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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2026

☐	TRANSITION REPORT PERSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 000-56239

	QUALITY INDUSTRIAL CORP.
	(Exact name of registrant as specified in its charter)

Nevada		35-2675388
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

505 Montgomery Street San Francisco, CA 94104		94111
(Address of principal executive offices)		(Zip Code)

800-706-0806

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) Yes ☐ No ☒

As of May 15, 2026, there were a total of 193,266,631 shares of the registrant’s common Stock, $0.001 par value per share, outstanding.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	9
Item 4.	Controls and Procedures	9

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	10
Item 1A.	Risk Factors	10
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	10
Item 3.	Defaults Upon Senior Securities	11
Item 4.	Mine Safety Disclosures	11
Item 5.	Other Information	11
Item 6.	Exhibits	12

SIGNATURES		13

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Quality Industrial Corp.

Unaudited Consolidated Financial Statements

	Page
Consolidated Balance Sheets as of March 31, 2026 (unaudited) and December 31, 2025 (audited)	F-1
Consolidated Statements of Operations for the Three Months Ended March 31, 2026, and 2025 (unaudited)	F-2
Consolidated Statements of Changes in Equity as of March 31, 2026 and March 31, 2025 (unaudited)	F-3
Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026, and 2025 (unaudited)	F-4
Notes to the Consolidated Financial Statements (unaudited)	F-5

QUALITY INDUSTRIAL CORP.

CONSOLIDATED BALANCE SHEETS

	March 31, 2026			December 31, 2025
	Unaudited			Audited
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	172,548		$	426,585
Inventory		213,551			201,153
Accounts receivable		5,299,183			5,307,371
Related party receivables		324,280			-
Deposits, prepayments & advances		794,712			610,279
Other current assets		493,525			493,525
TOTAL CURRENT ASSETS		7,297,799			7,038,913

NON-CURRENT ASSETS
Property, plant and equipment		547,178			499,288
Right-of-use assets		343,948			370,285
Advances for purchase of property, plant and equipment		299,785			299,785
Goodwill		8,411,100			8,411,100
TOTAL NON-CURRENT ASSETS		9,602,011			9,580,458
TOTAL ASSETS	$	16,899,810		$	16,619,371
LIABILITIES AND EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable	$	1,059,885		$	1,158,471
Related party payables		4,667,537			4,427,537
Lease liabilities – current portion		157,678			154,040
Convertible notes, net of discount		1,948,786			2,066,056
Other payables - current		9,069,680			7,965,456
Other current liabilities		1,133,088			981,812
TOTAL CURRENT LIABILITIES		18,036,654			16,753,372

NON-CURRENT LIABILITIES
Lease liabilities - non-current portion		201,132			230,032
Other non-current liabilities		183,267			1,320,183
TOTAL NON-CURRENT LIABILITIES		384,399			1,550,215
TOTAL LIABILITIES		18,421,053			18,303,587
EQUITY (DEFICIT)
Preferred stock; $0.001 par value; 1,000,000 shares authorized; 0 and 8,500 Series B shares issued and outstanding as of as of March 31, 2026, and December 31, 2025, respectively		-			9
Common stock; $0.001 par value; 450,000,000 shares authorized; 193,266,631 and 179,110,820 shares issued and outstanding as of March 31, 2026, and December 31, 2025, respectively		193,269			179,113
Additional paid-in capital		18,491,648			18,465,526
Accumulated deficit		(22,662,016	)		(22,670,845	)
Accumulated other comprehensive income (loss) – foreign currency translation		572			-
Noncontrolling interest		2,455,284			2,341,981
TOTAL EQUITY (DEFICIT)		(1,521,243	)		(1,684,216	)
TOTAL LIABILITIES AND EQUITY (DEFICIT)	$	16,899,810		$	16,619,371

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-1

QUALITY INDUSTRIAL CORP.

CONSOLIDATED STATEMENT OF OPERATIONS

	31-March-26			31-March-25
	For the Three Months Ended
	31-March-26			31-March-25
	Unaudited			Unaudited
REVENUE	$	3,665,660			3,621,473

Cost of revenues		2,665,060			2,666,087

GROSS PROFIT		1,000,600			955,386

OPERATING EXPENSES
Professional fees		77,665			51,840
General and administrative		699,699			1,810,440
Depreciation and amortization		47,416			40,228
TOTAL OPERATING EXPENSES		824,780			1,902,508

OPERATING INCOME (LOSS)		175,820			(947,122	)

OTHER (INCOME) EXPENSES
Interest expenses		9,413			32,241
Interest on convertible notes		43,205			188,539
Conversion fees		1,500			12,000
Discount on convertible notes		-			52,638
Other non operating expenses		2,000			-
Other income - credit card fees		(1,152	)		-
Other non - operating income		(35,000	)		-
TOTAL OTHER (INCOME) EXPENSES, NET		19,966			285,418

INCOME (LOSS) BEFORE INCOME TAX		155,854			(1,232,540	)
Corporate income tax		22,630			27,066
NET INCOME (LOSS)		133,224			(1,259,606	)
Less: net income attributable to noncontrolling interest		124,396			146,604
NET INCOME (LOSS) ATTRIBUTABLE TO QIND STOCKHOLDERS	$	8,828			(1,406,210	)

Net income (loss) per common share:
Basic	$	0.00			(0.01	)
Diluted	$	0.00			(0.01	)
Weighted average number of common shares outstanding:
Basic		187,505,800			135,477,908
Diluted		192,817,598			135,477,908

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-2

QUALITY INDUSTRIAL CORP.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the Three Months Ended March 31, 2026

	Shares		Amount			Shares			Amount			Shares		Amount		Shares		Amount			Amount			Amount		Amount			Amount
	Preferred Stock A				Preferred Stock B							Common Stock				Noncontrolling Interest					Additional Paid-in Capital			Accumulated other comprehensive income (loss) – foreign currency translation		Accumulated Deficit			Total Equity
	Shares		Amount			Shares			Amount			Shares		Amount		Shares		Amount			Amount			Amount		Amount			Amount

Total Equity as of December 31, 2025		-		-			8,500			9			179,110,820		179,113		-		2,341,981			18,465,526			-		(22,670,844	)		(1,684,216	)
Issued shares from conversion of convertible note		-		-			-			-			5,655,811		5,656		-		-			34,614			-		-			40,269
Prefer B stock Converted to common Stock		-		-			(8,500	)		(9	)		8,500,000		8,500		-		-			(8,492	)		-		-			-
Income for the period		-		-			-			-			-		-		-		124,396			-			-		8,828			133,224
Other comprehensive income – foreign currency translation adjustment		-		-			-			-			-		-		-		-			-			572		-			572
Net transactions with Non-controlling interest		-		-			-			-			-		-		-		(11,093	)		-			-		-			(11,093	)
Total Equity (Deficit) as of March 31, 2026		-		-			-			-			193,266,631		193,269		-		2,455,284			18,491,648			572		(22,662,016	)		(1,521,243	)

For the Three Months Ended March 31, 2025

		Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		Amount		Amount			Amount
	Preferred Stock A			Preferred Stock B			Common Stock			Minority Interest			Additional Paid-in Capital		Retain Loss			Total Equity
		Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		Amount		Amount			Amount

Balance, December 31, 2024		-	-		20,000	20		126,642,689	126,645		-	1,049,865		18,046,911		(17,226,549	)		1,996,892
Issued shares from conversion of convertible note		-	-		-	-		13,786,992	13,787		-	-		215,139		-			228,926
Minority Interest		-	-		-	-		-	-		-	-		-		-			-
Income for the period		-	-		-	-		-	-		-	146,604		-		(1,406,210	)		(1,259,606	)
Balance March 31, 2025		-	-		20,000	20		140,429,681	140,432		-	1,196,469		18,262,050		(18,632,759	)		966,212

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-3

QUALITY INDUSTRIAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	March 31, 2026			March 31, 2025
Cash flows from operating activities
Income (Loss) for the period		133,224			(1,259,606	)

Adjustment to reconcile net gain (loss) to net cash
Finance cost		38,205			220,780
Employee End of service benefits accrual		6,118			-
Conversion fees		1,500			15,831
Corporate income tax expense		22,630			27,066
Depreciation and amortization		47,416			40,228
Other non – operating income		(35,000	)		-
Discount on convertible Notes		-			52,638
Changes in assets and liabilities, net
Inventory		(12,398	)		140,735
Accounts receivable		8,188			117,662
Deposits, prepayments & advances		(184,433	)		(251,613	)
Related party receivables		(324,280	)		(106,229	)
Accounts payable		(63,586	)		(423,004	)
Other current liabilities		91,941			1,110,333
Lease liabilities		(39,175	)		(19,637	)
Net cash used in operating activities		(309,650	)		(334,816	)

Cash flows from investing activities
Addition of fixed assets		(55,057	)		-
Payments to ASG shareholders		(20,000	)		(200,000	)
Net cash used in investing activities		(75,057	)		(200,000	)

Cash flows from financing activities
Proceeds from issuance of common stock		-			228,926
Repayment of convertible note, net		(80,000	)		(255,550	)
Finance cost		-			(3,830	)
Fund support from holding company		240,000			862,237
Repayment of bank borrowings - ASG		(18,809	)		(162,135	)
Changes in noncontrolling interest		(11,093	)		-
Net cash provided by financing activities		130,098			669,648
Effect of exchange rate changes on cash and cash equivalents		572			-
Net (decrease)increase in cash and cash equivalents		(254,609	)		134,832

Cash and cash equivalents at the beginning of the period		426,585			225,582
Cash and cash equivalents at end of the period		172,548			360,414

The accompanying notes are an integral part of these unaudited consolidated financial statements.

