{"url_path":"/sec/vrdr/10-k/2026/item-1","section_key":"item-1","section_title":"Item 1 Business.**","topic":"sec","document":{"doc_type":"10-K/A","doc_date":"2026-06-03","source_url":"https://www.sec.gov/Archives/edgar/data/1506929/0001493152-26-027105-index.html","accession_number":"0001493152-26-027105","cik":"0001506929","ticker":"VRDR","issuer_name":"VERDE RESOURCES, INC.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1506929/0001493152-26-027105-index.html","primary_entity_key":"0001506929","primary_entity_name":"VERDE RESOURCES, INC."},"word_count":9506,"has_tables":true,"body_markdown":"**ITEM\n1. Business.**\n\n \n\n**Overview**\n\n \n\nWe\nare a road construction and building materials company offering proprietary, environmentally sustainable materials and seeking to redefine\nour industry with a clear mission: **enabling the “Transition to Zero.”** Our proprietary product *BioAsphalt™*\nincorporates **biochar**, a powerful carbon sequestering material, into infrastructure with the goal of reducing emissions,\nimproving performance, and lowering overall costs. We also offer a licensed proprietary cold mix biochar asphalt emulsifying agent, which\nwe call “*Verde V24*”. Further, we expect to generate revenues from the generation by our products, and our subsequent\nsale, of *carbon removal credits*. We believe our proprietary products, know-how and business plan place us at the forefront of\nsustainable innovation in the construction and building materials sector, an industry we believe is long overdue for transformation.\n\n \n\nOur\nstrategic roadmap for achieving net-zero emissions—what we call the **Verde Net Zero Blueprint**—has achieved the following\nsignificant milestones:\n\n \n\n \n●\nThe\nissuance to our company in April 2025 of the world’s first carbon removal credit from asphalt production and application, certified\nby Puro.earth, the leading global registry for engineered carbon removal.\n\n \n \n \n\n \n●\nTechnological\nvalidation of our BioAsphalt™ by the National Center for Asphalt Technology (NCAT), including receipt of preliminary performance\nresults from NCAT in July 2025 that demonstrated consistent durability, particularly under low-volume roadway conditions. Most recently,\nin September 2025, NCAT’s latest evaluation of our cold recycling mix using 100% reclaimed asphalt pavement (“RAP”)\nfrom laboratory testing demonstrated that our cold-recycled mix not only meets but exceeds industry specifications for cold-recycled\nasphalt. These results showed superior cohesion, high tensile strength ratio (“TSR”), and retained stability compared\nto standard cold mix benchmarks, validating its strength, durability, and moisture resistance.\n\n \n\nOur\nVerde Net Zero Blueprint is comprised of our portfolio of validated technologies that enable the production of sustainable infrastructure\nmaterials with the integrated ability to generate certified carbon removal credits. This positions carbon sequestration not just as an\nenvironmental co-benefit, but as a monetizable feature embedded in our business plan.\n\n \n\n \n\n5\n\n[Table of Contents](#toc_001)\n\n \n\nAs\nthe rise of artificial intelligence accelerates data center energy consumption, which is now projected to account for a growing share\nof global electricity use, enterprises worldwide are facing increasing pressure to offset their carbon footprints. This is driving up\ndemand for high-integrity, verifiable carbon credits.\n\n \n\nOur\nmodel presents a novel combination of infrastructure performance with measurable climate impact, establishing us as a first mover in\nscalable Net Zero solutions, which we believe positions us well to meet the demands of a rapidly decarbonizing, carbon-constrained economy.\n\n \n\nWith\nkey third-party validations from groups such as NCAT and Puro.earth in place, we are now focused on commercializing our solutions in\nthe United States, our most strategic market. To this end, we recently entered into an exclusive licensing agreement with Ergon Asphalt\n& Emulsions, Inc. (“Ergon”), an industry leader in asphalt innovation and supply and one of the largest liquid asphalt\nand emulsion marketers in North America, for the production of asphalt surface course material containing our proprietary solution across\nNorth America. As our domestic operations scale through Ergon, we plan to license the Verde Net Zero Blueprint globally, targeting infrastructure\nand materials companies in countries aligned with the Paris Climate Agreement and pursuing Net Zero by 2050.\n\n \n\nTo\nfully focus on this transition, we have exited all of our company’s legacy business lines unrelated to sustainable infrastructure\ntechnologies, including:\n\n \n\n \n●\nThe\nsale of our Malaysian mining subsidiary Champmark Sdn Bhd (“CSB”), which was completed on April 20, 2023; and\n\n \n \n \n\n \n●\nThe\ndiscontinuation of our CBD business following the expiration of our supply agreement with MRX Xtractors, LLC on July 6, 2024.\n\n \n\nWe\nplan to expand operations and generate and grow revenue over the next twelve (12) months primarily through marketing and selling our\nproprietary road technologies through Ergon exclusively in North America, with an initial focus on the United States. Production planning\nof our materials has already commenced, with distribution anticipated to occur through the Ergon’s established sales channels,\nreaching asphalt mixing plants across the United States, Canada and Mexico for blending and placement. Embedding our technology into\nErgon’s nationwide business footprint would enable immediate scalability and near-term revenue generation.\n\n \n\nWe\nbelieve our asset light business model enables scalable growth while minimizing capital intensity, creating recurring revenue streams\nthrough licensing, sales, royalties, carbon monetization, and strategic partnerships. We operate through our primary U.S. subsidiary,\nVerde Renewables, Inc., headquartered in St. Louis, Missouri.\n\n \n\n**Our\nServices and Products**\n\n \n\nOur\nbusiness model includes two core proprietary technologies that form the foundation of our carbon-integrated road system:\n\n \n\n**Cold\nMix Biochar Asphalt.**We currently maintain proprietary rights to the key technology we use, Verde V24, which is used in our cold\nmix biochar asphalt mix design. Our cold mix asphalt is a surface course engineered with biochar, a stable form of carbon derived from\norganic waste, and formulated with a proprietary emulsifying agent, Verde V24, that enables the creation of a specialized emulsion, facilitating\na strong bond between the carbon and aggregate. Unlike traditional hot mix asphalt, which requires high temperatures and generates significant\ngreenhouse gas emissions during production and application, our solution is applied at ambient temperature and activated with water,\neliminating the need for heat or solvents. It is durable, cost-effective, and suitable for year-round use, including in cold-weather\nclimates.\n\n \n\nThe\nmaterial has been independently validated, including through trials at the NCAT, confirming its performance under real-world conditions.\nIn July 2025, we received encouraging preliminary performance results from NCAT. After approximately 50,000 equivalent single-axle loads\nof heavy truck traffic, the asphalt surface remained flexible and demonstrated consistent durability, particularly under low-volume roadway\nconditions. Importantly, it is the first carbon-sequestering asphalt surface course to maintain competitive strength and flexibility\nfor road applications and to enable the issuance of verified carbon removal credits, positioning it as a breakthrough in both sustainable\ninfrastructure and climate mitigation.\n\n \n\nIn\nSeptember 2025, NCAT’s latest evaluation of Verde’s cold recycling mix using 100% reclaimed asphalt pavement (“RAP”)\nfurther validated the testing results of our proprietary formulation. Laboratory testing conducted in accordance with ASTM D6927 (Marshall\nStability and Flow), ASTM D6931 (Indirect Tensile Strength), and AASHTO T283 (Moisture Susceptibility) demonstrated that Verde’s\ncold-recycled mix not only meets but exceeds industry specifications for cold-recycled asphalt. Results showed superior cohesion, high\ntensile strength ratio (“TSR”), and retained stability compared to standard cold mix benchmarks, validating its strength,\ndurability, and moisture resistance.