EX-99.6 25 ea026711701ex99-6_evolution.htm UNAUDITED FINANCIAL STATEMENTS OF HANDA LAB AS OF AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

Exhibit 99.6

 

Handa Lab Co., Ltd. and Subsidiary

Condensed Consolidated Interim Financial Statements

(Unaudited)

 

As of September 30, 2025 and for the nine-month periods ended September 30, 2025 and 2024

 

 

 

Table of Contents

 

  Page
Unaudited Condensed Consolidated Balance Sheets 1
Unaudited Condensed Consolidated Interim Statements of Operations 3
Unaudited Condensed Consolidated Interim Statements of Comprehensive Loss 4
Unaudited Condensed Consolidated Interim Statements of Changes in Stockholders’ Equity 5
Unaudited Condensed Consolidated Interim Statements of Cash Flows 6
Notes to the Unaudited Condensed Consolidated Interim Financial Statements 7

 

i

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Balance Sheets

 

(in US dollars)

 

   Notes  September 30,
2025
   December 31,
2024
 
      (Unaudited)     
Assets:           
Cash and cash equivalents     $641,095    553,907 
Trade accounts receivable  2,3   21,181    13,320 
Contract assets  2   17,728    - 
Non-trade account receivable  4   18,873    34,607 
Non-trade account receivable (Related party)  4,15   -    68,027 
Short-term financial instruments      -    204,082 
Inventories  5   147,533    16,593 
Prepaids and other current assets      27,706    1,914 
              
Total current assets      874,116    892,450 
              
Property, plant and equipment, net  6   294,420    292,793 
Operating lease right-of-use assets  7   2,168    2,714 
Intangible assets, net  14   84,620    94,358 
Other non-current assets      20,330    16,407 
              
Total non-current assets      401,538    406,272 
              
Total assets     $1,275,654    1,298,722 

 

See accompanying notes to the unaudited condensed consolidated interim financial statements.

 

1

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Balance Sheets, Continued

 

(in US dollars)

 

   Notes   September 30,
2025
   December 31,
2024
 
       (Unaudited)     
Liabilities and Stockholders’ Equity            
Liabilities:            
Trade accounts payable       $-    1,347 
Non-trade accounts payables        146,524    22,542 
Contract liabilities        107,827    - 
Current portion of finance lease liabilities   7    6,778    6,465 
Current portion of operating lease liabilities   7    1,402    2,535 
Other current liabilities        14,301    10,883 
                
Total current liabilities        276,832    43,772 
                
Long-term debt   8    419,341    400,000 
Long-term debt (Related party)   8,15    23,784    22,687 
Finance lease liabilities (non-current)   7    10,506    13,753 
Operating lease liabilities (non-current)   7    766    181 
                
Total non-current liabilities        454,397    436,621 
                
Total liabilities        731,229    480,393 
                
Stockholders’ equity:               
Common stock, par value of KRW 5,000 (equivalent to $ 3.7) authorized 1,500,000 shares; 380,800 shares issued and outstanding as of September 30, 2025 and December 31, 2024   11    1,514,241    1,514,241 
Additional paid-in capital        (3,058)   (3,058)
Accumulated deficit        (856,993)   (546,796)
Accumulated other comprehensive loss        (121,517)   (158,738)
                
Total equity attributable to the Company and Subsidiary        532,673    805,649 
                
Non-controlling interest        11,752    12,680 
                
Total equity        544,425    818,329 
                
Total liabilities and stockholders’ equity       $1,275,654    1,298,722 

 

See accompanying notes to the unaudited condensed consolidated interim financial statements.

 

2

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Interim Statements of Operations

 

(in US dollars)

 

      Nine-month periods ended September 30, 
   Notes  2025   2024 
            
Net revenues  2  $195,937    402,055 
              
Cost of sales      (204,374)   (311,693)
Cost of sales (Related party)  15   -    (9,875)
              
Total cost of sales      (204,374)   (321,568)
              
Gross profit      (8,437)   80,487 
              
Other operating income      130,159    279,620 
              
Selling, general, and administrative expenses      (436,844)   (505,873)
              
Operating Ioss      (315,122)   (145,766)
              
Other income      1,877    59 
Other expense      (149)   (438)
Interest income      5,349    4,718 
Interest income (Related party)  15   1,387    1,343 
Interest expense      (4,467)   (4,475)
              
Loss before tax      (311,125)   (144,559)
              
Income tax expense  9   -    - 
              
Loss for the period     $(311,125)   (144,559)
              
Loss attributable to:             
Owners of the Company     $(310,197)   (143,197)
Non-controlling interests      (928)   (1,362)
              

 

See accompanying notes to the unaudited consolidated interim financial statements.

