certain share subscription agreement with Ms. Ang Lee Kim Jane, who is a “non-U.S. Persons”
as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company
agreed to issue and sell shares of Common Stock, at a per share purchase price of $, as part of a series of offerings
by the Company for an aggregate of up to shares of Common Stock at a per share purchase price of $. The gross proceeds
were $ |
| 47 | Page |
| ● | On June 3, 2022, the Company
entered into certain share subscription agreement with Mr. Wong Hon Wai who is a “non-U.S. Persons” as defined in Regulation
S of the Securities Act pursuant to which the Company agreed to issue and sell shares of Common Stock, at a per share purchase
price of $, as part of a series of offerings by the Company for an aggregate of up to shares of Common Stock at a per
share purchase price of $. The gross proceeds were $ | |
| ● | On October 25, 2022, the Company entered into Regulation S share subscription agreements with eight investors, each of whom represented that it was a “non-U.S. Persons” as defined in Securities Act. On the same date, the Company entered into Regulation D share subscription agreements with two investors, each of whom represented that it was an “Accredited Investors” as defined in Regulation D of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) shares of Common Stock to the Regulation S investors, and (ii) shares of Common Stock to the Regulation D investors, respectively, at a per share purchase price of $, as part of a series of offerings by the Company for an aggregate of up to shares of Common Stock at a per share purchase price of $. The gross proceeds in aggregate were $. | |
| ● | On February 20, 2023, the
Company entered into Regulation S share subscription agreements with eleven investors, each of whom represented that it was a “non-U.S.
Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed
to issue and sell in aggregate, (i) shares of Common Stock to the Regulation S investors, at a per share purchase price of
$ as part of a series of the offerings by the Company for an aggregate of up to shares of Common Stock at a per share
purchase price of $. The gross proceeds in aggregate were $ | |
| ● | On July 13, 2023, the Company
entered into Regulation S share subscription agreements with 31 investors, each of whom represented that it was a “non-U.S.
Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed
to issue and sell in aggregate, (i) shares of Common Stock to the Regulation S Investors, at a per share purchase price of
$ as part of a series of the offerings by the Company for an aggregate of up to shares of Common Stock at a per share
purchase price of $. The gross proceeds in aggregate were approximately $ | |
| ● | On September 7, 2023, the
Company entered into Regulation S share subscription agreements with 71 investors, each of whom represented that it was a “non-U.S.
Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed
to issue and sell in aggregate, shares of Common Stock to the Regulation S investors, at a per share purchase price of $
as part of a series of the offerings by the Company for an aggregate of up to shares of Common Stock at a per share purchase
price of $. The gross proceeds in aggregate were approximately $ | |
| ● | On November 21, 2023, the
Company entered into a Regulation S share subscription agreement with Wong Chun Shoong who represented that he was a “non-U.S.
Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreement, the Company agreed
to issue and sell in aggregate, shares of Common Stock to the Regulation S investors, at a per share purchase price of $
as part of a series of the offerings by the Company for an aggregate of up to shares of Common Stock at a per share purchase
price of $. The gross proceeds in aggregate were approximately $ |
Reverse Stock Split
On April 12, 2024, the Company’s board of directors (the “Board”) unanimously resolved to effect a reverse stock split of the Company’s common stock, par value $ per share (the “Common Stock”), at a ratio of 1-for-4. Following such resolution, on September 9, 2024, the Company filed a Certificate of Amendment (the “Certificate of Amendment”) with the Secretary of State of the State of Nevada to effect the reverse stock split, with an effective time of 9:00AM. Eastern Time on September 11, 2024 (the “Reverse Stock Split”).
| 48 | Page |
Split Adjustment; Treatment of Fractional Shares
As a result of the 1:4 Reverse Stock Split, each 4 pre-split shares of Common Stock outstanding will automatically combine into one new share of Common Stock without any action on the part of the holders, and the number of outstanding shares of Common Stock was reduced from shares to shares (subject to rounding up of fractional shares to the nearest whole number). Following the rounding up of fractional shares, an additional shares of Common Stock were issued, resulting in shares of Common Stock issued and outstanding immediately following the Reverse Stock Split.
No fractional shares were issued in connection with the Reverse Stock Split. Fractional shares were rounded up to the nearest whole number.
Share Issuance
On
November 25, 2024, the Company issued, in aggregate, shares of Common Stock, representing
On
November 25, 2024, the Company issued, in aggregate, shares of Common Stock, representing
No shares of Common Stock were issued during the year ended August 31, 2026. As of August 31, 2026 and 2025, the Company had shares of Common Stock issued and outstanding.
Details of the Company’s subsidiaries:
SUMMARY OF CONSOLIDATED SUBSIDIARIES
| Subsidiaries of EVOH | Attributable interest | |||
| EvoAir International Limited (British Virgin Islands) | % | |||
| Subsidiary of EvoAir International Limited | ||||
| WKL Eco Earth Holdings Pte Ltd (Singapore) | % | |||
| Subsidiaries of WKL Eco Earth Holdings Pte Ltd | ||||
| WKL Eco Earth Sdn Bhd (Malaysia) | % | |||
| WKL Green Energy Sdn Bhd (Malaysia) | % | |||
| EvoAir Manufacturing (M) Sdn Bhd (Malaysia) | % | |||
| WKL EcoEarth Indochina Co Ltd (Cambodia)* | % | |||
| WKL Guanzhe Green Technology Guangzhou Co Ltd (China) | % | |||
| Subsidiary of EvoAir Manufacturing (M) Sdn Bhd | ||||
| Evo Air Marketing (M) Sdn Bhd (Malaysia) | % | |||
The Company and its subsidiaries, collectively to be referred to as “EvoAir Group” or the “Group”.
| * |
NOTE 2 – CHANGE OF CONTROL
Pursuant
to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company
and the owner of restricted shares of the Company’s ordinary shares representing approximately % of the Company’s
then issued and outstanding shares, sold his entire shareholding of the Company to WKL Global for an aggregate consideration of $.
Upon completion of the Change of Control Transaction, WKL Global then owned shares, or approximately
NOTE 3 – GOING CONCERN
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business. In accordance with ASC 205-40, Presentation of Financial Statements – Going Concern, management has evaluated the conditions and events, considered in the aggregate, that may affect the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued.
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As of August 31, 2026 and August 31, 2025, the Company had accumulated deficits of $
The Company has historically
financed its operations through internally generated funds, shareholder advances and proceeds from the issuance of securities. As of August
31, 2026, amounts due to related parties and other shareholders totaled $, reflecting an increase of $ during the year.
Certain lenders have extended the maturities of their advances, while others have requested renewal options. In addition, the Company
had short-term borrowings of approximately $
Management continues to pursue initiatives aimed at strengthening the Company’s operating performance and financial position through the development and expansion of its HVAC business. These include broadening product offerings, expanding into new geographical markets, diversifying revenue streams and improving operational efficiencies to support long-term business growth.
In support of these initiatives, the Company is actively pursuing financing opportunities to strengthen its working capital position and facilitate the execution of its business plans. These include its proposed uplisting to the Nasdaq Capital Market and associated securities offering, as well as alternative financing arrangements, including private placements, other capital-raising opportunities, continued shareholder advances and extensions or refinancing of existing financing arrangements. Management believes that the successful implementation of these initiatives would provide additional financial resources to support ongoing operations and facilitate the Company’s planned business expansion.
However, the availability and timing of additional financing remain subject to uncertainties, and there can be no assurance that the proposed offering will be completed, additional funding will be secured or existing financing arrangements will be extended or refinanced as required. Accordingly, management has concluded that substantial doubt remains about the Company’s ability to continue as a going concern within one year after the date the consolidated financial statements are issued.
The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 4 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation:
The accompanying consolidated financial statements have been prepared by the Company in accordance with U.S. GAAP for financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”).
The
consolidated financial statements include the accounts of EvoAir International, WKL Eco Earth Holdings, WKL Eco Earth, WKL Green
Energy, and its
All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of the Management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with U.S. GAAP.
The non-controlling interests are presented in the consolidated balance sheets, separately from equity attributable to the stockholders of the Company. Non-controlling interests in the results of the Company are presented on the face of the consolidated statements of operations and comprehensive loss as an allocation of the total loss for the year between non-controlling interest holders and the stockholders of the Company.
Changes in the Company’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions in accordance with ASC 810-10-45-23. The carrying amount of the non-controlling interest is adjusted to reflect the change in relative ownership, and any difference between the consideration paid and the adjustment to the non-controlling interest is recognized in additional paid-in capital. The increase in the Company’s interest in WKL Guanzhe on February 6, 2026 did not have a material effect on equity attributable to the stockholders of the Company, as WKL Guanzhe had a net deficit at the transaction date.
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Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reporting periods. Key estimates in the accompanying consolidated financial statements include, among others, the allowance for credit losses, the allowance for obsolete inventory, the useful lives and recoverability of technology-related intangible assets and other long-lived assets, the lease terms and incremental borrowing rates used to measure operating lease liabilities and right-of-use (“ROU”) assets, and the valuation allowance for deferred income tax assets. Actual results could differ materially from these estimates.
Fiscal Year End
The Company operates on a fiscal year basis with the fiscal year ending on August 31.
Reclassification
Certain fiscal year 2025 amounts have been reclassified
to conform to the current-year presentation. Interest expense of $
Cash and Cash Equivalents
The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. The Company places its cash with high credit quality financial institutions.
WKL Guanzhe business is primarily conducted in China and substantially all of revenue are denominated in RMB. The government of People’s Republic of China (“PRC”) imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade.
Comprehensive Gain or Loss
ASC 220 “Comprehensive Income,” establishes standards for the reporting and display of comprehensive income and its components in the financial statements. For the years ended August 31, 2026, and 2025, the Company determined that there are items that represented components of comprehensive income, consisting of foreign currency translation adjustments, and, therefore, has included a statement of comprehensive loss in the financial statements.
Foreign Currency Translation
The reporting currency of the Company is the United States dollar (“USD”). The functional currency of the Company and of EvoAir International (BVI) is USD. The functional currency of the Company’s Singapore operations is the Singapore dollar (“SGD”), of its Malaysia operations is the Ringgit Malaysia (“RM”), of its PRC operations is the Chinese Renminbi (“RMB”), and of its Cambodia operations is USD. Management has adopted ASC 830 “Foreign Currency Matters” for transactions that occur in foreign currencies
Transactions denominated in currencies other than an entity’s functional currency are remeasured into the functional currency at the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are remeasured at the exchange rate prevailing at the balance sheet date. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income for the respective periods.
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Assets and liabilities of the Company’s operations are translated into the reporting currency, United States Dollars, at the exchange rate in effect at the balance sheet dates. Revenue and expenses are translated at average rates in effect during the reporting periods. Equity transactions are recorded at the historical rate when the transaction occurred. The resulting translation adjustment is reflected as accumulated other comprehensive income, a separate component of stockholders’ equity in the consolidated statement of changes in equity (deficit).