\n\n \n\nTogether,\nwe believe these findings reinforce the scalability and commercial readiness of our cold mix biochar asphalt as a next-generation, carbon-sequestering\npavement solution, offering a credible and practical alternative to conventional road construction materials and application methods.\n\n \n\n*TerraZyme\nEnzyme-Based Soil Stabilization.*TerraZyme is a proprietary enzyme-based catalyst engineered to improve the strength, durability,\nand moisture resistance of native soils, serving as a sustainable alternative for road base preparation, subgrade stabilization, and\nerosion control. The enzyme works by catalyzing a natural reaction in clay-bearing soils, breaking down organic material and rearranging\nsoil particles into a more tightly bonded structure. This reaction reduces permeability, minimizes swelling, and significantly enhances\nload-bearing capacity without the need for imported aggregates or traditional binders.\n\n \n\nConventional\nstabilization methods typically rely on cement, lime, or other chemical additives, which are not only costly and labor-intensive but\nalso carbon-intensive in both production and application. By contrast, TerraZyme is a low-emission, cost-effective, and rapidly deployable\nsolution that requires less equipment and labor while delivering superior long-term performance and carbon reduction. Its liquid form\nallows for easy on-site mixing with water and application using standard equipment, followed by compaction.\n\n \n\nTerraZyme\nis also well-suited for rural or remote areas, resource-constrained regions, or developing markets where access to aggregates is limited\nor prohibitively expensive. It is a key component of our broader mission to deliver climate-smart infrastructure solutions worldwide.\n\n \n\nWe\ncurrently have access to the TerraZyme enzyme through a Memorandum of Understanding (the “NPI MOU”) with Nature Plus Inc.\n(“NPI) which is effective until December 2026. We are currently in negotiations with NPI for a definitive agreement that would\ncontain an exclusive worldwide license for TerraZyme.\n\n \n\n6\n\n[Table of Contents](#toc_001)\n\n \n\n**Anticipated\nPlans and Expenditures**\n\n \n\n \n**●**\n**October\n2025 – March 2026:** Following the October 2025 execution of our definitive licensing agreement with Ergon for North America,\nwe are moving forward with initial marketing, technology transfer, and initial production ramp-up.\n\n \n \n \n\n \n**●**\n**April\n2026 – September 2026:** As described further below, our initial “go to market” period with Ergon lasts until\nthe end of 2026. During this time, we will look to establish nationwide distribution and deployment across multiple asphalt plants,\nwith early sales-based revenues expected.\n\n \n \n \n\n \n**●**\n**October\n2026 – December 2026: Initiation of discussions regarding minimum quantities with Ergon for 2027.**\n\n \n \n \n\n \n**●**\n**Expenditures:**\nMinimal business-related capital outlays are anticipated for our company over the next twelve months, as Ergon’s existing infrastructure\nwill support production and distribution. Costs will primarily involve purchases of Verde V24 from our Verde V24 licensor, C-Twelve\nPty Ltd., an Australian company (“C-Twelve”), biochar procurement, technology integration, compliance, and monitoring.\nHowever, we will also be required to fund $3 million to C-Twelve by the end of July 2026 as a loan ($2 million) and as a license\nfee ($1 million) under our Joint Development Agreement with C-Twelve, as described under “Intellectual Property” below.\n\n \n\n**Ergon\nLicense**\n\n \n\nOn\nOctober 10, 2025, Verde Renewables, Inc. (“Verde Renewables”), our wholly owned subsidiary, entered into a license agreement\nwith Ergon (the “Ergon License”), pursuant to which we have granted Ergon an exclusive, non-transferable license to use,\nmanufacture, commercialize, market, sell and distribute any product that contains or is manufactured or formed by Ergon using our proprietary\nVerde V24 cold mix biochar asphalt emulsifying agent in the United States (including its territories), Canada and Mexico, in exchange\nfor Ergon agreeing to purchase Verde V24 from us at a fixed price (which is inclusive of all fees associated with the license, but subject\nto consumer price index adjustments) for use in Ergon’s asphalt road materials products.\n\n \n\nErgon,\nthe largest asphalt marketer in North America, is a subsidiary of Ergon, Inc., a diversified global organization engaged in multiple\nindustries. The privately held Ergon is an industry pioneer in asphalt innovation and supply, employing more than 4,000 people and serving\ncustomers and partners in over 90 countries worldwide.\n\n \n\nWe\nhave agreed with Ergon to an initial fifteen (15) month “go-to-market period”, during which there will be no minimum purchase\nrequirements for Ergon’s purchases of Verde V24. For each calendar year beginning January 1, 2027, Ergon has agreed to negotiate\nwith us in good faith towards the establishment of possible minimum purchase amounts based on certain customary factors. We have also\nagreed with Ergon that if minimum purchase amounts are agreed to for any given calendar year, we and Ergon will agree in good faith to\nnew minimum purchase amounts for each subsequent year, subject to consideration of customary factors.\n\n \n\nWe\nhave also agreed to provide Ergon with forty percent (40%) of our share of the carbon removal credits generated from the mixing of the\nfinal carbon sequestering BioAsphalt™ surface material, so long as (a) the carbon removal credits are generated from bulk mixing\nor packaged mixed product, and (b) the mixing of the final BioAsphalt™ surface material includes biochar purchased from us. The\nErgon License additionally grants Ergon the right to use our trademarks and access to ongoing technical services to facilitate the monitoring,\nreporting, and verification process of each ton of carbon dioxide sequestered.\n\n \n\nThe\nterm of the Ergon License is ten (10) years, with an automatic renewal for additional ten (10) year periods, subject to a minimum of\nsix (6) months’ notice of cancellation prior to renewal. The Ergon License may be terminated in the event of non-payment of amounts\ndue, initiation of bankruptcy proceedings, or under other customary terms. Additionally, Ergon may terminate the Ergon License upon sixty\n(60) days’ prior written notice in the event that our Chief Executive Officer, Jack Wong, or our Chief Operating Officer, Eric\nBava, are removed from their respective positions with the Company for reasons other than termination for cause or voluntary resignation.\nThe Ergon License additionally contains provisions regarding confidentiality, indemnification, and representations and warranties of\nthe parties that are customary for such an agreement.\n\n \n\nThe\nforegoing description of the Ergon License is not complete and is qualified in its entirety by reference to the full text of the Ergon\nLicense, a copy of which is filed as Exhibit 10.1 to this Annual report.\n\n \n\n**BioFraction\nand Expansion Plans**\n\n \n\nWith\nthe execution of our agreement with Ergon, our business model has been established and we now operate with a singular focus on sustainable\ninfrastructure technologies. Once we scale our North American operations, we intend to turn our focus to Malaysia, where we have had\nour BioFraction facility in Borneo since 2021. This facility is set to become fully operational once production and expansion in Malaysia\nis ready to begin. BioFraction refers to the biological fractionalization of waste through pyrolysis, a thermal decomposition process\nin an oxygen-free environment that converts organic waste into valuable outputs including biochar, biofuel, bio-syngas, and wood vinegar.\nAt this BioFraction facility, we plan to convert palm oil waste into biochar and other renewable byproducts. The BioFraction facility\nwas strategically set to dormant status in recent years in order to prioritize our U.S.-based proof of concept test track in partnership\nwith NCAT, though we have continued regular maintenance and test production runs to preserve its operational capability. With that milestone\nnow complete and with the Ergon License secured, we are now focused on scaling our North American operations. Once we turn our focus\nto Southeast Asia, we intend to restart and increase the operation of our BioFraction facility.