| RELATED PARTY BALANCES AND TRANSACTIONS |
16.
RELATED PARTY BALANCES AND TRANSACTIONS
The
principal related parties with which the Company had transactions as of June 30, 2026 and December 31, 2025, and also for the six months
ended June 30, 2026 and 2025 presented are as follows:
a)
Related Parties
SCHEDULE
OF RELATED PARTIES AND THEIR RELATIONSHIPS
| Name |
|
Relationship
with the Company |
| |
|
|
| Beijing
Xinlongmai Enterprise Management Co., Ltd. (“Beijing Xinlongmai”) |
|
Affiliate
of a shareholder of the Company |
| Huizhou
Highpower Technology Co., Ltd. (“Huizhou Highpower”) |
|
Shareholder
of the Company |
| Ms.
Xiaodan Liu |
|
CEO
of Elong Power |
| Beijing
Danwu Technology Co., Ltd. |
|
Entity
controlled by Ms. Xiaodan Liu, Chief Executive Officer of the Company; not part of the Company’s consolidated group. |
b)
Related party transactions
The
following table consists of the purchases that have been entered into with related parties:
SCHEDULE
OF RELATED PARTY TRANSACTIONS
| | |
| | | |
| | |
| | |
For
the six months ended June 30, | |
| | |
2026 | | |
2025 | |
| | |
(Unaudited) | | |
(Unaudited) | |
| Lease expense for renting
a vehicle from a related party | |
| | | |
| | |
| –Ms. Xiaodan Liu | |
$ | - | | |
$ | 82,729 | |
| Lease from a related party | |
$ | - | | |
$ | 82,729 | |
c)
Short-term loans payable to related parties
| | |
| |
As
of June 30, | | |
As
of December 31, | |
| |
Note | |
2026 | | |
2025 | |
| | |
| |
| (Unaudited) | | |
| (Audited) | |
| Beijing Xinlongmai Enterprise Management
Co., Ltd. (“Beijing Xinlongmai”) | |
(a) | |
$ | - | | |
$ | 428,994 | |
| Huizhou Highpower Technology Co., Ltd. (“Huizhou
Highpower”) | |
(a) | |
| 147,382 | | |
| 142,998 | |
| Ms. Xiaodan Liu | |
(b) | |
| - | | |
| 1,458,374 | |
| Beijing Danwu Technology
Co., Ltd. | |
(c) | |
| 4,531,842 | | |
| - | |
| Total | |
| |
$ | 4,679,224 | | |
$ | 2,030,366 | |
| Short-term loans payable to related parties | |
| |
$ | 4,679,224 | | |
$ | 2,030,366 | |
| (a) |
On
October 30, 2023, Huizhou Jingyang entered into two one-year loans with its related parties
Beijing Xinlongmai Enterprise Management Co., Ltd. (“Beijing Xinlongmai”) and
Huizhou Highpower Technology Co., Ltd. (“Huizhou Highpower”) of RMB 3 million
($0.4 million) and RMB 1 million ($0.1 million), respectively, both are interest free. During
the year ended December 31, 2025, the loans have been extended to October 20, 2026 and November
8, 2026, respectively.
In
2025, Huizhou Jingyang transferred its debt of RMB 3
million and RMB 1
million owed to Beijing Xinlongmai and Huizhou Highpower, respectively, to Elong Beijing under the same terms. As of June 30, 2026
and December 31, 2025, the Company had outstanding borrowings of nil
and $428,994
from Beijing Xinlongmai, respectively. As of June 30, 2026 and December 31, 2025, the Company had outstanding borrowings of $147,382
and $142,998
from Huizhou Highpower, respectively. The two borrowings are unsecured and interest-free.
|
(b)
|
In
April 2025, the Company obtained aggregate borrowings of RMB9,680,136
($1,436,819)
from Ms. Xiaodan Liu on several occasions, bearing interest at 8%
per annum and due on April
10, 2026.
