{"url_path":"/sec/cdtg/10-k/2026/item-19","section_key":"item-19","section_title":"Item 19 EXHIBITS**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1793895/0001731122-26-000740-index.html","accession_number":"0001731122-26-000740","cik":"0001793895","ticker":"CDTG","issuer_name":"CDT Environmental Technology Investment Holdings Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1793895/0001731122-26-000740-index.html","primary_entity_key":"0001793895","primary_entity_name":"CDT Environmental Technology Investment Holdings Ltd"},"word_count":19065,"has_tables":true,"body_markdown":"**ITEM 19. EXHIBITS**\n\n \n\n**EXHIBIT INDEX**\n\n \n\n**Exhibit\nNumber**\n \n**Description of Exhibit**\n\n1.1†\n \n[Second Amended and Restated Memorandum and Articles of Association (incorporated by reference to Exhibit 3.1 to our Form 6-K (File No. 001-42007) filed with the Securities and Exchange Commission on September 29, 2025)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000214/e2395_ex3-2.htm)\n\n2.1†\n \n[Specimen certificate evidencing ordinary shares (incorporated by reference to Exhibit 4.1 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex4-1.htm)\n\n2.2†\n \n[Representative’s Warrant, dated April 22, 2024, issued to WestPark Capital, Inc. (incorporated by reference to Exhibit 4.1 to the Report on Form 6-K (File No. 001-42007) filed with the Securities and Exchange Commission\non April 23, 2024)](http://www.sec.gov/Archives/edgar/data/1793895/000173112224000660/e5609_ex4-1.htm)\n\n2.3*\n \n\n[Description of Securities](e7642_ex2-3.htm)\n\n4.1†\n \n[Indemnification Escrow Agreement, dated April 17, 2024, by and among the Company, WestPark Capital, Inc. and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.1 to the Report on Form 6-K filed with the Securities and Exchange Commission on April 23, 2024)](http://www.sec.gov/Archives/edgar/data/1793895/000173112224000660/e5609_ex10-1.htm)\n\n4.2†\n \n[Form of Indemnification Agreement between the registrant and its officers and directors (incorporated by reference to Exhibit 10.2 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-2.htm)\n\n4.3†\n \n[Form of Director Agreement between the registrant and its directors (incorporated by reference to Exhibit 10.3 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-3.htm)\n\n4.4†\n \n[Form of Independent Director Agreement between the registrant and certain of its independent directors(incorporated by reference to Exhibit 10.4 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-4.htm)\n\n4.5†\n \n[Form of Independent Director Agreement between the registrant and its U.S. independent director(incorporated by reference to Exhibit 10.5 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-5.htm)\n\n4.6†\n \n[Form of Employment Agreement between the registrant and its officers (incorporated by reference to Exhibit 10.6 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-6.htm)\n\n \n\n109\n\n \n\n \n\n4.7†\n \n[Unofficial\nEnglish Translation of Shenzhen Housing Lease, dated as of October 1, 2024, by and between Shenzhen CDT Environmental Technology\nCo., Ltd. and Shenzhen Science and Technology Industrial Park (Group) Co., Ltd. (incorporated by reference to Exhibit 4.7 of our Annual Report on Form\n20-F for the fiscal year ended December 31, 2025 (File No. 001-42007) as filed with the Securities and Exchange Commission on May 15,\n2025)](http://www.sec.gov/Archives/edgar/data/1793895/000173112225000746/e6592_ex4-7.htm)\n\n4.8†\n \n[Employment Agreement, dated as of September 1, 2019, by and between Yunwu Li and the registrant (incorporated by reference to Exhibit 10.9 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-9.htm)\n\n4.9†\n \n\n[Employment Agreement, dated as of September 1, 2019, by and between Yuntao Guan and the registrant (incorporated by reference to Exhibit 10.12 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-12.htm)\n\n4.10†\n \n\n[Employment Agreement, dated as of November 20, 2019, by and between Tiefeng Wang and the registrant (incorporated by reference to Exhibit 10.13 of our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on January 15, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000083/e2362_ex10-13.htm)\n\n4.11*\n \n\n[Employment Agreement, dated as of May 1, 2025, by and between Xiong Zuhong and the registrant](e7642_ex4-11.htm)\n\n4.12†\n \n[Unofficial English Translation of Contract for the Subcontracting of the Inland River Water Environmental Comprehensive Improvement PPP Project in Lianjiang County Urban Area, dated as of January 9, 2023, by and between Longyuan Construction Group Co., Ltd. and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.19 of Amendment No. 11 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on November 20, 2023)](http://www.sec.gov/Archives/edgar/data/1793895/000173112223002166/e5231_ex10-19.htm)\n\n4.13†\n \n[Unofficial English Translation of Zhongshan City Comprehensive Treatment Project Contract for Non-up-to-standard Water Body, dated as of April 5, 2021, by and between Shenzhen Beier Environmental Protection Technology Co., Ltd and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.14 of Amendment No. 5 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on March 1, 2022)](http://www.sec.gov/Archives/edgar/data/1793895/000173112222000335/e3531_ex10-14.htm)\n\n4.14†\n \n[Unofficial English Translation of Drainage Pipe Network Reconstruction Project (EPC) Project in Guankouhouxi Area Trenchless Pipeline Repair and Sporadic Works, dated as of September 30, 2021, by and between CCCC Shanghai Dredging Co., Ltd. and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.15 of Amendment No. 5 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on March 1, 2022)](http://www.sec.gov/Archives/edgar/data/1793895/000173112222000335/e3531_ex10-15.htm)\n\n4.15†\n \n[Unofficial English Translation of Neitianxi Wuxing Community Sewage Treatment Station and Storage Tank Project (Storage Tank) Equipment Procurement, Installation and Auxiliary Material Procurement, Technical Service and Construction Contract, dated as of October 15, 2021, by and between Zhongjian Xinhongding Environment Group Co., Ltd. and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.16 of Amendment No. 5 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on March 1, 2022)](http://www.sec.gov/Archives/edgar/data/1793895/000173112222000335/e3531_ex10-16.htm)\n\n4.16†\n \n[Unofficial English Translation of China Construction Eighth Engineering Bureau Co., Ltd. Wuyishan City Rural Domestic Wastewater Upgrading and Treatment Integrated Design, Procurement, Construction, and Operation Project for the Years 2021 to 2025, dated as of September 28, 2022, by and between China Construction Eighth Engineering Bureau Co., Ltd. and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.17 of Amendment No. 11 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on November 20, 2023)](http://www.sec.gov/Archives/edgar/data/1793895/000173112223002166/e5231_ex10-17.htm)\n\n4.17†\n \n[Unofficial English Translation of China Construction Eighth Engineering Bureau Co., Ltd. Wuyishan City Rural Domestic Wastewater Upgrading and Treatment Integrated Design, Procurement, Construction, and Operation Project for the Years 2021 to 2025, dated as of July 21, 2023, by and between China Construction Eighth Engineering Bureau Co., Ltd. and Shenzhen CDT Environmental Technology Co., Ltd. (incorporated by reference to Exhibit 10.18 of Amendment No. 11 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on November 20, 2023)](http://www.sec.gov/Archives/edgar/data/1793895/000173112223002166/e5231_ex10-18.htm)\n\n \n\n110\n\n \n\n \n\n4.18†\n \n[Form of Share Subscription Agreement (incorporated by reference to Exhibit 10.1 to our Form 6-K (File No. 001-42007) filed with the Securities and Exchange Commission on January 5, 2026)](http://www.sec.gov/Archives/edgar/data/1793895/000173112226000010/e7130_ex10-1.htm)\n\n4.19†\n \n[Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.20 to our Registration Statement on Form F-1 (File No. 333-293986) filed with the Securities and Exchange Commission on March 4, 2026) ](http://www.sec.gov/Archives/edgar/data/1793895/000173112226000330/e7383_ex10-20.htm)\n\n8.1*\n \n[List of Subsidiaries](e7642_ex8-1.htm)\n\n11.1†\n \n[Code of Business Conduct and Ethics (incorporated by reference to Exhibit 99.1 of Amendment No. 1 to our Registration Statement on Form F-1 (File No. 333-252127) filed with the Securities and Exchange Commission on February 12, 2021)](http://www.sec.gov/Archives/edgar/data/1793895/000173112221000214/e2395_ex99-1.htm)\n\n11.2†\n \n[Insider Trading Policy (incorporated by reference to Exhibit 11.2 to our Annual Report on Form 20-F (File No. 001.42007) filed with the Securities and Exchange Commission on May 15, 2025)](http://www.sec.gov/Archives/edgar/data/1793895/000173112225000746/e6592_ex11-2.htm)\n\n12.1*\n \n[CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](e7642_ex12-1.htm)\n\n12.2*\n \n[CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](e7642_ex12-2.htm)\n\n13.1**\n \n[CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](e7642_ex13-1.htm)\n\n13.2**\n \n[CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](e7642_ex13-2.htm)\n\n15.1†\n \n[Letter of Wei, Wei & Co., LLP, dated April 26, 2024 (incorporated by reference to Exhibit 16.1 to the Report on Form 6-K (File No. 001-42007) filed with the Securities and Exchange Commission on April 26, 2024)](http://www.sec.gov/Archives/edgar/data/1793895/000173112224000698/e5622_ex16-1.htm)\n\n15.2*\n \n[Consent of Enrome LLP ](e7642_ex15-2.htm)\n\n97.1†\n \n\n[Incentive-Based Compensation Recovery Policy (incorporated by reference to Exhibit 8.1 to our Annual Report on Form 20-F (File No. 001-42007) filed with the Securities and Exchange Commission on May 15, 2024)](http://www.sec.gov/Archives/edgar/data/1793895/000173112224000803/e5660_ex8-1.htm)\n\n101.INS**\n \nInline XBRL Instance Document\n\n101.SCH**\n \nInline XBRL Taxonomy Extension Schema Document\n\n101.CAL**\n \nInline XBRL Taxonomy Extension Calculation Linkbase Document\n\n101.DEF**\n \nInline XBRL Taxonomy Extension Definition Linkbase Document\n\n101.LAB**\n \nInline XBRL Taxonomy Extension Label Linkbase Document\n\n101.PRE**\n \nInline XBRL Taxonomy Extension Presentation Linkbase Document\n\n104**\n \nCover Page Interactive Data File\n\n \n\n†\nPreviously filed.\n\n*\nFiled herewith\n\n**\nFurnished herewith.\n\n  \n\n111\n\n \n\n \n\n**SIGNATURES**\n\n \n\nThe registrant hereby certifies that it meets all\nof the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its\nbehalf.\n\n \n\n \n**CDT Environmental Technology Investment Holdings Limited**\n \n\n \n \n \n\nBy:\n/s/ Yunwu Li\n \n\n \nYunwu Li\n \n\n \nChief Executive Officer and Chairman of the Board of Directors\n \n\n \n\nDate: May 15, 2026\n\n \n\n112\n\n \n\n \n\n**CDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS\nLIMITED AND SUBSIDIARIES**\n\n \n\n**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**\n\n \n\n****\n\n \n \n**page** \n\n[Report of Independent Registered Public Accounting Firm (Enrome LLP (PCAOB ID # 6907, Singapore)](#a_037)\n \nF-2\n\n[Consolidated Balance Sheets as of December 31, 2025 and December 31, 2024](#a_038)\n \nF-3\n\n[Consolidated Statements of Income and Comprehensive Income for the Years Ended December 31, 2025,\n2024, and 2023](#a_039)\n \nF-4\n\n[Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended December 31, 2025, 2024, and 2023](#a_040)\n \nF-5\n\n[Consolidated Statements of Cash Flows for the Years Ended December 31, 2025, 2024, and 2023](#a_041)\n \nF-6\n\n[Notes to Consolidated Financial Statements](#a_042)\n \nF-7\n\n \n\nF-1\n\n \n\n \n\n**Report of\nIndependent Registered Public Accounting Firm**\n\n \n\nTo the Board of Directors and Shareholders\nof\n\nCDT Environmental Technology Investment Holdings Limited\n\n \n\n**Opinion on the Financial Statements**\n\n \n\nWe have audited the accompanying consolidated balance\nsheets of CDT Environmental Technology Investment Holdings Limited and its subsidiaries (the\n“Company”) as of December 31, 2025 and 2024, the related consolidated statements of income and comprehensive income, change\nin shareholders’ equity and cash flows for the years ended December 31, 2025, 2024 and 2023, and the related notes (collectively\nreferred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly,\nin all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operation and\ncash flows for the years ended December 31, 2025, 2024 and 2023, in conformity with accounting principles generally accepted in the United\nStates of America (“U.S. GAAP”).\n\n \n\n**Material Uncertainty Related to Going Concern**\n\n \n\nThe accompanying consolidated financial statements\nhave been prepared assuming that the Company will continue as a going concern. As more fully described in Note 2 to consolidated financial\nstatements, the Company had incurred net losses of $10.37 million and had negative cash flows from operating activities of $1.49 million\nfor the year ended December 31, 2025. These conditions raise substantial doubt about the Company’s ability to continue as a going\nconcern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not\ninclude any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.\n\n  \n\n**Basis for Opinion**\n\n \n\nThese consolidated financial statements\nare the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated\nfinancial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board\n(United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal\nsecurities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe conducted our audits in accordance\nwith the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether\nthe consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to\nhave, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required\nto obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness\nof the Company’s internal control over financial reporting. Accordingly, we express no such opinion.\n\n \n\nOur audits included performing procedures\nto assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures\nthat respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the\nconsolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by\nmanagement, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides\na reasonable basis for our opinion.\n\n \n\n/s/ Enrome LLP\n\n \n\nWe have served as the Company’s\nauditor since 2024.\n\n \n\nSingapore\n\n \n\nMay 15, 2026\n\n \n\nF-2\n\n \n\n \n\nCDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\nAND SUBSIDIARIES\n\nCONSOLIDATED BALANCE SHEETS\n\n \n\n \n \n \n \n \n \n \n \n \n\n \n \nDecember 31,\n \nDecember 31,\n\n \n \n2025\n \n2024\n\nASSETS\n \n \n \n \n \n \n \n \n\nCURRENT ASSETS\n \n \n \n \n \n \n \n \n\nCash\n \n$\n66,686\n \n \n$\n124,379\n \n\nAccounts receivable, net\n \n \n44,128,933\n \n \n \n45,188,231\n \n\nOther receivables, net\n \n \n189,800\n \n \n \n424,313\n \n\nOther receivables - related parties\n \n \n124,752\n \n \n \n123,532\n \n\nContract assets\n \n \n39,309,995\n \n \n \n31,438,860\n \n\nPrepayments and other current assets, net\n \n \n497,181\n \n \n \n405,136\n \n\nTotal current assets\n \n \n84,317,347\n \n \n \n77,704,451\n \n\n \n \n \n \n \n \n \n \n \n\nOTHER ASSETS\n \n \n \n \n \n \n \n \n\nProperty and equipment, net\n \n \n1,087,057\n \n \n \n1,291,322\n \n\nIntangible assets, net\n \n \n—\n \n \n \n5,628\n \n\nDeferred tax assets, net\n \n \n3,499,649\n \n \n \n1,208,689\n \n\nContract assets, noncurrent\n \n \n—\n \n \n \n8,550,498\n \n\nEscrow\n \n \n—\n \n \n \n600,000\n \n\nTotal other assets\n \n \n4,586,706\n \n \n \n11,656,137\n \n\n \n \n \n \n \n \n \n \n \n\nTotal assets\n \n$\n88,904,053\n \n \n$\n89,360,588\n \n\n \n \n \n \n \n \n \n \n \n\nLIABILITIES AND SHAREHOLDERS’ EQUITY\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n\nCURRENT LIABILITIES\n \n \n \n \n \n \n \n \n\nAccounts payable\n \n$\n39,221,439\n \n \n$\n36,347,893\n \n\nShort-term loans - banks\n \n \n1,153,654\n \n \n \n1,814,551\n \n\nShort-term loans - third parties\n \n \n2,057,311\n \n \n \n836,765\n \n\nShort-term loans - related parties\n \n \n2,560,675\n \n \n \n2,794,894\n \n\nOther payables and accrued liabilities\n \n \n2,298,833\n \n \n \n2,220,896\n \n\nOther payables - related party\n \n \n256,348\n \n \n \n256,863\n \n\nContract liabilities\n \n \n28,809\n \n \n \n28,026\n \n\nTaxes payable\n \n \n10,329,598\n \n \n \n7,408,674\n \n\nTotal current liabilities\n \n \n57,906,667\n \n \n \n51,708,562\n \n\n \n \n \n \n \n \n \n \n \n\nOTHER LIABILITIES\n \n \n \n \n \n \n \n \n\nLong-term loan - bank\n \n \n357,495\n \n \n \n213,969\n \n\nTotal other liabilities\n \n \n357,495\n \n \n \n213,969\n \n\n \n \n \n \n \n \n \n \n \n\nTotal liabilities\n \n \n58,264,162\n \n \n \n51,922,531\n \n\n \n \n \n \n \n \n \n \n \n\nCOMMITMENTS AND CONTINGENCIES\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n\nSHAREHOLDERS’ EQUITY\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n\nClass A Ordinary Shares, $0.0025 par value, 94,000,000 shares authorized, 13,525,000 and 10,825,000 shares issued and outstanding as of December 31, 2025 and 2024, respectively\n \n \n33,813\n \n \n \n27,063\n \n\n Class B Ordinary Shares, $0.0025 par value, 6,000,000 shares authorized,\nnone issued and outstanding as of December 31, 2025 and 2024\n \n \n—\n \n \n \n—\n \n\nAdditional paid-in capital\n \n \n14,316,883\n \n \n \n11,578,633\n \n\nStatutory reserves\n \n \n3,433,589\n \n \n \n3,433,589\n \n\nRetained earnings\n \n \n14,258,161\n \n \n \n24,455,403\n \n\nAccumulated other comprehensive loss\n \n \n(1,429,733\n)\n \n \n(2,210,909\n)\n\nTotal CDT Environmental Technology Investment Holdings Limited shareholders’ equity\n \n \n30,612,713\n \n \n \n37,283,779\n \n\n \n \n \n \n \n \n \n \n \n\nNoncontrolling interests\n \n \n27,178\n \n \n \n154,278\n \n\nTotal shareholders’ equity\n \n \n30,639,891\n \n \n \n37,438,057\n \n\n \n \n \n \n \n \n \n \n \n\nTotal liabilities and shareholders’ equity\n \n$\n88,904,053\n \n \n$\n89,360,588\n \n\n \n\nThe accompanying notes are an integral part of these\nconsolidated financial statements.