\n\n \n\n7\n\n[Table of Contents](#toc_001)\n\n \n\nWe\nplan to target major Malaysian highway operators who are interested Net Zero solutions. We intend to require any potential licensing\nof our solutions in Malaysia to also require exclusive sourcing of biochar from our subsidiary, Verde Resources (Malaysia) Sdn Bhd, which\noperates our BioFraction facility. This will help draw down existing inventory and ramp up production. We also plan to explore the licensing\nof our BioFraction intellectual property and know-how to qualified palm oil waste processors in Malaysia to produce designer grade biochar\ncompatible with our biochar asphalt mixed designs, potentially generating additional revenue through carbon credit royalties, product\nresale margins, and licensing fees.\n\n \n\n**Our\nIndustry and Market Opportunity**\n\n \n\nWe\noperate at the convergence of two rapidly evolving sectors: sustainable building materials (which accounts for approximately 37% of annual\nglobal emissions according to an article entitled “The Building Sector is Key to the Fight Against Climate Change”, by Gim\nHuay Neo and Yvonne Zhou, dated June 25, 2024, and published by *Caixin Global*), with a particular focus on road construction technologies,\nand the carbon removal industry, where our innovations enable both the reduction and removal of atmospheric carbon emissions. One of\nour principal missions is to bridge these sectors by delivering high-performance, low-carbon infrastructure solutions that drive both\nenvironmental impact and economic value, creating a scalable pathway for the infrastructure sector to actively contribute to global sustainability\ngoals.\n\n \n\n*Building\nMaterials Industry*\n\n \n\nThe\nglobal road construction market was valued at $572.9 billion in 2023, according to *Market Research Future’s Road Maintenance\nMarket Report (January 2025)*. In 2024, the North American market reached $188.0 billion, as reported by *IBISWorld*. *Astute\nAnalytica* projects continued growth through 2032, driven by rising infrastructure investment, increased public funding, and the growing\nshift toward sustainable construction materials.\n\n \n\nGovernments\naround the world are increasing infrastructure spending to promote road modernization, enhance durability, and reduce emissions. In the\nUnited States, Canada, and the European Union, various initiatives are advancing low-carbon construction practices and encouraging the\nuse of more sustainable materials in road projects.\n\n \n\nAs\nthe industry accelerates the adoption of cost-effective, low-emission alternatives to traditional asphalt, we believe Verde is well positioned\nto contribute to and benefit from this global transition.\n\n \n\n*Global\nCarbon Market and Carbon Credits*\n\n \n\nWe\ndefine the “global carbon market” as the global market for carbon offsetting or carbon trading. Carbon offsetting is a system\ndesigned to reduce global greenhouse gas emissions by allowing countries, companies, or individuals to compensate for their own emissions\nby purchasing “credits” from projects that reduce or remove greenhouse gasses from the atmosphere. To generate these “credits”,\nwhich are often referred to as “carbon credits” or “carbon removal credits”, a carbon offsetting project must\nbe certified by either a governmental authority or independent certification body, such as Puro.earth. The governmental authority or\ncertification body reviews the carbon offsetting project, tests the project to verify it has demonstrated emissions reductions, and,\nonce the project is approved, issues the carbon credits to the developer.\n\n \n\nA\nlandmark report entitled “Unlocking the Potential of Carbon Dioxide Removal,” dated June 27, 2024, by James Davis and Paddy\nMortimer of consulting firm Oliver Wyman, and co-authored by the City of London Corporation, and the UK Carbon Markets Forum, states\nthat the global market for carbon dioxide removal credits could surge from roughly $2.7 billion in 2023 to as much as $100 billion per\nyear by 2030–35, if key obstacles are resolved, including clarity on credit standards, stronger corporate guidance, and robust\npolicy frameworks. An article entitled “The New Renewable Revolution: Why carbon dioxide Removal Will Transform the Carbon Market”\ndated April 10, 2025, by Shou-Hwei Michelle You and published by the World Economic Forum, notes a pivot in the global carbon market\nlessoning reliance on avoided-emission credits. As a result, the market fell from $1.87 billion in 2023 to $0.72 billion in 2024, but\ncarbon dioxide removal (CDR) is emerging as the linchpin for future growth. Major firms are beginning to step into the carbon market\nas well. For instance, Microsoft recently purchased about 3.5 million carbon credits, with each credit typically representing one metric\nton of carbon dioxide, to offset emissions tied to its rapidly expanding artificial intelligence operations, a signal that heavy tech\ninvestment could become a major catalyst.\n\n \n\nWe\nbelieve a significant opportunity lies in our ability to generate certified carbon removal credits through the production of biochar-infused\nasphalt, a process which has been independently validated through successful trials at the NCAT Test Track. With the United States consuming\napproximately 400 million tons of asphalt annually according to an article entitled “The Advancement of Asphalt Pavements Over\nthe Last 50 Years”¸ by Drs. Jon Epps, Ph. D., P.E., and Dave Johnson, P.E., dated August 1, 2021, and published in *Asphalt\nMagazine*, the potential for credit generation is substantial.\n\n \n\nCurrently,\navailable U.S. biochar supply can support the production of only about 4 million tons of finished asphalt according to our internal estimates\ndeveloped in consultation with our domestic biochar suppliers. However, according to a report by the U.S. Department of Energy from March\n2024 entitled “2023 Billion-Ton Report: An Assessment of U.S. Renewable Carbon Resources”, the United States produces over\n600 million tons of biogenic waste each year, which is enough to yield up to 100 million tons of biochar and enable the production of\nmore than 2 billion tons of carbon-sequestering asphalt. This represents what we believe to be a transformative opportunity to scale\nboth infrastructure decarbonization and carbon credit generation nationwide.\n\n \n\n8\n\n[Table of Contents](#toc_001)\n\n \n\nAs\ninfrastructure stakeholders increasingly seek cost-effective, climate-aligned solutions, we offer a rare combination of affordability,\nperformance, and verified climate impact. Each ton of biochar-asphalt produced enables the generation of additional carbon removal credits,\nunlocking what we expect will be a scalable, high-margin, and recurring revenue stream alongside traditional infrastructure income.\n\n \n\nWith\nPuro.earth certification and early credit purchases by a major financial institution following our proof-of-concept success, we are positioned\nat the forefront of engineered carbon removal. As our operations scale, we believe our model offers a clear path to monetizing decarbonization,\nhelping governments and corporations meet climate targets while maximizing impact for each dollar spent.\n\n \n\n**Market\nChallenges**\n\n \n\nThe\nbuilding materials industry is highly fragmented, comprising both large publicly traded corporations and a wide range of privately held\nfirms, and subject to significant competition. Historically, many of these companies have relied on conventional road materials and methods,\nsuch as hot mix asphalt, with limited innovation. However, there is a growing shift across the sector, as companies increasingly invest\nin research and development to meet the rising demand for sustainable and environmentally friendly solutions such as ours.\n\n \n\nDespite\nthis momentum, the adoption of new technologies remains challenging due to entrenched industry practices, complex regulatory frameworks,\nand performance expectations tied to long-established standards. While many competitors are significantly larger and better capitalized,\nwe believe our products are positioned to lead in this transition. Further, our strategic collaboration with Ergon, a large and established\nplayer in the road materials industry, is expected to help us manage competitive pressures.