NOTE 15 —DISCONTINUED OPERATIONS AND SALES OF ABL CHICAGO

During the third quarter of 2026, the Company entered into the Share Purchase Agreement (“SPA”) to sell the equity interests of its subsidiaries that own and operate its ABL business (the “Sale Transaction”), subject to shareholder and regulatory approvals, for a total base purchase price of $1. The ABL Chicago business has been recast as discontinued operations, and the assets and liabilities of ABL Chicago are classified as assets and liabilities of discontinued operations. See Note 1 – Business Organization and Nature of Operations.

On February 12, 2026, the sale of 100% of the issued and outstanding shares of ABL Chicago was duly approved and adopted. Accordingly, the Company consummated the sale of the ABL Chicago business.

As of June 30, 2025, the major of assets and liabilities from discontinued operation included the following:

Results of Discontinued Operations

Net income (loss) from discontinued operations details is as follows:

Revenue from discontinued operation

ABL Chicago generates revenue from providing cross-border ocean and airfreight solutions. No practical expedients were used when adoption ASC606. Revenue recognition policies are as follows:

Revenue from cross-border freights solutions

The Company provides comprehensive services in the United States for customers to transport goods from overseas to the United States and from the United States to overseas. Operating under service contracts, for goods entering the United States, after the goods arrive at a U.S. seaports or airports, the Company offers customs clearance, container unloading, storage, unpacking, packing, and transportation services to the locations specified by the customers. For customers shipping goods overseas, the Company provides cargo space arrangements, storage, packing, export customs clearance, and arranges transportation to seaports or airports for loading.

The transaction price is determined based on the range of services provided and the volume of goods. The Company considers these comprehensive services as one performance obligation since these promises are not distinct within the context of the contract, and the bundle of integrated services represents a combined output. This performance obligation is satisfied over time as customers receive the benefits of these services during the process of transporting goods from one location to another.

For goods entering the United States, the Company determines that the performance period for revenue recognition is between the pickup date and the date of completing delivery. For customers shipping goods overseas with cargo space booking service, the Company determines that the performance period for revenue recognition is between the container or cargo space confirmed date and the date of arrival at destination. For customers shipping goods overseas without cargo space booking service, the Company determines that the performance period for revenue recognition is between pickup date and the date when the goods depart from airport or port. The performance period may be estimated if the date of completing delivery or the departure date or arrival date has not occurred by the reporting date. The Company has determined that revenue recognition over the time in transit provides a reasonable estimate of the transfer of services to its customers as it depicts the pattern of the Company’s performance under the contracts with its customers. Determining the performance period and the progress of the transportation as of the reporting date requires management’s estimation and judgement, which may impact the timing of revenue recognition.

For customers with goods entering the United States, we offer customs clearance, container unloading, storage, unpacking, packing, and transportation services to customer-specified locations after the goods arrive at a U.S. seaport or airport. For customers shipping goods overseas, we provide cargo space arrangement, storage, packing, export customs clearance, and transportation to the seaport or airport for loading. The performance obligation is satisfied over time as customers receive the benefits of these services during the process of transporting goods from one location to another. As a result, we recognize revenue over time. We believe that the methodology employed is comparable to that of other global logistics companies and offers faithful depiction of the services rendered to customers.

Principal and agent considerations

In the Company’s transportation business, the Company utilizes independent contractors and third-party carriers and related party carriers in the performances of some transportation services as and when needed. U.S. GAAP requires us to evaluate, using a control model, whether the Company itself promises to provide services to the customers (as a principal) or to arrange for services to be provided by another party (as an agent). Based on the Company’s evaluation using a control model, the Company determined that in all of its major business activities, it serves as a principal rather than an agent within their revenue arrangements. Revenue and the associated purchased transportation costs are both reported on a gross basis within the unaudited condensed consolidated statements of income (loss) and comprehensive income (loss).

Accounts receivable, net

Accounts receivables are carried at the original invoiced amount less an estimated allowance for expected credit losses based on the probability of future collection. The Company reviews its accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. The Company grant credit to customers, without collateral, under normal payment terms. The Company uses a loss rate method to estimate allowance for credit losses for accounts receivable from cross-border freights solutions and aging schedule to estimate the allowance for credit losses for accounts receivable from distribution of pharmaceutical products respectively. Loss-rate approach is based on the historical loss rates. The Company evaluates the expected credit loss of accounts receivable based on customer financial condition and historical collection information adjusted for current market economic conditions and forecasts of future economic performance when appropriate. For those past due balances over one year and other higher risk receivables identified by the Company are reviewed individually for collectability. The Company writes off potentially uncollectible accounts receivable against the allowance for credit losses if it is determined that the amounts will not be collected. As of June 30, 2025, the Company recorded the allowance of credit loss of $54,689.