\n\n \n\nF-3\n\n \n\n \n\nCDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\nAND SUBSIDIARIES\n\nCONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE\nINCOME\n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the Years Ended\n\n \n \nDecember 31,\n\n \n \n2025\n \n2024\n \n2023\n\n \n \n \n \n \n \n \n\nREVENUES\n \n \n \n \n \n \n \n \n \n \n \n \n\nSewage treatment systems\n \n$\n17,279,031\n \n \n$\n28,417,150\n \n \n$\n32,267,593\n \n\nSewage treatment services and others\n \n \n946,788\n \n \n \n1,348,055\n \n \n \n1,942,326\n \n\nTotal revenues\n \n \n18,225,819\n \n \n \n29,765,205\n \n \n \n34,209,919\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCOST OF REVENUES\n \n \n \n \n \n \n \n \n \n \n \n \n\nSewage treatment systems\n \n \n10,074,628\n \n \n \n17,779,226\n \n \n \n21,630,216\n \n\nSewage treatment services and others\n \n \n592,234\n \n \n \n739,502\n \n \n \n1,194,817\n \n\nTotal cost of revenues\n \n \n10,666,862\n \n \n \n18,518,728\n \n \n \n22,825,033\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nGROSS PROFIT\n \n \n7,558,957\n \n \n \n11,246,477\n \n \n \n11,384,886\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nOPERATING EXPENSES:\n \n \n \n \n \n \n \n \n \n \n \n \n\nSelling\n \n \n162,602\n \n \n \n108,637\n \n \n \n106,147\n \n\nGeneral and administrative\n \n \n2,160,434\n \n \n \n2,164,457\n \n \n \n2,674,519\n \n\nResearch and development\n \n \n47,602\n \n \n \n61,786\n \n \n \n80,948\n \n\nShare-based compensation\n \n \n2,145,000\n \n \n \n454,250\n \n \n \n—\n \n\nProvision for (Recovery from) credit loss, net\n \n \n14,694,723\n \n \n \n6,459,240\n \n \n \n(88,221\n)\n\nTotal operating expenses\n \n \n19,210,361\n \n \n \n9,248,370\n \n \n \n2,773,393\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n(LOSS) INCOME FROM OPERATIONS\n \n \n(11,651,404\n)\n \n \n1,998,107\n \n \n \n8,611,493\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nOTHER INCOME (EXPENSE)\n \n \n \n \n \n \n \n \n \n \n \n \n\nInterest income\n \n \n105\n \n \n \n471\n \n \n \n15,510\n \n\nInterest expense\n \n \n(91,446\n)\n \n \n(136,757\n)\n \n \n(106,130\n)\n\nOther income (expense), net\n \n \n110,637\n \n \n \n6,504\n \n \n \n(92,939\n)\n\nTotal other income (expense), net\n \n \n19,296\n \n \n \n(129,782\n)\n \n \n(183,559\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n(LOSS) INCOME BEFORE INCOME TAXES\n \n \n(11,632,108\n)\n \n \n1,868,325\n \n \n \n8,427,934\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nINCOME TAXES (BENEFIT) EXPENSE\n \n \n(1,266,021\n)\n \n \n462,043\n \n \n \n1,403,880\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNET (LOSS) INCOME\n \n \n(10,366,087\n)\n \n \n1,406,282\n \n \n \n7,024,054\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nLess: net loss attributable to noncontrolling interest\n \n \n(168,845\n)\n \n \n(46,909\n)\n \n \n(393,652\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNET(LOSS) INCOME ATTRIBUTABLE TO SHAREHOLDERS OF CDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\n \n$\n(10,197,242\n)\n \n$\n1,453,191\n \n \n$\n7,417,706\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNET (LOSS) INCOME\n \n \n(10,366,087\n)\n \n \n1,406,282\n \n \n \n7,024,054\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nFOREIGN CURRENCY TRANSLATION ADJUSTMENT\n \n \n789,332\n \n \n \n(204,383\n)\n \n \n(497,722\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nTOTAL COMPREHENSIVE (LOSS) INCOME\n \n \n(9,576,755\n)\n \n \n1,201,899\n \n \n \n6,526,332\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nLess: Comprehensive loss attributable to noncontrolling interest\n \n \n(160,689\n)\n \n \n(49,804\n)\n \n \n(372,574\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCOMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO SHAREHOLDERS OF CDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\n \n$\n(9,416,066\n)\n \n$\n1,251,703\n \n \n$\n6,898,906\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nWEIGHTED AVERAGE NUMBER OF ORDINARY SHARES\n \n \n \n \n \n \n \n \n \n \n \n \n\nBasic and diluted\n \n \n12,141,807\n \n \n \n10,320,628\n \n \n \n9,200,000\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n(LOSS) EARNINGS PER SHARE\n \n \n \n \n \n \n \n \n \n \n \n \n\nBasic and diluted\n \n$\n(0.84\n)\n \n$\n0.14\n \n \n$\n0.81\n \n\n \n\nThe accompanying notes are an integral part of these\nconsolidated financial statements.\n\n \n\nF-4\n\n \n\n \n\nCDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\nAND SUBSIDIARIES\n\nCONSOLIDATED STATEMENTS OF CHANGE IN SHAREHOLDERS’\nEQUITY\n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n \nAccumulated\n \n \n \n \n\n \n \n \n \n \n \nAdditional\n \nRetained earnings\n \nother\n \n \n \nTotal\n\n \n \nOrdinary shares\n \npaid-in\n \nStatutory\n \n \n \ncomprehensive\n \nNoncontrolling\n \nshareholders’\n\n \n \nShares\n \nPar value\n \ncapital\n \nreserves\n \nUnrestricted\n \nloss\n \ninterest\n \nequity\n\n BALANCE, January 1, 2023\n \n \n9,200,000\n \n \n \n23,000\n \n \n$\n7,453,265\n \n \n$\n2,396,539\n \n \n$\n16,621,556\n \n \n$\n(1,490,621\n)\n \n$\n556,172\n \n \n \n25,559,911\n \n\nNet income attributable to shareholders of CDT Environmental Technology Investment Holdings Limited\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n7,417,706\n \n \n \n—\n \n \n \n—\n \n \n \n7,417,706\n \n\nNet loss attributable to noncontrolling interests\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(393,652\n)\n \n \n(393,652\n)\n\nStatutory reserve\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n796,316\n \n \n \n(796,316\n)\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\nForeign currency translation adjustments\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(518,800\n)\n \n \n21,078\n \n \n \n(497,722\n)\n\nBALANCE, December 31, 2023\n \n \n9,200,000\n \n \n \n23,000\n \n \n \n7,453,265\n \n \n \n3,192,855\n \n \n \n23,242,946\n \n \n \n(2,009,421\n)\n \n \n183,598\n \n \n \n32,086,243\n \n\nNet income attributable to shareholders of CDT Environmental Technology Investment Holdings Limited\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n1,453,191\n \n \n \n—\n \n \n \n—\n \n \n \n1,453,191\n \n\nNet loss attributable to noncontrolling interests\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(46,909\n)\n \n \n(46,909\n)\n\nIssuance of ordinary shares and warrants in initial public offerings, net of issuance costs\n \n \n1,500,000\n \n \n \n3,750\n \n \n \n3,671,431\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n3,675,181\n \n\nShare-based compensation to third parties\n \n \n125,000\n \n \n \n313\n \n \n \n453,937\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n454,250\n \n\nStatutory reserve\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n240,734\n \n \n \n(240,734\n)\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\nDerecognition of noncontrolling interest upon disposal of subsidiaries\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n20,484\n \n \n \n20,484\n \n\nForeign currency translation adjustments\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(201,488\n)\n \n \n(2,895\n)\n \n \n(204,383\n)\n\nBALANCE, December 31, 2024\n \n \n10,825,000\n \n \n \n27,063\n \n \n \n11,578,633\n \n \n \n3,433,589\n \n \n \n24,455,403\n \n \n \n(2,210,909\n)\n \n \n154,278\n \n \n \n37,438,057\n \n\nNet loss attributable to shareholders of CDT Environmental Technology Investment Holdings Limited\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(10,197,242\n)\n \n \n—\n \n \n \n—\n \n \n \n(10,197,242\n)\n\nNet loss attributable to noncontrolling interests\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n(168,845\n)\n \n \n(168,845\n)\n\nIssuance of ordinary shares from share subscription agreement\n \n \n1,200,000\n \n \n \n3,000\n \n \n \n597,000\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n600,000\n \n\nShare-based compensation\n \n \n1,500,000\n \n \n \n3,750\n \n \n \n2,141,250\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n2,145,000\n \n\nDerecognition of noncontrolling interest upon disposal of subsidiaries\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n33,589\n \n \n \n33,589\n \n\nForeign currency translation adjustments\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n781,176\n \n \n \n8,156\n \n \n \n789,332\n \n\nBALANCE, December 31, 2025\n \n \n13,525,000\n \n \n \n33,813\n \n \n \n14,316,883\n \n \n \n3,433,589\n \n \n \n14,258,161\n \n \n \n(1,429,733\n)\n \n \n21,178\n \n \n \n30,639,891\n \n\n \n\nThe accompanying notes are an integral part of these\nconsolidated financial statements.\n\n \n\nF-5\n\n \n\n \n\nCDT ENVIRONMENTAL TECHNOLOGY INVESTMENT HOLDINGS LIMITED\nAND SUBSIDIARIES\n\nCONSOLIDATED STATEMENTS OF CASH FLOWS\n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the Years Ended\n\n \n \nDecember 31,\n\n \n \n2025\n \n2024\n \n2023\n\nCASH FLOWS FROM OPERATING ACTIVITIES:\n \n \n \n \n \n \n \n \n \n \n \n \n\nNet (loss) income\n \n$\n(10,366,087\n)\n \n$\n1,406,282\n \n \n$\n7,024,054\n \n\nAdjustments to reconcile net (loss) income to net cash used in operating activities:\n \n \n \n \n \n \n \n \n \n \n \n \n\nDepreciation\n \n \n235,099\n \n \n \n263,109\n \n \n \n331,336\n \n\nAmortization of intangible assets\n \n \n5,629\n \n \n \n10,603\n \n \n \n11,355\n \n\nAmortization of right-of-use assets\n \n \n—\n \n \n \n70,975\n \n \n \n95,695\n \n\nProvision for (Recovery from) credit loss, net\n \n \n14,694,723\n \n \n \n6,459,240\n \n \n \n(88,221\n)\n\nGain on disposal of subsidiaries\n \n \n(34,468\n)\n \n \n(132,844\n)\n \n \n—\n \n\nLoss on disposal of equipment\n \n \n962\n \n \n \n60,895\n \n \n \n119,069\n \n\nDeferred tax (benefit) expense\n \n \n(2,196,153\n)\n \n \n(966,395\n)\n \n \n46,745\n \n\nShare-based compensation\n \n \n2,145,000\n \n \n \n454,250\n \n \n \n—\n \n\nChange in operating assets and liabilities\n \n \n \n \n \n \n \n \n \n \n \n \n\nAccounts receivable\n \n \n(12,081,146\n)\n \n \n(23,087,580\n)\n \n \n(9,240,652\n)\n\nOther receivables\n \n \n(45,829\n)\n \n \n(613,173\n)\n \n \n(247,609\n)\n\nContract assets\n \n \n1,747,586\n \n \n \n(1,409,441\n)\n \n \n(13,579,514\n)\n\nContract costs\n \n \n—\n \n \n \n—\n \n \n \n889,180\n \n\nDeferred costs\n \n \n—\n \n \n \n—\n \n \n \n45,194\n \n\nPrepayments and other current assets\n \n \n(149,223\n)\n \n \n50,175\n \n \n \n1,735,536\n \n\nAccounts payable\n \n \n1,808,172\n \n \n \n13,005,301\n \n \n \n9,216,778\n \n\nOther payables and accrued liabilities\n \n \n103,431\n \n \n \n440,732\n \n \n \n(45,075\n)\n\nContract liabilities\n \n \n—\n \n \n \n14\n \n \n \n(280\n)\n\nLease liabilities\n \n \n—\n \n \n \n(82,027\n)\n \n \n(91,010\n)\n\nTaxes payable\n \n \n2,641,347\n \n \n \n2,082,856\n \n \n \n644,753\n \n\nNet cash (used in) operating activities\n \n \n(1,490,957\n)\n \n \n(1,987,028\n)\n \n \n(3,132,666\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH FLOWS FROM INVESTING ACTIVITIES:\n \n \n \n \n \n \n \n \n \n \n \n \n\nPurchases of equipment\n \n \n(2,233\n)\n \n \n(3,893\n)\n \n \n(21,550\n)\n\nCash received from disposal of equipment\n \n \n1,135\n \n \n \n—\n \n \n \n38,379\n \n\nRepayments from third parties\n \n \n—\n \n \n \n—\n \n \n \n56,764\n \n\nRepayments from related parties\n \n \n—\n \n \n \n—\n \n \n \n169,993\n \n\nCash deposit into escrow\n \n \n—\n \n \n \n600,000\n \n \n \n—\n \n\nCash release from escrow\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\nNet cash release from disposal of subsidiaries\n \n \n(5\n)\n \n \n(41,356\n)\n \n \n—\n \n\nLoan to related parties\n \n \n2,170\n \n \n \n(9,584\n)\n \n \n—\n \n\nNet cash provided by investing activities\n \n \n1,067\n \n \n \n545,167\n \n \n \n243,586\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH FLOWS FROM FINANCING ACTIVITIES:\n \n \n \n \n \n \n \n \n \n \n \n \n\nPayments of initial public offering (“IPO”) costs\n \n \n—\n \n \n \n—\n \n \n \n(46,859\n)\n\nNet proceed received from IPO\n \n \n—\n \n \n \n4,284,498\n \n \n \n—\n \n\nProceed from IPO placed in escrow\n \n \n—\n \n \n \n(600,000\n)\n \n \n—\n \n\nNet proceed received from share subscription agreement\n \n \n600,000\n \n \n \n—\n \n \n \n—\n \n\nProceeds from short-term loans - banks\n \n \n1,096,348\n \n \n \n1,756,967\n \n \n \n2,108,789\n \n\nRepayments of short-term loans - banks\n \n \n(1,933,105\n)\n \n \n(2,663,952\n)\n \n \n(355,840\n)\n\nProceeds from long-term loan - bank\n \n \n347,826\n \n \n \n252,196\n \n \n \n255,439\n \n\nRepayments of long-term loan - bank\n \n \n(69,565\n)\n \n \n(36,695\n)\n \n \n(67,576\n)\n\nProceeds from short-term loans - third parties\n \n \n1,164,797\n \n \n \n533,115\n \n \n \n(134,957\n)\n\nRepayments of other payables - related parties, net\n \n \n—\n \n \n \n(29,390\n)\n \n \n14,191\n \n\nProceeds from (Repayments of) short-term loans - related parties, net\n \n \n192,001\n \n \n \n(2,478,013\n)\n \n \n1,216,973\n \n\nNet cash provided by financing activities\n \n \n1,398,302\n \n \n \n1,018,726\n \n \n \n2,990,160\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nEFFECT OF EXCHANGE RATE CHANGES\n \n \n33,895\n \n \n \n279,412\n \n \n \n(32,842\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNET CHANGE IN CASH AND RESTRICTED CASH\n \n \n(57,693\n)\n \n \n(143,723\n)\n \n \n68,238\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH, BEGINNING OF THE YEAR\n \n \n124,379\n \n \n \n268,102\n \n \n \n199,864\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH, END OF THE YEAR\n \n$\n66,686\n \n \n$\n124,379\n \n \n$\n268,102\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nSUPPLEMENTAL CASH FLOW INFORMATION:\n \n \n \n \n \n \n \n \n \n \n \n \n\nCash paid for income tax\n \n$\n—\n \n \n$\n141\n \n \n$\n7,271\n \n\nCash paid for interest\n \n$\n89,695\n \n \n$\n137,072\n \n \n$\n106,130\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nSUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION:\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nDerecognition of operating right of use assets and lease liabilities upon termination of the leases\n \n$\n—\n \n \n$\n22,434\n \n \n$\n—\n \n\nPayment of Initial public offering (“IPO”) costs from IPO proceed\n \n$\n—\n \n \n$\n364,576\n \n \n$\n—\n \n\n Repayments of other payables-related parties through fund release from escrow\n \n$ \n600,000 \n \n \n$ \n—\n \n \n$ \n—\n \n\n \n\nThe accompanying notes are an integral part of these\nconsolidated financial statements.\n\n \n\nF-6\n\n \n\n \n\n**Note 1– Nature of business and organization**\n\n \n\nCDT Environmental Technology Investment Holdings Limited\n(“CDT Cayman” or the “Company”) is a holding company incorporated on November 28, 2016, under the laws of the\nCayman Islands. The Company has no substantive operations other than holding all of the outstanding equity of Chao Qiang Holdings Limited\n(“CQ BVI”) established under the laws of the British Virgin Islands on December 14, 2015 and all of the outstanding equity\nof CDT Environmental Technology Group Limited (“CDT BVI”) established under the laws of the British Virgin Islands on June\n26, 2015.