\n\n \n\nOur\nproprietary technologies, particularly in the road construction sector, enable the integration of carbon-sequestering materials like\nbiochar directly into asphalt and other mix designs. These solutions are not only difficult to replicate but are also backed by real-world\nvalidation and the ability to generate carbon removal credits. This positions us at the intersection of two urgent global needs: decarbonizing\ninfrastructure and delivering high-performance, cost-effective alternatives to legacy materials.\n\n \n\nSee\n“Competition” below for further information on competitive challenges we face.\n\n \n\n**Our\nGrowth Strategies**\n\n \n\nOur\ngrowth strategy is focused on forming strategic relationships with organizations like Ergon that already possess established infrastructure\ncritical to large-scale deployment. This includes companies with existing asphalt mixing facilities, supply chains for raw materials,\ndistribution networks, and sales agreements with end-users such as state departments of transportation, municipalities, and contractors.\n\n \n\nRather\nthan building these capabilities from scratch, we license our proprietary technologies to these organizations alongside our fully integrated\nNet Zero infrastructure blueprint. Our model allows our commercial collaborators to easily incorporate carbon-negative technologies,\nsuch as our BioAsphalt™, into their current operations. We believe this significantly reduces the barrier to adoption while accelerating\nmarket penetration. By leveraging their physical assets, regulatory relationships, and customer base, and combining them with our innovation\nand carbon credit-generating solutions, we can create a mutually beneficial path to scale faster, smarter, and with greater environmental\nimpact.\n\n \n\nOur\ninitial focus over the next few years is to demonstrate and validate this model across the U.S., Canada and Mexico through our strategic\nrelationship with Ergon. We believe this approach will facilitate rapid adoption among our target customers, who operate within a traditionally\nconservative and highly regulated industry. Following successful validation in the U.S., we plan to scale our North American operations\nand subsequently expand licensing opportunities to Southeast Asia, where we already maintain an established presence. Our initial emphasis\nwill be on Malaysia and Singapore, supported by our existing BioFraction facility in Borneo, which is capable of supplying up to 6,000\ntons of biochar annually to serve local infrastructure projects and advance regional decarbonization initiatives.\n\n \n\n9\n\n[Table of Contents](#toc_001)\n\n \n\n**Sources\nand Availability of Raw Materials**\n\n \n\nWhile\nwe do not directly produce our cold mix biochar asphalt surface course material, the key ingredients in its production are Verde V24\nand biochar, a carbon-rich by-product used in our mix designs. We purchase our supple of Verde V24 from C-Twelve under the terms of the\nC-Twelve Agreement (as discussed below) and we have entered into a memorandum of understanding, and are currently in the process of negotiating\na definitive agreement, with Oregon Biochar Solutions and its affiliated facilities to secure a reliable supply of biochar in the United\nStates through its facilities that are capable of producing our designer-grade biochar tailored to our specifications for use in the\ntesting of our products and for downstream use by licensees of our solutions. Oregon Biochar Solutions is a related party as Karl Strahl,\nthe Chief Operating Officer of Oregon Biochar Solutions, is also a member of our board of directors.\n\n \n\nWe\nare in discussions with existing facilities to establish supplies of biochar in Canada and Mexico. In Southeast Asia, our BioFraction\nfacility in Borneo is expected to produce up to 6,000 tons of biochar annually to our required specifications, and we anticipate utilizing\nthis facility as our primary regional supply source.\n\n \n\nThe\nproposed licensing structure for the BioAsphalt™ product in Asia would require licensees to procure biochar exclusively from Verde\nResources (Malaysia) Sdn. Bhd, facilitating the depletion of existing inventory at the Sabah facility and the resumption of localized\nproduction to meet market demand. We plan to refine its BioFraction technology to produce designer-blend biochar for our proprietary\nasphalt formulations and to separately license the BioFraction technology to qualified palm-oil waste processors across Southeast Asia.\nThese processors would convert palm waste into specialized biochar suitable for our applications while generating certified carbon removal\ncredits. We expect to derive revenue from technology licensing fees, carbon credit royalties, and resale margins from biochar supplied\nto its asphalt partners. This asset-light model enables scalable growth of our biochar supply chain with minimal capital expenditure,\nsupporting our mission to advance the adoption of carbon-sequestering infrastructure solutions across the Asia-Pacific region.\n\n \n\n**Distribution\nNetwork and Marketing**\n\n \n\nBecause\nwe operate primarily under a licensing model, we do not directly distribute or market the final road construction products ourselves.\nInstead, we leverage the existing distribution channels and customer networks of our licensees to commercialize our technologies efficiently\nand cost-effectively.\n\n \n\nIn\naddition to our licensing activities, we intend to market and distribute two proprietary products directly: our designer blend biochar\nand Verde V24, our proprietary emulsifying agent. The designer blend biochar is a critical input in the production of the cold mix biochar\nasphalt, providing the consistency, quality, and performance characteristics required to ensure the durability and carbon credit eligibility\nof the end product. Similarly, Verde V24 serves as a key chemical component used to formulate the specialized emulsion that enables a\nstrong bond between biochar and aggregate.\n\n \n\nUnder\nour current commercialization strategy, Ergon will serve as our exclusive licensee and distributor of Verde V24 and the associated specialized\nemulsion throughout the United States, Canada, and Mexico. We believe that partnering with Ergon, one of the world’s leading producers\nand marketers of liquid asphalt and emulsions, provides extensive market reach, promotes standardized product performance, and maintains\nconsistent quality control across all licensed production facilities.\n\n \n\n10\n\n[Table of Contents](#toc_001)\n\n \n\n**Customers**\n\n \n\nOur\ncore customer base consists of businesses involved in road construction and infrastructure development, as well as governmental entities.\nUnder our licensing-based model, we provide proprietary technology and product formulations to commercial partners like Ergon that can\nmanufacture, distribute, and deploy our carbon-integrated solutions at scale.\n\n \n\nAs\ndiscussed above, we recently entered into the Ergon License, which provides Ergon an exclusive license to produce, manufacture, distribute,\nand sell products containing our Verde V24 emulsifying agent in the United States, Mexico and Canada. As such, almost all of our current\nbusiness is reliant upon our strategic relationship with Ergon and our direct customers in the United States will be Ergon and asphalt\nmixing plants serviced by Ergon, which will use our cold mix biochar asphalt formulations and technologies to manufacture next-generation\nroad construction materials. These plants have the infrastructure to produce, blend, and distribute materials in accordance with DOT\nspecifications, making them what we believe to be the ideal channel for product deployment at scale.\n\n \n\nAlthough\nwe do not directly engage with other customers in the United States under our exclusive licensing arrangement with Ergon, we anticipate\nthat Ergon will serve a wide range of downstream market segments that are key adopters of sustainable road materials, including:\n\n \n\n*State\nDepartments of Transportation (DOTs), Local Municipalities, and U.S. Federal Agencies*\n\n \n\nDOTs\nare among the largest purchasers of asphalt materials, responsible for the construction and maintenance of public highways. As they implement\ncarbon accounting frameworks and pursue emissions reduction mandates, our carbon-negative technologies offer a compelling, policy-aligned\nsolution.