 

3

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Statements of Comprehensive Loss

 

(in US dollars)

 

      Nine-month periods ended September 30, 
   Notes  2025   2024 
            
Loss for the period     $(311,125)   (144,559)
              
Other comprehensive income (loss):             
Foreign currency translation adjustments      37,221    (21,719)
              
Total other comprehensive income (loss)      37,221    (21,719)
              
Total comprehensive loss     $(273,904)   (166,278)
              
Total comprehensive loss attributable to:             
Owners of the Company     $(272,976)   (164,916)
Non-controlling interests      (928)   (1,362)

 

See accompanying notes to the unaudited consolidated interim financial statements.

 

4

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity

 

(in US dollars)

 

   Common
stock
  

Additional
paid-in Capital

   Accumulated
other
comprehensive
loss
   Accumulated
deficit
  

Equity
attributable to
owners of the
Company

   Non-controlling
interests
   Total
stockholders’
equity
 
                             
Balances at January 1, 2024  $1,176,095    (646)   (42,337)   (397,894)   735,218    14,303    749,521 
Loss for the period   -    -    -    (143,197)   (143,197)   (1,362)   (144,559)
Foreign currency translation adjustments   -    -    (21,719)   -    (21,719)   -    (21,719)
Paid-in capital increase   338,146    (658)   -    -    337,488    -    337,488 
                                    
Balances at September 30, 2024  $1,514,241    (1,304)   (64,056)   (541,091)   907,790    12,941    920,731 
                                    
Balances at January 1, 2025  $1,514,241    (3,058)   (158,738)   (546,796)   805,649    12,680    818,329 
Loss for the period   -    -    -    (310,197)   (310,197)   (928)   (311,125)
Foreign currency translation adjustments   -    -    37,221    -    37,221    -    37,221 
                                    
Balances at September 30, 2025  $1,514,241    (3,058)   (121,517)   (856,993)   532,673    11,752    544,425 

 

See accompanying notes to the unaudited consolidated interim financial statements.

 

5

 

 

Handa Lab Co., Ltd. and Subsidiary

Unaudited Condensed Consolidated Interim Statements of Cash Flows

 

(in US dollars)

 

   Nine-month periods ended September 30, 
   2025   2024 
         
Cash flows from operating activities        
Loss for the period  $(311,125)   (144,559)
           
Adjustments to reconcile loss for the period to net cash used in operating activities          
Depreciation and amortization   14,791    7,897 
Amortization of Intangible Assets   15,325    16,083 
Interest expenses   4,466    4,475 
Others   (1,370)   2,555 
Change in operating assets and liabilities          
Accounts receivable   (11,957)   160,617 
Inventories   (129,162)   184,432 
Other assets   (25,456)   (20,136)
Accounts payable   227,703    (269,252)
Other liabilities   2,870    (9,320)
           
Net cash used in operating activities   (213,915)   (67,208)
           
Cash flows from investing activities          
           
Acquisitions of property, plant and equipment   (4,398)   (16,588)
Acquisition of short-term financial instruments   -    (332,631)
Proceeds from short-term financial instruments   212,346    183,317 
Proceeds from government grants   9,555    7,855 
Acquisition of intangible assets   (8,644)   (6,189)
Increase in leasehold deposits   (1,892)   - 
Issuance of loans   -    (465,684)
Collection of loans   70,782    354,807 
           
Net cash provided by (used in) investing activities   277,749    (275,113)
           
Cash flows from financing activities          
Proceeds from long-term borrowings   -    221,754 
Paid in capital increase   -    338,146 
Payment of finance lease liabilities   (3,882)   (9,726)
Stock issuance costs   -    (658)
           
Net cash provided by (used in) financing activities  $(3,882)   549,516 
           
Effect of exchange rate changes on cash and cash equivalents   27,236    (10,940)
Net increase in cash and cash equivalents   59,952    207,195 
Cash and cash equivalents as of beginning of period   553,907    294,351 
           
Cash and cash equivalents as of end of period  $641,095    490,606 

 

See accompanying notes to the unaudited consolidated interim financial statements.