In
2025, Jingyang HK borrowed RMB0.8
million ($117,076)
from Ms. Xiaodan Liu, bearing interest at 8%
per annum and payable on demand. On December 31, 2025, Jingyang HK transferred its debt of RMB0.8
million ($117,076)
owed to Ms. Xiaodan Liu to ELPW under the same terms. Accordingly, as of December 31, 2025, the Company had outstanding borrowings
of RMB10,480,136
($1,498,640)
from Ms. Xiaodan Liu, consisting of the term loan of RMB0.8
million ($117,076)
due on April 10, 2026 and demand loans of RMB9,680,136
($1,436,819)
with no fixed maturity date. All the unsecured borrowings bore interest at 8%
per annum.
During the six months ended June 30, 2026, the Company made cash repayments of RMB2,837,844 (approximately $418,246)
to Ms. Xiaodan Liu. In April and June 2026, the Company issued Class B ordinary shares to Ms. Xiaodan Liu to settle principal of RMB332,149
(approximately $48,953) of the borrowings. In addition, the outstanding principal of RMB7,310,143 (approximately $1,077,382) was extinguished
through set-off against proceeds from redemption of money-market fund investments. After giving effect to the above transactions, no amount
remained outstanding to Ms. Xiaodan Liu as of June 30, 2026
|
| |
|
| (c) |
On
May 15, 2026, the Company obtained borrowings of RMB 31
million ($4,568,835)
from Beijing Danwu Technology Co., Ltd. During the six-month period ended June 30, 2026, the Company repaid
RMB 251,000
($36,993)
under this borrowing arrangement. As of June 30, 2026, the outstanding principal balance of this borrowing amounted to
RMB 30.75
million ($4,531,842).
The borrowing is unsecured, interest-free and repayable on demand. |
For
the six months ended June 30, 2026 and 2025 interest expense of $108,597 and $16,757 was incurred on the Company’s borrowings from
related parties, respectively.
d)
Amounts due from related parties
Amounts
due from related parties consisted of the following for the periods indicated:
SCHEDULE
OF AMOUNTS DUE FROM RELATED PARTIES
| | |
Relationship | |
As
of
June
30, 2026 | | |
As
of
December
31, 2025 | | |
Note |
| | |
| |
| (Unaudited) | | |
| (Audited) | | |
|
| Ms. Xiaodan Liu | |
CEO and Board Chair of Elong Power | |
$ | 138,091 | | |
$ | 71,499 | | |
Lease deposit and receivable |
As
of June 30, 2026 and December 31, 2025, the Company had security deposits of $73,691
and $71,499,
respectively, due from Ms. Xiaodan Liu related to a vehicle lease.
On
June 23, 2026, the Company entered into a securities purchase agreement with GRACEDAN CO., LIMITED, pursuant to which the Company agreed
to issue and sell to GRACEDAN CO., LIMITED 66,119 Class B ordinary shares of the Company, valued at $0.974 per share, the closing price
of the Company’s Class A ordinary shares as of June 22, 2026. As of June 2026, the subscription receivable of $64,400 remained
outstanding from GRACEDAN CO., LIMITED (controlled by Ms. Xiaodan Liu), and was subsequently settled in full on July 21, 2026.
e)
Amounts due to related parties
Amounts
due to related parties consisted of the following for the periods indicated:
SCHEDULE
OF AMOUNTS DUE TO RELATED PARTIES
| | |
Relationship | |
As
of June
30, 2026 | | |
As
of December
31, 2025 | | |
Note |
| Ms. Xiaodan Liu | |
CEO and Board Chair of Elong Power | |
| - | | |
| 4,713 | | |
Payable for employee reimbursement |
| Ms. Xiaodan Liu | |
CEO and Board Chair of
Elong Power | |
| - | | |
| 75,060 | | |
Interest payable |
| Total | |
| |
$ | - | | |
$ | 79,773 | | |
|
|