Credit Losses
In June 2016, the FASB issued Accounting Standards Update (ASU) 2016-13, specifically Financial Instruments – Credit Losses (Topic 326), denoted as ASC 326. This regulatory framework supersedes the incurred loss methodology with the Current Expected Credit Loss (CECL) methodology. CECL necessitates the derivation of credit loss estimates for the remaining projected life of financial assets, encompassing historical data, prevailing conditions, and substantiated forecasts. Broadly applicable to financial assets assessed at amortized cost, including trade receivables, loan receivables, and held-to-maturity debt securities, CECL also extends its purview to certain off-balance sheet credit exposures, such as unfunded commitments to extend credit. In adherence to this methodology, financial assets measured at amortized cost are to be presented on financial statements at the net amount anticipated to be collected, incorporating an allowance for credit losses as a means of accounting for the estimated credit losses. The Company adopted ASU 2016-13 on September 1, 2023, using the modified retrospective method. See below allowance for credit losses for more information.
Accounts Receivable and Allowance for Credit Losses
Accounts receivable are recorded at the net value of the face amount less any allowance for expected credit loss. In accordance with ASC 326, the allowance for credit losses reflects the Company’s estimate of expected credit losses over the contractual life of its accounts receivable, and is determined based on historical loss experience, the aging of receivables, customer-specific information, current conditions and reasonable and supportable forecasts of future economic conditions. Receivables that share similar risk characteristics are evaluated on a pooled basis, and receivables that do not share similar risk characteristics are evaluated individually. The Company reviews the allowance for credit losses on a regular basis, and all past due balances are reviewed individually for collectability. An account receivable is written off after all collection effort has ceased. Recoveries of receivables previously written off are recorded when received. Interest is not charged on past due accounts.
As
of August 31, 2026 and August 31, 2025, our accounts receivable amounted to $
Inventories
Inventories consist primarily of finished goods and raw materials held by WKL Eco Earth and EvoAir Manufacturing. Unrealized profit on inventories transferred between Group entities is eliminated on consolidation, so that inventories held by Group entities are carried at their original cost to the Group, subject to the lower of cost or net realizable value.
We value inventories at the lower of cost or net realizable value. We determine the costs of inventory using the standard cost method, which approximates actual cost based on a first-in, first-out method. All other costs, including administrative costs, are expensed as incurred.
Deposit, prepayments, and other receivables
Deposit, prepayments and other receivables are comprised of prepayments paid to vendors to initiate orders and prepaid services fees and are classified as current assets if such amounts are to be recognized within one year from the balance sheet date.
Property, Plant and Equipment
Property,
plant and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of
the related capitalized assets. Property and equipment are depreciated over
SUMMARY OF ESTIMATED USEFUL LIVES OF ASSETS
| Useful lives | ||
| Plant and machineries | ||
| Office equipment | ||
| Vehicles | ||
| Furniture and equipment | ||
| Renovation |
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Repair and maintenance costs are charged to expense as incurred. At the time of retirement or other disposition of property, plant and equipment, the cost and accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations.
Intangible Assets and Other Long-Lived Assets
The
Company’s intangible assets consist of patents and trademarks related to assignments of intellectual properties by Dr. Low into
WKL Eco Earth Holdings under the IP Assignments as contemplated in Note 1. The intangible assets are recorded at fair value and
are amortized using the straight-line method over an estimated life of
Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds their fair value.
Revenue Recognition
Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.
The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenue from the sale of air-conditioners, HVAC products, components and parts, and Ionic Nano Copper Zinc (“INC”) products is recognized at a point in time when control transfers to the customer, generally upon delivery. Installation and retrofitting services are generally completed within a short period and are recognized at the point in time the service is completed. Substantially all of the Company’s revenue is generated from customers in Malaysia.
The following table disaggregates the Company’s revenue by product and service line for the years ended August 31, 2026 and 2025:
SCHEDULE OF DISAGGREGATES THE COMPANY’S REVENUE
| August 31, 2026 | August 31, 2025 | |||||||
| Air-conditioners and HVAC products | $ | $ | ||||||
| Installation and related services | ||||||||
| Components and parts | ||||||||
| Retrofitting | ||||||||
| Ionic Nano Copper Zinc products | ||||||||
| Other | ||||||||
| Total revenue | $ | $ | ||||||
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Deferred Revenue
The
Company collects customer deposits in advance for certain business contracts. These advance payments are initially recorded as deferred
revenue (contract liabilities) on the balance sheet. As of August 31, 2025, deferred revenue totaled $
Deferred Offering Costs
The
Company follows the requirements of the FASB ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A - “Expenses
of Offering”. Deferred offering costs consist of underwriting, legal and other expenses incurred through the balance sheet date
that are directly related to the intended initial public offering (“IPO”) and uplisting to the Nasdaq Capital Market, including
the fair value of shares of Common Stock of $
Leases
We have entered into operating agreements primarily for office and factory. We determine if an arrangement is a lease at inception. For all classes of underlying assets, we elect not to recognize right of use assets or lease liabilities when a lease has a lease term of 12 months or less at the commencement date and does not include an option to purchase the underlying asset that we are reasonably certain to exercise. Operating lease assets and liabilities are included on our consolidated balance sheet as of August 31, 2026 and 2025.
Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in most of our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in the economic environments where the leased asset is located. The ROU asset also includes any lease payments made at or before the commencement date and initial direct costs incurred, and is reduced by lease incentives received. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We generally use the base, non-cancellable, lease term when determining the lease assets and liabilities. Operating lease expense is recognized on a straight-line basis over the lease term.
Our lease agreements generally contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. We combine fixed payments for non-lease components with our lease payments and account for them together as a single lease component, which increases the amount of our lease assets and liabilities.
Income Taxes
The Company utilizes ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. The Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts, using currently enacted tax rates. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.
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The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the consolidated statements of operations.
Measurement of Fair Value
The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined in the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs or inputs that are corroborated by market data.
Level 3: Unobservable inputs that are not corroborated by market data.
The Company computes basic and diluted earnings (loss) per share amounts in accordance with ASC Topic 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of August 31, 2026 and 2025, the Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.
Segment Reporting
The
Company reports segment information in accordance with ASC 280, Segment Reporting, as amended by ASU 2023-07. The Company’s Chief
Executive Officer is the chief operating decision maker (“CODM”). The Company manages its business on a consolidated basis
and has
SCHEDULE OF SUMMARY INFORMATION BY SEGMENT
| 2026 | 2025 | |||||||
| Revenue | $ | $ | ||||||
| Cost of revenue | ( | ) | ( | ) | ||||
| Selling and marketing expenses | ( | ) | ( | ) | ||||
| General and administrative expenses, excluding items below | ( | ) | ( | ) | ||||
| Amortization of intangible assets | ( | ) | ( | ) | ||||
| Impairment of intangible assets | ( | ) | ||||||
| Stock-based consulting expense | ( | ) | ||||||
| Interest expense, net | ( | ) | ( | ) | ||||
| Other income | ||||||||
| Segment and consolidated net loss | $ | ( | ) | $ | ( | ) | ||
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Other
segment items include depreciation of $
Recently Adopted Accounting Pronouncements
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires disclosure of significant segment expenses regularly provided to the CODM and applies to entities with a single reportable segment. The standard was effective for the Company for the fiscal year beginning September 1, 2024 and has been applied retrospectively to all periods presented. The adoption affected disclosures only.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The standard requires a tabular rate reconciliation presented in both amounts and percentages using specific categories, separate disclosure of reconciling items that meet a quantitative threshold of 5% of the amount computed by multiplying pretax income or loss by the applicable statutory rate, and disaggregation of income taxes paid by federal, state and foreign jurisdiction. The Company adopted the standard effective September 1, 2025 on a retrospective basis. The adoption affected disclosures only and had no impact on the Company’s financial position, results of operations or cash flows (see Note 13).
In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This standard amends guidance on measuring expected credit losses for current accounts receivable and contract assets arising from revenue contracts. This amended guidance requires to estimate credit losses for these short-term assets based on the economic conditions that exist as of the balance sheet date, without forecasting future economic conditions. We will adopt this standard effective beginning fiscal 2027. We do not expect the adoption to have a material impact on our consolidated financial statements.
Effective September 1, 2025, the Company also adopted ASU No. 2023-08 (Accounting for and Disclosure of Crypto Assets), ASU No. 2024-01 (Scope Application of Profits Interest and Similar Awards) and ASU No. 2024-02 (Codification Improvements-Amendments to Remove References to the Concepts Statements). The adoption of these standards had no impact on the Company’s consolidated financial statements.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This standard is intended to make targeted improvements to the accounting and application of guidance related to costs incurred to develop software for internal use. This standard is effective for us in the interim and annual periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements.
In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses. This standard requires disclosures of additional information about specific expense categories in the notes to the financial statements for interim and annual reporting periods. This standard, as clarified by ASU No. 2025-01, is effective for us in the annual period beginning in fiscal 2028 and interim periods beginning in the first quarter of fiscal 2029. Early adoption is permitted. We are currently evaluating the potential impact of this standard on our consolidated financial statements.
In December 2025, the FASB issued ASU No. 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities. This standard establishes recognition, measurement and presentation guidance for government grants received by business entities. This standard is effective for us in the annual period beginning in fiscal 2030. Early adoption is permitted. We do not currently receive material government grants and do not expect the adoption to have a material impact on our consolidated financial statements.
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In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This standard clarifies the form and content of interim financial statements and requires disclosure of events since the last annual reporting period that have a material impact on the entity. This standard is effective for our interim periods beginning in the first quarter of fiscal 2029. We are currently evaluating the potential impact of this standard on our interim disclosures.
In December 2025, the FASB issued ASU No. 2025-12, Codification Improvements. This standard makes clarifications, technical corrections and other minor improvements to a broad range of Topics. This standard is effective for us in the annual period beginning in fiscal 2028. We do not expect the adoption to have a material impact on our consolidated financial statements.
There are no other recently issued accounting pronouncements that have not yet been adopted that the Company considers material to its consolidated financial statements.
NOTE 5 INVENTORIES
Inventories consist of the following:
SCHEDULE OF INVENTORIES
| August 31, 2026 | August 31, 2025 | |||||||
| Finished goods | $ | $ | ||||||
| Raw materials and supplies | ||||||||
| Total | $ | $ | ||||||
As
of August 31, 2026, inventories were held by EvoAir Manufacturing, WKL Eco Earth and WKL EcoEarth Indochina.