F-4

NOTE 1: OUR HISTORY

Quality Industrial Corp., a Nevada corporation (the “Company,” “QIND,” “we,” “us,” or “our”) was incorporated in the state of Nevada under the name Sensor Technologies, Inc. on May 4, 1998. In March 2006 the Company changed its name to Bixby Energy Systems Inc. In September 2006, the Company changed its name to Power Play Development Corporation. In April 2007, the Company changed its name to National League of Poker, Inc. In October 2007 the Company changed its name back to Power Play Development Corporation. In October 2011 the Company changed its name to Bluestar Technologies, Inc. In March 2018, the Company then changed its name to Wikisoft Corp.

In May 2016, the Company’s Board of Directors terminated the services of all prior officers and directors and the board appointed Robert Stevens as the Board Appointed Receiver for the Company. This was a private receivership where the receiver was appointed by the board to act on behalf of the Company and no court filings were ever made in connection with the receivership. On April 16, 2019, in connection with the Merger described below, Robert Stevens resigned from all of his positions with the Company and the board-appointed receivership was concluded. At that time Rasmus Refer was appointed as the Company’s CEO and Director, and he resigned from such positions in August and November 2020, respectively. On August 31, 2020, Carsten Kjems Falk was appointed as CEO, and Paul C Quintal was on December 1, 2021, appointed as the sole director of the Company.

On April 11, 2019, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with WikiSoft Acquisition Corp., a Delaware corporation which was then the Company’s wholly owned subsidiary (“Merger Sub”) and WikiSoft Corp., a privately held Delaware corporation (“WikiSoft DE”). In connection with the closing of this merger transaction, Merger Sub merged with and into WikiSoft DE (the “Merger”) on April 24, 2019. Pursuant to the Merger, the Company acquired WikiSoft DE which then became its wholly owned subsidiary.

On March 19, 2020, the Company entered into an Agreement and Plan of Merger (the “Short Form Merger Agreement”) with WikiSoft DE, pursuant to which it was agreed that the Company would merge with and into WikiSoft DE, with the Company surviving. Thereafter, on March 25, 2020, WikiSoft DE merged with and into the Company, with the Company (i.e., WikiSoft Corp. - the NV corporation) surviving pursuant to a Certificate of Ownership and Merger filed in with Delaware Secretary of State, whereby the then wholly owned subsidiary (WikiSoft DE) merged with and into the Company, with the Company surviving. On March 25, 2020, the Company filed Articles of Conversion in Nevada, whereby the then subsidiary (WikiSoft DE) merged with and into the Company, with the Company surviving. Prior to the Merger, the Company did not have any business operations, and at the closing of the Merger, the Company’s business was as described in detail below.

Wikisoft Corp. had a vision to become one of the largest portals of information for businesses and business professionals. Built on open-source software, the portal wikiprofile.com, was initially launched in January 2018, and the portal was relaunched in June 2021.

We changed ownership on May 28, 2022, when Ilustrato Pictures International, Inc., a Nevada corporation (“Ilustrato”), at the time, acquired 77.4% of the outstanding shares in our Company. Consequently, Ilustrato was able to unilaterally control the election of our Board of Directors, all matters upon which shareholder approval was required and, ultimately, the direction of our Company. Also, during the year, Mr. Nicolas Link, beneficial owner of Ilustrato, was appointed as our Executive Chairman of the Board, Mr. John-Paul Backwell was appointed as our Chief Executive Officer and Mr. Carsten Falk resigned as our Chief Executive Officer and was appointed as our Chief Commercial Officer.

In line with the change in control and business direction, our Company changed its name to Quality Industrial Corp. with the ticker QIND, with a market effective date of August 4, 2022. As a result of these transactions, Quality Industrial Corp. became a public company focused on the industrial, oil & gas and utility sectors. The Company filed articles of merger with the Secretary of State of Nevada in order to effectuate a merger with our wholly owned subsidiary, Quality Industrial Corp. Shareholder approval was not required under Section 92A.180 of the Nevada Revised Statutes. As part of the merger, our Board of Directors authorized a change in our name to “Quality Industrial Corp.” and our Articles of Incorporation have been amended to reflect this name change. Our common stock trades under the symbol “QIND.”

F-5

After Ilustrato acquired control of QIND, on May 28, 2022, Ilustrato signed a binding letter of intent on June 28, 2022, to acquire 51% of Quality International, an international process manufacturing company, manufacturing custom solutions for the oil & gas, petrochemical & refinery, chemical & fertilizer, power & desalination, water & wastewater, and offshore industries.

On March 9, 2023, we changed the SIC code of the Company to SIC 3590 - Misc. Industrial & Commercial Machinery and Equipment to reflect the new business direction.

On March 27, 2024, the Company signed a definitive Share Purchase Agreement with Al Shola Al Modea Gas LLC (“ASG” or “Al Shola Gas”). ASG is an Engineering and Distribution Company in the liquefied petroleum gas (“LPG”) Industry in the UAE and was established in 1980. The company are one of the leading suppliers & contractors of LPG centralized pipeline systems. ASG has been consolidated since its acquisition on March 27, 2024.

On April 8, 2025, the Company signed an Amendment to the Share Purchase Agreement, dated March 27, 2024, with the shareholders of ASG. The amended Share Purchase Agreement removed the termination clause 9.14 and amended other clauses of the Share Purchase Agreement, dated March 27, 2024.

On April 1, 2024, after several failed effort negotiations with the purpose of restructuring the deal and obtaining information from the selling shareholders of Quality International, the QI Purchase Agreement with Quality International was terminated by Quality International and subsequently the board of directors of the Company (the “Board of Directors” or the “Board”) approved the cancellation of the agreement with Quality International Co Ltd FZC signed on January 18, 2023, and amended on July 27, 2023. Quality International Co Ltd FZC is no longer consolidated with our financial statements.

On November 18, 2024, the Company, Fusion Fuel Green PLC, an Irish public limited company (“Fusion Fuel Green PLC”, “Fusion Fuel” or “HTOO”), Ilustrato, a stockholder of the Company, and certain other stockholders of the Company (together with Ilustrato, the “QIND Sellers”), entered into a Stock Purchase Agreement, dated as of November 18, 2024 (the “Purchase Agreement”). Under the Purchase Agreement, the QIND Sellers transferred an aggregate of 78,312,334 shares of common stock and 20,000 shares of Series B Convertible Preferred Stock, par value $0.001 per share (“Series B Preferred Stock”) of the Company, constituting approximately 67.36% of the voting stock of at the time to Fusion Fuel Green PLC. Fusion Fuel issued 3,818,969 Class A ordinary shares and 4,171,327 preferred shares to the QIND Sellers. As a result of these transactions, Quality Industrial Corp. is a majority owned subsidiary of Fusion Fuel.

On August 28, 2025, the Board of Directors of the Company approved a strategic realignment of its executive leadership and board composition, effective immediately. As part of this planned transition, the Board approved several executive and director appointments. In connection with these appointments, certain officers and directors submitted their resignations, which became effective concurrently to facilitate the new leadership structure.

Appointment of Interim Chief Financial Officer and Director; Resignation of Chief Financial Officer

The Board appointed Mr. Carsten Kjems Falk as the Company’s Interim Chief Financial Officer and as a Director of the Company, effective August 28, 2025. Mr. Falk has served the Company in several senior executive roles since 2020 and brings extensive leadership experience across the SaaS, FMCG, and energy sectors.

In connection with Mr. Falk’s appointment, Mr. Krishnan Krishnamoorthy resigned from his position as Chief Financial Officer, effective immediately. The resignation was not the result of any disagreement with the Company, its management, operations, policies, or practices. Mr. Krishnamoorthy has confirmed that he has no outstanding claims or obligations with respect to the Company.

Appointment of Chief Operating Officer; Resignation of Chief Operating Officer

The Board appointed Mr. Sanjeeb Safir as the Company’s Chief Operating Officer (“COO”), effective August 28, 2025. Mr. Safir has served since 2008 as Managing Director of Al Shola Al Modea Gas and Distribution LLC and currently oversees the Company’s operations in the Middle East region. Mr. Safir’s existing employment agreement remains unchanged and has been filed as Exhibit 10.1 to the Current Report on Form 8-K, filed with the Securities and Exchange Commission (the “SEC”) on September 4, 2025.

F-6

To facilitate Mr. Safir’s appointment, Mrs. Louise Bennett resigned from her position as COO, effective immediately. The resignation was not the result of any disagreement with the Company, its operations, or policies. Pursuant to a pre-agreed arrangement, the Company has agreed to pay Mrs. Bennett approximately $120,000 in accordance with a defined payment schedule.

Appointment of Chairman and Director; Resignation of Chairman and Director

The Board appointed Mr. Frederico Figueira de Chaves as Chairman of the Board of Directors and as a Director of the Company, effective August 28, 2025. Mr. Chaves currently serves as Interim Chief Financial Officer and Director of Fusion Fuel. He has previously served in multiple senior leadership roles at Fusion Fuel, including Chief Executive Officer and Chief Financial Officer.

In connection with Mr. Chaves’s appointment, Mr. Nicolas Link resigned as Chairman of the Board and Director of the Company, effective immediately. The resignation was not the result of any disagreement with the Company, its management, operations, policies, or practices. Pursuant to a pre-agreed arrangement, the Company has agreed to pay Mr. Link approximately $430,000 over a defined payment schedule.

