EVOH

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.
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 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.
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.
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.
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.
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.
Risks Related to our Common Stock and this Offering Volatility in our shares price may subject us to securities litigation.
We may never be able to pay dividends and are unlikely to do so.
“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.
We have only one factory that can manufacture a specific product or product line.

Gone since FY2025

RISK FACTORS Risks Related to Our Business and Industry 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.
We nonetheless rely on a combination of patents, trademarks, nondisclosure agreements, customer and supplier agreements, license agreements, information technology security systems, internal controls and compliance systems and other measures to protect our intellectual property.
Low”), as our founder, chief executive officer, chief operating officer and chairman of the board, the loss of who may result in a severe impediment to our business, results of operation and financial condition.
According to Economy Outlook 2025 from Ministry of Finance Malaysia, the global economy remains engulfed in a complex and challenging environment.
While inflation is gradually receding and monetary policy begins to loosen, significant uncertainties persist.
The recovery, while progressing, is fraught with risks from global instabilities and external shocks, raising concerns that underlying economic vulnerabilities may deepen, despite the emerging signs of temporary relief.
Unfolding of geopolitical uncertainties in Europe and the Middle East, may also threaten economic equilibrium.
Headline inflation, as measured by the Consumer Price Index (“CPI”), eased to an average of 1.8% in the first eight months of 2024, down from 2.8% over the same period in 2023, following favourable cost environment and sustained demand.
Headline inflation is projected to remain manageable for 2025 and is expected to range between 1.5% and 2.5%, with inflation projected close to its long-term average of approximately 2%.(source: Economic Outlook 2025, 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.
The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that: ● any of our pending patent applications, if issued, will include claims having a scope sufficient to protect our products; ● any of our pending patent 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.
Risks Related to our Common Stock and this Offering There may not be sufficient liquidity in the market for our securities in order for investors to sell their securities.
There is currently only a limited public market for our ordinary share, which is listed on the OTC Pink Limited Market and there can be no assurance that a trading market will develop further or be maintained in the future.
Volatility in our shares price may subject us to securities litigation.
We have not paid dividends in the past and do not expect to pay dividends in the foreseeable future and any return on investment may be limited to the value of our stock.
In the event that we are still considered a “smaller reporting company,” at such time as we cease being an “emerging growth company,” we will be required to provide additional disclosure in our SEC filings.
However, similar to an “emerging growth companies”, “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.
We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.
We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from requirements applicable to other public companies that are not emerging growth companies, including, most significantly, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act for so long as we remain an emerging growth company.
As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have access to certain information they may deem important.
The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards.
We do not plan to “opt out” of such exemptions afforded to an emerging growth company.
As a result of this election, our financial statements may not be comparable to those of companies that comply with public company effective dates.
We have only one factory and another assembly line that can manufacture a specific product or product line.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2025 ↗, FY2026 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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