NOTE 6 DEPOSIT, PREPAYMENTS AND OTHER RECEIVABLES
Deposit, prepayments and other receivables consist of the following:
SCHEDULE OF DEPOSIT PREPAYMENTS AND OTHER RECEIVABLES
| August 31, 2026 | August 31, 2025 | |||||||
| Deposits and Prepayments | $ | $ | ||||||
| Other receivables (Advances to suppliers) | ||||||||
| Total | $ | $ | ||||||
NOTE 7 PROPERTY, PLANT AND EQUIPMENT, NET
Property, plant and equipment consist of the following:
SCHEDULE OF PROPERTY, PLANT AND EQUIPMENT
| August 31, 2026 | August 31, 2025 | |||||||
| Plant and machineries | $ | $ | ||||||
| Office equipment | ||||||||
| Vehicles | ||||||||
| Furniture and equipment | ||||||||
| Renovation | ||||||||
| Property, plant and equipment gross | ||||||||
| Less: Accumulated depreciation | ( | ) | ( | ) | ||||
| Property, plant and equipment, net | $ | $ | ||||||
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Depreciation
expense for the years ended August 31, 2026 and 2025 was $
NOTE 8 – INTANGIBLE ASSETS
The
Company’s intangible assets consist of patents and trademarks relating to its EvoAir™ condensing unit technology and its
portable air cooler technology, assigned to WKL Eco Earth Holdings under the IP Assignments described in Note 1. The assets are amortized
on a straight-line basis over a
SUMMARY OF INTANGIBLE ASSETS
As of August 31, 2026
| Technology 1 – Portable Air Cooler | Technology 2 – Condensing Unit | Total | ||||||||||
| Gross carrying amount | $ | $ | $ | |||||||||
| Accumulated impairment | ( | ) | ( | ) | ( | ) | ||||||
| Accumulated amortization | ( | ) | ( | ) | ( | ) | ||||||
| Intangible assets, net | $ | $ | $ | |||||||||
As of August 31, 2025
| Technology 1 – Portable Air Cooler | Technology 2 – Condensing Unit | Total | ||||||||||
| Gross carrying amount | $ | $ | $ | |||||||||
| Accumulated impairment | ( | ) | ( | ) | ( | ) | ||||||
| Accumulated amortization | ( | ) | ( | ) | ( | ) | ||||||
| Intangible assets, net | $ | $ | $ | |||||||||
Accumulated
impairment includes $
Amortization
expenses for intangible assets for the years ended August 31, 2026 and 2025 was $
Based
on the carrying amount of the intangible assets as of August 31, 2026, estimated amortization expense is $
Impairment recognized in fiscal year 2025
As
of August 31, 2025, sales of EvoAir™ products were significantly below the projections used for impairment assessment purposes
over the preceding three years, and the Group continued to incur operating losses. Management attributed these results to slower market
adoption of the technology and delays in regulatory approvals. In light of these factors, management performed impairment testing of
Technology 1 and Technology 2 under ASC 360-10. Management determined that the asset group’s carrying amount of $
Fair value was measured using a discounted cash flow method, a Level 3 measurement. The significant unobservable inputs were:
| ● | the discount rate; | |
| ● | growth in the Malaysian air-conditioner market; | |
| ● | projected market share and sales volumes; | |
| ● | average selling prices; | |
| ● | probabilities applied to unsigned project revenue; and | |
| ● | long-term EBITDA margins. |
Recoverability assessment as of August 31, 2026
The
continued operating losses of the Group and fiscal year 2026 revenue substantially below the forecasts used in the fiscal year 2025 impairment
test were considered an indicator that the carrying amount of the technology-related intangible assets may not be recoverable. Management
performed a recoverability test as of August 31, 2026 in accordance with ASC 360-10. It concluded that the estimated undiscounted future
cash flows expected to result from the use and eventual disposition of the asset group exceeded its carrying amount of $
The undiscounted cash flows cover the Company’s Malaysian retail and project channels over the remaining life of its Malaysian patents. They depend on significant assumptions, including the probability of a successful uplisting on the Nasdaq Capital Market and the deployment of the related offering proceeds, projected market share and sales volumes, average selling prices, gross and EBITDA margins, and the remaining economic life of the Malaysian patents. These assumptions are inherently uncertain given the Company’s limited revenue history. If the uplisting is not completed or actual results fall short of these assumptions, it is reasonably possible that the Company will recognize an impairment loss on these assets in the near term, and that loss could be material.
NOTE 9 ACCOUNTS PAYABLE, ACCRUALS, AND OTHER PAYABLES
Accounts payable and accruals, and other payables consist of the following:
SCHEDULE OF ACCOUNTS PAYABLES ACCRUALS AND OTHER PAYABLE
| August 31, 2026 | August 31, 2025 | |||||||
| Accounts payable | $ | $ | ||||||
| Accruals | ||||||||
| Other payables | ||||||||
| Total | $ | $ | ||||||
Other payables are non-trade and
unsecured, and principally comprise amounts payable by WKL Eco Earth Holdings and WKL Eco Earth of $
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NOTE 10 SHORT-TERM BORROWINGS
In
July 2026, WKL Eco Earth Holdings obtained an unsecured loan of SGD
The carrying amount of the short-term borrowings approximates fair value because of their short-term maturity. See Note 3 for the effect of these borrowings on the Company’s liquidity.
NOTE 11 RELATED PARTY TRANSACTIONS
SCHEDULE OF RELATED PARTY TRANSACTIONS
(a) Nature of relationships
| Related party | Relationship with the Company | |
| Dr. Low Wai Koon (“Dr. Low”) | ||
| Chan Kok Wei | ||
| Chong Sein Chin | ||
| Tan Soon Hock | ||
| Oh Teik Huat |
(b) Amounts due to related parties and other shareholders
| US$ | Nature | August 31, 2026 | August 31, 2025 | |||||||
| Chan Kok Wei | Shareholder loan | |||||||||
| Dr. Low | Shareholder loan and expenses paid on behalf of the Group | |||||||||
| Chong Sein Chin | Shareholder loan | |||||||||
| Tan Soon Hock | Shareholder loan | |||||||||
| Oh Teik Huat | Shareholder loan | |||||||||
| Amounts due to related parties | ||||||||||
| Amounts due to other shareholders | Shareholder loans | |||||||||
| Total amounts due to related parties and other shareholders | ||||||||||
(c) Related party transactions
| US$ | Year ended August 31, 2026 | Year ended August 31, 2025 | ||||||
| Interest expense on amounts due to related parties | ||||||||
| Interest expense on amounts due to other shareholders | ||||||||
| Total interest expense on amounts due to related parties and other shareholders | ||||||||
(d) Terms
NOTE 12 STOCKHOLDERS’ EQUITY
On December 16, 2021, the Company increased the authorized common stock from shares with a par value of $ per share to shares with a par value of $ per share. In connection with the Reverse Stock Split effected on September 11, 2024 pursuant to NRS 78.207, the number of authorized shares of common stock was proportionately reduced from shares to shares.
On April 12, 2024, the Company’s board of directors unanimously resolved to effect a reverse stock split of the Company’s common stock, par value $ per share, at a ratio of 1-for-4. Following such resolution, on September 9, 2024, the Company filed a Certificate of Amendment with the Secretary of State of the State of Nevada to effect the reverse stock split, with effective on September 11, 2024.
On
November 25, 2024, the Company issued, in aggregate, shares of Common Stock, representing
On
November 25, 2024, the Company issued, in aggregate, shares of Common Stock, representing
As a result of the 1:4 Reverse Stock Split, each 4 pre-split shares of Common Stock outstanding automatically combined into one new share of Common Stock without any action on the part of the holders, and an additional 105 shares of Common Stock were issued as a result of rounding up fractional shares to the nearest whole number. No shares of Common Stock were issued during the year ended August 31, 2026. Therefore, as of August 31, 2026, and August 31, 2025, the Company had and shares of its common stock issued and outstanding, respectively.
Non-controlling
interests decreased from $(
NOTE 13 INCOME TAXES
The Company and its subsidiaries are subject to income taxes under the tax laws of the jurisdictions in which they are incorporated and operate. We routinely undergo examinations in the jurisdictions in which we operate.
The Company has operations in Singapore, Malaysia, Cambodia, BVI, and China that are subject to taxes in the jurisdictions in which they operate, as follows:
Singapore
WKL
Eco Earth Holdings is incorporated in Singapore, and under the current tax laws of Singapore, its standard corporate income tax rate
is
Malaysia
WKL
Eco Earth, WKL Green Energy and EvoAir Manufacturing (including its
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Cambodia
WKL
EcoEarth Indochina is incorporated in Cambodia, and under the current tax laws of Cambodia, its standard corporate tax rate is
BVI
EvoAir International is incorporated in BVI, and a BVI Business Company is exempt from the BVI income tax.
China
WKL
Guanzhe is incorporated in China. Under the current tax law in the PRC, WKL Guanzhe is subject to the enterprise income tax rate of
EvoAir
Holdings Inc. is incorporated in the State of Nevada and is subject to U.S. federal income tax at
Due
to the Company’s net loss position, there was no provision for income taxes recorded for the years ended August 31, 2026 and 2025,
and no income taxes were paid to federal, state or foreign jurisdictions in either year. As a result of the Company’s losses to
date, there exists doubt as to the ultimate realization of the deferred tax assets. Accordingly, a valuation allowance equal to the total
deferred tax assets has been recorded. Loss before income taxes comprised a domestic (U.S.) loss of $
The Company adopted ASU 2023-09 effective September 1, 2025 and applied it retrospectively. The reconciliation of income tax computed at the U.S. federal statutory rate to the Company’s effective income tax for the years ended August 31, 2026 and 2025 is as follows:
SCHEDULE OF RECONCILIATION BETWEEN THE STATUTORY TAX RATE AND THE ACTUAL PROVISION
| Year Ended August 31, 2026 | ||||||||
| Amount | Percent | |||||||
| $ | ( | ) | % | |||||
| Change in valuation allowance – U.S. | ( | )% | ||||||
| Foreign tax effects – Singapore: statutory tax rate difference | ( | )% | ||||||
| Foreign tax effects – Singapore: non-deductible amortization of intangible assets | ( | )% | ||||||
| Foreign tax effects – Singapore: change in valuation allowance | ( | )% | ||||||
| Foreign tax effects – Malaysia: statutory tax rate difference | ( | ) | % | |||||
| Foreign tax effects – Malaysia: change in valuation allowance | ( | )% | ||||||
| Foreign tax effects – other foreign jurisdictions | ( | )% | ||||||
| Effective income tax | % | |||||||
| Year Ended August 31, 2025 | ||||||||
| Amount | Percent | |||||||
| $ | ( | ) | % | |||||
| Nondeductible items – U.S.: stock-based consulting expense | ( | )% | ||||||
| Change in valuation allowance – U.S. | ( | )% | ||||||
| Foreign tax effects – Singapore: statutory tax rate difference | ( | )% | ||||||
| Foreign tax effects – Singapore: non-deductible amortization of intangible assets | ( | )% | ||||||
| Foreign tax effects – Singapore: non-deductible impairment of intangible assets | ( | )% | ||||||
| Foreign tax effects – Singapore: change in valuation allowance | ( | )% | ||||||
| Foreign tax effects – Malaysia: statutory tax rate difference | ( | ) | % | |||||
| Foreign tax effects – Malaysia: change in valuation allowance | ( | )% | ||||||
| Foreign tax effects – other foreign jurisdictions | ( | )% | ||||||
| Effective income tax | % | |||||||
| 60 | Page |
The stock-based consulting expense for the year ended August 31, 2025 relates to shares of Common Stock issued by the Company to a business development consultant and has been treated as non-deductible for U.S. federal income tax purposes. The non-deductible impairment and amortization of intangible assets relate to the technology-related intangible assets held by WKL Eco Earth Holdings in Singapore.