Appointment of Director

The Board of Directors also appointed Mr. John-Paul Backwell as a Director of the Company, effective August 28, 2025. Mr. Backwell currently serves as the Company´s Chief Executive Officer and as Chief Executive Officer of Fusion Fuel Green PLC, the Company´s majority shareholder. He brings over 25 years of leadership experience in the manufacturing, technology, and energy industries.

Company’s Authorized Shares increase

On January 20, 2026, the Board of Directors of Quality Industrial Corp. and Fusion Fuel Green PLC, the Company’s majority stockholder holding approximately 53.5% of the Company’s voting power, approved an amendment to the Company’s Articles of Incorporation. The amendment increased the Company’s authorized share capital from 200,000,000 shares of common stock, par value $0.001 per share, to 450,000,000 shares of common stock. The increase had effect on February 25, 2026. The number of authorized shares of preferred stock was not affected by the amendment.

On April 20, 2026, John-Paul Backwell resigned from his position as Chief Executive Officer of the Company, effective immediately. Mr. Backwell will continue to be a director of the Company. The resignation was not the result of any disagreement with the Company on any matter known to an executive officer of the Company relating to the operations, policies or practices of the Company.

Further on April 20, 2026, the Board of Directors of the Company appointed Carsten Kjems Falk as the Company’s Chief Executive Officer, effective immediately. Mr. Falk, 51, has served as the Interim Chief Financial Officer and a director of the Company since August 2025. Since June 2025, Mr. Falk has also served as Head of M&A of Fusion Fuel Green PLC, an Irish public limited company (Nasdaq: HTOO). From October 2022 to August 2025, Mr. Falk was the Chief Commercial Officer of the Company. From June 2022 to October 2024, Mr. Falk served as Chief Commercial Officer of Ilustrato Pictures International Inc., a Nevada corporation (OTC: ILUS). From September 2020 to October 2022, Mr. Falk was the Chief Executive Officer of the Company. From 2013 through 2019, Mr. Falk was Chief Executive Officer of Domino’s Pizza Denmark. Mr. Falk holds a Master of Arts in Educational Theory and Curriculum Studies: Mathematics from Aarhus University. The Board of Directors of the Company believes that Mr. Falk is qualified to serve on the Company’s Board of Directors due to his service to the Company in several senior executive roles since 2020 and extensive leadership experience across the SaaS, FMCG, and energy sectors.

F-7

NOTE 2. SUMMARY OF SIGNIFICANT POLICIES

Basis of Presentation and Principles of consolidation

The accompanying consolidated financial statements represent the results of operations, financial position, and cash flows of QIND, and all of its majority-owned and controlled subsidiary are prepared in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The accounts of ASG have been included since acquired on March 27, 2024. All significant inter-company accounts and transactions have been eliminated.

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the SEC for interim financial information. It is management’s opinion that the unaudited condensed consolidated financial statements are prepared in accordance with instructions for Form 10-Q and include all adjustments (consisting only of normal recurring accruals) which are necessary for a fair presentation of the results for the periods presented. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the Annual Report on Form 10-K of Quality Industrial Corp. for the year ended December 31, 2025, filed with the SEC on March 31, 2026 (the “Annual Report”).

Use of estimates

A critical accounting estimate is an estimate that: (i) is made in accordance with generally accepted accounting principles, (ii) involves a significant level of estimation uncertainty and (iii) has had or is reasonably likely to have a material impact on the Company’s financial condition or results of operations.

The Company’s Consolidated Financial Statements have been prepared in accordance with U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and judgments that affect reported amounts and related disclosures. On an ongoing basis, management evaluates and updates its estimates. Management employs judgment in making its estimates but they are based on historical experience and currently available information and various other assumptions that the Company believes to be reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ from those estimates. Management believes that its judgment is applied consistently and produces financial information that fairly depicts the results of operations for all periods presented.

Significant estimates include estimates used to review the Company’s, impairments and estimations of long-lived assets, revenue recognition of Contract based revenue, allowances for uncollectible accounts, and the valuations of non-cash capital stock issuances. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Accounts receivable

Accounts receivables are recorded at the invoice amount less an allowance for credit losses. The allowance is an estimate based on historical collection experience, current and future economic and market conditions, and a review of the current status of each customer’s trade accounts receivable. Management evaluates the aging of the accounts receivable balances and the financial condition of its customers and all other forward-looking information that is reasonably available to estimate the amount of accounts receivable that may not be collected in the future and before recording the appropriate provision.

The duration of such receivables extends from 30 days to beyond 90 days. Payments are received only when a project is completed, and approvals are obtained. Provisions are created based on the estimated irrecoverable amounts determined by referring to past default experience and future economic and market conditions.

F-8

Inventories

In accordance with ASC 330, the Company states inventories at the lower of cost or net realizable value. Cost, which includes material, labor and overhead, is determined on a first-in, first-out basis. The Company makes adjustments to reduce the cost of inventory to its net realizable value, if required, for estimated excess, obsolete, zero usage or impaired balances. Factors influencing these adjustments include changes in market demand, product life cycle and engineering changes.

Property, Plant & Equipment

Property, Plant and Equipment are recorded at cost, except when acquired in a business combination where property, plant and equipment are recorded at fair value. Depreciation of property, plant and equipment is recognized over the estimated useful lives of the respective assets using the straight-line method. The estimated useful lives are as follows:

SCHEDULE OF ESTIMATED USEFUL LIVES

Property, Plant and Equipment		Years
Machinery & Cylinders		5 – 20
Vehicles		5 – 10
Furniture, Fixtures & Office Equipment		3 – 5
LPG Cylinders		5 – 20

Expenditures that extend the useful life of existing property, plant and equipment are capitalized and depreciated over the remaining useful life of the related asset. Expenditures for repairs and maintenance are expensed as incurred. When property, plant and equipment are retired or sold, the cost and related accumulated depreciation is removed from the Company’s balance sheet, with any gain or loss reflected in operations.

Deposits, Advances and Prepayments

Advances have been paid to the suppliers and subcontractors in the ordinary course of business for the procurement of specialized material and equipment required in the process of designing, engineering and installing Central Gas distribution and monitoring systems. The Company is engaged in the design, engineering, supply and monitoring of Central Gas systems supplying and installing equipment such as pressure regulators, pipelines, safety equipment, tapping points, metering units, valves and storage tanks. To undertake these projects, the Company is required to make upfront investments in materials and machinery. These projects involve many processes and take substantial time to complete. We estimate that the deposit will be utilized in the next 12 months, however, some will only be returned upon cancellation such as office lease deposit, internet and utilities.

Deposits & Advances Details	March 31, 2026		December 31, 2025
Project Job Refundable Security Deposit Against Project Performances		309,381		309,591
DEWA Office		545		545
Emarat General Petroleum Corporation LLC		13,615		13,624
WASL Land		5,446		5,450
Dubai Properties		34,037		34,060
Dubai Real Estate Corporation		6,807		6,812
DIRE Land		6,807		6,812
Emirates Gas LLC		13,615		13,624
Energy Tech		8,931		8,937
Al Nabbah Real Estate		359		360
Breeze Business Center LLC		731		-
Total Deposits And Advances		400,273		399,815

F-9

Prepaid Expenses	March 31, 2026		December 31, 2025
Hamsah Office Rent		22,740		3,659
Store Rent		13,013		3,032
Insurance		30,964		49,936
Accommodation Rent		161,609		8,248
DCD License		2,371		242
Trade License		13,602		3,041
Visa Cost		40,894		39,888
On Account Fees, Costs and disbursements to Priestlys Attorneys at Law		5,000		-
Retainer Fee to Leah Martin Law		1,900		-
Prepaid Expenses		292,091		108,046
Other Pre Payments
Aiwa Energy		81,688		81,744
Aiko Mall		20,422		20,436
Aswaaq Shopping Mall		238		238
Other Pre Payments		102,349		102,418
Total Deposits, Prepayments &Advances		794,712		610,279

End-of-service benefits

Employee end-of-service benefits in our subsidiary Al Shola Gas amounting to $138,866 as of March 31, 2026, are provided to employees, in the UAE when they leave a job. Eligibility begins after one year of continuous service and varies based on contract type and length of service. These liabilities are included in other current liabilities on the accompanying consolidated balance sheet.

SCHEDULE OF OTHER LIABILITIES CURRENT

Employee end of service benefits Al Shola Gas	March 31, 2026			December 31, 2025
Balance at Beginning		132,748			139,985
Add: charge for the period		6,304			21,568
Less: Settlement for the period		(95	)		(28,805	)
Foreign currency translation adjustment		(90	)		-
Balance at the end of the period		138,866			132,748

Goodwill

Goodwill represents the cost of acquired companies in excess of the fair value of the net assets at the acquisition date and is subject to annual impairment. Goodwill is the excess of the purchase price paid for an acquired entity and the amount of the price not assigned to acquired assets and liabilities. It arises when an acquirer pays a high price to acquire a business. This asset only arises from an acquisition, and it cannot be generated internally. Goodwill is an intangible asset, and so is listed within the long-term assets section of the acquirers’ balance sheet.

The Company accounts for business combinations by estimating the fair value of consideration paid for acquired businesses and assigning that amount to the fair values of assets acquired and liabilities assumed, with the remainder assigned to goodwill. If the fair value of assets acquired and liabilities assumed exceeds the fair value of consideration paid, a gain on bargain purchase is recognized. The estimates of fair values are determined utilizing customary valuation procedures and techniques, which require us, among other things, to estimate future cash flows and discount rates. Such analyses involve significant judgments and estimations.