\n\n \n\nCQ BVI is a holding company holding all of the outstanding\nequity of Ultra Leader Investments Limited (“Ultra HK”) which was established in Hong Kong on February 27, 2015. Ultra HK\nis a holding company holding 15% of the outstanding equity of Shenzhen CDT Environmental Technology Co., Ltd. (“Shenzhen CDT”)\nwhich was established on August 27, 2012 under the laws of the People’s Republic of China (“PRC” or “China”).\n\n \n\nCDT BVI is a holding company holding all of the outstanding\nequity of CDT Environmental Technology (Hong Kong) Limited (“CDT HK”) which was established in Hong Kong on July 30, 2015.\nCDT HK is also a holding company holding 85% of the outstanding equity of Shenzhen CDT. The Company, through Ultra HK and CDT HK, holds\n100% of the outstanding equity of Shenzhen CDT.\n\n \n\nThe Company, through its wholly owned subsidiary,\nShenzhen CDT, and its subsidiaries, engages in developing, producing, selling and installing sewage treatment systems and providing sewage\ntreatment services. The Company focuses on the harmless treatment of municipal and rural cesspool, pipe dredging, treatment of inland\nriver sludge and rural sewage treatment, and providing one-stop solutions.\n\n \n\nThe accompanying consolidated financial statements\nreflect the activities of CDT Cayman and each of the following entities as of December 31, 2025:\n\n \n\nSchedule of subsidiaries\n \n \n \n \n\n**Name**\n \n**Background**\n \n**Ownership**\n\nChao Qiang Holdings Limited (“CQ BVI”)\n \n\n● A British Virgin Islands company\n\n● Incorporated on December 14, 2015\n\n● A holding company\n\n \n100% owned by CDT Cayman\n\nCDT Environmental Technology Group Limited (“CDT BVI”)\n \n\n● A British Virgin Islands company\n\n● Incorporated on June 26, 2015\n\n● A holding company\n\n \n100% owned by CDT Cayman\n\nUltra Leader Investments Limited (“Ultra HK”)\n \n\n● A Hong Kong company\n\n● Incorporated on February 27, 2015\n\n● A holding company\n\n \n100% owned by CQ BVI\n\n \n\nF-7\n\n \n\n \n\nCDT Environmental Technology (Hong Kong) Limited (“CDT HK”)\n \n\n● A Hong Kong company\n\n● Incorporated on July 30, 2015\n\n● A holding company\n\n \n100% owned by CDT BVI\n\nShenzhen CDT Environmental Technology Co., Ltd.\n\n(“Shenzhen CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on August 27, 2012\n\n● Registered capital of RMB 60,000,000\n\n● Developing, producing, selling and installing sewage treatment\nsystems and providing sewage treatment services\n\n \n100% collectively owned by Ultra HK (15%) and CDT HK (85%)\n\nBeijing Minyun Environmental Technology Co., Ltd., formerly known as Beijing\nCDT Environmental Technology Co., Ltd.\n\n (“BJ CDT”) (4)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on April 25, 2016\n\n● Registered capital of RMB 20,000,000\n\n● Providing sewage treatment services\n\n \n100% owned by Shenzhen CDT\n\nFuzhou LSY Environmental Technology Co., Ltd.\n\n(“FJ LSY”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on March 13, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nTianjin CDT Environmental Technology Co., Ltd.\n\n(“TJ CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on October 22, 2014\n\n● Registered capital of RMB 10,000,000\n\n● Providing sewage treatment services\n\n \n100% owned by Shenzhen CDT\n\nChengde CDT Environmental Technology Co., Ltd.\n\n(“CD CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on March 26, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nBeijing Innovation CDT Environmental Technology Co., Ltd.\n\n(“BJ CX CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on September 7, 2016\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nBaoding CDT Environmental Technology Co., Ltd.\n\n(“BD CDT”) (3)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on October 21, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nHengshui CDT Environmental Technology Co., Ltd.\n\n(“HS CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on May 18, 2015\n\n● Registered capital of RMB 3,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nGuangxi CWT Environmental Technology Co., Ltd.\n\n(“GX CDT”) (1)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on January 29, 2016\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nHuzhou CDT Environmental Technology Co., Ltd.\n\n(“HZ CDT”)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on February 6, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nHohhot CDT Environmental Technology Co., Ltd.\n\n(“HHHT CDT”)\n\n \n\n \n\n \n\n● A PRC limited liability company\n\n● Incorporated on February 11, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nTaiyuan CDT Environmental Technology Co., Ltd.\n\n(“TY CDT”) (2)\n\n \n\n● A PRC limited liability company\n\n● Incorporated on March 23, 2015\n\n● Registered capital of RMB 5,000,000\n\n● Providing sewage treatment services\n\n \n51% owned by Shenzhen CDT\n\nShaowu Fuluoneng Energy Technology Co., Ltd. (“Shaowu”)\n \n \n\n● A PRC limited liability company\n\n● Incorporated on December 8, 2025\n\n● Registered capital of RMB 10,000,000\n\n● Providing organic waste conversion services\n\n \n\n100% owned by Shenzhen CDT\n \n\n \n\nF-8\n\n \n\n \n\n(1)\nIn March 2024, the Company disposed of its entire 51% ownership in GX CDT and transferred its ownership to Chun’E Zhao, the legal representative of GX CDT for consideration of RMB 500. The disposal of GX CDT did not have a material impact on the Company’s consolidated financial statements. \n\n \n\n(2)\nIn June 2024, the Company disposed of its entire 51% ownership in TY CDT and transferred its ownership to a third party for consideration of RMB 1,000. The disposal of TY CDT did not have a material impact on the Company’s consolidated financial statements. \n\n \n\n(3)\nIn June 2025, the Company BD CDT was dissolved. The dissolution of BD CDT did not have a material impact on the Company’s consolidated financial statements. \n\n** **\n\n(4)\nIn July 2024, Beijing CDT Environmental Technology Co., Ltd had changed its name to Beijing Minyun Environmental Technology Co., Ltd\n\n \n\n**Note 2 – Liquidity**\n\n \n\nIn assessing the\nCompany’s liquidity, the Company monitors and analyzes its cash on-hand and its operating requirements and capital expenditure commitments.\nThe Company’s liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations.\n\n \n\nThe Company\nengages in installing sewage treatment systems and providing sewage treatment services in both urban and rural areas. The\nCompany’s business is capital intensive. Working capital was approximately $26.41\nmillion as of December 31, 2025, as compared to approximately $26.0\nmillion as of December 31, 2024. As of December 31, 2025, cash on-hand balance was approximately $66,686.\nIn addition to cash on-hand, the Company also has other current assets mainly composed of accounts receivable and contract assets.\nThe Company had accounts receivable, net, of approximately $44.13 million, and contract assets – current of approximately\n$39.31 million as of December 31, 2025, all of which are short-term in nature and should be collected and utilized within\nthe Company’s operating cycle to be used to support the Company’s working capital needs.\n\n \n\nOn April 22, 2024,\nthe Company completed the initial public offering (“IPO”) of 1,500,000 ordinary shares at an initial public offering price\nof $4.00 per share, resulting in net proceeds to the Company of approximately $4.3 million after deducting underwriting discounts and\ncommissions and other expenses, and including net proceeds in the amount of $600,000 that were placed in an escrow account for 24-months\nfollowing the closing of the IPO. As of December 31, 2025, the restrictions on such funds had been early released. Accordingly, the balance\nof the escrow account related to the IPO was $0 as of December 31, 2025, compared to $600,000 as of December 31, 2024.\n\n \n\nAlthough the Company\nbelieves that it can realize its current assets in the normal course of business, its ability to repay its current obligations will depend\non the future realization of its current assets. Management has considered historical experience, the economic environment, trends in\nthe sewage treatment industry, and the expected collectability of accounts receivable and contract assets as of December 31, 2025. The\nCompany expects to realize these outstanding balances, net of allowance within the normal operating cycle of twelve-months. As of the\ndate of the issuance of these consolidated financial statements, the Company has received approximately $1.90 million of its accounts\nreceivable. If the Company is unable to realize its current assets within the normal twelve-month operating cycle, the Company may have\nto consider supplementing its available sources of funds through the following:\n\n \n\n \n●\nFinancing from the Company’s officers/shareholders; and\n\n \n\n \n●\nOther available sources of financing from PRC banks, other financial institutions and related parties, given the Company’s credit history.\n\n \n\nF-9\n\n \n\n \n\nBased on the above\nconsiderations, management believes that the Company has sufficient funds to meet its working capital requirements and debt obligations,\nfor at least the next 12 months from the filing date of these consolidated financial statements. However, there is no assurance that management\nwill be successful in their plans. There are a number of factors that could potentially arise that could undermine the Company’s\nplans, such as changes in the demand for its services, economic conditions, competitive pricing in the sewage treatment services industry,\nits operating results may deteriorate and its bank and shareholders may not provide continued financial support.\n\n \n\n**Note 3 – Summary of significant accounting policies**\n\n \n\nBasis of presentation\n\n \n\nThe accompanying consolidated financial\nstatements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.\nGAAP”) for information pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”).\n\n \n\nPrinciples of consolidation\n\n \n\nThe consolidated\nfinancial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company\nand its subsidiaries have been eliminated upon consolidation.\n\n \n\nSubsidiaries are\nthose entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern\nthe financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority\nof votes at the meeting of directors.\n\n \n\nNoncontrolling\ninterest represents the portion of the net assets of a subsidiary attributable to interests that are not owned by the Company. The non-controlling\ninterest is presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Noncontrolling\ninterest’s operating results are presented on the face of the consolidated statements of operation and comprehensive (loss) income\nas an allocation of the total income for the year between noncontrolling shareholders and the shareholders of the Company.\n\n \n\nUse of estimates and assumptions\n\n \n\nThe preparation\nof the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect\nthe reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated\nfinancial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates\nreflected in the Company’s consolidated financial statements include the estimated cost or input measure method used to calculate\nthe revenue recognized in the Company’s sewage treatment systems installation business, the useful lives of property and equipment\nand intangible assets, impairment of long-lived assets, allowance for credit losses and allowance for deferred tax assets and uncertain\ntax position. Actual results could differ from these estimates.\n\n \n\nForeign currency translation and transaction\n\n \n\nThe reporting currency\nof the Company is the U.S. dollar. The Company in China conducts its businesses in the local currency, Renminbi (RMB), as its functional\ncurrency. Assets and liabilities are translated at the unified exchange rate as quoted by the People’s Bank of China at the end\nof the period. The statements of income accounts are translated at the average translation rates and the equity accounts are translated\nat historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive loss. Transaction\ngains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency\nare included in the results of operations as incurred.\n\n \n\nF-10\n\n \n\n \n\nTranslation adjustments\nincluded in accumulated other comprehensive loss amounted to $1,429,733 and $2,210,909 as of December 31, 2025 and December 31, 2024,\nrespectively. The balance sheet amounts, with the exception of shareholders’ equity at December 31, 2025 and December 31, 2024 were\ntranslated at RMB 6.99 and RMB 7.19 to $1.00, respectively, and at HKD 7.78 and HKD 7.77 to $1.00, respectively. The shareholders’\nequity accounts are stated at their historical exchange rates. The average translation rates applied to the statements of income accounts\nfor the years ended December 31, 2025, 2024, and 2023 were to RMB 7.19 RMB 7.14, and RMB 7.05 to $1.00, respectively, and were HKD 7.80,\nHKD 7.80, and HKD 7.83 to $1.00, respectively. Cash flows are also translated at average translation rates for the periods, therefore,\namounts reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on\nthe consolidated balance sheets.\n\n \n\nCash\n\n \n\nCash consists of\ncash on hand and deposits placed with banks or other financial institutions and have original maturities of less than three months.\n\n \n\nAccounts receivable, net\n\n \n\nAccounts receivable\nare recognized and carried at the original invoiced amount less an allowance for credit losses and do not bear interest. Customers who\nowed accounts receivables, are granted credit terms based on their credit metrics. The Company records the allowance for credit losses\nas an offset to accounts receivable, and the estimated credit losses charged to the allowance is classified as “general and administrative”\nin the consolidated statements of operating and comprehensive (loss) income. The Company assesses collectability by reviewing accounts\nreceivable on a collective basis where similar characteristics exist, primarily based on similar business line, service or product offerings\nand on an individual basis when the Company identifies specific customers with known disputes or collectability issues. In determining\nthe amount of the allowance for credit losses, the Company considers historical collectability based on past due status, the age of the\naccounts receivable balances, credit quality of the Company’s customers based on ongoing credit evaluations, current economic conditions,\nreasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect\nfrom customers. As of December 31, 2025 and December 31, 2024, the Company provided allowance for credit losses against its accounts receivable\namounted to $24,256,924 and $9,267,851 , respectively.\n\n \n\nOther receivables, net\n\n \n\nOther receivables\nprimarily include advances to employees, and other deposits. The Company measures credit losses on its other receivables using the current\nexpected credit loss model under ASC 326. As of December 31, 2025 and December 31, 2024, the Company provided allowance for credit losses\nof $773,594 and $468,219, respectively. For the years ended December 31, 2025, 2024 and 2023, the Company had recovered $46,304, $25,829,\nand $0 from previous allowance for credit losses, respectively, and for the years ended December 31, 2025, 2024, and 2023, the bad debt\nexpense for other receivables amounted to $0, $0, and $34,189.\n\n \n\nContract assets and contract liabilities\n\n \n\nProjects with performance\nobligations recognized over time that have revenue recognized to date but not yet billed are reported on our consolidated balance sheets\nas “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in\nwhich such losses are determined.\n\n \n\nContract assets\nhaving billing terms with the unconditional right to be billed beyond one year are classified as non-current assets.\n\n \n\nContract liabilities\non uncompleted contracts represent an entity's obligation to transfer goods or services to a customer for which the entity has received\nconsideration (or an amount of consideration is due) from the customer, which typically arises when cash is collected or billings occur\nin advance of performance.