The components of net deferred tax assets are as follows:
SCHEDULE OF COMPONENTS OF NET DEFERRED TAX ASSETS
| August 31, 2026 | August 31, 2025 | |||||||
| Net operating loss carry-forwards (tax-effected) | $ | $ | ||||||
| Less: valuation allowance | ( | ) | ( | ) | ||||
| Net deferred tax asset | ||||||||
The
valuation allowance increased by $
As of August 31, 2026 and 2025, the Company had no unrecognized tax benefits, and no interest or penalties related to uncertain tax positions were recognized during the years ended August 31, 2026 and 2025. The Company does not expect the amount of unrecognized tax benefits to change significantly within the next twelve months. The Company’s tax returns remain subject to examination by the tax authorities in the U.S., Singapore, Malaysia, the PRC and Cambodia for the tax years that remain open under the applicable statutes of limitation.
The Company’s foreign subsidiaries have incurred cumulative losses and have no undistributed earnings; accordingly, no deferred tax liability has been recognized for outside basis differences in its foreign subsidiaries. For the years ended August 31, 2026 and 2025, the Company had no income inclusions under the U.S. global intangible low-taxed income (“GILTI”) or Subpart F provisions, as its controlled foreign corporations incurred losses.
NOTE 14 ROU ASSET AND LEASES
A lease is defined as a contract that conveys the right to control the use of identifiable tangible property for a period of time in exchange for consideration. The Company adopted ASC Topic 842 which primarily affected the accounting treatment for operating lease agreements in which the Company is the lessee including the Company’s leases of office and factory. The Company elected to not recognize ROU assets and lease liabilities arising from short-term leases with initial lease terms of twelve months or less (deemed immaterial) on the accompanying consolidated balance sheets.
ROU assets are initially measured at the amount of the lease liability, adjusted for lease payments made at or before the commencement date, less lease incentives received, plus initial direct costs incurred. Lease expense for minimum lease payments under operating leases is recognized on a straight-line basis over the lease term. The lease terms may include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option.
When
measuring lease liabilities for leases that were classified as operating leases, the Company discounted lease payments using its estimated
incremental borrowing rate of
| 61 | Page |
In January 2025, the Company entered into a supplemental agreement amending its existing PRC factory lease agreement (original Contract effective from 2021) with the lessor. The amendment reduces the leased area of the existing factory space.
The Company determined that the amendment qualifies as a lease modification under ASC 842-10-25-8 because it decreases the scope of the leased asset (reduced factory space) without granting additional rights of use, and the decrease in consideration is commensurate with the reduced scope, adjusted for market conditions and the Company’s circumstances. This modification is accounted for as a partial termination of the existing lease.
The
amendments were accounted for as lease modifications effective February 1, 2025. Per ASC 842-10-25-8, the lease liability was remeasured
at the modification date as the present value of the revised lease payments over the remaining term, discounted using the Company’s
incremental borrowing rate of
The PRC factory lease expired during the year ended August 31, 2026. As of August 31, 2026, the Company’s remaining operating lease relates to the factory and office premises of EvoAir Manufacturing in Malaysia.
The following is a summary of ROU asset and operating lease liabilities:
SCHEDULE OF ROU ASSET AND OPERATING LEASE LIABILITIES
| August 31, 2026 | August 31, 2025 | |||||||
| Assets: | ||||||||
| ROU asset | $ | $ | ||||||
| Liabilities: | ||||||||
| Current: | ||||||||
| Operating lease liabilities | $ | $ | ||||||
| Operating lease liabilities current | $ | $ | ||||||
| Non-current | ||||||||
| Operating lease liabilities | ||||||||
| Total lease liabilities | $ | $ | ||||||
As of August 31, 2026, the remaining maturities of lease liabilities were as follows:
SCHEDULE OF MATURITIES OF LEASE LIABILITIES
| Operating lease | ||||
| 2027 | $ | |||
| Total undiscounted lease payments | ||||
| Less: imputed interest | ( | ) | ||
| Present value of operating lease liabilities | $ | |||
For
the years ended August 31, 2026 and 2025, amortization of ROU assets was $
NOTE 15 COMMITMENTS AND CONTINGENCIES
During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals. As of August 31, 2026, the Company is not aware of any contingent liabilities that should be reflected in the financial statements.
NOTE 16 SUBSEQUENT EVENTS
In accordance with FASB ASC 855-10 Subsequent Events, the Company has analyzed its operations subsequent to August 31, 2026, to the date these consolidated financial statements were issued, and has determined that other than as described below, it does not have any material subsequent events to disclose in these consolidated financial statements.
Shareholder loan
On
September 2, 2026, WKL Eco Earth Holdings obtained an unsecured shareholder loan of SGD
Extension of borrowings
On
September 28, 2026, the maturity of a shareholder loan of RM
On October 2, 2026, the maturity of the
SGD
Dissolution of WKL EcoEarth Indochina
As of October, 13, 2026, the date these consolidated financial statements were issued, the dissolution of WKL EcoEarth Indochina remained in progress (see Note 1).
| 62 | Page |
| ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
None.
| ITEM 9A. | CONTROLS AND PROCEDURES |
Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of August 31, 2026. Based on this evaluation, our management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, due to the material weaknesses in our internal control over financial reporting described below.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, management conducted an assessment of the effectiveness of our internal control over financial reporting as of August 31, 2026 based on the criteria set forth in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management concluded that our internal control over financial reporting was not effective as of August 31, 2026 because of the material weaknesses described below.
A material weakness is a control deficiency, or combination of control deficiencies, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the assessment described above, management identified the following control deficiencies that represent material weaknesses at August 31, 2026:
| ● | Due to our limited resources, we do not have enough accounting personnel with extensive experience in maintaining books and records and preparing financial statements in accordance with US GAAP which could lead to untimely identification and resolution of accounting matters inherent in our financial transactions in accordance with US GAAP. |
| ● | The Company has insufficient written policies and procedures for accounting and financial reporting, which led to inadequate financial statement closing process. |
| ● | The Company has a lack of segregation of duties, a lack of audit committee or independent governance/oversight. |
Our management also confirmed that there was no change in our internal control over financial reporting during the year ended August 31, 2026 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
| ITEM 9B. | OTHER INFORMATION |
| 63 | Page |
PART III
| ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
Our executive officer’s and director’s and their respective ages as of October 14, 2026 hereof are as follows:
| Name | Age | Positions | ||
| Low Wai Koon | 55 | Executive Director/ Chairman/ Chief Executive Officer | ||
| Chan Kok Wei | 51 | Executive Director/ Group Managing Director | ||
| Ong Bee Chen | 50 | Executive Director/ Chief Financial Officer | ||
| Goh Chuan Meng | 41 | Independent Non-Executive Director | ||
| Ivan Oh Joon Wern | 32 | Independent Non-Executive Director |
Dr. Low Wai Koon, aged 55, is the founder and Chief Executive Officer of the EvoAir Group since 2017, where heads the research and development team of EvoAir Group, provides leadership and builds consensus, in conjunction with the Group Managing Director and oversees the day the day-to-day operations of the Group. Prior to joining the EvoAir Group, Dr. Low had over 15 years of experience in the mechanical engineering sector. He founded Proficient Auto Sdn Bhd, a chain auto service centre in Malaysia, in 2001 and acted as an executive director from 2001 to 2013 where he was in charge of day-to-day operation. Dr Low was the founder and Executive Director of LWK Automotive Green Technologies Sdn Bhd from 2011 to 2017 overseeing day to day operation, as well as designing producing various products focusing on green technologies, including the Hydraulic Powered Drive System (“HPDS”), a fully waterproof transmission technology that incorporates a normal combustion engine with a hydraulic system, with the objective to produce an environmentally friendly system that enables conventional engines and generators to run more efficiently; and multi-purpose rescue vehicle (“MRV”), a unique vehicle built upon the HPDS green technology for the disaster relief sector. Dr. Low is also the author of ‘The Light’, a book focusing on creating awareness of environmental protection by mankind as a green activist. He was conferred a Degree of Doctor of Philosophy (Honoris Causa) with a major in Robotics Engineering Science from the American World University in 2009 and is an Honorary Fellow of the International Society of Professional Engineers, USA, since 2010.
Mr. Chan Kok Wei, aged 51, is an Executive Director of the Group. Mr. Chan has been a Co-founder and Group Managing Director of EvoAir Group since 2017. He is the Secretary of the Company since November 12, 2025. He is responsible for the general management, planning of overall strategy and day-to-day operations of the Group, development of the Group’s overall strategic plan, capital markets activities and corporate development initiatives. Mr. Chan has over 20 years of experience in general management, capital markets, wealth management, investment banking, corporate advisory, corporate development and investors relations experience in Asia. He is a Co-founder and Managing Director of Allegro Corporate Advisory Pte Ltd (“Allegro”) since 2015, an independent strategic and corporate advisory firm based in Singapore. Allegro provides advisory services relating to initial public offerings (“IPOs”), mergers and acquisitions (“M&A”), business and trade sales, strategic corporate transactions, and capital raising, which focuses on Southeast Asia and China. Mr. Chan was the Director of Corporate Development of ZingMobile Group Limited (“ZingMobile”) from 2012 to 2017, an Australian Securities Exchange (“ASX”)-listed mobile platform enabler responsible for the group’s corporate finance, business and corporate development as well as investors relation and stakeholder management. Mr. Chan was also a director of ZingMobile’s holding company, ZingMobile International Pte Ltd. Prior to joining ZingMobile group, he was a Vice President at BNP Paribas Wealth Management, Singapore from 2010 to 2012, and Vice President of CIMB Investment Bank, Malaysia from 2005 to 2010, providing wealth management solutions to high net worth individuals.