The Company follows the guidance prescribed in Accounting Standards Codification (“ASC”) 350, Goodwill and Other Intangible Assets, to test goodwill and intangible assets for impairment annually if an event occurs or circumstances change which indicates that its carrying amount may not exceed its fair value.

F-10

Fair value of financial instruments

The carrying value of cash, accounts payable, warrants, accrued expenses, and debt, short term as well as long term, is recorded at fair value. Management believes the Company is not exposed to significant interest or credit risks arising from these financial instruments.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The Company utilizes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable.

	Level 1. Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets.

	Level 2. Quoted prices for similar assets and liabilities in active markets; quoted prices included for identical or similar assets and liabilities that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. These are typically obtained from readily available pricing sources for comparable instruments.

	Level 3. Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances.

Revenue Recognition

The Company recognizes revenue in accordance with Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (ASC 606).

The principal activity of the Company is through our operating subsidiary, ASG, we provide comprehensive solutions for the LPG industry. Our services include consulting, designing, supplying, installing, and maintaining LPG systems, as well as the transportation and supply of LPG in both bulk and cylinder formats. We cater to a diverse range of clients, including commercial buildings, mixed-use apartment complexes, shopping centers, food courts, heavy industries, labor accommodations, catering units, commercial kitchens, and dining establishments. Revenue from contracts with customers is recognized when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The company has applied the five-step approach below and has generally concluded that it is the principal in its revenue arrangements because it typically controls the goods or services before transferring them to the customer.

	1.	Identify the contract with a customer.

	2.	Identify the performance obligations in the contract.

	3.	Determine the transaction price.

	4.	Allocate the transaction price.

	5.	Recognize revenue when the entity satisfies the performance obligation.

Stock-based compensation

The Company recognizes all stock-based compensation using the fair value provisions prescribed by ASC Topic 718, Compensation - Stock Compensation. Accordingly, compensation costs for awards of stock-based compensation settled in shares are determined based on the fair value of the share-based instrument at the time of grant and are recognized as expense over the vesting period of the share-based instrument, net of estimated forfeitures.

In accordance with ASC 718, the Company will generally apply the same guidance to both employee and non-employee share-based awards. However, the Company will also follow specific guidance for share-based awards to non-employees related to the attribution of compensation cost and the inputs to the option-pricing model for expected term. Non-employee share-based payment equity awards are measured at the grant-date fair value of the equity instruments, similar to employee share-based payment equity awards.

F-11

The Company calculates the fair value of option grants and warrant issuances utilizing the Binomial pricing model. The amount of stock-based compensation recognized during a period is based on the value of the portion of the awards that are ultimately expected to vest. ASC 718 requires forfeitures to be estimated at the time stock options are granted and warrants are issued to employees and non-employees, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The term “forfeiture” is distinct from “cancellations” or “expirations” and represents only the unvested portion of the surrendered stock option or warrant. The Company estimates forfeiture rates for all unvested awards when calculating the expenses for the period. In estimating the forfeiture rate, the Company monitors both stock option and warrant exercises as well as employee termination patterns. The resulting stock-based compensation expense for both employee and non-employee awards is generally recognized on a straight-line basis over the period in which the Company expects to receive the benefit, which is generally the vesting period.

Rounding

For purposes of clarity and ease of presentation, all dollar amounts in these financial statements have been rounded to the nearest whole number. However, the underlying data used in the calculations is not rounded, and the totals presented may differ by a small amount due to rounding. These differences are considered immaterial and do not affect the overall financial position or results of operations.

Earnings (loss) per share

The Company reports earnings (loss) per share in accordance with the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) 260-10 “Earnings Per Share,” which provides for the calculation of “basic” and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income or loss available to common stockholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of an entity. The calculation of diluted net loss per share gives effect to common stock equivalents; however, potential common shares are excluded if their effect is anti-dilutive.

Particulars	March 31, 2026 (Unaudited)		March 31, 2025 (Unaudited)
Earnings (loss) per share
Numerator
Net income (loss)		133,224		(1,259,606	)
Net Income attributable to noncontrolling interest		124,396		146,604
Net Income (loss) attributable to common stock holders		8,828		(1,406,210	)
Denominator
Weighted average number of common shares outstanding:
Basic		187,505,800		135,477,908
Diluted		192,817,598		135,477,908
Net income (loss) per share:
Basic		0.00		(0.01	)
Diluted*		0.00		(0.01	)

*	Potential common shares from warrants and convertible preferred stock were excluded from the calculation of diluted EPS for the comparative period due to the net loss incurred, as their inclusion would have been anti-dilutive.

F-12

Income taxes

The Company accounts for income tax positions in accordance with Accounting Standards Codification Topic 740-10-50, “Income Taxes” (“ASC Topic 740”). This standard prescribes a recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There was no material impact on the Company’s financial position or results of operations as a result of the application of this standard. Deferred tax assets have not been created the majority of the company’s income belongs to the subsidiary, which is registered in an income tax-free jurisdiction since any losses incurred cannot be utilized in the future, rendering deferred tax assets irrelevant, The profits of a foreign subsidiary corporation are ordinarily not subject to tax in the United States as in accordance with the general Internal Revenue Service rule, foreign subsidiaries are not considered U.S. corporations even if they are wholly owned.

Corporate Tax Provision

On January 1, 2024, the UAE introduced a Corporate Tax applicable to Companies on taxable income of above AED 375,000 (i.e., equivalent to USD 102,000 approx.) with a rate of 9% subject to certain conditions/requirements, and due filing of return within nine (9) months to the FTA, post the financial year ending 2024. This relevant tax provision has been accounted for with our UAE based subsidiary Al Shola Gas.

Recently issued accounting pronouncements

The Company has evaluated all other recent accounting pronouncements and believes that none of them are expected to have a material effect on the Company’s financial position, results of operations, or cash flows.

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources that are material to stockholders.

Lease liabilities

The Company accounts for leases under ASC Topic 842, Leases (Topic 842). Under Topic 842, at the commencement date of the lease, the Company recognizes lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include, if any, the exercise price of a purchase option reasonably certain to be exercised by the Company and payments of penalties for terminating a lease, if the lease term reflects the Company exercising the option to terminate.

The variable lease payments that do not depend on an index or a rate are recognized as expenses in the period on which the event or condition that triggers the payment occurs.

In calculating the present value of lease payments, the Company uses the incremental borrowing rate at the lease commencement date if the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the in-substance fixed lease payments, or a change in the assessment to purchase the underlying asset.

F-13

The Company’s subsidiary, Al Shola Gas, has entered into commercial vehicles. These leases generally have a lease term of 4 years. The Company’s obligations under its leases are secured by the lessor’s title to the leased assets. There are no restrictions placed upon the Company by entering into these leases. The Company also has leases with terms of 12 months or less which the Company has elected to not apply Topic 842 to short-term leases.

The Company has a Lease arrangement for which the liability has been recorded separately. The Company determines whether an arrangement contains a lease at inception. A lease liability and corresponding right of use (ROU) asset are recognized for qualifying leased assets based on the present value of fixed and certain index-based lease payments at lease commencement.

The Company’s obligations under its leases are secured by the lessor’s title to the leased assets. There are no restrictions placed upon the Company by entering into these leases. The Company determines if an arrangement is or contains a lease at contract inception and recognizes an ROU asset and a lease liability based on the present value of fixed, and certain index-based lease payments at the lease commencement date. Variable payments are excluded from the present value of lease payments and are recognized in the period in which the payment is made.

The Company generally uses its incremental borrowing rate as the discount rate for measuring its lease liabilities, as the Company cannot determine the interest rate implicit in the lease because it does not have access to certain lessor-specific information. Lease expense is recognized on a straight-line basis over the lease term. The Company does not have significant finance leases. The Company has elected not to separate payments for lease components from payments for non-lease components for all classes of leases.

When accounting for finance leases in accordance with ASC 842, entity recognizes interest on the lease liability and amortization of the ROU asset in the income statement and classify payments of the principal portion of the lease liability as financing activities and payments of interest on the lease liability as operating activities.

Reclassification

Certain prior-period amounts have been reclassified in accordance with ASC 205 to conform to the current-period presentation, including the reclassification of retirement benefits from current liabilities to other payables – non-current, and the presentation of depreciation as a separate line item within operating expenses. These changes had no impact on previously reported net income, total assets, total liabilities, equity, or net cash flows.

During the year ended December 31, 2025, the Company reclassified Employee End of Service Benefits previously presented within Other current liabilities to other payables – non-current in the Consolidated Statements of Financial Position. Management determined this reclassification was appropriate to reflect the expected timing of settlement of the obligation, consistent with the classification guidance under ASC 210, Balance Sheet.

In addition, in accordance with ASC 230, Statement of Cash Flows, the Company reclassified interest paid from financing activities to operating activities in the Consolidated Statements of Cash Flows. This change was made to align the classification of cash payments for interest with U.S. GAAP presentation requirements.

Effective January 1, 2025, the Company revised the presentation of sales discounts to reflect their nature as variable consideration in accordance with ASC 606, Revenue from Contracts with Customers. Under the revised presentation, sales discounts are recorded as a reduction of revenue, resulting in revenue being reported on a net basis

The Company implemented this presentation beginning in the fourth quarter of 2025 and recorded the full-year impact of sales discounts, totaling USD 45,994, as a reduction of revenue in that period. Quarterly amounts previously reported during 2025 were not restated, as the impact was not material, and were instead adjusted in the fourth quarter.

