| RELATED PARTY TRANSACTIONS |
Note 14 — RELATED PARTY TRANSACTIONS
The table below sets forth major related parties
of the Company and their relationships with the Company:
SCHEDULE OF MAJOR RELATED PARTIES
| Entity or individual name |
|
Relationship with the Company |
| Feng Xie |
|
Founder and controlling shareholder of the Company |
| Wuhan Huiyu |
|
Investee of the Company |
| Shanghai Dongying Network Technology Co., Ltd. (“Shanghai Dongying”) |
|
Investee of the Company |
| Mobile Motion Co., Limited (“Mobile Motion”) |
|
Wholly-owned subsidiary of investee of the Company |
| (a) | The Company entered into the following
related party transactions: |
The Company invested in companies engaged in mobile
game development and required the royalty right of the games from such investees to distribute on third-party platforms. The Company typically
pays one-time royalties, continues to share profits, and/or pays customized design fees to such investees.
SCHEDULE OF ROYALTY FEE AND SERVICE FROM RELATED PARTIES
| | |
| | | |
| | |
| | |
For the
Nine Months Ended
March 31, | |
| | |
2025 | | |
2024 | |
| Royalty fee and service from related parties | |
| | | |
| | |
| Wuhan Huiyu | |
$ | 261,084 | | |
$ | 316,790 | |
| Shanghai Dongying | |
| 1,709,587 | | |
| 1,984,280 | |
| Mobile Motion | |
| 434,398 | | |
| 714,689 | |
| Total | |
$ | 2,405,069 | | |
$ | 3,015,759 | |
| Royalty fee and service from related parties | |
$ | 2,405,069 | | |
$ | 3,015,759 | |
| 1) |
The Company entered into an exclusive game agency agreement with Wuhan Huiyu in January 2020. The exclusive agency term is eight years from the date of launching the game. Pursuant to the exclusive game agency agreement, the Company shares 15% to 18% of gross profit generated by the game with Wuhan Huiyu on a monthly basis. The Company recorded $261,084 and $316,790 of profit-sharing expenses for the nine months ended March 31, 2025 and 2024, respectively. |
| 2) |
The Company entered into a technology development agreement with Shanghai Dongying in January 2021 to customize design the game. During the year ended June 30, 2024, the Company entered supplementary agreement with Shanghai Dongying regarding the profit-sharing policy. Pursuant to supplementary agreement, the Company shares 25% of operating income of the game generated by the game with Shanghai Dongying on a monthly basis. The Company recorded $1,709,587 and $1,984,280 of profit-sharing expenses for the nine months ended March 31, 2025 and 2024, respectively. |
| 3) |
The Company entered into an exclusive game agency agreement with Mobile Motion in January 2021. The exclusive agency term is eight years from the date of launching the game. The Company recorded $25,248 and $25,194 of amortization of royalty fees for the nine months ended March 31, 2025 and 2024, respectively. The Company record $409,150 and $689,496 of customized design fees for the nine months ended March 31, 2025 and 2024. |
| (b) | The Company had the following
significant related party balances: |
Advanced to Suppliers — related parties
As of March 31, 2025 and June 30, 2024, advanced
to suppliers - related parties, consisted as following:
SCHEDULE OF ADVANCED TO SUPPLIERS - RELATED PARTIES
| | |
| | | |
| | |
| | |
As of | |
| | |
March 31,
2025 | | |
June 30, 2024 | |
| Wuhan Huiyu | |
$ | 42,285 | | |
$ | - | |
| Shanghai Dongying | |
| 552,343 | | |
| 320,488 | |
| Mobile Motion | |
| 704,937 | | |
| 873,717 | |
| Total | |
$ | 1,299,565 | | |
$ | 1,194,205 | |
| Advanced
to suppliers - related parties | |
$ | 1,299,565 | | |
$ | 1,194,205 | |
Due to related party
As of March 31, 2025 and June 30, 2024, the
Company had a due to related party balance of nil and $107,361, respectively, to Feng Xie. The advances were due on demand and without
interest. The Company paid off the due to Feng Xie during the nine months ended March 31, 2025.
|