Mr. Chan has listed company transaction experience including spearheading the IPO of Oilfield Workforce Group Ltd (“Oilfield”) on ASX in 2013; reverse takeover exercise of ZingMobile involving Pixie Entertainment Group Pte Ltd in 2015. Mr. Chan and his partner were credited for unlocking the shareholders’ value of the then ASX-listed company, Oilfield by restructuring the group through injecting a healthy business, Jack-In-Pile (M) Sdn Bhd, a Malaysian-based piling company and divesting the ailing oil and gas business. He was the Independent Non-Executive Director, Chairman of Audit Committee and Nomination Committee of Oilfield.
Mr. Chan received a Master in Business Administration (Finance) from the Charles Sturt University, Australia in April 2003 and a Bachelor of Economics from The Australian National University, Australia in April 2000.
| 64 | Page |
Ms. Ong Bee Chen, aged 50, is an Executive Director and Chief Financial Officer of the Group. She is the Treasurer of the Company since November 12, 2025. Ms. Ong has been a Co-founder of EvoAir Group since 2017. She is responsible for the planning, implementation, managing accounting and finance activities of EvoAir Group, including business planning, budgeting, forecasting and cashflow management, working alongside with Chief Executive Officer and Group Managing Director in formulating corporate strategies for the Group as well as spearheading the corporate exercises undertaken by the Group. Ms. Ong has over 20 years of experience in general management, corporate finance, private equity, investment management, strategic and advisory, internal audit in Singapore and Malaysia. She is the co-founder and Executive Director of Allegro since 2015, an independent strategic and corporate advisory firm based in Singapore. Allegro provides advisory services relating to IPO, M&A, business and trade sales, strategic corporate transactions, and capital raising, which focuses on Southeast Asia and China. Ms. Ong was an Associate Director of a Singapore-based private equity firm, where she was responsible for managing private equity investments (including origination, structuring, execution and divestments) in Emerging East Asia with China centric, which includes formulating value creation plans and bringing investee companies for listing and trade sale as part of exit strategies. During her tenure with investment banks and corporate and strategic advisory firms, she was widely involved in corporate finance transactions including cross-border mergers and acquisitions, reverse takeovers, initial public offerings and equity capital market transactions on ASX, Bursa Malaysia Securities Berhad and Stock Exchange of Hong Kong Limited. Ms Ong and her partner were credited for unlocking the shareholders’ value of an ASX-listed company, Oilfield by restructuring the group through injecting a healthy business, Jack-In-Pile (M) Sdn Bhd, a Malaysian-based piling company and divesting the ailing oil and gas business.
Ms. Ong graduated from The Australian National University with Bachelor of Commerce majoring in Accounting, Finance and sub-majoring in Economics in April 2000 and obtained Certified Practising Accountant status with CPA Australia since 2004.
Dr. Goh Chuan Meng, aged 41, is an independent non-executive director of the Group. He has also served as the Technology Advisor for the EvoAir Group since 2017. Dr. Goh had over 10 years’ experience in engineering and teaching. Dr. Goh is an assistant professor at the Universiti Tunku Abdul Rahman, Kampar since September 2017. From July 2014 to May 2016, Dr. Goh taught as a Graduate Assistance at the Universiti Teknologi Petronas. From April 2014 to July 2014, Dr, Goh taught as a Physics Teacher at Tenby International School. From March 2013 to April 2014, Dr. Goh worked as a Senior Process Engineer at Finisar Berhad. From January 2010 to March 2013, Dr. Goh worked as an equipment engineer at Unisem (M) Berhad. From July 2009 to January 2010, Dr. Goh worked as a product engineer at Carsem (M) Berhad. Dr. Goh obtained both his doctorate degrees of Doctorate of Philosophy in Electronic and Electrical Engineering from the University of Technology Petronas, Tronoh, Perak and Doctorate Philosophy in Electronic and Image Engineering from the University of Burgundy, Dijon, France in August 2017. Dr. Goh obtained his Master of Business Administration from the Universiti Utara Malaysia, Sintok in March 2016. Dr. Goh obtained his Master of Science in Electronic System (Honors Engineering from the University of Technology Petronas, Tronoh, Perak in May 2014. Dr. Goh obtained his Bachelor of Engineering (Hons) Mechanical from the University of Industry Selangor, Batang Berjuntai, Selangor in August 2009.
Mr. Ivan Oh Joon Wern, aged 32, is an Independent Non-Executive Director of EvoAir Group. Mr. Oh had over 10 years of experience in business development, finance and sales. Since September 2016, Mr. Oh has been the deputy chief financial officer of Tone Group International Sdn Bhd, a telecommunications company in Malaysia. Mr. Oh is a Marketing Manager of Bread Buddy PLT, a bakery located in Malaysia since February 2020. From March 2011 to August 2011, Mr. Oh was a sales executive at Apple Inc. in Malaysia. Mr. Oh obtained a Bachelor of International Business and Entrepreneurship from the University of Essex with Honours Class II (Division 1), United Kingdom in 2016.
Audit, Nominating and Compensation Committees
As of the date of this Report, we do not have an audit, nominating or compensation committee or committees performing similar functions. The Board of Directors as a whole performs such duties.
SIGNIFICANT EMPLOYEES
Other than our director, we do not expect any other individuals to make a significant contribution to our business.
| 65 | Page |
| ITEM 11. | EXECUTIVE COMPENSATION |
The following tables set forth certain information about compensation paid, earned or accrued for services by our Executive Officer for FYE 2026 and 2025:
Summary Compensation for Executive Officers
| Name and principal position | Year ended August 31, | Salary($) | Bonus($) | Stock awards($) | Option awards($) | Non-equity incentive plan compensation($) | Nonqualified deferred compensation earnings($) | All other compensation ($) | ||||||||||||||||||||||||
Low Wai Koon Executive Director/Chairman/Chief Executive Officer | 2026 | 133,054 | - | - | - | - | - | - | ||||||||||||||||||||||||
| 2025 | 124,239 | - | - | - | - | - | ||||||||||||||||||||||||||
Chan Kok Wei Executive Director/ Group Managing Director | 2026 | 133,942 | - | - | - | - | - | 2741 | ||||||||||||||||||||||||
| 2025 | 118,482 | - | - | - | - | - | ||||||||||||||||||||||||||
| Ong Bee
Chen Executive Director/Chief Financial Officer | 2026 | 124,597 | - | - | - | - | - | 2741 | ||||||||||||||||||||||||
| 2025 | 91,140 | - | - | - | - | - | ||||||||||||||||||||||||||
Director Compensation for the year ended August 31, 2026
| Name | Fees earned or paid in cash ($) | Stock awards ($) | Option awards($) | Non-equity incentive plan compensation ($) | Nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | |||||||||||||||||||||
| Low Wai Koon | 133,054 | - | - | - | - | - | 133,054 | |||||||||||||||||||||
| Chan Kok Wei | 133,942 | - | - | - | - | 2,741 | 136,683 | |||||||||||||||||||||
| Ong Bee Chen | 124,597 | - | - | - | - | 2,741 | 127,338 | |||||||||||||||||||||
| Goh Chuan Meng | 5,913 | 5,913 | ||||||||||||||||||||||||||
| Ivan Oh Joon Wern | 5,913 | 5,913 | ||||||||||||||||||||||||||
Director Compensation for the year ended August 31, 2025
| Name | Fees earned or paid in cash ($) | Stock awards ($) | Option awards($) | Non-equity incentive plan compensation ($) | Nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | |||||||||||||||||||||
| Low Wai Koon | 124,239 | - | - | - | - | - | 124,239 | |||||||||||||||||||||
| Chan Kok Wei | 118,482 | - | - | - | - | - | 118,482 | |||||||||||||||||||||
| Ong Bee Chen | 91,140 | - | - | - | - | - | 91,140 | |||||||||||||||||||||
| Goh Chuan Meng | 5,522 | 5,522 | ||||||||||||||||||||||||||
| Ivan Oh Joon Wern | 5,522 | 5,522 | ||||||||||||||||||||||||||
For the years ended August 31, 2026 and 2025, we paid an aggregate of approximately $397,075 and approximately $344,905, respectively in cash and benefits in-kind granted to or accrued on behalf of all of our directors and members of senior management for their services, in all capacities, and we did not pay any additional compensation to our directors and members of senior management. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
Executive Compensation Philosophy
Our Board of Directors determines the compensation given to our executive officers in their sole determination. Our Board of Directors reserves the right to pay our executive or any future executives a salary, and/or issue them shares of common stock in consideration for services rendered and/or to award incentive bonuses which are linked to our performance, as well as to the individual executive officer’s performance. This package may also include long-term stock-based compensation to certain executives, which is intended to align the performance of our executives with our long-term business strategies. Additionally, while our Board of Directors has not granted any performance base stock options to date, the Board of Directors reserves the right to grant such options in the future, if the Board in its sole determination believes such grants would be in the best interests of the Company.
| 66 | Page |
Incentive Bonus
The Board of Directors may grant incentive bonuses to our executive officer and/or future executive officers in its sole discretion, if the Board of Directors believes such bonuses are in the Company’s best interest, after analyzing our current business objectives and growth, if any, and the amount of revenue we are able to generate each month, which revenue is a direct result of the actions and ability of such executives.
Long-term, Stock Based Compensation
In order to attract, retain and motivate executive talent necessary to support the Company’s long-term business strategy we may award our executive and any future executives with long-term, stock-based compensation in the future, at the sole discretion of our Board of Directors, which we do not currently have any immediate plans to award.
Pensions
As of October 14, 2026, besides regulatory Central Provident Fund payments for Singapore employees and regulatory Employees Provident Fund payments for Malaysia employees, we had no pension plans or compensatory plans or other arrangements which provide compensation in the event of a termination of employment or a change in our control.
| ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
The following table sets forth information as of October 14, 2026 regarding the ownership of our common stock by each shareholder known by us to be the beneficial owner of more than five percent of our outstanding shares of common stock, each director and all executive officers as a group. Except as otherwise indicated, each of the shareholders has sole voting and investment power with respect to the shares of common stock beneficially owned.
| Name of Beneficial Owner | Common Stock Beneficially Owned and Percentage of Common Stock (1) | |||||||
| Number | Percentage | |||||||
| Directors and Executive Officers | ||||||||
| Low Wai Koon(2) | 8,095,194 | 29.78 | % | |||||
| Chan Kok Wei(3) | 2,063,224 | 7.59 | % | |||||
| Ong Bee Chen(4) | 2,063,224 | 7.59 | % | |||||
| Chin Chee Keat | - | - | ||||||
| Goh Chuan Meng | - | - | ||||||
| Oh Ivan Joon Wern | 630,000 | 2.32 | % | |||||
| All officers and directors as a group | 10,788,418 | 39.69 | % | |||||
| 5% Stockholders | ||||||||
| Tan Soon Hock | 1,759,441 | 6.47 | % | |||||
| WKL Global Limited(2) | 8,095,194 | 29.78 | % | |||||
| Allegro Investment (BVI) Limited(3)(4) | 2,063,224 | 7.59 | % | |||||
| (1) | Applicable percentage ownership is based on 27,180,631 shares of common stock issued and outstanding as of the date of this report. Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. |
| (2) | WKL Global Limited is wholly owned and controlled by Low Wai Koon. |
| (3) | Chan Kok Wei is a director and the spouse of Ong Bee Chen. Chan Kok Wei beneficially holds 100% shareholding of Allegro Investment (BVI) Limited. |
| (4) | Ong Bee Chen is a director and the spouse of Chan Kok Wei. Ong Bee Chen beneficially holds 100% shareholding of Allegro Investment (BVI) Limited. |
| 67 | Page |
| ITEM 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
SEC rules require us to disclose any transaction since the beginning of our last fiscal year or any currently proposed transaction in which we are a participant in which the amount involved exceeded or will exceed $120,000 and in which any related person has or will have a direct or indirect material interest. A related person is any executive officer, director, nominee for director, or holder of 5% or more of our common stock, or an immediate family member of any of those people.