\n\n \n\nPrepayments and other current assets, net\n\n \n\nPrepayments are\ncash deposited or advanced to suppliers for future inventory purchases or service providers for future services. These amounts are refundable\nand bear no interest. Prepayments also consist of prepaid consulting fees remitted to third parties in acquiring contracts with customers.\nSuch consulting fee is refundable if the contract with the customer is not signed within the certain period indicated in the consulting\nservice contract term.\n\n \n\nF-11\n\n \n\n \n\nFor any prepayments\ndetermined by management that will not be completed by the receipt of inventories, services, or refunded, the Company will recognize an\nallowance account to reserve for such balances. Management reviews its advances to suppliers on a regular basis to determine if the valuation\nallowance is adequate and adjusts the allowance when necessary. Delinquent account balances are written-off against allowance after management\nhas determined that the likelihood of completion or collection is not probable. The Company’s management continues to evaluate the\nreasonableness of the valuation allowance policy and update it if necessary. As of December 31, 2025 and December 31, 2024, allowance\nfor doubtful account for prepayments was $356,552 and $276,198, respectively.\n\n \n\nProperty and equipment, net\n\n \n\nProperty and equipment\nare stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives\nof the assets. The estimated useful lives are as follows:\n\n \n\nSchedule of estimated useful lives\n \n \n\n \n \n**Useful Life**\n\nBuilding\n \n45 years\n\nEquipment\n \n4 - 10 years\n\nOffice equipment, fixtures and furniture\n \n3 - 5 years\n\nAutomobiles\n \n5 - 10 years\n\n \n\nThe cost and related\naccumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the\nconsolidated statements of operation and comprehensive (loss) income. Expenditures for maintenance and repairs are charged to operations\nas incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company\nalso re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful\nlives.\n\n \n\nIntangible assets, net\n\n \n\nThe Company’s\nacquired intangible assets with definite useful lives only consist of patents. The Company amortizes its intangible assets with definite\nuseful lives over their estimated useful lives and reviews these assets for impairment. The Company typically amortizes its patents with\ndefinite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated economic lives, which is determined\nto be approximately eight to nine years.\n\n \n\nImpairment for long-lived assets\n\n \n\nLong-lived assets,\nincluding property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances\n(such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value\nof an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows\nthe assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result\nfrom the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset.\nIf an impairment is identified, the Company will reduce the carrying amount of the asset to its estimated fair value based on a discounted\ncash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2025 and December 31, 2024, no\nimpairment of long-lived assets was recognized.\n\n \n\nEscrow\n\n \n\nIn connection with\nthe closing of the Company’s initial public offering in April 2024, $600,000 of the net proceeds received from the initial\npublic offering was deposited in an escrow account, and the Company is restricted to withdraw therefrom, for twenty-four months after\nthe closing date of the initial public offering. During the year ended December 31, 2025, the Company obtained an early release of the\nescrow restrictions and withdrew the full amount of $600,000 from the escrow account. As of December 31, 2025 and December 31, 2024, the\nbalance of the escrow account related to IPO was $0 and $600,000, respectively.\n\n \n\nF-12\n\n \n\n \n\nFair value measurement\n\n \n\nThe accounting\nstandard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires\ndisclosure of the fair value of financial instruments held by the Company.\n\n \n\n The\naccounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance\ndisclosure requirements for fair value measures. The three levels are defined as follow:\n\n \n\n \n●\nLevel 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.\n\n \n\n \n●\nLevel 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted prices for identical assets and liabilities in inactive markets and inputs that are observable for the assets or liabilities, either directly or indirectly, for substantially the full term of the financial instruments.\n\n \n\n \n●\nLevel 3 inputs to the valuation methodology are unobservable and significant to the fair value.\n\n \n\nFinancial instruments\nincluded in current assets and current liabilities are reported in the consolidated balance sheets at face value or cost, which approximate\nfair value because of the short period of time between the origination of such instruments and their expected realization and their current\nmarket rates of interest.\n\n \n\nAccounts\npayable\n\n \n\nAccounts payable represent liabilities\nfor goods or services provided to the Company prior to the end of the financial year which are unpaid. They are classified as current\nliabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). Otherwise, they are\npresented as non-current liabilities.\n\n \n\n*Short-term loans and borrowing\ncosts*\n\nShort-term loans\nrepresent borrowings with original maturities of one year or less from the date of issuance. They are initially recognized at the proceeds\nreceived, net of direct debt issuance costs. Interest on short-term loans is accrued as an expense in the period incurred based on the\nstated interest rate and outstanding principal balance, in accordance with ASC 835. Borrowing costs, including interest and debt issuance\ncosts, are recognized as expenses in the period incurred, unless eligible for capitalization under ASC 835-20.\n\nShort-term loans\nare classified as current liabilities on the consolidated balance sheets. Any portion of a short-term loan that the Company has both the\nintent and ability to refinance on a long-term basis may be classified as non-current in accordance with ASC 470-10.\n\n*Other payables and accrued liabilities*\n\n \n\nOther payables accrued expenses primarily\nconsist of other payables and payroll-related payables incurred in the ordinary course of business. \n\nRevenue recognition\n\n \n\nThe Company recognizes\nrevenue under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606,\nRevenue from Contracts with Customers (ASC 606). The Company recognizes revenue to depict the transfer of promised goods or services (that\nis, an asset) to customers in an amount that reflects the consideration to which the Company expects to receive in exchange for those\ngoods or services. An asset is transferred when the customer obtains control of that asset. It also requires the Company to identify contractual\nperformance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods\nor services transfers to a customer.\n\n \n\nTo achieve that\ncore principle, the Company applies the five steps defined under Topic 606: (i) identify the contract(s) with a customer, (ii) identify\nthe performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance\nobligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation.\n\n \n\nThe Company accounts\nfor a contract with a customer when the contract is committed in writing, the rights of the parties, including payment terms, are identified,\nthe contract has commercial substance and consideration to collect is substantially probable.\n\n \n\nIn accordance with\nFASB ASC 340-40, “Other Assets and Deferred Costs”, which requires the capitalization of all incremental costs from obtaining\nand fulfilling a contract with a customer if such costs are expected to be recovered with the period of more than one year, the Company\ncapitalizes certain contract acquisition costs consisting primarily of consulting fees and expects such consulting fees as a result of\nobtaining customer contracts to be recoverable. For contracts with a realization period of less than one year, the guidance provides a\npractical expedient that permits an entity to immediately expense contract acquisition costs when the asset that would have resulted from\ncapitalizing these costs would have been amortized in one year or less.\n\n \n\nF-13\n\n \n\n \n\nRevenue recognition\npolicies for each type of revenue steams are as follows:\n\n \n\n \n*i)*\n*Sewage treatment systems*\n\n \n\n \n*a)*\n*Rendering of sewage treatment systems installation*\n\n \n\n*Performance obligations satisfied over time*\n\n \n\nSales relating\nto the installation of sewage treatment systems are generally recognized based on the Company’s efforts or inputs to the satisfaction\nof its performance obligation over time as work progresses because of the continuous transfer of control to the customer and the Company\nhas the right to bill the customer as costs are incurred. The performance obligation includes the sewage treatment system and equipment\nthat the Company sells as well as the continuous system installation to be performed. Typically, revenue is recognized over time using\nan input measure (i.e., costs incurred to date relative to total estimated costs at completion) to measure progress. The Company generally\nuses the cost-to-cost measure of progress method because it best depicts the transfer of control to the customer which occurs as the Company\nincurs costs on its contracts. Under the cost-to-cost measure of progress method, the extent of progress towards completion is measured\nbased on the ratio of total costs incurred to date to the total estimated costs at completion of the performance obligation. Revenues,\nincluding estimated fees or profits, are recorded proportionally as costs are incurred. Any expected losses on construction-type contracts\nin progress are charged to operations, in total, in the period the losses are identified. Contract costs include all direct material and\nlabor costs and those indirect costs related to contract performance, such as indirect labor and supplies. Contract modifications that\nextend or revise contract terms generally result in recognizing the impact of the revised terms prospectively over the remaining life\nof the modified contract (i.e., effectively like a new contract).\n\n \n\nPart of the Company’s\nprocess of identifying whether there is a contract with a customer is to assess whether it is probable that the Company will collect substantially\nall of the consideration to which it will be entitled in exchange for goods or services that will be transferred to the customer. In assessing\nit is probable that the Company will collect substantially all of the consideration, the Company considers the following:\n\n \n\n \n1)\nCustomary business practice and its knowledge of the customer\n\n \n\nThe Company procures\ncontracts from city or provincial level state-owned construction companies that are responsible for constructing rural sewage infrastructures\nfor local governments to sell, install and operate decentralized rural sewage treatment systems. Although the Company does not have a\nlong period of sewage treatment system operations, historically, the collections from state-owned companies or local governments of their\naccounts receivable for sewage treatment services did not result in any significant write-downs. As a result, the Company believes it\nwill collect substantially all of the consideration to which it is entitled to.\n\n \n\n \n2)\nPayment terms\n\n \n\nThe Company’s\ncontract with the customer has payment terms specified based upon certain conditions completed. The payment terms usually include, but\nare not limited to, the following billing stages: 1) signing of the sales contract, 2) completion of delivery of system equipment to the\njob sites, 3) completion of system installations, 4) completion of water test and satisfaction of meeting national standards for sewage\ndischarge, and 5) completion of maintenance periods. As the Company’s customers are required to pay the Company at different billing\nstages over the contract period, as such, the Company believes the progress payments limit the Company’s exposure to credit risk\nand the Company would be able to collect substantially all of the consideration gradually at different stages.\n\n \n\nThe timing of the\nsatisfaction of our performance obligations is based upon the cost-to-cost measure of progress method, which is generally different than\nthe timing of unconditional right of payment, and is based upon certain conditions completed as specified in the contract. The payment\nterms usually include, but are not limited to, the following billing stages: 1) signing of the sales contract, approximately 20% - 30%\nof the contract price, 2) completion of delivery of system equipment to the job sites, approximately 10% - 20% of the contract price,\n3) completion of system installations, approximately 10% - 20% of the contract price, 4) completion of water test and satisfaction of\nnational standards for sewage discharge, approximately 20% - 30% of the contract price, and 5) completion of maintenance periods, approximately\n5% - 10% of the contract price. The timing between the satisfaction of our performance obligations and the unconditional right to payment\nwould contribute to contract assets and contract liabilities.\n\n \n\nF-14\n\n \n\n \n\nPayment for sewage\ntreatments systems is made by the customer pursuant to the billing schedule stipulated in the contract which is generally based on the\nprogress of the construction. Cost based input methods of revenue recognition require the Company to make estimates of costs to complete\nits projects. In making such estimates, significant judgment is required to evaluate assumptions related to the costs to complete its\nprojects, including materials, labor, contingencies, and other system costs. The estimate of unit material costs are reviewed and updated\non a quarterly basis, based on the updated information available in the supply markets. The estimate of material quantities to be used\nfor completion and the installation cost is also reviewed and updated on a quarterly basis, based on the updated information on the progress\nof project execution. If the estimated total costs on any contract, including any inefficient costs, are greater than the net contract\nrevenues, the Company recognizes the entire estimated loss in the period the loss becomes known. The cumulative effect of revisions to\nestimates related to net contract revenues or costs to complete contracts are recorded in the period in which the revisions to estimates\nare identified and the amounts can be reasonably estimated. The effect of the changes on future periods are recognized as if the revised\nestimates had been used since revenue was initially recognized under the contract. Such revisions could occur in any reporting period,\nand the effects may be material depending on the size of the contracts or the changes in estimates.\n\n \n\nThe installation\nrevenues of treatment system components are combined and considered as one performance obligation. The promises to transfer the equipment\nand system components and installation are not separately identifiable, which is evidenced by the fact that the Company provides a significant\nservice of integrating the goods and services into a sewage treatment system for which the customer has contracted. The Company currently\ndoes not have any modifications of contracts and the contracts currently do not have any variable consideration. The transaction price\nis clearly identifiable within the Company’s sales contracts, the performance obligation of the Company’s equipment and system\ncomponent and installation revenues.\n\n \n\nFurthermore, the\ninstallation revenues and sales of treatment system components normally includes assurance-type warranties that the Company’s performance\nis free from material defect and consistent with the specifications of the Company’s contract, which do not give rise to a separate\nperformance obligation. To the extent the warranty terms provide the customer with an additional service, such as extended maintenance\nservices, such warranty is accounted for as a separate performance obligation even though it is embedded in the sewage treatment system\nand installation sales contract, which is generally between one to two years after installation. Revenue generated from maintenance services\nare clearly identifiable and distinguished from the equipment and system component and installation revenues.