\n\n \n\nMunicipalities\nmanage local roads, subdivisions, and emergency repairs. Our cold mix asphalt, which requires no heating and minimal equipment, is ideal\nfor off-season maintenance and budget-sensitive repairs, enabling year-round infrastructure improvements with reduced logistical complexity.\n\n \n\nFederal\nagencies, including the Department of Defense and the Department of Transportation, are under increasing pressure to source sustainable\nand low-emission materials. Our technologies meet both environmental goals and practical needs, such as performance in cold or remote\nconditions and reduced emissions during installation.\n\n \n\n*Private\nSector Contractors & Developers*\n\n \n\nContractors\nand developers are seeking to enhance their “Environmental, Social, and Governance” (known as ESG) credentials and qualify\nfor green financing or tax incentives. By integrating our solutions, they can offer carbon-negative infrastructure without disrupting\nexisting construction workflows, meeting market demand while advancing sustainability objectives.\n\n \n\n11\n\n[Table of Contents](#toc_001)\n\n \n\n**Competition**\n\n \n\n*Competitive\nLandscape*\n\n \n\nThe\nconstruction materials industry is dominated by large, established public and private companies that compete primarily on cost, scale,\nlogistics, and supply chain efficiency. These incumbents often have extensive production capacity, longstanding customer relationships,\nand significant influence over industry standards. Many are substantially better capitalized than we are and have decades of experience\nin the construction space. While historically slow to innovate, many of these companies are now investing in sustainable product development\nto meet regulatory pressure and market demand for greener infrastructure.\n\n \n\nIn\nparallel, the carbon removal and offset sector represents a fast-growing and increasingly competitive space. It includes a mix of climate-tech\nstartups, project developers, environmental consultancies, and digital platforms focused on digital measurement, reporting, verification\n(“dMRV”), and carbon removal credit issuance. These entities operate across various methodologies ranging from nature-based\nsolutions like reforestation and regenerative agriculture to engineered approaches, such as direct air capture and biochar-based removal.\n\n \n\nWhat\nwe believe differentiates us is our ability to embed carbon removal directly into essential infrastructure products like roads, and generate\nverified carbon removal credits from every mile paved. Unlike firms focused solely on offset trading or dMRV, we deliver physical carbon\ndrawdown through material innovation, creating a defensible position at the intersection of two massive and converging industries: construction\nand climate.\n\n \n\nAt\nthis time, we do not face direct competition in the development and commercialization of carbon-sequestering asphalt. We are the first\nto establish a fully validated and licensable Net Zero Blueprint for asphalt, a model that enables the production of cold-applied, biochar-infused\nasphalt while generating certified carbon removal credits. This blueprint was proven through successful trials at the NCAT Test Track\nand has been certified by Puro.earth, the leading global standard for engineered carbon removal. It is already commercially validated\nthrough early credit purchases by a major financial institution and as evidenced by our entry into the Ergon License.\n\n \n\nRather\nthan competing with existing hot mix asphalt producers, our model presents a paradigm shift, offering existing producers a new revenue-generating\nopportunity. By licensing our blueprint, traditional producers can transition to cold-based biochar asphalt without overhauling their\nexisting equipment or vendor relationships. This not only eliminates the need for energy-intensive burners and dramatically reduces GHG\nemissions, but also allows for year-round operations, including in winter, potentially increasing both positive environmental impact\nand profitability.\n\n \n\nWhile\nother companies in the infrastructure or sustainability space may have more resources or legacy experience in producing green materials,\nno other company to date has combined asphalt production with certified carbon credit generation. We believe our ability to monetize\ndecarbonization through a scalable, licensable model places us at the forefront of engineered carbon removal and gives us a significant\nfirst-mover advantage.\n\n \n\n12\n\n[Table of Contents](#toc_001)\n\n \n\n*Our\nCompetitive Advantages*\n\n \n\nDespite\nthe competitive nature of our industry and the relatively small size of our company, we believe we have certain competitive advantages,\nand we believe we will be able to capture a good market share through the following:\n\n \n\n \n●\n*Scalable\nLicensing Model*: We plan to implement a global licensing model that will enable building materials companies to integrate our\nproprietary technologies into their existing operations. We believe this capital-light approach allows us to scale quickly without\nthe costs of manufacturing or installation. By partnering with companies that already have infrastructure and market access, we accelerate\nadoption, expand our impact, and enable the local generation of carbon-negative materials and credits. Freed from production, we\ncan focus on innovation, while our partners focus on regulatory alignment and customer fit in their respective markets.\n \n\n \n \n \n \n\n \n●\n*Next-Generation\nRoad Technologies*: Our products have been tested and shown to be more durable, cost-effective, and environmentally friendly than\ntraditional hot mix asphalt for surface courses and cement- or lime-based methods for soil stabilization.\n \n\n \n \n \n \n\n \n●\n*Carbon\nImpact*: Our products can help contractors and infrastructure companies reduce their Scope 1 emissions (direct GHG emissions),\nScope 2 emissions (indirect GHG emissions from the generation of energy that an organization consumes), and Scope 3 emissions (indirect\nGHG emissions that occur throughout an organization’s value chain as a result of its activities), enabling a path toward net-zero\noperations. Compared to traditional hot-mix asphalt products, our cold-mix biochar asphalt produces fewer emissions, including by\neliminating high-temperature processing and requiring less electricity during manufacturing, being fully recyclable, and taking advantage\nof local and low-carbon sourcing of raw material inputs.\n \n\n \n \n \n \n\n \n●\n*Carbon\nCredit Generation:*Unlike traditional materials, our solutions enable the creation of verified carbon removal credits, opening\nnew revenue streams for our company, our commercial partners and their customers while helping them meet ESG and Net Zero goals.\n \n\n \n \n \n \n\n \n●\n*Integrated\nModel*: We combine proprietary building material technologies with carbon credit generation, offering both product and environmental\nvalue.\n \n\n \n \n \n \n\n \n●\n*Verified\nCarbon Removal*: Our use of biochar enables the generation of third-party certified carbon removal credits, backed by measurable\ndata.\n \n\n \n \n \n \n\n \n●\n*Asset-Light\nExpansion*: Through licensing agreements and local commercial collaborations, we believe we can scale efficiently without heavy\ncapital investment.\n \n\n \n \n \n \n\n \n●\n*Policy\nand ESG Alignment*: Our solution aligns with global Net Zero targets, Scope 1,2, and 3 emissions reductions, and climate-resilient\nprocurement policies.\n \n\n \n \n \n \n\n \n●\n*First-Mover\nPositioning*: We believe we are among the first to successfully commercialize asphalt-integrated biochar with verified carbon\ncredits in the United States.\n \n \n\n \n\n13\n\n[Table of Contents](#toc_001)\n\n \n\nWhile\nthis market is highly competitive, we believe in our competitive advantages. We are focusing on the following strategies to further expand\nour horizons and fuel further growth:\n\n \n\n \n●\n*Commercial\nLicensing*: Now that we have entered into the Ergon License which covers the United States, Canada, and Mexico, we plan to foster\nsimilar strategic relationships with national and regional infrastructure companies globally to license our asphalt formulations\nand biochar technologies.