 

6

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements

 

1. Summary of Significant Accounting Policies

 

(1)Description of Business

 

Handa Lab Co., Ltd. (the “Company”) and subsidiary (collectively, the “Group”), established in 2021, specialize in the manufacture and sale of intelligent monitoring systems, machine vision and laser testing systems, data gathering systems. The Company offers a diverse range of equipment and software, tailored to meet specific customer requirements in terms of specifications, functions, standards, and delivery timelines. Handa Corporation Co., Ltd., in which the Company holds a 60% stake, was established in 2023 and specializes in the manufacture and sale of intelligent robotic systems.

 

(2)Basis of Presentation

 

These financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) assuming the Group will continue as a going concern. The accounting policies applied by the Group in these consolidated interim financial statements are the same as those applied by the Group in its condensed consolidated financial statements as of and for the year ended December 31, 2024.

 

The unaudited condensed interim financial information does not represent complete financial statements and should be read in conjunction with the Group’s latest annual audited financial statements.

 

These interim results are not necessarily indicative of the results to be expected for the fiscal year ended December 31, 2025, or for any other interim period or for any other future year.

 

In the opinion of management, these unaudited condensed consolidated interim financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Group’s financial information.

 

(3)Going Concern

 

The going concern assumption contemplates the realization of assets and satisfaction of liabilities in the normal course of business. However, substantial doubt about the Group’s ability to continue as going concern exists.

 

Primarily due to a decline in sales associated with the business, the Group generated loss for the period of $311,125 and net cash outflows from operations of $213,915 for the period ended September 30, 2025. At September 30, 2025, however, the Group had a net working capital of $43,811 and cash equivalents of $641,095.

 

The Group is evaluating strategies to obtain the required additional funding for future operations. These strategies may include, but are not limited to, obtaining equity financing, issuing debt or entering into other financing arrangements, and restructuring of operations to grow revenues and decrease expenses. However, upon the economic environment and the Group’s current capability, the Group may be unable to access future equity or debt financing when needed. As such, there can be no assurance that the Group will be able to obtain additional liquidity when needed or under acceptable terms, if at all.

 

The condensed consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Group were unable to continue as a going concern.

 

7

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

(4)New Accounting Standards and Interpretations Not Yet Adopted

 

Income Statement (Topic 220) Reporting Comprehensive Income - Expense Disaggregation Disclosures

 

In November 2024, the FASB issued ASU 2024-03, which becomes effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The standard requires to disclose disaggregated information about certain income statement expense line items. The Group does not expect the standard to have a material effect on its financial statements and has begun evaluating disclosure presentation alternatives.

 

Income Taxes (Topic 740) - Improvements to Income Tax Disclosures

 

In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Group does not expect the standard to have a material effect on its financial statements.

 

The Group has not early adopted any of the forthcoming new or amended accounting standards in preparing these condensed consolidated interim financial statements.

 

2.Significant Risks and Uncertainties Including Business and Credit Concentrations

 

The Group manufactures smart monitoring visual system and laser inspection systems. The specifications, functions, and delivery dates vary depending on the demand of customers. After receiving orders from customers, the Group manufactures and sell those products.

 

The Group’s operating segment is a single segment and compose of equipment and machine manufacturing segment, and as of the end of the reporting period, assets and liabilities of the segment is the same as the attached financial statements. The manufacturing periods vary per project, ranging from as short as one month to over a year. Sales are approximately $196 thousand in the third quarter of 2025, all of which are domestic.

 

Sales to a small number of major customers account for all of the Group’s total net revenue. The Group is making efforts to gain new customers by continuously expanding its sales activities. If orders from existing major customers decrease, there is a possibility of a loss of sales, which may adversely affect business results.

 

For the nine-month period ended September 30, 2025, the customers accounting for 10% or more of total revenue are Customer D, Customer F and Customer A, with revenues of $57,022, $31,993 and $27,363, respectively. For the nine-month period ended September 30, 2024, the customers accounted for 10% or more of Total revenue are Customer B and Customer C, with revenues of $85,301 and $80,497, respectively.