\n\n \n\nThe Company has\nno obligations for returns, refunds or similar obligations for its sewage treatment system installations.\n\n \n\nAs of December 31, 2025, the Company had transaction price\nallocated to remaining performance obligations for sewage treatment system installation amounting to $2,421,017 which is expected to be\nrecognized upon the satisfaction of the performance obligations within 12 months from December 31, 2025 using an input measure method.\n\n \n\n \n*b)*\n*Rendering of sewage treatment system maintenance services*\n\n \n\n*Performance obligations satisfied over time*\n\n \n\nRevenue from sewage\ntreatment system maintenance service contracts require the Company to render repair or maintenance on any system failure during the contracted\nmaintenance periods, which is generally between one to two years. Revenue generated from sewage treatment system maintenance services\nis recognized over the coverage period on a straight-line basis.\n\n \n\nThe maintenance\ncontract revenue is embedded in the installation contract but clearly identifiable for such maintenance services, which is generally between\none to two years after installation. This clause includes identifiable payment terms within the sales contract, which the Company believes\ncan be distinguished from the installation services should the Company need to separately enter the installation and maintenance service\ncontracts. Maintenance services revenues are immaterial to the Company’s consolidated statements of operation and comprehensive\n(loss) income for the years ended December 31, 2025, 2024, and 2023.\n\n \n\nF-15\n\n \n\n \n\nAs of December\n31, 2025, the Company had transaction price allocated to remaining performance obligations for rendering sewage treatment services amounting\nto $979,790 which is expected to be recognized within 12 months from December 31, 2025 and $0 is expected to be recognized subsequent\nto December 31, 2026, all on a straight-line basis.\n\n \n\n \n*c)*\n*Financing revenues*\n\n \n\n*Performance obligations satisfied over time*\n\n \n\nFinancing revenues\non interest income from long term contracts with payment terms over one year are recognized as financing revenues over the payment term\nbased on the effective interest rate method determined using the Company’s incremental borrowing rate.\n\n \n\n \n*ii)*\n*Sewage treatment services*\n\n \n\n \n*a)*\n*Rendering of sewage treatment services*\n\n \n\n*Performance obligations satisfied over time*\n\n \n\nRevenue from sewage\ntreatment service contracts requires the Company to render treatment services on a one-time basis or based upon a specified treatment\nperiod, which is generally one year or less. The Company’s performance obligations are generally satisfied over time because customers\nreceive and consume the benefits of such services and the Company has the right to bill the customer as services are performed. Revenue\ngenerated from sewage treatment service is recognized using an input measure method, (i.e., labor costs incurred to date relative to total\nestimated labor cost at completion) to measure progress. Under the labor cost measure of progress method, the extent of progress towards\ncompletion is measured based on the ratio of total labor cost incurred to date to the total estimated labor cost at completion of the\nperformance obligation. Revenue, including estimated fees or profits, are recorded proportionally as labor costs are incurred. The Company\nconsiders labor time as the best available indicator of the pattern and timing in which contract obligations are fulfilled. The Company\nhas a long history of sewage treatment services resulting in its ability to reasonably estimate the service hours expected to be incurred\nand the progress toward completion on each fixed-price contract based on the proportion of service hours incurred to date relative to\ntotal estimated service hours at completion. Estimated contract costs are based on the budgeted service hours, which are updated based\non the progress toward completion on a monthly basis. Pursuant to the contract terms, the Company has enforceable right to payments for\nthe work performed. Provisions for estimated losses, if any, on uncompleted contracts are recorded in the period in which such losses\nbecome probable based on the current contract estimates. Costs of sewage treatment services are expensed in the period in which they are\nincurred.\n\n \n\nThe Company’s\ndisaggregated revenue streams are summarized and disclosed in Note 16.\n\n \n\nThe Company applies\na practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period is one\nyear or less. The Company has no material incremental costs of obtaining contracts with customers that the Company expects the benefit\nof those costs to be longer than one year which need to be recognized as assets.\n\n \n\nWarranty provision\n\n \n\nThe Company generally\nprovides limited warranties for work performed under its contracts. At the time a sale is recognized, the Company records estimated future\nwarranty costs under FASB ASC 460, “Guarantees”. Such estimated costs for warranties are estimated at completion and these\nwarranties are not service warranties separately sold by the Company. Generally, the estimated claim rates of warranties is based on actual\nwarranty experience or the Company’s best estimate. There were no such reserves for the years ended December 31, 2025, 2024, and\n2023, because the Company’s historical warranty expenses have been immaterial to the Company’s consolidated financial statements.\n\n \n\nAdvertising costs\n\n \n\nAdvertising costs\namounted to $1,319, $6,053, and 22,677 for the years ended December 31, 2025, 2024, and 2023 respectively. Advertising costs are expensed\nas incurred and included in selling expenses.\n\n \n\nF-16\n\n \n\n \n\nResearch and development (“R&D”)\n\n \n\nR&D expenses\ninclude salaries and other compensation-related expenses paid to the Company’s research and product development personnel while\nthey are working on R&D projects, as well as raw materials used for the R&D projects. R&D expenses amounted to $47,602, $61,786,\nand 80,948 for the years ended December 31, 2025, 2024 and 2023, respectively.\n\n \n\nValue added taxes (“VAT”)\n\n \n\nRevenue represents\nthe invoiced value of products or services, net of VAT. The VAT is based on gross sales price and VAT rates range from 6% up to 17% prior\nto May 2018, up to 16% starting in May 2018, and up to 13% starting in April 2019, depending on the type of products sold or services\nprovided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT\nliabilities. The net VAT balance between input VAT and output VAT is recorded in taxes payable. All of the VAT returns filed by the Company’s\nsubsidiaries in China, have been and remain subject to examination by the tax authorities for five years from the date of filing.\n\n \n\nIncome taxes\n\n \n\nThe Company accounts\nfor income taxes in accordance with ASC 740, “Accounting for income taxes”. The charge for taxation is based on the results\nfor the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted\nor substantively enacted by the balance sheet date.\n\n \n\nDeferred taxes\nare accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying\namount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable\ntax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized\nto the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized.\nDeferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled.\nDeferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity,\nin which case the deferred tax is also dealt with in equity. Net deferred tax assets are reduced by a valuation allowance when, in\nthe opinion of management, it is more likely than not that some portion or all of the net deferred tax asset will not be realized. Current\nincome taxes are provided for in accordance with the laws of the relevant taxing authorities.\n\n \n\nAn uncertain tax\nposition is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax\nexamination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that has greater\nthan 50% likelihood of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax\nbenefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as other expense in the period\nincurred. PRC tax returns filed in 2019 to 2023 are subject to examination by any applicable tax authorities.\n\n \n\nShare-based compensation\n\n \n\nThe Company accounts\nfor share-based compensation awards to non-employees in accordance with FASB ASC Topic 718 amended by ASU 2018-07. Under FASB ASC Topic\n718, share compensation granted to non-employees has been determined as the fair value of the consideration received or the fair value\nof equity instrument issued, whichever is more reliably measured and is recognized as an expense as the goods or services are received.\n\n \n\nComprehensive loss\n\n \n\nComprehensive loss\nconsists of two components, net income and other comprehensive income. Other comprehensive loss refers to revenue, expenses, gains and\nlosses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive\nincome consists entirely of foreign currency translation adjustments resulting from the U.S. dollar not being the Company’s functional\ncurrency.\n\n \n\nF-17\n\n \n\n \n\n(Loss) earnings per share\n\n \n\nThe Company computes\n(loss) earnings per share (“EPS”) in accordance with FASB ASC 260, “Earnings per Share”. FASB ASC 260 requires\ncompanies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary shares outstanding\nduring the reporting period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible\nsecurities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later.\nPotential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are\nexcluded from the calculation of diluted EPS. For the years ended December 31, 2025, 2024, and 2023, there were no potential dilutive\nshares.\n\n \n\nEmployee benefits\n\n \n\nThe full-time employees\nof the Company are entitled to staff welfare benefits including medical care, housing fund, pension benefits, unemployment insurance and\nother welfare, which are government mandated defined contribution plans. The Company is required to accrue for these benefits based on\ncertain percentages of the employees’ respective salaries, subject to certain ceilings, in accordance with the relevant PRC regulations,\nand make cash contributions to the state-sponsored plans out of the amounts accrued. Total expenses for the plans were $71,488, $83,687,\nand $166,199 for the years ended December 31, 2025, 2024, and 2023, respectively.\n\n \n\nStatutory reserves\n\n \n\nPursuant to the\nlaws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable “statutory surplus\nreserve fund”. Subject to certain cumulative limits, the “statutory surplus reserve fund” requires annual appropriations\nof 10% of after-tax profits until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles\ngenerally accepted in the PRC (“PRC GAAP”) at each year-end). For foreign invested enterprises and joint ventures in the PRC,\nannual appropriations should be made to the “reserve fund”. For foreign invested enterprises, the annual appropriation for\nthe “reserve fund” cannot be less than 10% of after-tax profits until the aggregated appropriations reach 50% of the registered\ncapital (as determined under PRC GAAP at each year-end). If the Company has accumulated losses from prior periods, the Company is able\nto use the current period net income after tax to offset against the accumulated losses.\n\n \n\nContingencies\n\n \n\nFrom time to time,\nthe Company is a party to various legal actions arising in the ordinary course of business. The Company accrues costs associated with\nthese matters when they become probable and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies\nare expensed as incurred. The Company’s management does not expect any liability from the disposition of such claims and litigation\nindividually or in the aggregate would have a material adverse impact on the Company’s consolidated financial position, results\nof operations and cash flows.\n\n \n\nLease\n\n \n\nEffective January\n1, 2022, the Company adopted ASU 2016-02, “Leases” (Topic 842), and elected the practical expedients that does not require\nus to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing\nleases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, a lessee is permitted\nto make an accounting policy election not to recognize lease assets and liabilities. The Company recognized ROU assets and lease liabilities\nof $201,180 upon adoption of this standard on January 1, 2022.\n\n \n\nIf any of the following\ncriteria are met, the Company classifies the lease as a finance lease:\n\n \n\nF-18\n\n \n\n \n\nThe lease transfers\nownership of the underlying asset to the lessee by the end of the lease term;\n\n \n\n●\nThe lease grants the lessee an option to purchase the underlying asset that the Company is reasonably certain to exercise;\n\n \n \n\n●\nThe lease term is for 75% or more of the remaining economic life of the underlying asset, unless the commencement date falls within the last 25% of the economic life of the underlying asset;\n\n \n\n●\nThe present value of the sum of the lease payments equals or exceeds 90% of the fair value of the underlying asset; or\n\n \n \n\n●\nThe underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of the lease term.\n\n \n\nLeases that do\nnot meet any of the above criteria are accounted for as operating leases.\n\n \n\nThe Company combines\nlease and non-lease components in its contracts under Topic 842, when permissible.\n\n \n\nOperating lease\nright-of-use (“ROU”) asset and lease liability are recognized at the adoption date of January 1, 2022 or the commencement\ndate, whichever is earlier, based on the present value of lease payments over the lease term. Since the implicit rate for the Company’s\nleases is not readily determinable, the Company uses its incremental borrowing rate based on the information available at the commencement\ndate in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would\nhave to pay to borrow, on a collateralized basis, an amount equal to the lease payments, in a similar economic environment and over a\nsimilar term.\n\n \n\nLease terms used\nto calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the\nCompany does not have reasonable certainty at lease inception that these options will be exercised. The Company generally considers the\neconomic life of its operating lease ROU asset to be comparable to the useful life of similar owned assets. The Company has elected the\nshort-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of twelve months\nor less. Its leases generally do not provide a residual guarantee.\n\n \n\nThe operating lease\nROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term for operating lease.\n\n \n\nThe Company reviews\nthe impairment of its ROU asset consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability\nof its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable.\nThe assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted\nfuture pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of its operating lease liabilities\nin any tested asset group and includes the associated operating lease payments in the undiscounted future pre-tax cash flows. For the\nyears ended December 31, 2025, 2024, and 2023, the Company did not recognize an impairment loss on its operating lease ROU asset.\n\n \n\nRecent accounting pronouncements\n\n \n\nThe Company considers\nthe applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting\nstandards that are issued. Under the Jumpstart Our Business Startups Act of 2012, as amended (the “JOBS Act”), the Company\nmeets the definition of an emerging growth company and has elected the extended transition period for complying with new or revised accounting\nstandards, which delays the adoption of these accounting standards until they would apply to private companies.\n\n \n\n*New Accounting\nStandards That Had Been Adopted:*\n\n* *\n\nIn December 2023,\nthe FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU enhances the transparency and decision\nusefulness of income tax disclosures by requiring more consistent categories and greater disaggregation in the effective tax rate reconciliation,\nas well as income taxes paid disaggregated by jurisdiction. The Company adopted ASU 2023-09 effective January 1, 2025. The adoption did\nnot have a material impact on the Company’s consolidated financial statements and primarily resulted in enhanced income tax disclosures.