The impact of this reclassification was not material to any previously reported interim or annual period. Accordingly, prior period amounts have not been reclassified to conform to the current period presentation.

This change in presentation had no impact on net income, operating income, total assets, liabilities, or stockholders’ equity for any period presented.

NOTE 3. GOING CONCERN

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.

Management evaluated all relevant conditions and events that are reasonably known or reasonably knowable, in the aggregate, as of the date the consolidated financial statements are issued and determined. The Company’s ability to continue as a going concern is dependent on the Company’s ability to continue to generate sufficient revenues and raise capital within one year from the date of filing.

Over the next twelve months, management plans to use borrowings and security sales to mitigate the effects of cash flow deficits; however, no assurance can be given that debt or equity financing, if and when required, will be available.

F-14

NOTE 4. CURRENT ASSETS

Cash and Cash Equivalents

For purposes of the statements of cash flows, in accordance with ASC 230-10-20, the Company considers all highly liquid investments and short-term debt instruments with original maturities of three months or less to be cash equivalents. There were $172,548 and $426,585 in cash and cash equivalents as of March 31, 2026, and December 31, 2025, respectively.

SCHEDULE OF CASH AND CASH EQUIVALENTS

	March 31, 2026		December 31, 2025
Cash and Cash Equivalents
Cash in hand		116,254		120,950
Cash at bank		56,294		305,635
Total	$	172,548	$	426,585

Accounts Receivables

Accounts receivable arises from our subsidiary Al Shola Gas consolidated as of March 31, 2026. The duration of such receivables extends from 30 days to beyond 90 days. Payments are received only when a project milestone is completed, and approvals are obtained, or after the goods or services are transferred and according to the payment terms with the customer. Provisions are created based on the estimated irrecoverable amounts determined by referring to past default experience.

SCHEDULE OF ACCOUNTS RECEIVABLES

Accounts Receivables Ageing Al Shola Gas	March 31, 2026		December 31, 2025
1-30 days		848,435		1,653,097
31-60 days		1,159,342		1,235,778
61-90 days		170,648		895,583
+90 days		3,120,758		1,522,913
Total		5,299,183		5,307,371
Accounts Receivables		5,299,183		5,307,371

Other Current Assets

As of March 31, 2026, and December 31, 2025, the Company reported Other Current Assets of $493,525 and $493,525, respectively. The $493,525 balance represents an amount due from Ilustrato, a former majority shareholder and related party of the Company. Effective December 31, 2025, this balance was reclassified to Other Current Assets, as Ilustrato is no longer considered a related party of the Company.

NOTE 5. NON-CURRENT ASSETS

Goodwill

The Company acquired a 51% interest in Al Shola Gas on March 27, 2024, with the issuance of $9,000,000 note payable and $1,000,000 in cash. The note payable is due as follows: $9 million in National Exchange listed stock or cash to be paid to Seller. Payment in eight quarterly tranches over 24 months, beginning from the first quarter following uplist to a National Exchange. Stock value is to be protected by a make whole agreement/s and each tranche is subject to a mutually agreed 12-month leak-out agreement. Within 12 months of closing and at the soonest possible time, $1 million cash payment to the Seller.

F-15

The Company acquired 51% of Al Shola Gas for $10,000,000 and now owns 51% of the Net Assets of Al Shola Gas. The net assets of Al Shola Gas were $3,115,491 on March 31, 2024, of which $1,588,900 (51%) is owned by QIND. The remaining $1,526,591 (49%) of net assets are held by a minority interest or noncontrolling interest. The purchase price of $10,000,000 minus the net assets held by the Company in Al Shola Gas equating to $8,411,100 is part of the Company’s Goodwill. The noncontrolling interest has been presented separately on the accompanying consolidated balance sheet and statement of operations.

NOTE 6. CURRENT LIABILITIES

Accounts Payable

Accounts payable of $1,059,885 as of March 31, 2026, includes the Trade and Other Payables of the company and its subsidiary Al Shola Gas, compared to $1,158,471 as of December 31, 2025.

SCHEDULE OF ACCOUNTS PAYABLE

Accounts Payable Ageing Al Shola Gas	March 31, 2026		December 31, 2025
1-30 days		228,700		350,210
31-60 days		257,979		137,972
61-90 days		162,101		95,294
+90 days		411,105		574,995
Total		1,059,885		1,158,471
Accounts Payable		1,059,885		1,158,471

Operating Lease Liabilities - Current

As of March 31, 2026, the Company had a current portion of lease liabilities of $157,678 compared to $154,040 as of December 31, 2025.

Convertible Notes

On August 3, 2022, the Company issued a two-year convertible promissory note in the principal amount of $1,100,000 to RB Capital Partners Inc. The Note bears interest at 7% per annum. The Company has the right to prepay the Note at any time. All principal on the Note is convertible into shares of our common stock after six months from issuance at the election of the holder at a conversion price equal to $1.00 per share.

On March 17, 2023, the Company issued a two-year convertible promissory note in the principal amount of $200,000 to RB Capital Partners Inc. The Note bears interest at 7% per annum. The Company has the right to repay the Note at any time. All principal on the Note is convertible into shares of our common stock after six months from issuance at the election of the holder at a conversion price equal to $1.00 per share.

On May 23, 2023, the Company issued to Jefferson Street Capital LLC a one-year convertible promissory note in the principal amount of $220,000 (the “Jefferson Note”). The Jefferson Note bears interest at 6.5% per annum. The Company has the right to prepay the Note at any time. All principal on the Jefferson Note is convertible into shares of our common stock after six months from issuance at the election of the holder at a conversion price equal to $0.35 per share. During the six months ended September 30, 2024, the lender elected to convert an aggregate of $100,000 of principal into 2,697,315 shares of common stock.

On July 31, 2023, the Company issued to 1800 Diagonal Lending Ltd. a promissory note in the principal amount of $174,867 (the “Diagonal Lending Note”). The Diagonal Lending Note had a one-time interest amount of $22,732. The Company will prepay the Diagonal Lending Note in nine monthly payments each in the amount of $21,955.45. The promissory note matures on February 28, 2024, with a total payback to the Holder of $197,599. All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date. The note has been repaid in full.

F-16

On August 15, 2023, the Company issued to 1800 Diagonal Lending Ltd. a promissory note in the principal amount of $118,367 (the “Diagonal Lending Note”). The Diagonal Lending Note had a one-time interest amount of $15,387.71. The Company will prepay the Diagonal Lending Note in nine monthly payments each in the amount of $14,861.64. The promissory note matures on May 30, 2024, with a total payback to the Holder of $133,754.71 All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date. The note has been repaid in full.

On June 16, 2023, the Company issued to Sky Holdings Ltd. a six-month convertible promissory note in the principal amount of $550,000. The Note bears interest at 7% per annum. The Company has the right to prepay the Note at any time. All principal on the Note is convertible into shares of our common stock after six months from issuance at the election of the holder at a conversion price equal to $0.35 per share. On May 16, 2024, the promissory note was amended to have a conversion price equal to $0.0375 per share. During the six months ended September 30, 2024, the lender elected to convert $77,000 of principal and $35,863 of accrued interest into 3,009,680 shares of common stock at a conversion price of $.0375.

On December 20, 2023, QIND issued a two-year convertible promissory note RB Capital Partners Inc. in the principal amount of $100,000 with a maturity date of December 30, 2025. The note bears interest at 10% per annum. QIND has the right to prepay the note at any time. All principal on the note is convertible into shares of QIND common stock after six months from issuance at the election of the holder at a conversion price equal to $1.00 per share. As of December 31, 2025, The note had been repaid in full including interest.

On December 20, 2023, the Company issued a one-year convertible promissory note in the principal amount of $100,000 to Lorlev 26 Irrevocable Trust. This Convertible Promissory Note (the “Note”) shall bear a minimum of Twenty percent (20%) interest which will be payable within 5 business days from when the company receives the IPO funding, and thereafter Fifteen percent (15%) per annum will be charged. The Note is for 1 year and cannot be converted until (6) months from the date first written above has passed. Fifty Percent (50%) of the value of this note in commitment shares to be issued at a 25% discount to the IPO price. These shares are to be issued upon uplist to the NASDAQ and must be held for six (6) months. If QIND does not uplist, then Holder will be issued 200% of the value of this note in QIND stock listed on the OTC Markets. Upon payment in full of the principal, this Note shall be surrendered to the Company for cancellation.

On January 18, 2024, we issued a convertible promissory note 1800 Diagonal Lending LLC in the principal amount of $174,867 and a one-time interest charge of $22,732. Accrued, unpaid Interest and outstanding principal, subject to adjustment, shall be paid in nine (9) payments each of $21,955 (a total payback to the Holder of $197,599). All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days before the Conversion Date. The note has been repaid in full.

On February 6, 2024, we issued a six-month convertible promissory note to Exchange Listing LLC in the principal amount of $35,000. The note is convertible into common stock at the rate of at a discount of thirty-five percent (35%) to the volume weight average trading (“VWAP”) of the Company’s common stock for the five (5) days before any conversion and bears 10% interest per annum. The maturity date shall be the earlier of (i) six (6) months from the Issue Date or upon completion of a listing of the Company on a Senior Exchange.