 

The following table disaggregates trade accounts receivable and contracts assets by major customers.

 

   September 30,
2025
   December 31,
2024
 
(in US dollars)        
Trade accounts receivable and contracts assets by customers        
Customer A  $17,728    8,082 
Customer B   21,181    - 
Customer G   -    5,238 
           
Total  $38,909    13,320 

 

8

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

3.Trade Accounts Receivable

 

There was no allowance for credit losses related to trade accounts receivables recorded as of September 30, 2025 and December 31, 2024.

 

4.Non-Trade Account Receivable

 

Non-trade account receivables consist of accrued income and refundable tax. The Group disaggregates the non-trade account receivable by type of financing receivable when assessing and monitoring risk and performance of the entire portfolio.

 

Non-trade account receivables are unsecured and generally have terms of less than one year, requiring payments of principal at maturity.

 

The amortized cost basis of non-trade account receivable, net as of September 30, 2025 and December 31, 2024, respectively, was as follows:

 

   September 30,
2025
   December 31,
2024
 
(in US dollars)        
Non-trade account receivable, net:        
Short-term loan receivable (Related party)  $-    68,027 
Other receivables   18,873    34,607 
           
Total  $18,873    102,634 

 

There was no allowance for credit losses related to non-trade account receivables recorded as of September 30, 2025 and December 31, 2024.

 

9

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

5.Inventories

 

Details of inventories as of September 30, 2025 and December 31, 2024 were as follows:

 

   September 30
2025
   December 31
2024
 
(in US dollars)        
Raw materials  $54    - 
Work in process   147,479    16,593 
           
Total  $147,533    16,593 

 

There were no write-downs of inventories recorded for the period ended September 30, 2025 and December 31, 2024.

 

6.Property, Plant and Equipment

 

(1)Details of Property, plant and equipment as of September 30, 2025 and December 31, 2024 are as follows:

 

       Initial Cost   Carrying Amount 
   Useful
Lives
   2025   2024   2025   2024 
(in US dollars)                    
Land  -   $26,759    25,525    26,759    25,525 
Buildings  40    247,306    235,900    226,182    220,173 
Machinery and equipment (*)  5    101,891    97,191    1,034    1,226 
Vehicles (*)  5    19,288    18,399    -    - 
Furniture and fixtures (*)  5    86,870    78,636    2,395    22 
Finance lease right of use assets  4    53,411    50,947    38,050    45,847 
                         
Total      $535,525    506,598    294,420    292,793 

 

(*)The government grants related to asset have been deducted from the related asset accounts.

 

Total depreciation for the nine-month periods ended September 30, 2025 and 2024 was $14,791 and $7,897, respectively.

 

(2)As of September 30, 2025, the details of property, plant and equipment pledged as collateral were as follows:

 

Collateral Provided Asset  Net Carrying
Value
   Pledged
Amount
   Creditor  Relevant
Debt
Amount
 
                
Land  $26,759   $246,470   Hana Bank  $205,392 
Buildings   226,182              

 

10

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

7.Leases

 

The Group has operating leases for corporate offices and certain office equipment. Operating lease assets and liabilities are included in operating lease right-of-use assets and operating lease liabilities, respectively, on the condensed consolidated balance sheets.

 

Lease agreement of office space include renewal options for up to 10 years, renewable annually under the Commercial Building Lease Protection Act in Korea. Because the Group is not reasonably certain to exercise these renewal options, the options are not considered in determining the lease term, and associated potential option payments are excluded from lease payments.

 

The Group’s leases generally do not include termination options for either party to the lease or restrictive financial or other covenants. Payments due under the lease contracts include fixed payments.