\n\n \n\nF-19\n\n \n\n \n\n*New Accounting\nStandards That Have Not Yet Been Adopted:*\n\n* *\n\nIn October 2023, the FASB issued\nASU 2023-06, Disclosure Improvements — codification amendments in response to SEC’s disclosure Update and Simplification initiative\nwhich amend the disclosure or presentation requirements of codification subtopic 230-10 Statement of Cash Flows—Overall, 250-10\nAccounting Changes and Error Corrections— Overall, 260-10 Earnings Per Share— Overall, 270-10 Interim Reporting— Overall,\n440-10 Commitments—Overall, 470-10 Debt—Overall, 505-10 Equity—Overall, 815-10 Derivatives and Hedging—Overall,\n860-30 Transfers and Servicing—Secured Borrowing and Collateral, 932-235 Extractive Activities— Oil and Gas—Notes to\nFinancial Statements, 946-20 Financial Services— Investment Companies— Investment Company Activities, and 974-10 Real Estate—Real\nEstate Investment Trusts—Overall. The amendments represent changes to clarify or improve disclosure and presentation requirements\nof above subtopics. Many of the amendments allow users to more easily compare entities subject to the SEC’s existing disclosures\nwith those entities that were not previously subject to the SEC’s requirements. Also, the amendments align the requirements in the\nCodification with the SEC’s regulations. For entities subject to existing SEC disclosure requirements or those that must provide\nfinancial statements to the SEC for securities purposes without contractual transfer restrictions, the effective date aligns with the\ndate when the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Early adoption is not allowed. For all other entities,\nthe amendments will be effective two years later from the date of the SEC’s removal. The Company is currently evaluating the impact\nof the update on the Company’s consolidated financial statements and related disclosures.\n\n \n\nOn November 4, 2024, the FASB\nissued ASU No. 2024-03, Expense Disaggregation Disclosures (“ASU 2024-03”). ASU 2024-03 amends\nASC 220, Comprehensive Income to expand income statement expense disclosures and require disclosure in the notes to the financial statements\nof specified information about certain costs and expenses. ASU 2024-03 is required to be adopted for fiscal years commencing\nafter December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard on the\nconsolidated financial statements.\n\n \n\nIn January 2025, the FASB issued\nASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which clarified\nthe effective date guidance included in ASU 2024-03 for non-calendar year-end public business entities. The amendments are effective for\nannual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after\nDecember 15, 2027. Early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on\nits consolidated financial statements.\n\n \n\nIn July 2025, the FASB issued ASU\n2025-05, Financial Instruments—Credit Losses (Topic 326), which provides a practical expedient for estimating expected credit losses\nrelated to current accounts receivable and current contract assets arising from transactions accounted for under ASC 606. The amendments\nare effective for annual reporting periods beginning after December 15, 2025, including interim periods within those annual periods. Early\nadoption is permitted. The Company is currently evaluating the impact of adopting this guidance and does not expect it to have a material\nimpact on its financial statements.\n\n \n\nIn December 2025, the FASB issued\nASU 2025-11, which clarifies the scope and disclosure requirements for interim financial reporting under ASC 270. The amendments are effective\nfor interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company\nis currently evaluating the impact that adoption of this guidance will have on its interim financial statement disclosures.\n\n \n\nExcept as mentioned\nabove, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have\na material effect on the Company’s consolidated balance sheets, statements of income and comprehensive income and statements of\ncash flow.\n\n \n\n**Note 4 – Accounts receivable, net**\n\n \n\nAccounts receivable, net consists of the following:\n\n \n\nSchedule of accounts receivable, net\n \n \n \n \n \n \n \n \n\n \n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n\nAccounts receivable\n \n$\n68,385,857\n \n \n$\n54,456,082\n \n\nAllowance for credit loss\n\n \n \n(24,256,924\n)\n \n \n(9,267,851\n)\n\nTotal accounts receivable, net\n \n$\n44,128,933\n \n \n$\n45,188,231\n \n\n \n\nF-20\n\n \n\n \n\nMovements of allowance for credit loss are as follows:\n\n \n\nSchedule of movements of allowance for doubtful accounts\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nDecember 31, 2025\n \nDecember 31, 2024\n \nDecember 31, 2023\n\n \n \n \n \n \n \n \n\nBeginning balance\n \n$\n9,267,851\n \n \n$\n3,009,363\n \n \n$\n3,189,642\n \n\n Addition\n \n \n14,382,434\n \n \n \n6,379,841\n \n \n \n246,336\n \n\n Recovery*\n \n \n(42,778\n)\n \n \n(4,656\n)\n \n \n(374,078\n)\n\n Disposal of GX CDT and TY CDT\n \n \n—\n \n \n \n(4,115\n)\n \n \n—\n \n\n Exchange rate effect\n \n \n649,417\n \n \n \n(120,812\n)\n \n \n(52,537\n)\n\nEnding balance\n \n$\n24,256,924\n \n \n$\n9,267,851\n \n \n$\n3,009,363\n \n\n \n\n*\nThe Company recovered accounts receivable for the years ended December 31, 2025, 2024 and 2023 due to collection of accounts receivable balances that had been provided for as allowance in prior periods.\n\n \n\n**Note 5 – Contract assets**\n\n \n\nSewage treatment system revenues\nare recognized over time using an input measure method (cost-to-cost measure of progress method) to measure progress. Under this method,\nthe extent of progress towards completion is measured based on the ratio of total costs incurred to date to the total estimated costs\nat completion of the performance obligation. Revenues to date are recognized by applying this ratio to the total contract price of the\nsewage treatment system revenues.\n\n \n\nProjects with performance obligations\nrecognized over time that have revenue recognized to date in excess of cumulative billings are reported on the Company’s consolidated\nbalance sheets as “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made\nin the period in which such losses are determined.\n\n \n\nContract assets that have billing\nterms with unconditional rights to be billed beyond one year are classified as non-current assets.\n\n \n\nContract assets consist of the following:\n\n \n\nSchedule of contract assets\n \n \n \n \n \n \n \n \n\n \n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n\nRevenue recognized\n \n$\n147,290,371\n \n \n$\n97,333,105\n \n\nLess: progress billings\n \n \n(107,980,376\n)\n \n \n(57,343,747\n)\n\nContract assets\n \n$\n39,309,995\n \n \n$\n39,989,358\n \n\nContract assets, current\n \n$\n39,309,995\n \n \n$\n31,438,860\n \n\nContract assets, non-current\n \n$\n—\n \n \n$\n8,550,498\n \n\n \n\n**Note 6 – Property and equipment, net**\n\n \n\nProperty and equipment, net consist of the following:\n\n \n\nSchedule of property and equipment\n \n \n \n \n \n \n \n \n\n \n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n\nBuilding\n \n$\n1,149,705\n \n \n$\n1,118,469\n \n\nEquipment\n \n \n1,572,900\n \n \n \n1,474,577\n \n\nOffice equipment, fixtures and furniture\n \n \n54,529\n \n \n \n52,400\n \n\nAutomobiles\n \n \n463,888\n \n \n \n486,950\n \n\nSubtotal\n \n \n3,241,022\n \n \n \n3,132,396\n \n\nLess: accumulated depreciation\n \n \n(2,153,965\n)\n \n \n(1,841,074\n)\n\nProperty and equipment, net\n \n$\n1,087,057\n \n \n$\n1,291,322\n \n\n \n\nF-21\n\n \n\n \n\nDepreciation expense for the years\nended December 31, 2025, 2024, and 2023 amounted to $235,099, $263,109, and $331,336, respectively.\n\n \n\n**Note 7 – Intangible assets, net**\n\n \n\nIntangible assets, net consist of the following:\n\n \n\nSchedule of intangible assets\n \n \n \n \n \n \n \n \n\n \n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n\nPatents\n \n$\n118,265\n \n \n$\n115,051\n \n\nLess: accumulated amortization\n \n \n(118,265\n)\n \n \n(109,423\n)\n\nIntangible assets, net\n \n$\n—\n \n \n$\n5,628\n \n\n \n\nAmortization expense For the years\nended December 31, 2025, 2024, and 2023 amounted to $5,629, $10,603, and $11,355, respectively.\n\n \n\n**Note 8 – Other payables and accrued liabilities**\n\n \n\nOther payables and accrued liabilities consist of the following:\n\n \n\nSchedule of other payables and accrued liabilities\n \n \n \n \n \n \n \n \n\n \n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n\nPayables to non-trade vendors and service providers\n \n$\n1,385,662\n \n \n$\n1,381,806\n \n\nSalary payable\n \n \n913,171\n \n \n \n839,090\n \n\nTotal other payables and accrued liabilities\n \n$\n2,298,833\n \n \n$\n2,220,896\n \n\n \n\n **Note 9 – Related party balances and transactions**\n\n \n\n*Related party balances*\n\n \n\nOther receivables - related parties\n\n \n\nSchedule of other receivables - related parties \n  \n  \n    \n   \n\nName of Related Party \nRelationship \nNature \nAs of\nDecember 31,\n2025 \nAs of\nDecember 31,\n2024\n\n  \n  \n  \n  \n \n\nFujian Tantan Technology Co, Ltd (“FJ Tantan”) \nFJ Tantan’s legal representative is the secretary of Fujian Hongfa Group Ltd (“Fujian Hongfa”). Fujian Hongfa is the shareholder of FJ LSY. \nInterest free, due on June 15, 2026 \n$112,683  \n$109,621 \n\nFuzhou Jinhui Environmental service Co, Ltd \nFujian Jinshun environmental Co, Ltd (“Jinshun”) is the major shareholder of FZ Jinhui. Weihao Chen is the Major shareholder of Jinshun, and the legal representative of FZ LSY. \nInterest free, due on August 31, 2026 \n 12,069  \n — \n\nYueyu Qi \nSpouse of Wang who is a supervisor of Huzhou CDT \nInterest free, debts offset claims, signed April 2025 \n —  \n 13,911 \n\nTotal \n  \n  \n$124,752  \n$123,532 \n\n \n\nF-22\n\n \n\n \n\nOther payables – related party\n\n \n\nSchedule of other payables – related parties\n \n \n \n \n \n \n \n \n\nName of Related Party\n \nRelationship\n \nNature\n \nAs of\nDecember 31,\n2025\n \nAs of\nDecember 31,\n2024\n\n \n \n \n \n \n \n \n \n \n\nWanqiang Lin\n \nDirector of Ultra HK\n \nAdvance payment for operational expenses of the Company pending for reimbursement\n \n$\n256,348\n \n \n$\n256,863\n \n\n \n\n \n\nShort-term loans - related parties\n\n \n\n Schedule of Short-term loans - related parties  \n  \n  \n  \n \n\nName of Related Party \nRelationship \nNature \nAs of\nDecember 31,\n2025 \nAs of\nDecember 31,\n2024\n\n  \n  \n  \n  \n \n\nBeijing Minhongyun Energy Supply Co. Ltd. \nYunwu Li, the Company’s Chief Executive Officer and Chairman of the Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd is the director of this entity \nInterest-free loans due on November 30, 2025 extended to November 30, 2026 \n$1,078,206  \n$1,048,912 \n\nShenzhen Li Yaxin Industrial Co., Ltd \nYunwu Li, the Company’s Chief Executive Officer and Chairman of the Company’s Board of Directors and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd., is the sole shareholder of this entity \nInterest-free loans due on December 10, 2025, extended to December 31, 2026 \n 90,804  \n 97,379 \n\nYunwu Li \nChairman of CDT Environmental Technology Co., Ltd. \nInterest-free loans due on October 31, 2025, extended to December 31, 2026 \n 635,131  \n 846,854 \n\nJianzhong Zhao \nLegal Representative, General Manager and Director of Hohhot CDT Environmental Technology Co., Ltd. \nInterest-free loans due on December 31, 2025, extended to December 31, 2026 \n 176,073  \n 237,868 \n\nJianshan Ma \nDirector and General Manager of Chengde CDT Environmental Technology Co., Ltd. \nInterest-free loans due on December 31, 2025, extended to December 31, 2026 \n 85,746  \n 95,264 \n\nYan Wang \nRelative of Ying Wang, Supervisor of Huzhou CDT Environmental Technology Co., Ltd. \nInterest-free loans due on February 28, 2025, extended to February 28, 2027 \n 179,120  \n 157,978 \n\nShaozhao Xu \nProject manager of Shenzhen CDT Environmental Technology Co., Ltd \nInterest free, due on December 31, 2026 \n 315,595  \n 310,639 \n\nTotal \n  \n  \n$2,560,675  \n$2,794,894 \n\n \n\nInterest expense pertaining to\nthe loans for the years ended December 31, 2025, 2024, and 2023 were amounted to $0, respectively.\n\n \n\nF-23\n\n \n\n \n\n**Note 10 – Credit facilities**\n\n \n\nShort-term loans – banks\n\n \n\nOutstanding balances on short-term bank loans consist of the following:\n\n \n\nSchedule of short-term bank loans \n    \n   \n \n  \n    \n   \n\nBank Name \nMaturities \nInterest Rate \nCollateral/ Guarantee \nAs of\nDecember 31,\n2025 \nAs of\nDecember 31,\n2024\n\n  \n  \n  \n  \n  \n \n\nChina Bank of Communication(1) \n January 2025, extended to November 2026  \n 4.2%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company, and the line of credit is secured by two real estate properties owned by Yunwu Li. \n 636,342  \n 1,112,904 \n\nZhejiang Hecheng Rural Commercial Bank Co.，Ltd (2) \n August 2025, extended to August 2026  \n 3.7-4.3%\n \nGuaranteed by Ying Wang, the operating manager of HZ CDT, and the line of credit is secured by real estate property owned by Ying Wang. \n 171,598  \n 166,936 \n\nBank of China \n November 2025, extended to November 2026  \n 3.5%\n \nNone \n 238,807  \n 317,178 \n\nWeizhong Bank \n August 2025, extended to August 2026  \n 5.9%\n \nGuaranteed by Zhan Su, the legal representative of BJ CDT \n 54,475  \n 132,489 \n\nWeizhong Bank \n November 2025  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 68,011 \n\nWeizhong Bank \n February 2025 (repaid in February 2025)  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General\n \nManager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 3,784 \n\nWeizhong Bank \n February 2025 (repaid in February 2025)  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General\n \nManager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 13,249 \n\nSichuan Xinwang Bank Co., Ltd \n August 2026  \n 18.0%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n 47,665  \n — \n\nWeizhong Bank \n January 2026 (repaid in January 2026)  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n 681  \n — \n\nWeizhong Bank \n March 2026(repaid in January 2026)  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n 4,086  \n — \n\nTotal \n    \n   \n \n  \n$1,153,654  \n$1,814,551 \n\n \n\n \n(1)\nIn August 2022, the Company secured a renewable line of credit (“Line of Credit 1”) worth approximately $1.1 million from China Bank of Communication for a two-year period. This line of credit is backed by the guarantee of Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company, and it is secured by a real estate property owned by Yunwu Li. On January 2, 2024, the Line of Credit 1 was extended to July 14, 2024 and further extended to November 18, 2026.\n\n \n\n \n(2)\nOn August 30, 2024, the Company entered into a loan agreement with Zhejiang Hecheng Rural Commercial Bank Co Ltd, for approximately $0.2 million. The loan is guaranteed by Yunwu Li, the Chief Executive Officer and Chairman of the Board of Directors of the Company to be due in August 2025 with 4.3% interest rate per annum. In August 2025, the Company renew such loan with 3.7% interest rate per annum to be due in August 2026.