On March 12, 2024, we issued a convertible promissory note to 1800 Diagonal Lending LLC in the principal amount of $118,367 and a one-time interest charge of $15,387. Accrued, unpaid Interest and outstanding principal, subject to adjustment, shall be paid in nine (9) payments each in the amount of $14,861.56 commencing April 15, 2024 (a total payback to the Holder of $133,754). All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date. The note has been repaid in full

On May 21, 2024, we issued a one-year convertible promissory note Jefferson Street Capital LLC in the principal amount of $71,500, with equal consecutive payments due monthly beginning on October 21, 2024, that is five (5) months from the Issue Date with the final payment due on February 21, 2025. The note is convertible into common stock at the rate of $0.03 and bears 10% interest per annum. The promissory note required 500,000 commitment shares to be issued. The relative fair value of these commitment shares of $24,179 was recorded as a debt discount and increase to additional paid-in capital. The discount will be amortized into interest expense over the term of the promissory note. As of September 30, 2024, the unamortized discount was approximately $21,000.

F-17

On July 3, 2024, we issued a convertible promissory note 1800 Diagonal Lending LLC in the principal amount of $179,400. A one-time interest charge of thirteen percent with a total of $23,322 was applied on the Issuance Date. The first payment shall be due August 15, 2024, with eight subsequent payments due on the 15th of each month thereafter. Accrued, unpaid Interest and outstanding principal, subject to adjustment, shall be paid in nine (9) payments each of $22,524.67 (a total payback to the Holder of $202,722). All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date. There is no Balance Due remaining under this Note.

On September 25, 2024, we entered into a loan agreement with J.J. Astor & Co. The Note is the senior secured with a Principal Amount of $405,000, which shall be payable in forty weekly instalments of $10,125. The note converts at 80% of the average of the four lowest volume weighted average closing prices of Company Common Stock over the twenty (20) trading days immediately prior to each permitted conversion of the Note.

On September 25, 2024, we issued a convertible promissory note 1800 Diagonal Lending LLC in the principal amount of $115,000. A one-time interest charge of thirteen percent with a total of $14,950 was applied on the Issuance Date. The first payment shall be due October 30, 2024, with eight subsequent payments due on the 30th of each month thereafter. Accrued, unpaid Interest and outstanding principal, subject to adjustment, shall be paid in nine (9) payments each of $ $14,438.89 (a total payback to the Holder of $129,500). All principal on the Diagonal Lending Note is convertible into shares of our common stock in the event of default with a conversion price of 65% multiplied by the lowest Trading Price for the Common Stock during the ten (10) Trading Days prior to the Conversion Date. The note has been fully converted.

Certain convertible notes include original issuance discounts or other issuance-type costs, resulting in debt discounts upon execution. These discounts are amortized into interest expense over the term of the convertible note. As of March 31, 2026, all related discounts have been fully amortized and no amortization expense was recognized during the period ended March 31, 2026.

F-18

A summary of these outstanding convertible notes and accrued interest as of March 31, 2026, is summarized below:

Debt & Interest Payable

																	Cumulative Repayments								Cumulative Conversions												Total Balance Remaining
Lender	Date of Issue		Maturity Date		Initial Interest Rate (%)			Default Interest Rate (%)			Original Principal Amount		Total Default Interest/Fees Incurred Since Issuance (Before Repayments and Conversions)		Total Interest Accrued Since Issuance (Before Repayments and Conversions)		Principal Repayments		Default Interest Repayments		Accrued Interest Repayments		Total Repayments		Principal Converted		Default Interest and Fees converted		Accrued Interest Converted		Total Amount Converted		Conversion Price per share		Total Number of Common Shares Issued		Principal Outstanding		Default Interest (Default Principal) outstanding		Accrued Interest Outstanding		Total Balance Remaining
											$		$		$		$		$		$		$		$		$		$		$		$				$		$		$		$
RB Capital Partners Inc.		August 3, 2022		August 3, 2024		7	%		-			1,100,000		-		282,052		-		-		-		-		-		-		-		-		-		-		1,100,000		-		282,052		1,382,052
RB Capital Partners Inc.		March 17, 2023		March 16, 2025		7	%		-			200,000		-		41,412		57,705		-		-		57,705		-		-		-		-		-		-		142,295		-		41,412		183,707
Jefferson Street Capital LLC		May 23, 2023		February 23, 2024		6.5	%		15	%		220,000		138,963		30,531		-		-		-		-		220,000		36,509		16,486		272,995		-		13,524,647		-		102,454		14,045		116,499
Sky Holdings Ltd		June 16, 2023		December 16, 2023		7	%		-			550,000		-		97,796		-		-		-		-		77,000		-		35,863		112,863		0.0375		3,009,680		473,000		-		61,933		534,933
Lorlev 26 Irrevocable Trust		December 20, 2023		December 20, 2024		-			-			100,000		-		29,000		100,000		-		5,000		105,000		-		-		-		-		-		-		-		-		24,000		24,000
Exchange Listing LLC		February 6, 2024		August 6, 2024		10	%		20	%		35,000		-		13,879		-		-		-		-		-		-		-		-		-		-		35,000		-		13,879		48,879
Jefferson Street Capital LLC		May 21, 2024		February 21, 2025		10	%		15	%		71,500		44,769		18,290		-		-		-		-		71,500		44,769		1,500		117,769		-		61,995,097		-		-		16,790		16,790
J.J. Astor & Co		September 20, 2024		June 30, 2025		0	%		16	%		405,000		37,462		77,779		308,963		37,462		-		346,425		-		-		-		-		-		-		96,037		-		77,779		173,816
Total												2,681,500		221,195		590,739		466,668		37,462		5,000		509,130		368,500		81,278		53,849		503,627		-		78,529,424		1,846,332		102,454		531,890		2,480,676

F-19

Options and Warrants

In accordance with ASC 470, warrants have been classified as a liability and recorded at their fair value.

On April 19, 2023, the Company issued a common share purchase warrant to Exchange Listings LLC (the “Exchange Common Share Purchase Warrant”). The holder is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of issuance hereof, to purchase from the Company, 200,000 of the Company’s common shares (whereby such number may be adjusted from time to time pursuant to the terms and conditions of the Exchange Common Share Purchase Warrant) at the exercise price of $0.58, per share then in effect. The warrants are exercisable for five years.

On May 23, 2023, the Company issued a common share purchase warrant to Jefferson Street Capital LLC (the “Jefferson Common Share Purchase Warrant”). The holder is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date of issuance hereof, to purchase from the Company, 50,000 of the Company’s common shares (whereby such number may be adjusted from time to time pursuant to the terms and conditions of the Jefferson Common Share Purchase Warrant) at the exercise price of $3.50, per share then in effect. The warrants are exercisable for five years.

Other Payables Current

Other payables - current amounted to $9,069,680 as of March 31, 2026, compared to $7,965,456 as of December 31, 2025.

The balance primarily consists of (i) the current portion of bank borrowings of $89,680, and (ii) $8,980,000 representing the current portion of the purchase consideration payable to the shareholders of Al Shola Gas in connection with its acquisition on March 27, 2024.

SCHEDULE OF OTHER PAYABLES CURRENT

Other Payables Current	March 31, 2026		December 31, 2025
Payable Al Shola Gas		8,980,000		7,875,000
Other Payables current		89,680		90,456
Total Other Payables Current	$	9,069,680	$	7,965,456

Other Current Liabilities –

Other current liabilities amounted to $1,133,088 as of March 31, 2026, compared to $981,812 as of December 31, 2025. The components of other current liabilities are presented in the table below.

SCHEDULE OF OTHER CURRENT LIABILITIES

Other Current Liabilities	March 31, 2026		December 31, 2025
Value Added Tax (VAT) Payable		115,419		-
Accrued Interest on Convertible note		531,890		495,185
Payroll Liabilities		237,402		231,518
Provision for Audit & Review fee		29,500		90,000
Provision for Legal & Professional Charges		31,250		-
Corporate Tax payable		187,627		165,109
Total		1,133,088		981,812

Related Party Payable

On November 18, 2024, QIND, Fusion, Ilustrato, and certain other stockholders of the Company, entered into the Purchase Agreement. Pursuant to section 6.04 of the Purchase Agreement, Purchaser (as defined therein) shall use commercially reasonable efforts to raise at least $5,000,000 in one or more financing transactions, and the Company and QIND Sellers shall support and assist Purchaser in connection with the Purchaser Financing (as defined therein). The Parties (as defined therein) agreed that 50% of the proceeds from the Purchaser Financing will be set aside and made available expressly for the Company to use for its working capital and corporate needs and the remaining 50% of such funds will be set aside and made available expressly for the businesses of Purchaser existing immediately prior to Closing to use for their working capital and corporate needs. To split the net proceeds of the Purchaser Financing as described above, Purchaser shall make loans of one-half of the net proceeds to the Company, which loans shall be (i) forgiven upon the Preferred Stock Conversion (as defined therein) or (ii) repaid if the Transactions (as defined therein) are unwound.

As of March 31, 2026, and December 31, 2025, the Company had amounts owed to Fusion Fuel amounting to $4,667,537 and $,4427,537, respectively.

NOTE 7. NON-CURRENT LIABILITIES

Lease Liabilities - Non-Current portion

Operating lease liabilities are measured at the present value of the remaining lease payments, discounted using an estimated incremental borrowing rate of 8%. As of March 31, 2026, and December 31, 2025, the company had a non-current portion of lease liabilities of $201,132 and $230,032 respectively.