\n\n \n \n \n\n \n●\n*Biochar\nSupply Network*: Expand a decentralized supply chain of biochar processors through IP licensing and offtake agreements.\n\n \n \n \n\n \n●\n*Carbon\nCredit Monetization*: Scale the generation and sale of carbon removal credits through verified methodologies and corporate buyers.\n\n \n \n \n\n \n●\n*Geographic\nExpansion*: Grow our presence across North America and Southeast Asia by leveraging early success and demand from infrastructure\nowners.\n\n \n\n**Seasonality**\n\n \n\nOur\ncold mix asphalt can be produced year-round and is well-suited for stockpiling, allowing for placement in virtually any season, including\nin colder climates where traditional hot mix asphalt cannot be applied. While seasonality may influence construction activity timing,\nparticularly in winter-prone regions, it does not impact the production, storage, or licensing of our technologies.\n\n \n\nAs\na result, our business operations are not materially affected by seasonality. We maintain the ability to license, supply, and support\ndeployment year-round, ensuring consistent commercial activity and project readiness regardless of climate.\n\n \n\n**Intellectual\nProperty**\n\n \n\nWe\ncurrently maintain rights to the key technologies we use. Verde V24, which is used in our cold mix biochar asphalt mix design, the TerraZyme\nenzyme, and the catalytic BioFraction process, are all held as trade secrets.\n\n \n\nThrough\nour Joint Development Agreement with C-Twelve, filed as Exhibit 10.2 to this Annual Report, and the related addendum, filed as Exhibit\n10.3 to this Annual Report (collectively, the “C-Twelve Agreement”), we hold an exclusive license in the United States, Canada\nand Mexico to produce and sell end-product asphalt surface course materials containing Verde V24 and have the option to sub-license use\nof Verde V24 to produce end-product asphalt surface course materials. Pursuant to the C-Twelve Agreement, we are required to pay C-Twelve\na $1 million exclusive licensing fee and concurrently provide C-Twelve a $2 million loan (the “C-Twelve Loan”). We are required\nto fund the C-Twelve Loan and the $1 million licensing fee to C-Twelve (the proceeds of which are expected to be used by C-Twelve in\npart to enhance its Verde V24 manufacturing capability) within thirty (30) days of closing of a transaction in which our Common Stock\nbecomes listed on a U.S. national exchange, provided that if such funding is not achieved by July 31, 2026, C-Twelve shall have the right,\non ten (10) business days’ notice, to hold us in breach of the Joint Development Agreement. The C-Twelve Agreement also provides\nfor a potential conditional fee payment to C-Twelve in 2027 based on agreed to minimum amounts of liters of Verde V24 which we may purchase\nfrom C-Twelve.\n\n \n\nWe\ncurrently have access to the TerraZyme enzyme through a Memorandum of Understanding (the “NPI MOU”) with Nature Plus Inc.\n(“NPI”). We entered into the MOU with NPI to formalize our collaboration on the NCAT test track project discussed above and\nto explore possible subsequent business opportunities arising from the successful completion of the NCAT testing, including a possible\nlicense for TerraZyme. The NPI MOU is effective until December 31, 2026, or until earlier replacement by a definitive agreement. We are\ncurrently in negotiations with NPI for a definitive agreement that would contain an exclusive worldwide license to our company for TerraZyme.\n\n \n\nOur\nsubsidiary, Bio Resources Limited (“BRL”) is the proprietor of a technical process known as the “Catalytic Biofraction\nProcess” (the “Biofraction Process”) and an exclusive license is assigned to our other subsidiary, Verde Resources\n(Malaysia) Sdn Bhd (“Verde Malaysia”), for the application of the Biofraction Process in our facilities in Borneo. The Biofraction\nProcess is a slow pyrolysis process using a proprietary catalyst to depolymerize palm biomass wastes (empty fruit bunches or palm kernel\nshells) in temperature range of 350 degrees Celsius to 500 degrees Celsius to yield commercially valuable bio products: bio-oil, wood\nvinegar (pyroligneous acid), biochar and bio-syngas. The intellectual property is a second-generation pyrolysis process where non-food\nfeedstock like palm biomass wastes is used as feedstock.\n\n \n\nWe\nhold no issued patents at this time. However, we have filed a provisional patent in the United States covering our complete cold mix\nasphalt design and system, including Verde V24, which is central to its performance. Under the terms of the C-Twelve Agreement, we have\nagreed not to prosecute the U.S. provisional patent for Verde V24 and ensure that it is voluntarily withdrawn within 30 days of C-Twelve\nlodging a U.S. patent application. Additionally, C-Twelve has agreed that any patent application filed in the U.S. claiming priority\nfrom its Australian provisional patent application will be filed jointly in the name of C-Twelve and us, and that we have a 50% interest\nand right of title for the U.S. patent application for Verde V24.\n\n \n\nWe\ncontinue to see trade secret protections as essential to maintain the secrecy of the proprietary formulations we use and we believe trade\nsecret protections reduce the risk of reverse engineering our technologies. However, we also believe there is significant value to be\ngained from seeking patent protection of our larger systems that integrate our trade secret technologies, including the ability to enforce\nsuch patents against any parties who may infringe upon them. As we grow, our plan is to invest more in registered patent protection to\nthe extent we feel such protection is superior to trade secret protection, which has the benefit of maintaining the privacy of critical\naspects of our technology.\n\n \n\nAs\nour proprietary rights to our key technologies are currently in the form of trade secrets, which we seek to protect by entering into\nnon-disclosure and confidentiality agreements with parties who have access to such technologies, and not protected by patents or other\nmore secured means, we face significant risks related to our limited ability to enforce confidentiality or enforce a claim that a party\nillegally disclosed or misappropriated any trade secrets, as further discussed under “*Risk Factors – If we are unable\nto protect the confidentiality of our trade secrets, our business and competitive position would be harmed*.”\n\n \n\n14\n\n[Table of Contents](#toc_001)\n\n \n\n**Governmental\nApprovals and Regulation**\n\n \n\n*Governmental\nApprovals*\n\n \n\nBecause\nour business will be centered around a licensing model and we do not currently produce or manufacture any products, we are not currently\naware of any laws or governmental regulations that materially influence our business. We will work in collaboration with our licensees\nwho will be manufacturing, distributing, and installing our technologies, as they engage with state and federal agencies to assist with\ntheir achieving full compliance with all applicable regulations, including:\n\n \n\n \n●\nConstruction\nmaterial standards and testing protocols; and\n\n \n \n \n\n \n●\nCarbon\ncredit methodologies approved by recognized certification bodies\n\n \n\n*Environmental\nLaws*\n\n \n\nUnder\nour licensing model, manufacturing is carried out by our licensees, who are responsible for complying with all applicable environmental\nlaws and regulations in their respective jurisdictions. We work closely with them to ensure adherence to best practices and sustainability\nstandards throughout the production process. Currently we do not experience any material effects from or incur costs related to compliance\nwith environmental regulations.\n\n \n\n**Insurance**\n\n \n\nWe\nbelieve our insurance coverage is consistent with the customary practices of companies of comparable size and stage of development and\nis adequate to support our ongoing operations and planned growth initiatives. We have additionally evaluated the cost, availability,\nand practicality of obtaining business interruption insurance and determined that, given our transition to an asset-light, licensing-based\nbusiness model, such coverage is not commercially feasible at this time. As a result, we do not maintain business interruption insurance\nfor our U.S. operations or our overseas facility in Borneo. Consequently, we may be exposed to unrecoverable losses in the event of a\ndisruption to our operations, as further discussed under “*Risk Factors – Risks Related to Our Business – We do not\ncarry business interruption insurance and could incur unrecoverable losses if our business is interrupted*.”