\n\n \n\nF-24\n\n \n\n  \n\nLong-term loans – bank\n\n \n\nOutstanding balances on long-term bank loans consist of the following:\n\n \n\nSchedule of long-term loans- bank \n    \n   \n \n  \n    \n   \n\n  \n  \n  \n  \nAs of \nAs of\n\nBank Name \nMaturities \nInterest\nRate \nCollateral/Guarantee \nDecember 31,\n2025 \nDecember 31,\n2024\n\n  \n  \n  \n  \n  \n \n\nSichuan Xinwang Bank Co., Ltd \n May 2026  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 115,927 \n\nWeizhong Bank \n January 2026  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 8,612 \n\nWeizhong Bank \n March 2026  \n 6.1%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 19,873 \n\nZhejiang Hecheng Rural Commercial Bank Co.,Ltd \n    \n 5.0%\n \nGuaranteed by Yunwu Li, Chief Executive Officer and Chairman of the Board of Directors of the Company and Chairman of the Board of Directors and General Manager of Shenzhen CDT Environmental Technology Co., Ltd. \n —  \n 69,557 \n\nZhejiang Hecheng Rural Commercial Bank Co.,Ltd \n August 2026 to October 2027  \n 4.9-5.0%\n \nNone \n 214,497  \n — \n\nZhejiang Hecheng Rural Commercial Bank Co.,Ltd \n August 2026 to October 2027  \n 4.7%\n \nGuaranteed by Ying Wang, the operating manager of HZ CDT. \n 71,499  \n — \n\nZhejiang Hecheng Rural Commercial Bank Co.,Ltd \n August 2026 to October 2027  \n 5.0%\n \nGuaranteed by Ying Wang and Yueyu Qi (Ying Wang’s husband), the operating manager of HZ CDT. \n 71,499  \n — \n\nTotal \n    \n   \n \n  \n$357,495  \n$213,969 \n\n \n\nF-25\n\n \n\n  \n\nShort-term loans – third parties\n\n \n\nOutstanding balances on long-term third-party loans consist of the following:\n\n \n\nSchedule of short-term loans- third parties \n    \n    \n  \n    \n   \n\n  \n  \n  \n  \nAs of \nAs of\n\nLender Name \nMaturities \nInterest Rate \nCollateral/ Guarantee \nDecember 31,\n2025 \nDecember 31,\n2024\n\n  \n  \n  \n  \n  \n \n\nLou Hong \n September 30, 2025, extended to September 30, 2026  \n —% \nNone \n$643,492  \n$626,009 \n\nRunze Li \n December 31, 2025, extended to December 31, 2026  \n —% \nNone \n 1,483  \n 2,086 \n\nShanghai Xinjing Construction Labor Service Center \n November 30, 2025, extended to November 30, 2026  \n —% \nNone \n 214,497  \n 208,670 \n\nNew Ben Global Enterprises Limited \n March 1, 2026  \n —% \nNone \n 983,342  \n — \n\nNanjing Chuangbao Management Consulting Partnership Enterprise (Limited Partnership) \n Repaid in February 11, 2026  \n —% \nNone \n 214,497  \n — \n\n Total \n    \n    \n  \n$2,057,311  \n$836,765 \n\n \n\nInterest expense pertaining to\nthe above loans for the years ended December 31, 2025, 2024, and 2023 were amounted to $91,446, $136,757, and $106,130, respectively.\n\n \n\n**Note 11 – Taxes**\n\n \n\nIncome tax\n\n \n\n*Cayman Islands*\n\n \n\nUnder the current laws of the Cayman\nIslands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no\nCayman Islands withholding tax will be imposed.\n\n \n\n*British Virgin Islands*\n\n \n\nCQ BVI and CDT BVI are incorporated\nin the British Virgin Islands and are not subject to tax on income or capital gains under current British Virgin Islands law. In addition,\nupon payments of dividends by these entities to their shareholders, no British Virgin Islands withholding tax will be imposed.\n\n \n\nF-26\n\n \n\n \n\n*Hong Kong*\n\n \n\nUltra HK and BVI HK are incorporated\nin Hong Kong and are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted\nin accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. The Company did not make any provisions\nfor Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception.\n\n \n\n*PRC*\n\n \n\nShenzhen CDT and its subsidiaries\nare governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable\ntax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof. Under\nthe Enterprise Income Tax Laws of the PRC (the “EIT Laws”), Chinese enterprises are subject to income tax at a rate of 25%\nafter appropriate tax adjustments. Shenzhen CDT obtained the “high-tech enterprise” tax status which reduced its statutory\nincome tax rate to 15% . Upon renewal in December 2025, the high-tech enterprise tax status will expire in December 2027. The statutory\nincome tax rate for PRC subsidiaries except Shenzhen CDT for the years ending December 31, 2025 was 25.0%.\n\n \n\nIncome tax savings due to the preferential\nrates on taxable subsidiaries For the years ended December 31, 2025, 2024, and 2023 were amounted to $907,713, $418,443, and $100,305,\nrespectively.\n\n \n\nThe Company’s basic and diluted\nearning per shares would have been lower by $0.07, $0.01, and $0.01 per share For the years ended December 31, 2025, 2024, and 2023, respectively,\nwithout the preferential tax rate reduction.\n\n \n\nIncome tax expense (benefit) For\nthe years ended December 31, 2025, 2024, and 2023 were amounted to $(1,266,021), $462,043, and $1,403,880, respectively. The effective\ntax rate for the years ended December 31, 2025, 2024, and 2023 were 10.9%, 24.8% and 16.7%, respectively.\n\n \n\nNet income (loss) before income taxes were comprised of the following:\n\n \n\nSchedule of significant components of the\nprovision for income taxes\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nDomestic income-Cayman Islands\n \n$\n(2,256,184\n)\n \n$\n(619,851\n)\n \n$\n—\n \n\nForeign income-PRC\n \n \n(8,814,304\n)\n \n \n3,153,986\n \n \n \n8,448,457\n \n\nForeign income-Hong Kong\n \n \n(561,620\n)\n \n \n(665,810\n)\n \n \n(20,523\n)\n\nTotal (loss) income before taxes\n \n$\n(11,632,108\n)\n \n$\n1,868,325\n \n \n$\n8,427,934\n \n\n \n\nThe components of income tax expense from continuing\noperations were as follows:\n\n \n\nSchedule\nof components of income tax expense\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nCurrent income tax expense\n \n \n \n \n \n \n \n \n \n \n \n \n\nPRC\n \n$\n930,132\n \n \n$\n1,428,438\n \n \n$\n1,357,135\n \n\nTotal current income tax expense\n \n \n930,132\n \n \n \n1,428,438\n \n \n \n1,357,135\n \n\nDeferred income tax (benefit) expense\n \n \n \n \n \n \n \n \n \n \n \n \n\nPRC\n \n \n(2,196,153\n)\n \n \n(966,395\n)\n \n \n46,745\n \n\nTotal deferred income tax (benefit) expense\n \n \n(2,196,153\n)\n \n \n(966,395\n)\n \n \n46,745\n \n\nTotal income tax (benefit) expense\n \n$\n(1,266,021\n)\n \n$\n462,043\n \n \n$\n1,403,880\n \n\n \n\nF-27\n\n \n\n  \n\nThe following table reconciles PRC statutory rates to the Company’s\neffective tax rate:\n\n \n\nSchedule of effective tax rate\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nPRC statutory income tax rate\n \n$\n(2,908,027\n)\n \n$\n467,081\n \n \n$\n2,106,984\n \n\nForeign tax effects\n \n \n \n \n \n \n \n \n \n \n \n \n\n Foreign tax effects-Cayman Islands\n \n \n564,046\n \n \n \n154,963\n \n \n \n—\n \n\nPreferential tax rate on PRC operations\n \n \n907,713\n \n \n \n(264,011\n)\n \n \n(706,818\n)\n\nChange in valuation allowance\n \n \n162,303\n \n \n \n168,104\n \n \n \n28,229\n \n\nNon-taxable or non-deductible items\n \n \n7,943\n \n \n \n(64,094\n)\n \n \n(24,515\n)\n\nTotal income tax (benefit) expense\n \n$\n(1,266,021\n)\n \n$\n462,043\n \n \n$\n1,403,880\n \n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nPRC statutory income tax rate\n \n \n25.0\n%\n \n \n25.0\n%\n \n \n25.0\n%\n\nForeign tax effects\n \n \n \n \n \n \n \n \n \n \n \n \n\n Foreign tax effects-Cayman Islands\n \n \n(4.8\n%)\n \n \n8.3\n%\n \n \n \n%\n\nPreferential tax rate on PRC operations\n \n \n(7.8\n%)\n \n \n(14.1\n%)\n \n \n(8.4\n%)\n\nChange in valuation allowance\n \n \n(1.4\n%)\n \n \n9.0\n%\n \n \n0.3\n%\n\nNon-taxable or non-deductible items\n \n \n(0.1\n%)\n \n \n(3.4\n%)\n \n \n(0.3\n%)\n\nEffective tax rate\n \n \n10.9\n%\n \n \n24.7\n%\n \n \n16.7\n%\n\n \n\nDeferred tax assets – China and Hong Kong\n\n \n\nSignificant components of deferred tax assets are as follows:\n\n \n\nSchedule of deferred tax assets\n \n \n \n \n \n \n \n \n\n \n \nDecember 31,\n2025\n \nDecember 31,\n2024\n\n \n \n \n \n \n\nAllowance for credit losses\n \n$\n3,649,292\n \n \n$\n1,354,590\n \n\nNet operating loss carryforwards\n \n \n508,006\n \n \n \n404,920\n \n\nValuation allowance\n \n \n(657,649\n)\n \n \n(550,821\n)\n\nDeferred tax assets, net\n \n$\n3,499,649\n \n \n$\n1,208,689\n \n\n \n\nAs of December 31, 2025 and December\n31, 2024, the Company had net operating loss carryforwards of $1,923,516 and $1,658,282, respectively, from the Company’s PRC subsidiaries\nwhich were operating at losses, which will expire by December 31, 2030 and 2029, based upon the level of historical operating losses in\nthe Company’s PRC subsidiaries, other than Shenzhen CDT, which were operating at cumulative losses as of December 31, 2025. The\nCompany also had net operating loss carryforwards of $1,996,769 and $1,435,150 as of December 31, 2025 and December 31, 2024, respectively,\nfrom Company’s Hong Kong subsidiaries which were operating at losses. The Company believes it is less likely than not that its PRC\nand Hong Kong operations will be able to fully utilize its deferred tax assets related to the net operating loss carryforwards in the\nPRC and Hong Kong. As a result, the Company provided 100% allowance on all deferred tax assets on the net operating losses of $178,539\nand $168,120 related to its operations in the PRC as of December 31, 2025 and December 31, 2024, respectively. The Company also provided\n100% allowance on all deferred assets on net operating losses of $329,467 and $236,800 related to its operations in Hong Kong as of December\n31, 2025 and December 31, 2024, respectively.\n\n \n\nF-28\n\n \n\n \n\nCertain of the Company’s\nallowance for credit losses are for the Company’s PRC subsidiaries which the Company believes it is less likely than not that its\nPRC operations, other than Shenzhen CDT will be able to fully utilize its deferred tax assets related to the allowance for credit losses\nin the PRC. As a result, the Company provided 100% allowance on all deferred tax assets on the allowance for credit losses of $149,643\nand $145,901 related to its operations in the PRC, other than Shenzhen CDT as of December 31, 2025 and 2024.\n\n \n\nIncome Taxes Paid\n\n \n\nThe following table presents income taxes paid, net of refunds, disaggregated\nby jurisdiction for the years ended December 31, 2025, 2024 and 2023:\n\n \n\nSchedule of income taxes paid\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nPRC\n \n$\n—\n \n \n$\n141\n \n \n$\n7,271\n \n\nTotal cash paid for income taxes\n \n$\n—\n \n \n$\n141\n \n \n$\n7,271\n \n\n \n\nUncertain tax positions\n\n \n\nThe Company evaluates each uncertain\ntax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized\nbenefits associated with the tax positions. As December 31, 2025 and 2024, the Company did not have any significant unrecognized uncertain\ntax positions.\n\n \n\nTaxes payable consist of the following:\n\n \n\n \n \n \n \n \n \n \n \n \n\n \n \nDecember 31,\n2025\n \nDecember 31,\n2024\n\n \n \n \n \n \n\nVAT taxes payable\n \n$\n3,232,531\n \n \n$\n1,421,831\n \n\nIncome taxes payable\n \n \n7,106,291\n \n \n \n5,982,737\n \n\nOther taxes payable\n \n \n(9,224\n)\n \n \n4,106\n \n\nTotals\n \n$\n10,329,598\n \n \n$\n7,408,674\n \n\n** **\n\n**Note 12– Concentration of risk**\n\n \n\nCredit risk\n\n \n\nFinancial instruments that potentially\nsubject the Company to significant concentrations of credit risk consist primarily of cash. As of December 31, 2025 and 2024, $54,992\nand $86,508 were deposited with financial institutions located in the PRC, respectively. The deposit insurance system in China only insures\neach depositor at each bank for a maximum of approximately $71,499 (RMB 500,000). As of December 31, 2025 and 2024, nil were over the\nChina deposit insurance limit, respectively. As of December 31, 2025 and December 31, 2024, $6,680 and $22,279 was deposited with financial\ninstitutions located in Hong Kong, respectively. The deposit insurance system in Hong Kong only insures each depositor at each bank for\na maximum of approximately $64,240 (HKD 500,000). As of December 31, 2025 and 2024, none of these balances are over the Hong Kong Deposit\nProtection Board limit.\n\n \n\nThe Company is also exposed to\nrisk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made\nfor estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.\n\n \n\nF-29\n\n \n\n \n\nAll of the Company’s expense\ntransactions are denominated in RMB and HKD, and all of the Company and its subsidiaries’ assets and liabilities are denominated\nin RMB and HKD. RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required\nby law to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”).\nRemittances in currencies other than RMB by the Company in China must be processed through the PBOC or other China foreign exchange regulatory\nbodies which require certain supporting documentation in order to affect the remittance.\n\n \n\nThe Company’s functional\ncurrency is the RMB, and its financial statements are presented in U.S. dollars. The RMB depreciated by 2.7% against the U.S. dollar from\nDecember 31, 2024 to December 31, 2025. It is difficult to predict how market forces or PRC or U.S. government policies may impact the\nexchange rate between the RMB and the U.S. dollar in the future. The change in the value of the RMB relative to the U.S. dollar may affect\nits financial results reported in U.S. dollar terms without giving effect to any underlying changes in its business or results of operations.\nCurrently, the Company’s assets, liabilities, revenues and costs are denominated in RMB.\n\n \n\nTo the extent that the Company\nneeds to convert U.S. dollars into RMB for capital expenditures and working capital and other business purposes, appreciation of RMB against\nthe U.S. dollar would have an adverse effect on the RMB amount the Company would receive from the conversion. Conversely, if the Company\ndecides to convert RMB into U.S. dollars for the purpose of making payments for dividends, strategic acquisitions or investments or other\nbusiness purposes, appreciation of U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount available to the\nCompany.\n\n \n\nCustomer concentration risk\n\n \n\nFor the year ended December 31,\n2025, three customers accounted for 46.6%, 20.3% and 12.1% of the Company’s total revenues, respectively. For the year ended December\n31, 2024, five customers accounted for 22.1%, 21.1%, 15.9%, 13.7% and 12.2% of the Company’s total revenues, respectively. For the\nyear ended December 31, 2023, two customers accounted for 23.4% and 10.2% of the Company’s total revenues, respectively.\n\n \n\nAs of December 31, 2025, five customers\naccounted for 17.4%, 15.3%, 14.6%, 11.9% and 10.9% of total balance of accounts receivable, respectively. As of December 31, 2024, four\ncustomers accounted for 25.0%, 16.3%, 14.3% and 13.1% of total balance of accounts receivable, respectively.\n\n \n\nVendor concentration risk\n\n \n\nFor the years ended December 31,\n2025, three vendors accounted for 26.0%, 25.2% and 16.6% of the Company’s total purchases, respectively. For the years ended December\n31, 2024, four vendors accounted for 31.1%, 14.8% and 14.7% of the Company’s total purchases, respectively. For the year ended December\n31, 2023, one vendor accounted for 27.3% of the Company’s total purchases, respectively.\n\n \n\nAs of December 31, 2025, two vendors\naccounted for 24.9% and 14.5% of total balance of accounts payable, respectively. As of December 31, 2024, three vendors accounted for\n17.8%, 15.2% and 11.2% of total balance of accounts payable, respectively.\n\n \n\n**Note 13 – Shareholders’ equity**\n\n \n\nOrdinary shares\n\n \n\nCDT Cayman was established under\nthe laws of Cayman Islands on November 28, 2016. The authorized number of ordinary shares was 38,000,000 shares with a par value of HK$0.01.\n\n \n\nOn October 15, 2019, the shareholders\nof the Company resolved to create an additional 50,000,000 of the authorized ordinary shares with a par value of US$ 0.001 (the “Increase\nin Share Capital”). Following the Increase in Share Capital, the Company newly issued 23,000,000 ordinary shares with a par value\nof US$0.001 (the “USD Shares Issued”). Following the USD Shares Issued, the Company repurchased and cancelled 900,000 of the\noutstanding ordinary shares with a par value of HK$0.01 then issued and outstanding as well as cancelled 38,000,000 of the authorized\nordinary shares with a par value of HK$ 0.01.\n\n \n\nF-30\n\n \n\n \n\nThe Company considered the above\ntransactions as a 25.56-for-1 split of its ordinary shares and deemed the cancellation of 900,000 original ordinary shares with par value\nof HK$ 0.01 and the new issuance of 23,000,000 ordinary shares with par value of US$0.001 were part of the Company’s recapitalization\nprior to completion of its initial public offering. The Company believed it is appropriate to reflect the above transactions on a retroactive\nbasis similar to stock split or dividend pursuant to FASB ASC 260 “Earnings Per Share”.\n\n \n\nOn December 30, 2020, the shareholders\nof the Company resolved to divide 50,000,000 of the authorized ordinary shares with a par value of US$ 0.001 (the “Decrease in Share\nCapital”) into 20,000,000 of the authorized ordinary shares with a par value of US$0.0025. Following the Decrease in Share Capital,\nthe Company’s existing 23,000,000 ordinary shares with a par value of US$0.001 were divided into 9,200,000 ordinary shares with\na par value of US$0.0025. The Company considered the above transactions as a 1-for-2.5 reverse split of its ordinary shares. The Company\nbelieved it is appropriate to reflect the above transactions on a retroactive basis similar to stock split or dividend pursuant to FASB\nASC 260. All share and per share amounts used herein and in the accompanying consolidated financial statements have been retroactively\nadjusted to reflect the share split.