F-20

The following is a summary of future lease payments required under the lease agreements:

SCHEDULE OF FUTURE LEASE PAYMENTS

Vehicle	DUSTER		X TRAIL		KICKS		URWAN		MICROBUS		SUNNY		ASX		YARIS		KICKS NEW		RENAULT NEW		MERCEDES BENZ G580		MAHINDRA SCORPIO S11 -41765EE		MAZDA CX5- 58416P		TOYOTA HIACE - 84402DD		ISUZU 4.2T SC TRUCK 72938P		MAZDA CX5- 94560Y		GEELY GX3 PRO		Total
Year 2026		3,589		4,967		7,332		15,238		12,818		7,705		927		-		3,443		3,542		28,393		5,322		4,386		7,044		5,983		4,325		2,298		117,311
Year 2027		2,088		4,074		6,013		8,867		7,460		6,319		-		-		4,923		5,064		40,598		7,610		6,271		10,072		8,555		6,184		3,285		127,384
Year 2028		-		-		-		-		-		-		-		-		3,959		3,146		21,545		8,241		6,792		10,908		9,265		6,698		3,558		74,111
Year 2029		-		-		-		-		-		-		-		-		-		-		-		5,795		4,900		8,771		9,786		6,128		3,853		39,233
Year 2030		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		-		771		771
Total		5,677		9,041		13,345		24,105		20,278		14,024		927		-		12,325		11,751		90,536		26,967		22,349		36,795		33,589		23,335		13,764		358,810

SCHEDULE OF SUPPLEMENTAL INFORMATION

Vehcile	DUSTER		X TRAIL		KICKS		URWAN		MICROBUS		SUNNY		ASX		YARIS		KICKS NEW		RENAULT NEW		MERCEDES BENZ G580		MAHINDRA SCORPIO S11 -41765EE		MAZDA CX5- 58416P		TOYOTA HIACE - 84402DD		ISUZU 4.2T SC TRUCK 72938P		MAZDA CX5- 94560Y		GEELY GX3 PRO		Total
RoU		5,090		8,160		12,044		21,614		18,182		12,658		799		-		11,640		11,027		87,961		26,276		22,331		35,866		33,298		23,379		13,623		343,948
Lease Liability		5,677		9,041		13,345		24,105		20,278		14,024		927		-		12,325		11,751		90,536		26,967		22,349		36,795		33,589		23,335		13,764		358,810
Current		4,833		6,690		9,874		20,523		17,264		10,377		927		-		4,638		4,770		38,241		7,168		5,907		9,487		8,059		5,825		3,094		157,678
Non Current		844		2,351		3,470		3,582		3,014		3,647		-		-		7,688		6,981		52,295		19,800		16,442		27,308		25,531		17,510		10,670		201,132

Weighted average remaining lease term (in years)			2.11
Weighted average discount rate			8	%

F-21

Other Non-Current Liabilities

Other non-current liabilities amounted to $183,267 as of March 31, 2026, compared to $1,320,183 as of December 31, 2025. The composition of other non-current liabilities is presented in the following schedule.

Other Non-Current Liabilities	March 31, 2026		December 31, 2025
Payable to Shareholders of Al Shola Gas		-		1,125,000
Bank Borrowings – Non – Current		44,401		62,435
Employee End of Service Benefits		138,866		132,748
Total		183,267		1,320,183

NOTE 8. STOCKHOLDERS’ EQUITY

The Company’s authorized capital stock consists of 450,000,000 shares of common stock and 1,000,000 shares of preferred stock, par value $0.001 per share.

As of March 31, 2026, and December 31, 2025, there were 193,266,631 and 179,110,820 shares of common stock issued and outstanding, respectively.

As of March 31, 2026, and December 31, 2025, there were 0 and 0 shares of Series A stock of the Company issued and outstanding, respectively.

As of March 31, 2026, and December 31, 2025, there were 0 and 8,500 shares of Series B stock of the Company issued and outstanding, respectively.

On January 20, 2026, the Board of Directors and Fusion Fuel Green PLC, the Company’s majority stockholder holding approximately 53.5% of the Company’s voting power, approved an amendment to the Company’s Articles of Incorporation. The amendment increased the Company’s authorized share capital from 200,000,000 shares of common stock, par value $0.001 per share, to 450,000,000 shares of common stock. The increase had effect on February 25, 2026. The number of authorized shares of preferred stock was not affected by the amendment.

From January 1, 2025, to March 31, 2025, we made the following issuances:

On January 10, 2025, the Company issued 600,962 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $20,000 of principal, pursuant to a convertible note signed on July 3, 2024.

On January 13, 2025, the Company issued 818,331 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $25,000 of principal, pursuant to a convertible note signed on July 3, 2024.

On January 17, 2025, the Company issued 1,024,590 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $25,000 of principal, pursuant to a convertible note signed on July 3, 2024.

On January 27, 2025, the Company issued 1,678,321 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $30,000 of principal, pursuant to a convertible note signed on July 3, 2024.

On January 29, 2025, the Company issued 2,482,269 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $35,000 of principal, pursuant to a convertible note signed on July 3, 2024.

On January 30, 2025, the Company issued 2,836,879 shares of our common stock to 1800 DIAGONAL LENDING LLC for $40,000, for part conversion of a convertible note signed on July 03, 2023.

On February 3, 2025, the Company issued 2,994,289 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $ 38,925.77 of principal, pursuant to a convertible note signed on July 3, 2024. There was no Balance Due remaining under this Note after this Conversion.

On March 27, 2025, the Company issued 1,351,351 shares of our common stock to 1800 DIAGONAL LENDING LLC for the conversion of $15,000 of principal, pursuant to a convertible note signed on September 25, 2024.

From January 1, 2026, to March 31, 2026, we made the following issuances:

On January 12, 2026, the Company issued 5,655,811 shares of our common stock to Jefferson Street Capital LLC for the conversion of $0.00 principal amount of the note together with $1,500.00 of accrued and unpaid interest thereto, $37,269.38 in default principal and $1,500.00 in fees, totaling $40,269.38 pursuant to a convertible note signed on May 21, 2024.

F-22

On February 23, 2026, Fusion Fuel Green PLC converted 8,500 shares of Series B Preferred Stock, into 8,500,000 shares of common stock, pursuant to the Certificate of Designation of Series B Convertible Preferred Stock of the Company (the “Series B Certificate of Designation”). The conversion was effected for no cash consideration, in accordance with the Series B Certificate of Designation. Fusion Fuel only holds common stock after the conversion.

NOTE 9. OPERATING EXPENSES

General and Administrative Expenses	March 31, 2026		March 31, 2025
Salaries and compensation to employees
Salary and compensation - QIND		22,150		1,200,000
Salary and compensation - ASG		262,899		248,942
Salary and compensation		262,899		248,942
Management Expenses – ASG		118,856		117,546
Management Expenses		118,856		117,546
Rent		59,394		32,349
Office Expenses		2,502		4,848
IT support		6,690		3,507
Other expenses*		227,208		203,248
Total		699,699		1,810,440

*	Other expenses are primarily expenses in Al Shola Gas for items such as Legal, Visa, Business Promotion, Fuel Expenses, Commission Against Business Activities and Rebate Expenses and other operating expenses.

NOTE 10. NON-OPERATING INCOME

The Company recognized non-operating income during the three months ended March 31, 2026, in connection with the waiver of outstanding consultancy fees payable to a third-party service provider. The service provider waived fees totaling $35,000, and the waived amount has been recognized as other non-operating income, as it does not arise from the Company’s core operations. The Company earned no other income for the three months ended March 31, 2025.

The table below presents the breakdown of non-operating income:

SCHEDULE OF NON-OPERATING INCOME

Non-Operating income

March 31,

2026

March 31,

2025

Non-operating income - liability waive off

35,000

Total

35,000

NOTE 11. BUSINESS COMBINATION DISCLOSURE

In Accordance with ASC 805-10-50, ASC 805-30-50, and ASC 805-10-25-6

On March 27, 2024, QIND entered into a definitive Stock Purchase Agreement with the shareholders of AL SHOLA AL MODEA GAS DISTRIBUTION L.L.C. to acquire 51% of the shares, a United Arab Emirates headquartered company (“ASG” or “Al Shola Gas”). Al Shola Gas is a revenue-generating company in the business of gas system installation and gas supply for commercial and domestic consumers.

QIND acquired majority ownership of Al Shola Gas, effective as of March 27, 2024, resulting in, Al Shola Gas becoming a subsidiary, in a transaction accounted for as a business combination. The Company and its auditors considered all pertinent facts pursuant to ASC 805-10-25-6 that the Share Purchase Agreement signing date is the acquisition date of the company, with the value of $10,000,000 and the payment plan outlined in the agreement. Pursuant to the terms of the Share Purchase Agreement, QIND will occupy two non-paid board seats including Chairman of the Board of Al Shola Gas and there shall be one other non-paid board seat for existing Al Shola Gas shareholders. QIND obtained immediate control with the execution of the Agreement. Full operational control will be retained by existing shareholders and management unless the new Board of Directors determines otherwise due to a breach of the Agreement, ongoing poor performance, or if structural changes are recommended in line with the laws governed by the Agreement which will be decided and approved by the new Board of Directors of the Company.

F-23

The audited pro forma financial statements of Al Shola Gas for the periods ended December 31, 2023, has been filed through 8-K on June 7, 2024.

In accordance with ASC 805-30-50-1 (b) and ASC 805-20-50-1(c), the following table summarizes the consideration transferred to acquire Al Shola Gas and the amounts of identified assets acquired, and liabilities assumed at the acquisition date, as well as the fair value of the noncontrolling interest in Al Shola Gas at the acquisition date:

The Payment Schedule signed on March 27, 2024, outlines a series of payment requirements as follows:

Tranche 1: $9 million in National Exchange listed stock or cash to be paid to Seller. Payment in eight quarterly tranches over a period of 24 months, beginning from the first quarter following uplist to a National Exchange. Stock value is to be protected by a make whole agreement/s and each tranche is subject to a mutually agreed 12-month leak-out agreement.