 

(1)The components of lease expense for the nine-month periods ended September 30, 2025 and 2024 were as follows:

 

   September 30,
2025
   September 30,
2024
 
(in US dollars)        
Operating lease expense  $2,718    2,842 
Finance lease expense:          
Amortization of right of use assets   9,939    2,831 
Interest on lease liabilities   1,440    637 
           
Short-term lease expense   145    227 
           
Total  $14,242    6,537 

 

(2)Amounts presented in the condensed consolidated balance sheet as of September 30, 2025 and December 31, 2024 were as follows:

 

   September 30,
2025
   December 31,
2024
 
(in US dollars)        
Operating Leases:        
Operating lease ROU assets  $2,168    2,716 
           
Long-term operating lease liabilities   766    182 
Current portion of long-term and short-term operating lease liabilities   1,402    2,534 
           
Total  $2,168    2,716 
           
Finance Leases:          
Finance lease ROU assets  $53,411    50,947 
Accumulated amortization assets   (15,361)   (5,100)
           
Total   38,050    45,847 
           
Long-term finance lease liabilities   10,506    13,753 
Current portion of long-term finance lease liabilities   6,778    6,465 
           
Total  $17,284    20,218 

 

11

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

(3)Other information related to leases for the nine-month periods ended September 30, 2025 and 2024 was as follows:

 

   September 30,
2025
   September 30,
2024
 
(in US dollars)        
Cash paid for amounts included in the measurement of lease liabilities:        
Cash used in operations for operating leases  $2,435    2,546 
Cash used in operations for finance leases   5,322    1,634 
           
ROU assets obtained in exchange for lease obligations:          
Operating leases  $1,886    - 
Finance leases  $-    19,410 
           
Reductions to ROU assets resulting from reductions to lease obligations:          
Operating leases  $(2,558)   (2,447)
Finance leases  $(9,939)   (2,831)
           
Weighted average remaining lease term:          
Operating leases   0.10 years    1.09 years 
Finance leases   2.82 years    3.42 years 
           
Weighted average discount rate:          
Operating leases   8.33%   10.20%
Finance leases   9.92%   10.45%

 

(4)Maturities of lease liabilities under noncancellable leases as of September 30, 2025 are as follows:

 

    
(in US dollars)
Maturities
  Operating
leases
   Finance
leases
 
         
2025  $497    1,787 
2026   1,346    7,150 
2027   660    7,150 
2028   -    3,782 
           
Undiscounted lease payments   428    19,869 
Less: imputed interest   1,740    (2,585)
           
Lease liabilities  $2,168    17,284 

 

12

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

8.Debt

 

(1)Long-Term Debt

 

Details of the carrying amounts of long-term debt as of September 30, 2025 and December 31, 2024 were as follows:

 

(in US dollars)
Description
  Maturity Date  Interest
Rate (%)
   Borrowing
Limit
   September 30,
2025
   December 31,
2024
 
                    
Facility loans (*1)(*2)  May 2027   1.06 ~ 2.04   $205,391   $205,391    195,918 
Working capital loans (*3)(*4)  May 2029   0.46 ~ 0.51    213,950    213,950    204,082 
Loan from the Company’s CEO  Sep 2028   0    23,784    23,784    22,687 
                        
Less: current portion of long-term debt                -    - 
                        
Long-term debt               $443,125    422,687 

 

(*1)As of the end of the reporting period, the Group is providing its land and buildings as collateral to Hana Bank in connection with a facility loans, and the building is currently being used as the Group’s research center (See note 6).
(*2)The Group receives a 3% interest rate subsidy provided for loans by Cheongju City Government.
(*3)As of the end of the reporting period, the Group is provided with a payment guarantee from the Korea Technology Finance Corporation.
(*4)The Group receives a 5.5% interest rate subsidy provided for loans by Korea Institute for Advancement of Technology.

 

(2)Future principal payments for long-term debt as of September 30, 2025 are as follows:

 

(in US dollars)
Maturities
  Long-term debt  
       
2025-2026   $ -  
2027     261,204  
2028     135,410  
2029     46,511  
         
Total   $ 443,125  

 

13

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

9.Income Taxes

 

The Company is subject to income taxation primarily in South Korea, and we do not expect any income tax expenses for the nine-month period ended September 30, 2025 and 2024, including tax expenses directly recorded in equity.

 

10.Uncertain Tax Positions

 

There were no unrecognized tax benefits as of September 30, 2025 and December 31, 2024.

 

11.Stockholder’s Equity

 

The Company has 1,500 thousand shares of authorized stock, consisting of: common stock, par value KRW 5,000 (equivalent to $ 3.70) per share, issuable. As of September 30, 2025, there were 380,800 shares of common stock outstanding. In 2024, a total of 89,000 shares were increased through a paid-in capital increase.