\n\n \n\nOn April 22, 2024, the Company\ncompleted the initial public offering (“IPO”) of 1,500,000 ordinary shares at an initial public offering price of $4.00 per\nshare, resulting in net proceeds to the Company of approximately $4.3 million after deducting underwriting discounts and commissions and\nother expenses, and including net proceeds in the amount of $600,000 that were placed in an escrow account for 24-months following the\nclosing of the IPO.\n\n \n\nOn September 23, 2025, the Company\nadopted its Second Amended and Restated Memorandum and Articles of Association, pursuant to which the authorized share capital was revised\nto US$250,000 divided into 94,000,000 Class A ordinary shares and 6,000,000 Class B ordinary shares, each with a par value of US$0.0025\nper share. The amendment reclassified the Company’s ordinary share structure into Class A and Class B ordinary shares, with Class\nA ordinary shares entitled to one vote per share and Class B ordinary shares entitled to twenty votes per share and convertible into Class\nA ordinary shares on a one-for-one basis at the option of the holder. Any transfer of Class B ordinary shares to a non-affiliate will\nautomatically result in conversion into Class A ordinary shares. The amendment also increased the Company’s authorized share capital;\nhowever, it did not constitute a stock split or reverse split and did not have any immediate impact on the Company’s consolidated\nfinancial statements, shareholders’ equity, or results of operations, as no additional shares or other equity instruments were issued\nin connection with the amendment.\n\n \n\nOn December 8, 2025, the Company\nentered into share purchase agreements with three investors, pursuant to which the Company issued an aggregate of 1,200,000 ordinary shares\nwith a par value of US$0.0025 per share at a purchase price of US$0.50 per share, resulting in gross proceeds to the Company of US$600,000.\nThese shares are subject to a 6-month lock-up restriction from the date of issuance, during which the shares may not be sold, transferred,\npledged or otherwise disposed of, and are deemed restricted shares under the U.S. Securities Act of 1933. As of December 31, 2025, all\n1,200,000 restricted shares remain outstanding and subject to transfer restrictions, and are not freely tradable under applicable securities\nlaws.\n\n  \n\nRestricted assets\n\n \n\nThe Company’s ability to\npay dividends is primarily dependent on the Company receiving distributions of funds from its subsidiaries. Relevant PRC statutory laws\nand regulations permit payments of dividends by Shenzhen CDT and its subsidiaries (collectively “CDT PRC entities”) only out\nof its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations\nreflected in the accompanying consolidated financial statements prepared in accordance with U.S. GAAP differ from those reflected in the\nstatutory financial statements of CDT PRC entities.\n\n \n\nCDT PRC entities are required to\nset aside at least 10% of their after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds\nreach 50% of its registered capital. In addition, CDT PRC entities may allocate a portion of its after-tax profits based on PRC accounting\nstandards to enterprise expansion fund and staff bonus and welfare fund at its discretion. CDT PRC entities may allocate a portion of\nits after-tax profits based on PRC accounting standards to a discretionary surplus fund at its discretion. The statutory reserve funds\nand the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of\nChina is subject to examination by the banks designated by State Administration of Foreign Exchange.\n\n \n\nF-31\n\n \n\n \n\nAs a result of the foregoing restrictions,\nCDT PRC entities are restricted in their ability to transfer their assets to the Company. Foreign exchange and other regulation in the\nPRC may further restrict CDT PRC entities from transferring funds to the Company in the form of dividends, loans and advances. As of December\n31, 2025 and 2024, amounts restricted are the paid-in-capital and statutory reserve of CDT PRC entities, which amounted to $8,260,051\nand $8,260,051, respectively.\n\n \n\nStatutory reserves\n\n \n\nFor the years ended December 31,\n2025, 2024, and 2023, CDT PRC entities collectively attributed $0, $240,734 and $796,316 of retained earnings for their statutory reserves,\nrespectively.\n\n \n\nShare-based compensation\n\n \n\nOn March 26, 2024, the Company\nentered into a marketing services agreement with Outside the Box LLC (“OTB”), a branding and communications consultancy, to\nprovide marketing and investor awareness services over the period from March 25, 2024 to September 25, 2024. Pursuant to the terms of\nthe agreement, the Company agreed to compensate OTB with a cash payment of $100,000 and an issuance of ordinary shares valued at $200,000,\nboth contingent upon the completion of the Company’s initial public offering (“IPO”). Following the completion of the\nIPO on April 22, 2024, the Company settled the cash obligation using IPO proceeds and issued 50,000 ordinary shares to OTB.\n\n \n\nOn May 5, 2024, the Company entered\ninto a services agreement with TraDigital Marketing Group, LLC (“TraDigital”), a Delaware limited liability company specializing\nin digital marketing and investor relations. Pursuant to the agreement, TraDigital was engaged to provide digital marketing services over\na six-month term ending November 4, 2024. As consideration for such services, the Company agreed to pay a monthly service fee of $7,500\nduring the term of the agreement and issued 75,000 ordinary shares to TraDigital on May 5, 2024, the effective date of the agreement.\n\n \n\nOn February 13, 2025, the Board\nof Directors of the Company adopted the 2025 Equity Incentive Plan (the “2025 Plan”), which became effective on the same date.\nThe 2025 Plan authorizes the issuance of up to 1,500,000 Class A ordinary shares and is intended to provide equity-based compensation\nto employees, directors, and consultants of the Company and its affiliates. Awards under the 2025 Plan may include non-qualified stock\noptions, incentive stock options, restricted stock awards, and unrestricted stock awards. As of December 31, 2025, a total of 1,500,000\nClass A ordinary shares had been issued to one employee and two consultants pursuant to the 2025 Plan. The Company determined the aggregate\nfair value of the equity-based compensation granted to be $2,145,000, which was recorded as share-based compensation expense for the years\nended December 31, 2025.\n\n \n\n**Note 14 – Leases**\n\n \n\nThe Company determines if a contract\ncontains a lease at inception. U.S. GAAP requires that the Company’s leases be evaluated and classified as operating or finance\nleases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the\nevaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal\noption periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic\npenalty. The Company’s office and warehouse leases were classified as operating leases. The leases generally do not contain options\nto extend at the time of expiration. Lease expense for lease payment is recognized on a straight-line basis over the lease terms.\n\n \n\nThe Company has elected the short-term\nlease exception; therefore operating leases’ ROU asset and liability do not include leases with a lease term of twelve months or\nless.\n\n \n\nFor operating leases that include\nrent escalation clauses, the Company recognized lease expense on a straight-line basis over the lease term from the date it takes possession\nof the leased property. The Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative\nexpenses on the consolidated statements of operation and comprehensive (loss) income.\n\n \n\nF-32\n\n \n\n \n\nDuring the years ended December\n31, 2025 and 2024, the Company did not enter into any new lease agreements that would require recognition of initial right-of-use (“ROU”)\nassets and corresponding operating lease liabilities. The Company’s lease agreements do not include material residual value guarantees\nor restrictive covenants.\n\n \n\nThe following table presents operating\nlease cost reported in the consolidated statements of operation and comprehensive (loss) income:\n\n \n\nSchedule of lease liabilities remaining operating\nleases\n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nOperating lease cost\n \n$\n—\n \n \n$\n70,862\n \n \n$\n109,184\n \n\nShort-term lease cost\n \n \n200,625\n \n \n \n53,891\n \n \n \n105,517\n \n\nTotal\n \n$\n200,625\n \n \n$\n124,753\n \n \n$\n214,701\n \n\n** **\n\n****\n\n**Note 15 – Commitments and contingencies**\n\n \n\n*Legal contingencies*\n\n \n\nFrom time to time, the Company\nis party to certain legal proceedings, as well as certain asserted and un-asserted claims. Amounts accrued, as well as the total amount\nof reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be material to the consolidated\nfinancial statements.\n\n \n\n**Note 16 – Segments information**\n\n \n\nThe Company conducts business as\na single operating segment which is based upon the Company’s organizational and management structure, as well as information used\nby the CODM, the CEO of the Company, to allocate resources and perform assessment. The key measure of segment profitability that the CODM\nuses to allocate resources and assess performance is consolidated net income. The following table presents the significant revenue and\nexpense categories of the Company’s single operating segment:\n\n \n\nF-33\n\n \n\n \n\nThe following table presents the\nsignificant revenue, cost of revenue and expense categories of the Company’s single operating segment:\n\n \n\nSchedule of Disaggregated information of revenues\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nSewage treatment systems\n \n$\n17,279,031\n \n \n$\n28,417,150\n \n \n$\n32,267,593\n \n\nSewage treatment services and others\n \n \n946,788\n \n \n \n1,348,055\n \n \n \n1,942,326\n \n\nTotal revenues\n \n \n18,225,819\n \n \n \n29,765,205\n \n \n \n34,209,919\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nSewage treatment systems\n \n \n10,074,628\n \n \n \n17,779,226\n \n \n \n21,630,216\n \n\nSewage treatment services and others\n \n \n592,234\n \n \n \n739,502\n \n \n \n1,194,817\n \n\nTotal cost of revenues\n \n \n10,666,862\n \n \n \n18,518,728\n \n \n \n22,825,033\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nTotal gross profit\n \n$\n7,558,957\n \n \n$\n11,246,477\n \n \n$\n11,384,886\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nLess:\n \n \n \n \n \n \n \n \n \n \n \n \n\nSelling expense\n \n \n162,602\n \n \n \n108,637\n \n \n \n106,147\n \n\nDepreciation expense\n \n \n149,050\n \n \n \n148,280\n \n \n \n165,683\n \n\nSalary expense\n \n \n923,569\n \n \n \n255,049\n \n \n \n991,037\n \n\nRent\n \n \n200,625\n \n \n \n124,753\n \n \n \n214,701\n \n\nProfessional fee\n \n \n703,406\n \n \n \n1,296,218\n \n \n \n679,438\n \n\nOther general and administrative expense\n \n \n183,784\n \n \n \n340,157\n \n \n \n623,660\n \n\nResearch and development expense\n \n \n47,602\n \n \n \n61,786\n \n \n \n80,948\n \n\nShare-based compensation\n \n \n2,145,000\n \n \n \n454,250\n \n \n \n—\n \n\nProvision for (Recovery from) credit losses, net\n \n \n14,694,723\n \n \n \n6,459,240\n \n \n \n(88,221\n)\n\nOther (income) expense, net\n \n \n(19,296\n)\n \n \n129,782\n \n \n \n183,559\n \n\n(Loss) Income before income taxes\n \n \n(11,632,108\n)\n \n \n1,868,325\n \n \n \n8,427,934\n \n\nIncome taxes (benefit) expenses\n \n \n(1,266,021\n)\n \n \n462,043\n \n \n \n1,403,880\n \n\nNet (loss) income\n \n$\n(10,366,087\n)\n \n$\n1,406,282\n \n \n$\n7,024,054\n \n\n \n\n**Note 17 – Subsequent events**\n\n** **\n\nIn preparing these consolidated\nfinancial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date of this\naudit report. No other events require adjustment to or disclosure in the consolidated financial statements other than the following:\n\n \n\nOn April 17, 2026, the Company\nentered into securities purchase agreements with certain investors for the issuance and sale of an aggregate of 62,000,000 ordinary shares\nof the Company at a purchase price of $0.105 per share, for aggregate gross proceeds of $6,510,000. As of the date of issuance of the\nconsolidated financial statements, the Company had completed the transaction and received the proceeds in full.\n\n \n\n**Note 18 – Financial information of the parent\ncompany**\n\n \n\nThe Company performed a test on the restricted net\nassets of consolidated subsidiary in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08(e)(3), “General\nNotes to Financial Statements” and concluded that it was applicable for the Company to disclose the financial statements for the\nparent company.\n\n \n\nThe subsidiary did not pay any dividends to the Company\nfor the periods presented. For the purpose of presenting parent only financial information, the Company records its investment in its\nsubsidiaries under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company\nas “Investment in subsidiaries” and the income (loss) of the subsidiaries is presented as “Equity income (loss) of subsidiaries”.\nCertain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been\ncondensed and omitted.\n\n \n\nThe Company does not have significant capital and\nother commitments, long-term obligations, or guarantees as of December 31, 2025 and 2024.\n\n \n\nF-34\n\n \n\n \n\nPARENT COMPANY BALANCE SHEETS\n\n \n\n Schedule of balance sheets\n \n \n \n \n \n \n \n \n\n \n \n**December 31,** ** ** **2025**\n \n**December 31,** ** ** **2024**\n\n \n \n \n \n \n\nASSETS\n \n \n \n \n \n \n \n \n\nOTHER ASSET\n \n \n \n \n \n \n \n \n\nInvestment in subsidiaries\n \n$\n30,612,713\n \n \n$\n37,283,779\n \n\nTotal asset\n \n$\n30,612,713\n \n \n$\n37,283,779\n \n\n \n \n \n \n \n \n \n \n \n\nLIABILITIES AND SHAREHOLDERS’ EQUITY\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n\nLIABILITIES\n \n$\n—\n \n \n$\n—\n \n\n \n \n \n \n \n \n \n \n \n\nCOMMITMENTS AND CONTINGENCIES\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n\nSHAREHOLDERS’ EQUITY\n \n \n \n \n \n \n \n \n\nOrdinary shares, $0.0025 par value, 20,000,000 shares authorized, 12,325,000 and 10,825,000 shares outstanding as of December 31, 2025 and 2024\n \n \n33,813\n \n \n \n27,063\n \n\nAdditional paid-in capital\n \n \n147,316,883\n \n \n \n11,578,633\n \n\nStatutory reserves\n \n \n3,433,589\n \n \n \n3,433,589\n \n\nRetained earnings\n \n \n14,258,161\n \n \n \n24,455,403\n \n\nAccumulated other comprehensive loss\n \n \n(1,429,733\n)\n \n \n(2,210,909\n)\n\nTotal shareholders’ equity\n \n \n30,612,713\n \n \n \n37,283,779\n \n\n \n \n \n \n \n \n \n \n \n\nTotal liabilities and shareholders’ equity\n \n$\n30,612,713\n \n \n$\n37,283,779\n \n\n \n\nF-35\n\n \n\n  \n\nPARENT COMPANY STATEMENTS OF OPERATION AND COMPREHENSIVE\n(LOSS) INCOME\n\n \n\nSchedule of income and comprehensive\nincome\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nEQUITY (LOSS) INCOME OF SUBSIDIARIES\n \n$\n(10,197,242\n)\n \n$\n1,453,191\n \n \n$\n7,417,705\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNET (LOSS) INCOME\n \n \n(10,197,242\n)\n \n \n1,453,191\n \n \n \n7,417,705\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nFOREIGN CURRENCY TRANSLATION ADJUSTMENT\n \n \n781,176\n \n \n \n(201,488\n)\n \n \n(518,799\n)\n\nCOMPREHENSIVE (LOSS) INCOME\n \n$\n(9,416,066\n)\n \n$\n1,251,703\n \n \n$\n6,898,906\n \n\n \n\nF-36\n\n \n\n  \n\nPARENT COMPANY STATEMENTS OF CASH FLOWS\n\n \n\nSchedule of cash flows\n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \nFor the year ended December 31, 2025\n \nFor the year ended December 31, 2024\n \nFor the year ended December 31, 2023\n\n \n \n \n \n \n \n \n\nCASH FLOWS FROM OPERATING ACTIVITIES:\n \n \n \n \n \n \n \n \n \n \n \n \n\nNet (loss) income\n \n$\n(10,197,242\n)\n \n$\n1,453,191\n \n \n$\n7,417,705\n \n\nAdjustments to reconcile net income to cash used in operating activities:\n \n \n \n \n \n \n \n \n \n \n \n \n\nEquity (loss) income of subsidiaries\n \n \n10,197,242\n \n \n \n(1,453,191\n)\n \n \n(7,417,705\n)\n\nNet cash used in operating activities\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCHANGES IN CASH\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH, beginning of year\n \n \n—\n \n \n \n—\n \n \n \n—\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH, end of year\n \n$\n—\n \n \n$\n—\n \n \n$\n—\n \n\n \n\nF-37\n\n \n\n** **"}