\n\n \n\n**Employee\nand Human Capital**\n\n \n\nAs\nof October 22, 2025, we had the following employees and consultants:\n\n \n\nSenior Management \n 3 \n\nSales and Marketing \n 1 \n\nProduction \n 2 \n\nInformation System Technology \n 5 \n\nAdministration / Finance / HR \n 4 \n\nIndependent Consultants \n 5 \n\nTotal \n 20 \n\n \n\nWe\nhave a total of 20 employees and representatives, including five independent consultants. Of these, eleven are based in the United States,\nincluding our five consultants. The remaining nine individuals are based in Malaysia, where they support local operations under the oversight\nof U.S.-based senior management.\n\n \n\nNone\nof our employees are members of a trade union. We believe we maintain strong relationships with our team and, to date, have not experienced\nany strikes, work stoppages, or material labor disputes. We intend to hire more staff to assist in the development and execution of our\nbusiness operations.\n\n \n\n**Corporate\nHistory and Structure**\n\n \n\nVerde\nResources, Inc. was incorporated on April 22, 2010, in the State of Nevada. We currently have four wholly owned subsidiaries, one majority-owned\nsubsidiary, and three wholly owned indirect subsidiaries, with Verde Renewables, Inc. acting as our primary operating company.\n\n \n\n15\n\n[Table of Contents](#toc_001)\n\n \n\nThe\nfollowing diagram illustrates our current corporate structure:\n\n \n\n \n\nThe\nfollowing paragraphs discuss our reclassifications, mergers, consolidations, and non-ordinary course purchases and sales of significant\nassets throughout our corporate history.\n\n \n\n*Acquisition\nof Verde Resources Asia Pacific Limited*\n\n \n\nOn\nOctober 25, 2013, we entered into an Assignment Agreement for the Assignment of Management Right in Merapoh Gold Mines in Malaysia (the\n“Assignment Agreement”) with Federal Mining Resources Limited (“FMR”), a company incorporated under the laws\nof the British Virgin Islands. FMR owned 85% equity interest in Champmark Sdn Bhd, a private limited liability company incorporated in\nMalaysia. CSB the Mining Contractor of the Mining Lease for Site IV-1 at the Merapoh Gold Mine (the “Mining Lease”) under\nthe Contract for Work with MMC Corporation Berhad, the Permit Holder of the Mining Lease.\n\n \n\nUnder\nthe terms of the Assignment Agreement, FMR had assigned its management rights of CSB’s mining operation in the Mining Lease to\nus, through FMR’s wholly-owned subsidiary Verde Resources Asia Pacific Limited in exchange for 80,000,000 shares of our Common\nStock, which constituted 95.26% of our issued and outstanding capital stock as of and immediately after the consummation of the acquisition.\nVRAP was formed on February 7, 2013, by FMR to monitor the CSB operation. The acquisition of 100% of the issued and outstanding capital\nstock of VRAP was agreed upon on October 18, 2013, and completed on October 25, 2013. Pursuant to the Assignment Agreement, and a Supplementary\nAgreement dated February 17, 2014, on further clarifications to the Assignment Agreement signed by the Company with FMR, FMR’s\n100% interest in VRAP was transferred to us at a consideration of one dollar ($1.00).\n\n \n\nOn\nApril 1, 2014, the Board of Directors of VRAP notified FMR of the decision to exercise its option to purchase an 85% equity interest\nof CSB pursuant to Section 3.2.4 of the Management Agreement dated July 1, 2013, between VRAP and FMR. This acquisition was completed\non April 1, 2014, with consideration of $1, and VRAP then became an 85% shareholder of CSB.\n\n \n\nWith\nthe above transactions, VRAP became a wholly-owned subsidiary of our company and CSB, its 85% deemed indirect subsidiary.\n\n \n\n16\n\n[Table of Contents](#toc_001)\n\n \n\n*Acquisition\nof Biofraction Facility and Catalytic Biofraction Process*\n\n \n\nOn\nMay 10, 2021, we announced the Sale and Purchase Agreement (the “S&P Agreement”) to acquire the assets of a biofraction\nplant and the “right to use” intellectual property license for the Catalytic Biofraction Process in Sabah, Malaysia from\nBorneo Energy Sdn Bhd, in exchange for the issuance of 166,666,667 shares of our Common Stock at a price of $0.03 per share, for an aggregate\nvalue of $5,000,000. 135,666,667 shares and 31,000,000 shares were issued to Borneo Energy Sdn Bhd on May 10, 2021, and July 1, 2021,\nrespectively. The acquisition from Borneo Energy Sdn Bhd the assets of its biofraction plant and the right to use its intellectual property\nlicense in Sabah, Malaysia was completed on February 24, 2023.\n\n \n\nWe\nalso announced our entry into a Share Sale Agreement on May 12, 2021, for the acquisition of the entire issued and paid-up share\ncapital of Bio Resources Limited from various unrelated third parties, including Taipan International Limited, The Wision Project\nLimited, and other individuals, in consideration for the issuance of 321,500,000 shares of our Common Stock at price of $0.03 per\nshare, for an aggregate value of $9,645,000, and the issuance of promissory notes with a two-year term period in an aggregate\nprincipal amount of $20,355,000. A total of 321,500,000 shares and the promissory notes were issued on May 12, 2021. The principal\namount of the promissory notes was repayable by May 12, 2023, and bore a zero coupon interest. On January 20, 2022, we reached a\nmutual agreement with the lenders of the promissory notes to enter into a Supplement to Promissory Note with each lender to convert\nthe total principal loan amount of $20,355,000 into shares of our Common Stock, at a price per share of $0.0611, which represented\nthe previous ninety (90) days’ volume weighted average price (VWAP) as of the market closing of January 19, 2022, with such\nshares of Common Stock to be issued at a later date under separate agreement. The acquisition of BRL was consummated on October 12,\n2022. The shares issuable upon conversion of the promissory notes were issued on December 9, 2022.\n\n \n\n*Settlement\nof Debt Agreement*\n\n \n\nOn\nJune 9, 2021, we entered into a Settlement of Debt Agreement (the “Debt Settlement Agreement”) with certain of our creditors,\nincluding Beijing Changxin Wanlin Technology Co., Ltd, Federal Mining Resources Ltd, Federal Capital Investment Limited and Yorkshire\nCapital Limited (collectively the “Creditors”) to convert a total of $1,945,096 of our accounts payable to the Creditors\ninto equity by issuing 64,836,533 new shares of our Common Stock at a price per share of $0.03. As set out in the Debt Settlement Agreement,\nthe new issued shares for settlement of the account payable to Beijing Changxin Wanlin Technology Co., Ltd, Federal Mining Resources\nLtd and Federal Capital Investment Limited were issued to their nominee Internet.com Ltd on June 9, 2021.\n\n \n\n*Biofraction\nFactory Expansion*\n\n \n\nOn\nJune 11, 2021, VRAP entered into a Sale and Purchase of Assets Agreement (the “SPA Agreement”) to purchase a factory site\nfrom a Malaysian company, Segama Ventures Sdn Bhd (“Segama Ventures”), in order to expand our BioFraction plant in Borneo,\nMalaysia. Under the terms of the SPA Agreement, the acquisition would be satisfied by payment to Segama Ventures of an aggregate total\nof $1,600,000 in cash, which would be paid in two instalments of $800,000 each, with one payment due upon signing the SPA Agreement,\nand the second payment due within three (3) months from the date of the SPA Agreement. A deposit of $800,000 was paid to Segama Ventures\non June 10, 2021. On March 2, 2022, however, VRAP entered into a Cancellation of Sale and Purchase of Assets Agreement (“Cancellation\nAgreement”) for the cancellation of the Sale and Purchase of Assets Agreement to purchase the factory site from Segama Ventures\nthat was signed on June 11, 2021.