 

Common Stock

 

Holders of common stock are entitled to one vote per share, and to receive dividends and, upon liquidation or dissolution, are entitled to receive all assets available for distribution to stockholders. The holders have no preemptive or other subscription rights, and there is no redemption or sinking fund provisions with respect to such shares.

 

12.Pension (Defined Contribution Plan)

 

The Group has a defined contribution plan. Under this plan, the Group pays specified amounts of contributions into a separate fund. These contributions are recognized as expenses when they are paid. The expenses related to post-retirement benefit plans under the defined contribution plans for the nine-month periods ended September 30, 2025 and 2024 were as follows:

 

   September 30,
2025
   September 30,
2024
 
(in US dollars)        
Expense related to post-retirement benefit plans under defined contribution plans  $49,993    27,796 

 

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Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

13.Supplemental Cash Flow Information

 

   September 30,
2025
   September 30,
2024
 
(in US dollars)        
Supplemental disclosure of cash flow information:        
Cash receipt during the period for interest  $9,987    10,326 
Cash paid during the period for interest   (4,581)   (4,425)
Income taxes paid   (51)   (1,604)

 

14.Intangible Assets

 

(1)Details of intangible assets as of the nine-month period ended September 30, 2025 were summarized as follows:

 

  Useful
lives
  Initial value   Accumulated
Amortization
   Government
grants
   Book value 
(in US dollars)                  
Patents 7 years  $151,902    (56,464)   (12,216)   83,222 
Software 5 years   68,591    (35,786)   (32,805)   - 
Under construction     9,388    -    (7,990)   1,398 
                       
Total    $229,881    (92,250)   (53,011)   84,620 

 

(2)Details of intangible assets as of the year ended December 31, 2024 were summarized as follows:

 

  Useful
lives
  Initial value   Accumulated
Amortization
   Government
grants
   Book value 
(in US dollars)                  
Patents 7 years  $144,896    (44,989)   (5,794)   94,113 
Software 5 years   65,011    (24,349)   (40,662)   - 
Under construction     7,866    -    (7,621)   245 
                       
Total    $217,773    (69,338)   (54,077)   94,358 

 

15

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

15.Related Party Transactions

 

(1)The Group’s list of related parties is as follows:

 

Relationship  Name of Related Party
    
Primary owners with more than 10% of shares  CLEVER Co., LTD
   Korea National University of Transportation Technology Holding Co., Ltd
   SANG MIN KIM(CEO)

 

(2)Related party transactions between companies cost of sales and interest income, which were included in the consolidated financial statements:

 

      Nine-month periods ended September 30 
Related parties  Transactions  2025   2024 
            
CLEVER Co., LTD  Cost of sales  $-    9,875 
   Interest income   1,387    1,343 

 

(3)Amounts of receivables and borrowings from related parties were as follows:

 

Related parties  Balances  September 30,
2025
   December 31,
2024
 
            
CLEVER Co., LTD   Non-trade account receivable
(Short-term loan receivable)
  $-    68,027 
SANG MIN KIM
(CEO)
  Long-term debt   23,784    22,687 

 

(4)Changes in the short-term loan receivable from the related party for the nine-month period ended September 30, 2025 were as follows:

 

   December 31,
2024
   Increase   Decrease   Others   September 30,
2025
 
(in US dollars)                    
Non-trade account receivable (Short-term loan receivable)  $68,027            -    (70,782)   2,755            - 

 

16

 

 

Handa Lab Co., Ltd. and Subsidiary

Notes to the Unaudited Condensed Consolidated Interim Financial Statements, Continued

 

(5)Changes in the borrowings from the related party for the nine-month period ended September 30, 2025 were as follows:

 

   December 31,
2024
   Increase   Decrease   Others   September 30,
2025
 
(in US dollars)                    
Long-term debt (Loan from the Company’s CEO)  $22,687           -             -    1,097    23,784 

 

16.Commitments and Contingencies

 

As of September 30, 2025, the Group has evaluated its commitments and contingencies and determined that no material commitments or contingencies exist.

 

17.Subsequent Events

 

The Group has evaluated subsequent events from the balance sheet date to the date at which the unaudited condensed consolidated interim financial statements were available to be issued, and except as disclosed below, no other events requiring disclosure were identified.

 

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