NOTE 10. CONCENTRATIONS OF RISK

The Company is exposed to various risks arising from its business operations. The primary risks include foreign currency risk, liquidity risk, product-liability exposure, and concentration risks related to customers and suppliers.

(a) Foreign Currency Exchange Rate Risk

The Company’s reporting currency is the U.S. dollar. Substantially all expenses were denominated in U.S. dollars during the nine months ended June 30, 2026 and 2025.

During the nine months ended June 30, 2026, the Company expanded its sales activities in Asia, and a portion of the Company’s revenue was generated from customers in the People’s Republic of China, resulting in transactions denominated in Renminbi (“RMB”). The Company is therefore exposed to foreign currency exchange rate risk associated with RMB-denominated transactions.

The Company also maintains subsidiaries in Hong Kong, the People’s Republic of China, and Malaysia. The Hong Kong subsidiary is a non-operating holding entity and does not have significant foreign currency-denominated transactions. The Malaysia subsidiary is currently engaged in preliminary project development and administrative activities related to sustainable aviation fuel initiatives and incurred limited expenses denominated in Malaysian Ringgit (“MYR”) during the period. The Company’s exposure to foreign currency exchange rate risk was not material as of June 30, 2026.

(b) Liquidity Risk

The Company has incurred recurring operating losses and has a working capital deficiency. The Company’s ability to meet its obligations depends on generating additional revenues and obtaining external financing. These conditions are described further in the Going Concern note to the condensed consolidated financial statements.

(c) Product Liability Exposure

The Company records accruals for product-related claims when losses are probable and reasonably estimable. Historically, product returns and claims have not been material. No product liability accruals were recorded as of June 30, 2026 and September 30, 2025.

d) Customer / Revenue Concentration

The Company generates revenue through a limited number of distribution channels, including online marketplace platforms and distribution partners.

For the nine months ended June 30, 2026, two customers accounted for approximately 55.99% and 43.58%, respectively, of the Company’s total revenue. No other individual customer accounted for 10% or more of total revenue during the period.

For the nine months ended June 30, 2025, substantially all of the Company’s revenue was generated through a single online marketplace channel.

Because the Company currently relies on a limited number of significant customers and sales channels, the loss of a significant customer or distribution channel, or a material reduction in sales to or through such customers or channels, could adversely affect the Company’s revenues, operating results, and cash flows.

(e) Geographic Concentration

The Company generates revenue in the People’s Republic of China and the United States. Revenue by geographic market is attributed based on the location of the customer.

For the nine months ended June 30, 2026, approximately 99.57% of the Company’s total revenue was generated from customers in the People’s Republic of China, with the remaining approximately 0.43% generated from customers in the United States.

For the nine months ended June 30, 2025, 100% of the Company’s total revenue was generated from customers in the United States.

Changes in economic conditions, regulatory environments, trade policies, or market demand in these markets could adversely affect the Company’s revenues, operating results, and cash flows.

(f) Supplier Concentration

Any disruption in this supplier relationship could adversely affect the Company’s operations.

The Company relies on third-party suppliers and manufacturing partners for key product inputs and finished goods.

For the nine months ended June 30, 2026, one supplier, which serves as the Company’s primary manufacturing partner for DAG oil, accounted for approximately 99.83% of the Company’s total cost of revenues. No other individual supplier accounted for 10% or more of total cost of revenues during the period.

For the nine months ended June 30, 2025, the Company relied on a single supplier for substantially all of its cost of revenues.

Due to the specialized nature of DAG oil production, transitioning to an alternative supplier could require technical validation, commercial qualification, and regulatory and quality review. Consequently, the loss of, or a disruption in the relationship with, a significant supplier could result in supply interruptions, increased product costs, or delays in fulfilling customer orders and could adversely affect the Company’s operations, financial condition, and results of operations.