The Company’s related party list and relationship are as follows:
| Related parties | Relationships | |
| Dr. Low Wai Koon | The executive director, chairman and chief executive officer of the Company is also the shareholder and director of WKL Global Limited. | |
| Chan Kok Wei | The executive director, and director of the Company is also the shareholder and director of Allegro Investment (BVI) Limited. | |
| Tan Soon Hock | One of the shareholders of the Company and EvoAir Manufacturing (M) Sdn. Bhd. | |
| Oh Teik Huat | One of the shareholders of the Company and, also one of the shareholders and directors of EvoAir Manufacturing (M) Sdn. Bhd. | |
| Chong Sein Chin | One of the shareholders of the Company and, also one of the directors of WKL Eco Earth Sdn Bhd |
Related party balances as of August 31, 2026 and 2025 are as per table below:
Related party balances
Amount due to shareholders
As of | ||||||||||
| Name of Related Party | Nature | August 31, 2026 | August 31, 2025 | |||||||
| Dr. Low Wai Koon | Shareholder loan/ Expenses paid on behalf | $ | 1,165,486 | $ | 961,173 | |||||
| Chan Kok Wei | Shareholder loan | 1,471,323 | 1,140,202 | |||||||
| Tan Soon Hock | Shareholder loan | 93,150 | 88,773 | |||||||
| Oh Teik Huat | Shareholder loan | 74,520 | 71,018 | |||||||
| Chong Sein Chin | Shareholder loan | 117,678 | - | |||||||
| Total | $ | 2,922,157 | $ | 2,261,166 | ||||||
| 68 | Page |
| ITEM 14. | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
The following table presents the fees for professional audit services of the Company’s annual financial statements for the fiscal years ended August 31, 2026 and August 31, 2025 and fees billed for other services rendered by the auditors during those periods. All services reflected in the following fee table were pre-approved, respectively, in accordance with the policy of the Board.
| August 31, 2026 | August 31, 2025 | |||||||
| Audit fees (1) | $ | 186,000 | $ | 196,000 | ||||
| Audit-related fees | - | |||||||
| Tax fees | 780 | 780 | ||||||
| Total Fees | $ | 186,780 | $ | 196,780 | ||||
Notes:
(1)Audit fees consist of audit and review services, consent and review of documents filed with the SEC for fiscal years ended August 31, 2026 and August 31, 2025, respectively.
In its capacity, the Board pre-approves all audits (including audit-related) and permitted non-audit services to be performed by the independent auditors. The Board will annually approve the scope and fee estimates for the year-end audit to be performed by the Company’s independent auditors for the fiscal year. With respect to other permitted services, the Board pre-approves specific engagements, projects and categories of services on a fiscal year basis, subject to the individual project and annual maximums. To date, the Company has not engaged its auditors to perform any non-audit related services.
| ITEM 15. | EXHIBITS |
The following exhibits are filed as part of this Annual Report.
| * Previously filed |
| 69 | Page |
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| EVOAIR HOLDINGS INC. | ||
| Dated: October 14, 2026 | By: | /s/ Low Wai Koon |
Low Wai Koon, Chairman, President and Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Dated: October 14, 2026 | By: | /s/ Ong Bee Chen |
Ong Bee Chen | ||
| Chief Financial Officer | ||
| 70 | Page |
Exhibit 19.1
EVOAIR HOLDINGS INC.
Statement of Policy Concerning Trading in Company Securities
Adopted September 10, 2025
TABLE OF CONTENTS
| Page No. | |||
| I | Summary of Policy Concerning Trading in Company Securities | 1 | |
| II | The Use of Inside Information in Connection with Trading in Securities | 1 | |
| A | General Rule | 1 | |
| B | Who Does the Policy Apply To? | 2 | |
| C | Other Companies’ Stock | 3 | |
| D | Hedging and Derivatives | 3 | |
| E | Pledging of Securities, Margin Accounts | 3 | |
| F | General Guidelines | 3 | |
| G | Applicability of U.S. Securities Laws to International Transactions | 5 | |
| III | Other Limitations on Securities Transactions | 6 | |
| A | Public Resales – Rule 144 | 6 | |
| B | Private Resales | 7 | |
| C | Restrictions on Purchases of Company Securities | 7 | |
| D | Filing Requirements | 7 | |
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I. SUMMARY OF POLICY CONCERNING TRADING IN COMPANY SECURITIES
It is the policy of EVOAIR HOLDINGS INC. and its subsidiaries (collectively, the “Company”) that it will, without exception, comply with all applicable laws and regulations in conducting its business. Each employee, each executive officer and each director is expected to abide by this policy. When carrying out Company business, employees, executive officers and directors must avoid any activity that violates applicable laws or regulations. In order to avoid even an appearance of impropriety, the Company’s directors, officers and certain other employees are subject to pre-approval requirements and other limitations on their ability to enter into transactions involving the Company’s securities. Although these limitations do not apply to transactions pursuant to written plans for trading securities that comply with Rule 10b5-1 under the Securities Exchange Act of 1934 (the “Exchange Act”), the entry into, amendment or termination of any such written trading plan is subject to pre-approval requirements and other limitations.
II. THE USE OF INSIDE INFORMATION IN CONNECTION WITH TRADING IN SECURITIES
A. General Rule.
The U.S. securities laws regulate the sale and purchase of securities in the interest of protecting the investing public. U.S. securities laws give the Company, its officers and directors, and other employees the responsibility to ensure that information about the Company is not used unlawfully in the purchase and sale of securities.
All employees, executive officers and directors should pay particularly close attention to the laws against trading on “inside” information. These laws are based upon the belief that all persons trading in a company’s securities should have equal access to all “material” information about that company. Information is considered to be “material” if its disclosure would be reasonably likely to affect (1) an investor’s decision to buy or sell the securities of the company to which the information relates, or (2) the market price of that company’s securities. While it is not possible to identify in advance all information that will be deemed to be material, some examples of such information would include the following: earnings; financial results or projections; dividend actions; mergers and acquisitions; capital raising and borrowing activities; major dispositions; major new customers, projects or products; significant advances in product development; new technologies; major personnel changes in management or change in control; expansion into new markets; unusual gains or losses in major operations; major litigation or legal proceedings; granting of stock options; and major sales and marketing changes. When doubt exists, the information should be presumed to be material. If you are unsure whether information of which you are aware is inside information, you should consult with the Company’s Chief Financial Officer. No individuals other than specifically authorized personnel may release material information to the public or respond to inquiries from the media, analysts or others. If you are contacted by the media or by a research analyst seeking information about the Company and if you have not been expressly authorized by the Company’s Chief Financial Officer to provide information to the media or to analysts, you should refer the call to the Chief Financial Officer. On occasion, it may be necessary for legitimate business reasons to disclose inside information to outside persons. Such persons might include investment bankers, lawyers, auditors or other companies seeking to engage in a potential transaction with the Company. In such circumstances, the information should not be conveyed until an express understanding has been reached that such information is not to be used for trading purposes and may not be further disclosed other than for legitimate business reasons. For example, if an employee, an executive officer or a director of a company knows material non-public financial information, that employee, executive officer or director is prohibited from buying or selling shares in the company until the information has been disclosed to the public. This is because the employee, executive officer or director knows information that will probably cause the share price to change, and it would be unfair for the employee or director to have an advantage (knowledge that the share price will change) that the rest of the investing public does not have. In fact, it is more than unfair; it is considered to be fraudulent and illegal. Civil and criminal penalties for this kind of activity are severe.
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The general rule can be stated as follows: It is a violation of federal securities laws for any person to buy or sell securities if he or she is in possession of material inside information. Information is material if there is a substantial likelihood that a reasonable investor would consider it important in making an investment decision. It is inside information if it has not been publicly disclosed in a manner making it available to investors generally on a broad-based non-exclusionary basis. Furthermore, it is illegal for any person in possession of material inside information to provide other people with such information or to recommend that they buy or sell the securities. (This is called “tipping”). In that case, they may both be held liable.
The Securities and Exchange Commission (the “SEC”), the stock exchanges and plaintiffs’ lawyers focus on uncovering insider trading. A breach of the insider trading laws could expose the insider to criminal fines up to three times the profits earned and imprisonment up to ten years, in addition to civil penalties (up to three times of the profits earned), and injunctive actions. In addition, punitive damages may be imposed under applicable state laws. Securities laws also subject controlling persons to civil penalties for illegal insider trading by employees, including employees located outside the United States. Controlling persons include directors, officers, and supervisors. These persons may be subject to fines up to the greater of $1,000,000 or three times profit (or loss avoided) by the insider trader.
Inside information does not belong to the individual directors, officers or other employees who may handle it or otherwise become knowledgeable about it. It is an asset of the Company. For any person to use such information for personal benefit or to disclose it to others outside the Company violates the Company’s interests. More particularly, in connection with trading in the Company’s securities, it is a fraud against members of the investing public and against the Company.
All directors, executive officers and employees of the Company must observe these policies at all times. Your failure to do so will be grounds for internal disciplinary action, up to and including termination of your employment or directorship.
B. Who Does the Policy Apply To?
The prohibition against trading on inside information applies to directors, officers and all other employees, and to other people who gain access to that information. The prohibition applies to both domestic and international employees of the Company and its subsidiaries. Because of their access to confidential information on a regular basis, Company policy subjects its directors and certain employees (the “Window Group”) to additional restrictions on trading in Company securities. The restrictions for the Window Group are discussed in Section F below. In addition, directors and certain employees with inside knowledge of material information may be subject to ad hoc restrictions on trading from time to time.
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C. Other Companies’ Stock.
Employees, executive officers and directors who learn material information about suppliers, customers, or competitors through their work at the Company, should keep it confidential and not buy or sell stock in such companies until the information becomes public. Employees, executive officers and directors should not give tips about such stock.