\n\n \n\nSimultaneously,\non March 2, 2022, through VRAP, we entered into a Commercial Lease Agreement and Option to Purchase (“Lease Agreement”) for\nrenting the factory site from Segama Ventures for a lease term of seven (7) years (“Lease Term”) at a monthly rental of MYR\n36,000 ($8,571). The rental for the entire Lease Term amounts to the sum of MYR 3,024,000 ($720,000) (the “Lease Payment”)\nwhich was required to be paid in advance upon commencement of the Lease Agreement together with a payment of security deposit for the\nsum of MYR 336,000 ($80,000) (the “Security Payment”). We utilized the refundable advance of $800,000 from the Cancellation\nAgreement above to fund the security deposit and payment of the Lease Payment. The Lease Agreement also provided VRAP with an exclusive\nright and option to purchase the factory site together with all its right title and interest for a consideration of MYR 8,000,000 ($1,904,762)\n(the “Purchase Price”) or other value as determined by a valuation report on the factory site by a Malaysian registered property\nvaluer at any time during the period of two years from the date of the Lease Agreement. The Lease Payment and Security Payment would\nbe applied toward the Purchase Price upon VRAP exercising the option to purchase. The option to purchase was not exercised and lapsed\non March 1, 2024.\n\n \n\n17\n\n[Table of Contents](#toc_001)\n\n \n\n*CSB\nAcquisition*\n\n \n\nOn\nJune 18, 2021, VRAP entered into a Shares Sale Agreement with Lamax Gold Limited (“LGL”), a company incorporated under the\nlaws of the British Virgin Islands, in relation to acquisition of the remaining 15% of the issued and paid-up share capital of CSB. Prior\nto this acquisition, VRAP owned 85% equity in CSB. Under the terms of the Shares Sale Agreement, the consideration for the acquisition\nshall be satisfied in full by the payment of MYR 150,000 (approximately $36,130) upon the execution of the Shares Sale Agreement. A deposit\nof MYR 150,000 (approximately $36,130) was paid to LGL on June 21, 2021. With the completion of the acquisition on October 20,2021, CSB\nbecame a wholly owned subsidiary of VRAP, and indirectly, of our company.\n\n \n\n*Verde\nLife, Inc. Incorporation*\n\n \n\nOn\nJuly 7, 2021, through our wholly-owned subsidiary VRAP, we entered into a Product Supply Agreement (the “Product Supply Agreement”)\nwith MRX Xtractors, LLC (“MRX”), an Oregon limited liability company. MRX is a market leader in commercial extraction systems\nfor cannabis and hemp. The Product Supply Agreement is a partnership between VRAP and MRX to establish a purchase and supply arrangement\nthat allows VRAP to distribute white-label THC-free CBD products from MRX. To facilitate the distribution of these CBD products, on November\n15, 2021, we formed a wholly owned subsidiary, Verde Life, Inc., under the laws of the State of Oregon. We terminated our business in\nthe distribution of CBD products upon the expiry of the Product Supply Agreement on July 6, 2024.\n\n \n\n*Establishment\nof Missouri Entities*\n\n \n\nOn\nAugust 10, 2021, we formed a wholly owned subsidiary, Verde Renewables, Inc., for the purpose of conducting business in Missouri (using\nstraw bed and wood waste to create biochar and related products). Another entity, Verde Estates, LLC, was also formed on August 10, 2021,\nto own property in Missouri. Verde Estates, LLC is a wholly owned subsidiary of Verde Renewables, Inc.\n\n \n\n*Establishment\nof Verde Malaysia*\n\n \n\nOn\nJanuary 17, 2022, we formed a wholly owned subsidiary, Verde Resources (Malaysia) Sdn Bhd, a company incorporated under the laws of Malaysia,\nfor the purpose of conducting consultation services and distribution of renewable agricultural commodities.\n\n \n\nOn\nMarch 23, 2022, through Verde Malaysia, we entered into a Sale of Shares Agreement (“SSA”) with The Wision Project Sdn Bhd,\na company incorporated under the laws of Malaysia, to acquire the one hundred percent (100%) of the issued and paid up ordinary shares\nin Wision. This transaction closed in May 2022.\n\n \n\n*Chesterfield\nProperty Acquisition*\n\n \n\nOn\nApril 29, 2022, VRI closed on the purchase of residential property located in Chesterfield, Missouri (the “Chesterfield Property”).\nThe purchase price for the Chesterfield Property was $750,000.00, paid at closing with cash on hand. The Chesterfield Property was subsequently\nsold to our Chief Executive Officer, Jack Wong, on December 10, 2024, at a purchase price of $857,500.\n\n \n\n*Conversion\nof Promissory Notes*\n\n \n\nOn\nDecember 7, 2022, we entered into a Supplementary Agreement with the seventeen holders, including our President and CEO, Jack Wong, of\nthe Promissory Notes discussed above related to the acquisition of BRL, to convert the total principal loan amount of $20,355,000 into\nshares of our Common Stock at an agreed conversion price of $0.0611 per share on or before December 9, 2022. On December 9, 2022, the\nconversion of promissory notes was completed with the issuance of 333,142,389 shares of our Common Stock, at a price of $0.0611 per share,\nto the seventeen holders, including Jack Wong.\n\n \n\n18\n\n[Table of Contents](#toc_001)\n\n \n\n*Sale\nof CSB*\n\n \n\nOn\nMarch 13, 2023, through VRAP, we entered into a Share Sale Agreement (the “SSA Agreement”) with Jusra Mining Merapoh Sdn\nBhd (“JMM”), a company incorporated under the laws of Malaysia, to sell the entire issued and paid-up share capital of CSB,\nour indirect wholly-owned subsidiary engaged in the mining business. Under the terms of the SSA Agreement, the consideration for the\nsale of CSB shall be satisfied in full by the payment of Malaysia Ringgit MYR 500,000. The sale of CSB is part of our larger restructuring\nexercise and shift in our corporate focus. The transaction closed on April 20, 2023.\n\n \n\nAlso\non March 13, 2023, we entered into a Settlement of Debts Agreement (the “SDA Agreement”) with CSB and a two year term period\npromissory note with CSB’s creditor, a related party, Borneo Oil Corporation Sdn Bhd (the “Creditor”), to settle in\nfull a total of USD 675,888 of CSB’s account payable to the Creditor either in cash or by the issuance of new restricted shares\nof our Common Stock at a price of $0.07 per share. On August 16, 2024, we entered into a Supplementary Agreement to the SDA Agreement\nand Promissory Note with the Creditor to convert the total accounts payable of USD 675,888 into 9,655,542 shares of our Common Stock.\nA total of 9,655,542 shares of our Common Stock was issued on August 16, 2024, to Borneo Oil Berhad, the appointed nominee of the Creditor,\nto settle in full the total accounts payable to the Creditor.\n\n \n\n*VATA\nAcquisition*\n\n \n\nOn\nMarch 23, 2023, through Verde Malaysia, we entered into a Shares Sale Agreement (the “VATA SSA Agreement”) with Murugesu\nA/L M. Narasimha and Deivamalar A/P Kandiah (“Vendors”), the legal and beneficial owners of Vata VM Synergy (M) Sdn. Bhd.\n(“VATA”), a company incorporated under the laws of Malaysia, to acquire 60% of the issued and paid-up share capital of VATA,\na company engaged in the business of providing green technology to public and private sectors and in creating high quality compost using\nagricultural waste and biomass products in Malaysia, in exchange for MYR 2,250,000 (approximately US$530,000 as of the date of this Annual\nReport). The MYR 2,250,000 purchase price was to be paid in installments, which include a first payment of MYR 100,000 upon the execution\nof the VATA SSA Agreement, a second payment of MYR 150,000 within thirty (30) days from the date of fulfillment or waiver of all the\nconditions set out in the SSA Agreement, and the issuance of shares of our Common Stock for the balance consideration of MYR 2,000,000\nat a price per share of not more than ten percent (10%) discount from the immediate preceding five trading days VWAP from the issuance\ndate pursuant to the terms of the SSA Agreement. The first payment of MYR100,000 was made, however, the SSA Agreement has since been\nterminated and the deposit amount has been fully impaired on the basis of non-disclosure of material information by the Vendors.\n\n \n\n**Available\nInformation**\n\n \n\nAs\na public company, we are required to file our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K,\nproxy statements on Schedule 14A and other information (including any amendments) with the Securities and Exchange Commission (the “SEC”).\nThe SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that\nfile electronically with the SEC. You can find our SEC filings at the SEC’s website at www.sec.gov.\n\n \n\n19\n\n[Table of Contents](#toc_001)"}