19. Subsequent Event

On July 23, 2026, the Company and LPOIZ entered into an equity transfer agreement (the “ETA”) with Hengtu Optical Technology Co., Ltd. (the “Purchaser”), and Mr. Leo Zheng (the “Purchaser Representative”). The Purchaser is owned by the Purchaser Representative and certain members of the Company’s current management team. Pursuant to the ETA, and subject to the terms and conditions set forth therein, the Company agreed to sell and transfer one hundred percent (100%) of its interest in LPOIZ to the Purchaser (the “LPOIZ Transaction”) for payment of cash consideration of $4,500,000 (the “Purchase Price”). The Purchase Price is payable in full no later than the fifth anniversary of the closing of the LPOIZ Transaction, with the Purchaser required to pay at least $500,000 per year, together with financing interest in an amount equal to four percent (4%) of the principal amount of each Purchase Price installment, all in accordance with the ETA. In addition, if the Purchaser fails to pay any amount due under the Agreement when due, the Purchaser shall pay damages on the overdue amount at an annual rate of seven percent (7%).

The ETA further provides that during the period commencing on the closing date of the LPOIZ Transaction and ending of the later of (i) the date on which the Purchase Price has been paid in full and (ii) the fifth anniversary of the closing date of the LPOIZ Transaction (such period, the “Restricted Period”), the Company shall have the right to designate an observer at all meetings of the board of directors, shareholders or other governing bodies of LPOIZ. The Purchaser has also agreed that, during the Restricted Period, (a) a change of control of the Company (as defined in the ETA) shall not occur; (b) the Company shall not sell, dispose of or otherwise transfer all or substantially all of its assets (including without limitation intellectual property) and/or business to any third party, except for the sale of inventory and products in the ordinary course of business consistent with past practice and the ETA; and (c) if there is any direct or indirect change in the ownership of LPOIZ or the Purchaser, the Purchaser shall provide a written notice to the Company immediately, and any new direct or indirect shareholder shall execute an acknowledgment in form and substance satisfactory to the Company acknowledging and agreeing to the post-closing restrictions and other applicable terms of the ETA.

Subject to the terms and conditions of the ETA, LPOIZ will receive from the Company certain limited rights and licenses to use specified trademarks in specified territories, including certain transitional trademark rights and a five-year license relating to specified marks. The ETA also provides LPOIZ with certain rights to use product drawings, tooling, molds, process documentation, technology, know-how and related technical support in connection with LPOIZ’s business following the closing. The rights and licenses are subject to the scope, duration, territory, quality control, confidentiality, payment, default and termination provisions set forth in the ETA, and the Company and its affiliates retain ownership of their intellectual property except to the extent expressly provided therein.

Additionally, pursuant to the ETA, during the first five years following the closing of the LPOIZ Transaction (the “Exclusive Supply Term”), LPOIZ shall continue to supply products to the Company in a manner consistent with past practice, applicable specifications and agreed upon quality requirements. The purchase price of such products to be supplied by LPOIZ to the Company shall continue to be cost plus ten percent (10%) following the closing of the LPOIZ Transaction; provided that for every payment by the Purchaser of $1,000,000 of the principal portion of the remaining balance of the Purchase Price, the cost plus markup percentage for products supplied to the Company shall automatically increase by five percent (5%) (e.g., upon payment of $2,000,000 in principal of the Purchase Price, the purchase price for products supplied to the Company will be cost plus twenty percent (20%). Upon full payment of the principal amount of the Purchase Price, the purchase price shall be fixed at cost plus thirty percent (30%) and shall not be further adjusted unless otherwise agreed by the parties in writing.

The ETA contains certain mutual post-closing covenants restricting each party’s ability to sell, market or distribute specified products in specified territories during the Exclusive Supply Term.

The LPOIZ Transaction is expected to close in September 2026.

End of Consolidated Financial Statements