D. Hedging and Derivatives.
Employees, executive officers and directors are prohibited from engaging in any hedging transactions (including transactions involving options, puts, calls, prepaid variable forward contracts, equity swaps, collars and exchange funds or other derivatives) that are designed to hedge or speculate on any change in the market value of the Company’s equity securities.
Trading in options or other derivatives is generally highly speculative and very risky. People who buy options are betting that the stock price will move rapidly. For that reason, when a person trades in options in his or her employer’s stock, it will arouse suspicion in the eyes of the SEC that the person was trading on the basis of inside information, particularly where the trading occurs before a company announcement or major event. It is difficult for an employee, executive officer or director to prove that he or she did not know about the announcement or event.
If the SEC or the Nasdaq were to notice active options trading by one or more employees, executive officers or directors of the Company prior to an announcement, they would investigate. Such an investigation could be embarrassing to the Company (as well as expensive), and could result in severe penalties and expense for the persons involved. For all of these reasons, the Company prohibits its employees, executive officers and directors from trading in options or other derivatives involving the Company’s stock. This policy does not pertain to employee stock options granted by the Company. Employee stock options cannot be traded.
E. Pledging of Securities, Margin Accounts.
Pledged securities may be sold by the pledgee without the pledgor’s consent under certain conditions. For example, securities held in a margin account may be sold by a broker without the customer’s consent if the customer fails to meet a margin call. Because such a sale may occur at a time when an employee, executive officer or a director has material inside information or is otherwise not permitted to trade in Company securities, the Company prohibits employees, executive officers and directors from pledging Company securities in any circumstance, including by purchasing Company securities on margin or holding Company securities in a margin account.
F. General Guidelines.
The following guidelines should be followed in order to ensure compliance with applicable antifraud laws and with the Company’s policies:
1. Nondisclosure. Material inside information must not be disclosed to anyone, except to persons within the Company whose positions require them to know it. Tipping refers to the transmission of inside information from an insider to another person. Sometimes this involves a deliberate conspiracy in which the tipper passes on information in exchange for a portion of the “tippee’s” illegal trading profits. Even if there is no expectation of profit, however, a tipper can have liability if he or she has reason to know that the information may be misused. Tipping inside information to another person is like putting your life in that person’s hands. So the safest choice is: Don’t tip.
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2. Trading in Company Securities. No employee, executive officer or director should place a purchase or sale order, or recommend that another person place a purchase or sale order in the Company’s securities when he or she has knowledge of material information concerning the Company that has not been disclosed to the public. This includes orders for purchases and sales of stock and convertible securities, including engaging in any “short sales” of the Company’s securities. The exercise of employee stock options is not subject to this policy. However, stock that was acquired upon exercise of a stock option will be treated like any other stock, and may not be sold by an employee who is in possession of material inside information. Any employee, executive officer or director who possesses material inside information should wait until the start of the third business day after the information has been publicly released before trading.
3. Avoid Speculation. Investing in the Company’s common stock provides an opportunity to share in the future growth of the Company. But investment in the Company and sharing in the growth of the Company does not mean short range speculation based on fluctuations in the market. Such activities put the personal gain of the employee, executive officer or director in conflict with the best interests of the Company and its stockholders. Although this policy does not mean that employees, executive officers or directors may never sell shares, the Company encourages employees, executive officers and directors to avoid frequent trading in Company stock. Speculating in Company stock is not part of the Company culture.
4. Trading in Other Securities. No employee, executive officer or director should place a purchase or sale order, or recommend that another person place a purchase or sale order, in the securities of another corporation (such as a supplier, an acquisition target or a competitor), if the employee, executive officer or director learns in the course of his or her employment confidential information about the other corporation that is likely to affect the value of those securities. For example, it would be a violation of the securities laws if an employee, executive officer or director learned through Company sources that the Company intended to purchase assets from a company, and then placed an order to buy or sell stock in that other company because of the likely increase or decrease in the value of its securities.
5. Restrictions on the Window Group. The Window Group consists of (i) directors, executive officers and vice presidents of the Company and their assistants and household members, (ii) subset of employees in the financial reporting, business development or legal groups and (iii) such other persons as may be designated from time to time and informed of such status by the Company’s Chief Financial Officer and general counsel or an officer with similar duties and responsibilities of the Company (the “General Counsel”). The Window Group is subject to the following restrictions on trading in Company securities:
| ● | trading is permitted from the start of the third business day following the release of the Company’s quarterly and annual earnings until the 16th calendar day of the last month of the then current fiscal quarter (the “Window”), subject to the restrictions below; | |
| ● | all trades are subject to prior review; |
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| ● | The Window Group must submit a request for approval in a form set forth in Annex B hereto from the Company’s Chief Financial Officer and General Counsel before making any trade in Company Securities; requests for approval of trades by the Chief Financial Officer and General Counsel should be submitted to the Chief Executive Officer; | |
| ● | no trading is permitted outside the Window except for reasons of exceptional personal hardship and subject to prior review by the Chief Financial Officer and General Counsel; provided that, if one of these individuals wishes to trade outside the Window, it shall be subject to prior review by the other; and | |
| ● | individuals in the Window Group are also subject to the general restrictions on all employees. |
Note that at times Chief Financial Officer and the General Counsel may determine that no trades may occur even during the Window when clearance is requested. No reasons may be provided and the closing of the Window itself may constitute material inside information that should not be communicated.
The foregoing Window Group restrictions do not apply to transactions pursuant to written plans for trading securities that comply with Rule 10b5-1 under the Exchange Act (“10b5-1 Plans”) described in Annex A hereto. However, Window Group members may not enter into, amend or terminate a 10b5-1 Plan relating to Company securities without the prior approval of Chief Financial Officer and the General Counsel, which will only be given during a Window period.
The Company from time to time may also impose an ad hoc trading freeze on all officers, directors, and other members of the Window Group due to significant unannounced corporate developments. These trading freezes may vary in length.
Executive officers, directors or any other member of the Window Group must promptly report to the Chief Financial Officer and General Counsel any transaction in any of the Company’s securities by his or her or any of their respective assistants or family members other than transactions made pursuant to an approved 10b5-1 Plan (as defined below).
In summary, every employee of the Company is subject to trading restrictions when in possession of inside information regarding the Company. In addition, officers, directors, and other members of the Window Group are subject to paragraph 5 above restricting their trading to window periods and requiring pre-clearance.
You must promptly report to the chief financial officer and the general counsel any trading in the company’s securities by anyone or disclosure of inside information by COMPANY personnel that you have reason to believe may violate this Policy or the securities laws of the United States.
G. Applicability of U.S. Securities Laws to International Transactions.
All employees of the Company’ and its subsidiaries are subject to the restrictions on trading in Company securities and the securities of other companies. The U.S. securities laws may be applicable to the securities of the Company’s subsidiaries or affiliates, even if they are located outside the United States. Transactions involving securities of PRC, Hong Kong, Australia, Malaysia, the Middle East, or Singapore subsidiaries or affiliates should be carefully reviewed by counsel for compliance not only with applicable PRC, Hong Kong, Australia, Malaysia, the Middle East, or Singapore law but also for possible application of U.S. securities laws.
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III. OTHER LIMITATIONS ON SECURITIES TRANSACTIONS
A. Public Resales – Rule 144.
The U.S. Securities Act (the “Securities Act”) requires every person who offers or sells a security to register such transaction with the SEC unless an exemption from registration is available. Rule 144 under the Securities Act is the exemption typically relied upon for (i) public resales by any person of “restricted securities” (i.e., unregistered securities acquired in a private offering or sale) and (ii) public resales by directors, officers and other control persons of a company (known as “affiliates”) of any of the Company’s securities, whether restricted or unrestricted.
The exemption in Rule 144 may only be relied upon if certain conditions are met. These conditions vary based upon whether the Company has been subject to the SEC’s reporting requirements for 90 days (and is therefore a “reporting company” for purposes of the rule) and whether the person seeking to sell the securities is an affiliate or not.
1. Holding Period. Restricted securities issued by a reporting company (i.e., a company that has been subject to the SEC’s reporting requirements for at least 90 days) must be held and fully paid for a period of six months prior to their sale. Restricted securities issued by a non-reporting company are subject to a one-year holding period. The holding period requirement does not apply to securities held by affiliates that were acquired either in the open market or in a public offering of securities registered under the Securities Act. Generally, if the seller acquired the securities from someone other than the Company or an affiliate of the Company, the holding period of the person from whom the seller acquired such securities can be “tacked” to the seller’s holding period in determining if the holding period has been satisfied.
2. Current Public Information. Current information about the Company must be publicly available before the sale can be made. The Company’s periodic reports filed with the SEC ordinarily satisfy this requirement. If the seller is not an affiliate of the Company issuing the securities (and has not been an affiliate for at least three months) and one year has passed since the securities were acquired from the issuer or an affiliate of the issuer (whichever is later), the seller can sell the securities without regard to the current public information requirement.
Rule 144 also imposes the following additional conditions on sales by persons who are “affiliates.” A person or entity is considered an “affiliate,” and therefore subject to these additional conditions, if it is currently an affiliate or has been an affiliate within the previous three months:
3. Volume Limitations. The amount of debt securities which can be sold by an affiliate during any three-month period cannot exceed 10% of a tranche (or class when the securities are non-participatory preferred stock), together with all sales of securities of the same tranche sold for the account of the affiliate. The amount of equity securities that can be sold by an affiliate during any three-month period cannot exceed the greater of (i) one percent of the outstanding shares of the class or (ii) the average weekly reported trading volume for shares of the class during the four calendar weeks preceding the time the order to sell is received by the broker or executed directly with a market maker.
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4. Manner of Sale. Equity securities held by affiliates must be sold in unsolicited brokers’ transactions, directly to a market-maker or in riskless principal transactions.
5. Notice of Sale. An affiliate seller must file a notice of the proposed sale with the SEC at the time the order to sell is placed with the broker, unless the amount to be sold neither exceeds 5,000 shares nor involves sale proceeds greater than $50,000. See “Filing Requirements”.
Bona fide gifts are not deemed to involve sales of shares for purposes of Rule 144, so they can be made at any time without limitation on the amount of the gift. Donees who receive restricted securities from an affiliate generally will be subject to the same restrictions under Rule 144 that would have applied to the donor, depending on the circumstances.
B. Private Resales.
Directors and officers also may sell securities in a private transaction without registration. Although there is no statutory provision or SEC rule expressly dealing with private sales, the general view is that such sales can safely be made by affiliates if the party acquiring the securities understands he is acquiring restricted securities that must be held for at least six months (if issued by a reporting company that meets the current public information requirements) or one-year (if issued by a non-reporting company) before the securities will be eligible for resale to the public under Rule 144. Private resales raise certain documentation and other issues and must be reviewed in advance by the Company’s General Counsel.
