The
balance as of June 30, 2026 primarily represented a loan in the principal amount of US$3,309,881
that the Company lent to Suzhou Chaoyuhua Precision Technology Co., Ltd. (the “Borrower”),
a third party, pursuant to a loan agreement dated February 25, 2026. The loan matures on
July 31, 2026, on which date the principal and accrued interest are repayable in a lump sum.
The loan is unsecured. As of the date of this report, the loan has not been collected..