Accounts receivable, net consists of the following:

Prepayment, deposit and other receivable – third party

Contract assets

Contract assets represent estimated amounts for which the Company has the right to consideration for the services provided while a delivery is still in-transit and has not yet invoiced the customer. The estimated contract asset is based on the estimated completion percentage of the performance obligation. We believe that customers simultaneously benefit from the comprehensive services we provided. Upon completion of the performance obligations, which can vary in duration based upon the method of transport and billing the customer, these amounts become classified within accounts receivable. As of June 30, 2025, the Company recorded contract assets $119,054.

Investment in other entity

The Company assesses its investment in ABL Wuhan and determines that no significant influence over investee existed, as defined in ASC 323-10-15-6, and therefore accounts for the investment used the measurement alternative under ASC 321-10-35-2. Under this approach, the investment is measured at cost, and adjusted for impairments, with changes recognized in net income. The investment in other entity that does not report net asset value is subject to qualitative assessment for indicators of impairments.

On August 4, 2023, ABL Wuhan ceased to be the ABL Chicago’s subsidiary and became the ABL Chicago’s long-term investment. As of June 30, 2025, the Company’s investment in ABL Wuhan amounted to $15,741, and no impairment charges was recorded.

Property and equipment, net

Property and equipment are stated at cost less accumulated depreciation. The straight-line depreciation method is used to compute depreciation over the estimated useful lives of the assets.

Lease

ABL Chicago has multiple lease agreements for warehouses, warehouse machinery and equipment and offices.

The following table includes supplemental cash flow and non-cash information related to leases:

Accrued liabilities and other payables

Accrued liabilities and other payables comprise the following amounts relating to the discontinued operation:

Loan payable to a related party

On March 1, 2025, the Company entered into a loan agreement with a related party – ABL Shenzhen for a principal amount up to $124,176, bearing interest at a fixed interest rate of 7.79% per annum, with a maturity date of March 1, 2028. The loan balance was $124,176 as of June 30, 2025, and interest expense in connection with the loan for the nine months ended March 31, 2025 was nil.

Loan payable

The Company obtained multiple loans to finance the purchase of vehicles and warehouse machinery and obtained other loans to support its working capital needs.

The loan balance consists of the following:

(a) Equipment loans

The Company made the total principal repayments of $37,507 in connection with the above vehicle loans during the nine months ended March 31, 2025. Interest expenses for the above-mentioned above vehicle loans amounted to $4,256 during the nine months ended March 31, 2025.

(b) Vehicle loans

The Company made the total principal repayments of $48,085 in connection with the equipment loans during the nine months ended March 31, 2025. Interest expenses for the above-mentioned equipment loans amounted to $7,827 during the nine months ended March 31, 2025.

(c) Other loans

The Company made the total principal repayments of $420,765 in connection with the above other loans during the nine months ended March 31, 2025. Interest expenses for the above-mentioned other loans amounted to $63,872 during the nine months ended March 31, 2025.

Related party transactions

a) Other receivable from related parties

Other receivable from related parties consists of balances with the parties listed below, arising from interest receivable, storage income, rental income, contractor salaries charged by related parties, other expenses paid on their behalf:

b) Summary of balances payable to related parties

c) Summary of balances receivable from related parties

d) Loan receivable from related parties

The Company entered into a loan agreement with related parties to support working capital needs. The loan bears interest at an annual rate of 8.99%, with the outstanding principal not exceeding $1.0 million. The loan matures within twelve months from the date of execution. In November 2025, the loan to ABL LAX was mutually extended and become repayable on demand.

e) Summary of related parties’ transactions

During the nine months ended March 31, 2026 and 2025, the Company had the following transactions with its related parties — Weship, ABL Wuhan, ABL Shenzhen, ABL LAX and Intermodal

f) Salaries and employee benefits paid to major shareholders

Transaction

On February 12, 2026, the sale of 100% of the issued and outstanding shares of ABL Chicago was duly approved and adopted by the Company’s shareholders. Accordingly, the Company consummated the transfer of the ABL Chicago business. Immediately prior to the Transaction, the Company forgave $3,402,808 of amounts due from ABL Chicago. The Company recorded a gain on the sale of the ABL Chicago business in the amount of $2,556,315 as follows:

Management has determined that there are no current federal or state income taxes payable in connection with the sale of ABL Chicago, after considering the Company’s tax basis in the stock of ABL Chicago as well as the Company’s projected tax losses. Further, if needed, the Company has net operating loss carryforwards that are available to offset any tax liability.