C. Restrictions on Purchases of Company Securities.
In order to prevent market manipulation, the SEC adopted Regulation M under the U.S. Exchange Act. Regulation M generally restricts the Company or any of its affiliates from buying Company stock, including as part of a share buyback program, in the open market during certain periods while a distribution, such as a public offering, is taking place. You should consult with the Company’s General Counsel, if you desire to make purchases of Company stock during any period that the Company is making conducting an offering or buying shares from the public.
D. Filing Requirements.
1. Schedule 13D and 13G. Section 13(d) of the Exchange Act requires the filing of a statement on Schedule 13D (or on Schedule 13G, in certain limited circumstances) by any person or group which acquires beneficial ownership of more than five percent of a class of equity securities registered under the Exchange Act. The threshold for reporting is met if the stock owned, when coupled with the amount of stock subject to options exercisable within 60 days, exceeds the five percent limit.
A report on Schedule 13D is required to be filed with the SEC and submitted to the Company within ten days after the reporting threshold is reached. If a material change occurs in the facts set forth in the Schedule 13D, such as an increase or decrease of one percent or more in the percentage of stock beneficially owned, an amendment disclosing the change must be filed promptly. A decrease in beneficial ownership to less than five percent is per se material and must be reported.
A limited category of persons (such as banks, broker-dealers and insurance companies) may file on Schedule 13G, which is a much abbreviated version of Schedule 13D, as long as the securities were acquired in the ordinary course of business and not with the purpose or effect of changing or influencing the control of the issuer. A report on Schedule 13G is required to be filed with the SEC and submitted to the Company within 45 days after the end of the calendar year in which the reporting threshold is reached.
A person is deemed the beneficial owner of securities for purposes of Section 13(d) if such person has or shares voting power (i.e., the power to vote or direct the voting of the securities) or dispositive power (i.e., the power to sell or direct the sale of the securities). A person filing a Schedule 13D or 13G may disclaim beneficial ownership of any securities attributed to him or her if he or she believes there is a reasonable basis for doing so.
2. Form 144. As described above under the discussion of Rule 144, an affiliate seller relying on Rule 144 must file a notice of proposed sale with the SEC at the time the order to sell is placed with the broker unless the amount to be sold during any three-month period neither exceeds 5,000 shares nor involves sale proceeds greater than $50,000.
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Annex A
Overview of 10b5-1 Plans
Under Rule 10b5-1, large stockholders, directors, officers and other insiders who regularly possess material nonpublic information (MNPI) but who nonetheless wish to buy or sell stock may establish an affirmative defense to an illegal insider trading charge by adopting a written plan to buy or sell at a time when they are not in possession of MNPI. A 10b5-1 plan typically takes the form of a contract between the insider and his or her broker.
The plan must be entered into at a time when the insider has no MNPI about the company or its securities (even if no trades will occur until after the release of the MNPI). The plan must:
1. specify the amount, price (which may include a limit price) and specific dates of purchases or sales; or
2. include a formula or similar method for determining amount, price and date; or
3. give the broker the exclusive right to determine whether, how and when to make purchases and sales, as long as the broker does so without being aware of MNPI at the time the trades are made.
Under the first two alternatives, the 10b5-1 plan cannot give the broker any discretion as to trade dates. As a result, a plan that requests the broker to sell 1,000 shares per week would have to meet the requirements under the third alternative. On the other hand, under the second alternative, the date may be specified by indicating that trades should be made on any date on which the limit price is hit. The affirmative defense is only available if the trade is in fact made pursuant to the preset terms of the10b5-1 plan (unless the terms are revised at a time when the insider is not aware of any MNPI and could therefore enter into a new plan). Trades are deemed not to have been made pursuant to the plan if the insider later enters into or alters a corresponding or hedging transaction or position with respect to the securities covered by the plan (although hedging transactions could be part of the plan itself).
Guidelines for 10b5-1 Plans
When can a plan be adopted or amended? Because Rule 10b5-1 prohibits an insider from adopting or amending a plan while in possession of MNPI, allegations of insider trading despite the existence of a 10b5-1 plan are likely to focus on what was known at the time of plan adoption or amendment. It is recommended that companies permit an executive to adopt or amend a 10b5-1 plan only when the executive can otherwise buy or sell securities under the company’s insider trading policy, such as during an open window immediately after the announcement of quarterly earnings.
Should a plan impose a waiting period before trading can begin? Because an insider cannot have MNPI when a plan is adopted or amended, Rule 10b5-1 does not require the plan to include a waiting period before trading can begin. And importantly, including a waiting period (even a lengthy delay) will not correct the fatal flaw of adopting or amending a plan while in possession of MNPI. Many companies, however, require 10b5-1 plans to include a waiting period as a matter of risk management, in order to decrease the likelihood of the scrutiny that can occur when an executive’s trading activity suddenly commences before material news is announced. Practice varies as to length (anywhere from 10 days to the next open window), although the rationale for including a waiting period is usually stronger when the period is long enough to be able to say that any information currently in the insider’s possession should either be stale or public by the time trading commences. This has no bearing on the effectiveness of a 10b5-1 plan, but a longer delay can, as a matter of optics, help an insider demonstrate that he or she was not motivated to make trades by nonpublic information available at the time of plan adoption or amendment.
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Should adoption of a plan be announced publicly? Generally speaking, there is no requirement to publicly disclose the adoption, amendment or termination of a 10b5-1 plan, although in some cases public announcement may be advisable due to the identity of the insider, the magnitude of the plan, or other special factors. That said, announcing the adoption of a 10b5-1 plan may be a useful way to head off future public relations issues, since announcing a plan’s adoption prepares the market and should help investors understand the reasons for insider sales when trades are later reported. If a company decides to announce the adoption of a 10b5-1 plan, we do not generally recommend disclosing plan details, other than, perhaps, the aggregate number of shares involved; this is to diminish the ability of market professionals to front-run the insider’s transactions. It is unusual to announce the suspension or termination of a plan.
What else should we consider when amending or modifying a plan? As noted above, an insider may only modify or amend a 10b5-1 plan when he or she is not in possession of MNPI. Even if an insider is not in possession of MNPI at the time of amendment, a pattern of amending or modifying one’s plan raises the question of whether the insider is using the plan as a legitimate tool to diversify his or her risk exposure and monetize assets, or as a way to opportunistically step in and out of the market. Because Rule 10b5-1 provides an affirmative defense but not a safe harbor, insiders and their companies should be aware that the effectiveness of the affirmative defense could be diminished by a pattern of plan amendments and modifications.
Can a plan be terminated or suspended? Unlike amending a plan, a 10b5-1 plan may legally be terminated before its predetermined end date even though the insider is in possession of MNPI (although some brokers’ forms prohibit this as a contractual matter). Because plan sales shortly before the announcement of bad news can generate unwanted attention, an insider may decide to terminate a plan in the face of an impending negative announcement, even though as a technical matter the affirmative defense would be expected to cover the sales. On the other hand, terminating a selling plan before an impending positive announcement may raise the suspicion that the insider is using Rule 10b5-1 as a way to opportunistically time the market, thereby risking the likelihood that his or her future use of the affirmative defense will be successful.
It is generally suggested that plan terminations initiated by an insider take place during an open window, absent special circumstances and approval by the general counsel. It may also make sense for the general counsel to have the ability, but not the responsibility, to terminate the plan. Plans should also allow for mandatory suspension if legally required, for example due to Regulation M or tax reasons.
How long should a plan last? In order to minimize the need for early termination, the term of the plan should be carefully weighed at the outset. An optimal plan term will be long enough to distance the insider, and any current knowledge that he or she may have, from a particular trade but short enough that it will not require termination should the insider’s financial planning strategies change. A short “one-off” 10b5-1 plan can appear to be timed to take advantage of MNPI. On the other hand, the longer the plan term, the greater the likelihood that it will need to be modified or terminated. Most plans tend to have a term of six months to two years.
Should the company pre-clear or review an executive’s plan? It is generally recommended that the company pre-clear or review a proposed 10b5-1 plan, which may provide assurance that the plan complies with best practices. Certain companies disallow the third type of plan (one that gives the broker the right to determine whether, how and when to make purchases) in order to avoid the evidentiary difficulty associated with proving that the executive did not communicate with the broker with respect to trades under the plan. While this is not required, this is a prudent option to consider.
In addition to requiring a 10b-5 plan to be pre-approved by the Company, other limits that are sometimes considered are whether to set a maximum percentage of holdings that can be subject to a 10b5-1 plan, and rules for setting price floors.
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Annex B
Request for Approval to Trade in the Securities of EVOAIR HOLDINGS INC.
To: Chief Financial Officer / General Counsel
| From: |
Print Name
I hereby request approval for myself (or a member of my immediate family or household or a family member whose transactions regarding securities of EVOAIR HOLDINGS INC.. are directed by me or are subject to my influence or control) to execute the following transaction relating to the securities of EVOAIR HOLDINGS INC.
Type of transaction (check one):
| ☐ | PURCHASE |
| ☐ | SALE |
| ☐ | EXERCISE OPTION (AND SELL SHARES) |
| ☐ | OTHER |
Securities involved in transaction: ___________________
Number of securities: _________________________________
Other (please explain): _________________________________
Name of beneficial owner if other than yourself: _________________________________
Relationship of beneficial owner to yourself: _________________________________
Signature: _________________________________ Date: _________________________________
This Authorization is valid until the earlier of thirty (30) calendar days after the date of this Approval or until the commencement of a “blackout” period.
Approved by: _______________________
Name: ______________________________
Date: ____________________________ Time: __________________________________
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Exhibit 31.1
Certification of Chief Executive Officer
pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
I, Low Wai Koon, certify that:
1. I have reviewed this Annual Report on Form 10-K of EvoAir 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. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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.
| October 14, 2026 | By: | /s/ Low Wai Koon |
| Name: | Low Wai Koon | |
| Title: | Chairman, President and Chief Executive Officer |
Exhibit 31.2
Certification of Chief Financial Officer
pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).
I, Ong Bee Chen, certify that:
1. I have reviewed this Annual Report on Form 10-K of EvoAir 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. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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.
| October 14, 2026 | By: | /s/ Ong Bee Chen |
| Name: | Ong Bee Chen | |
| Title: | Chief Financial Officer |
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of EvoAir Holdings Inc. (the “Company”) on Form 10-K for the year ended August 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Low Wai Koon, Chairman, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report 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.
| October 14, 2026 | By: | /s/ Low Wai Koon |
| Name: | Low Wai Koon | |
| Title: | Chairman, President and Chief Executive Officer |
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of EvoAir Holdings Inc. (the “Company”) on Form 10-K for the year ended August 31, 2026, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ong Bee Chen, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report 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.
| October 14, 2026 | By: | /s/ Ong Bee Chen |
| Name: | Ong Bee Chen | |
| Title: | Chief Financial Officer |