Tranche 2: Within 12 months of closing and at the soonest possible time, $1 million cash payment to the Seller.

SCHEDULE OF CONSIDERATION PAID

Consideration paid

March 31,

2026

December 31,

2025

Total

1,020,000

1,000,000

As of March 31, 2026, $8,980,000 payable to the shareholders of Al Shola Gas was outstanding.

Fair value of Consideration

SCHEDULE OF FAIR VALUE CONSIDERATION


Cash or National Exchange listed stock	$	9,000,000
Cash	$	1,000,000
Total	$	10,000,000

Goodwill calculation of acquisition

Date of Acquisition	USD
Cash and cash equivalents	$	111,767
Trade receivables & Other receivables		2,699,826
Inventories		1,315,937
Deposits, prepayments and advances		551,588
Property, plant, and equipment		102,682
Right of use assets		222,130
Trade and other payables		(885,016	)
Lease liabilities		(229,359	)
Bank borrowings		(774,064	)
Total identifiable net assets	$	3,115,491
Non-Controlling Share (49%)		1,526,591
Parent Share (51%)		1,588,900
Goodwill	$	8,411,100

F-24

NOTE 12. SUBSEQUENT EVENTS

In accordance with ASC 855-10-50, the company lists events that are deemed to have a determinable significant effect on the balance sheet at the time of occurrence or on future operations, and without disclosure of it, the financial statements would be misleading.

On April 7, 2026, it was announced that its majority-owned subsidiary, Al Shola Al Modea Gas Distribution L.L.C., was awarded 16 new engineering subcontracts with a combined expected value of approximately $1.14 million as of April 2026.

F-25

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis provides information that our management believes is relevant to an assessment and understanding of the Company’s condensed consolidated results of operations and financial condition. The discussion should be read together with the unaudited condensed consolidated financial statements and the accompanying notes to those statements that are included elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”) and the audited financial statements and related notes for the year ended December 31, 2025, included in the Annual Report on Form 10-K of the Company for the year ended December 31, 2025, filed by the Company with the Securities and Exchange Commission (the “SEC”) on March 31, 2026 (the “Annual Report”). This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties. See “Special Note Regarding Forward-Looking Statements”.

Use of Terms

Except as otherwise indicated by the context, references in this Quarterly Report to the “Company,” “we,” “us,” “our,” or “QIND” refer to Quality Industrial Corp., a Nevada corporation; and “common stock” refers to the Company’s common stock, par value $0.001 per share. References in this Quarterly Report to “Al Shola Gas” or “ASG” refer to Al Shola Al Modea Gas Distribution L.L.C., a United Arab Emirates (“UAE”) company, a 51.0%-owned subsidiary of the Company. References in this quarterly report to “Fusion Fuel” are to Fusion Fuel Green PLC, an Irish public limited company, the Company’s parent company.

Note Regarding Trademarks, Trade Names and Service Marks

We use various trademarks, trade names and service marks in our business. For convenience, we may not include the ℠, ® or ™ symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowed by law. Any other trademarks, trade names or service marks referred to in this report are the property of their respective owners.

Special Note Regarding Forward-Looking Statements

This Quarterly Report contains forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve significant risks and uncertainties. In some cases, these forward-looking statements can be identified by words and phrases such as “may,” “will,” “believes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “should,” “seeks,” “future,” “continue,” “plan,” “target,” “predict,” “potential,” or the negative form of these words and phrases or other comparable expressions. All statements other than statements of historical facts are forward-looking statements. These forward-looking statements include information about our possible or assumed future results of operations or our performance. Forward-looking statements are based on management’s current expectations and assumptions regarding the Company’s business, the economy, and other future conditions.

The forward-looking statements included in this Quarterly Report relate to, among other things:

	●	Al Shola Gas’s expected value from the announced new engineering subcontracts;
	●	Al Shola Gas’s plans to add service vehicles;
	●	the allocation of resources to Al Shola Gas;
	●	planned investments in new vehicles;
	●	anticipated enhancements to efficiency and bulk LPG supply capabilities;
	●	expected increases in sales and revenue;
	●	anticipated positive influence on financial performance from any of the above; and
	●	expected increases in operating expenses.

Forward-looking statements relate to the future, and are therefore subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Known and unknown risks, uncertainties and other factors may cause actual results to be materially different from those expressed or implied by such forward-looking statements.

Risks and uncertainties that could cause actual results to differ materially from those contemplated in the forward-looking statements include, but are not limited to:

	●	major, irreversible disruptions and damage to Al Shola Gas’s core operations due to ongoing military conflict among Iran, the United States, Israel, and other belligerents;
	●	the Company’s ability to support the expansion of the operations of Al Shola Gas;
	●	the ability of the parties to our service contracts to obtain all necessary regulatory and other consents and approvals and to deliver all required products and services in connection with the contemplated projects;
	●	the availability of additional financing from Fusion Fuel, the Company’s parent company, including uncertainty as to the timing and amount of capital raises by Fusion Fuel;
	●	the possibility that previous loans from Fusion Fuel will be required to be repaid;
	●	Al Shola Gas’s ability to secure and execute liquified petroleum gas (“LPG”) engineering and distribution projects;
	●	Al Shola Gas’s ability to obtain sufficient financing to support operations and growth initiatives;
	●	other risks associated with operating internationally, including in the UAE and other foreign jurisdictions;
	●	the ability of our projects to generate the expected free cash flow or net income necessary for the Company to generate the anticipated returns in connection with contemplated projects;
	●	fluctuations in demand for LPG engineering and distribution services;
	●	the Company’s ability to continue as a going concern and to generate sufficient revenues within one year from the date of filing;
	●	regulatory approvals and compliance requirements affecting LPG distribution and engineering services;
	●	volatility in energy markets and commodity prices;
	●	our goals and strategies;
	●	our future business development, financial condition and results of operations;
	●	our projected revenues, profits, earnings and other estimated financial information;
	●	our ability to secure additional funding necessary for the expansion of our business;
	●	the growth of and competition trends in our industry;
	●	fluctuations in general economic and business conditions in the markets in which we operate;
	●	relevant government policies and regulations relating to our industry; and
	●	those listed under Part I. Item 1A. “Risk Factors” of the Company’s Annual Report on Form 10-K.

Overview

We are an industrial company specializing in the energy sector. Through our 51.0%-owned operating subsidiary, Al Shola Al Modea Gas Distribution L.L.C. (“ASG” or “Al Shola Gas”), we provide comprehensive solutions for the liquefied petroleum gas (“LPG”) industry. Our services include consulting, designing, supplying, installing, and maintaining LPG systems, as well as the transportation and supply of LPG in both bulk and cylinder formats. We cater to a diverse range of clients, including commercial buildings, mixed-use apartment complexes, shopping centers, food courts, heavy industries, labor accommodations, catering units, commercial kitchens, and dining establishments. Our mission is to develop a next-generation industrial and energy corporation that meets the increasing global demand for high-quality, cost-effective, and sustainable energy solutions.

Factors Affecting Our Performance

The primary factors affecting our results of operations include, but are not limited to:

General Macroeconomic Conditions

Our business is impacted by the global economic environment, employment levels, consumer confidence, government, and municipal spending. Global instability in securities markets, the Russian invasion of Ukraine, and war in the Middle East are among other factors that can impact our financial performance. In particular, changes in the U.S. economic climate can impact the demand for our product range. The industrial and manufacturing sectors are impacted by the overall economic environment as addressed in the risk factors. Tenders can be withdrawn, and lead times for the manufacturing can be affected, which can result in cancellation of orders if not delivered on time.

Subsequent to December 31, 2025, military conflict involving Iran, Israel, and the United States escalated in the Middle East region. The Company operates in the United Arab Emirates within the oil and gas sector. Management has evaluated the potential impact of this conflict on the Company’s operations, supply chain, and financial condition and has concluded that, as of March 31, 2026, there has been no material adverse impact. However, the situation remains uncertain, and future developments could affect the Company’s operations and financial results.

Recent Developments

Subsequent to March 31, 2026, ASG, the Company’s majority-owned subsidiary, was awarded 16 new LPG engineering subcontracts with an aggregate expected contract value of approximately $1.14 million as of April 2026. In addition, ASG renewed a number of engineering and LPG supply contracts that are expected to continue generating recurring annual revenue.

Planned Developments

In 2026, the Company expects to allocate resources to its majority-owned subsidiary, Al Shola Gas, to enhance efficiency, boost sales, and positively influence financial performance, primarily through investment from our parent company, Fusion Fuel. We plan to continue investing in new vehicles for our subsidiary to improve their bulk LPG supply capabilities and increase our revenue. We expect that our revenue and operating expenses will increase as we implement such plans.

Results of Operations for the Three Months Ended March 31, 2026, and 2025

Revenues

Revenue for the three months ended March 31, 2026, increased to $3,665,660 from $3,621,473 for the three months ended March 31, 2025. The increase in revenue was a result of an increase of revenue of Al Shola Gas compared with the same quarter last year as a result of higher sales volumes and improved operational performance driven by continued growth in customer demand and expansion of business activities.

Gross Profit

Gross profit increased to $1,000,600 for the three months ended March 31, 2026, from $955,386 for the three months ended March 31, 2025. The increase in gross profit was primarily attributable to higher revenue during the three months ended March 31, 2026.

Operating Expenses

Operating expenses decreased to $824,780 for the three months ended March 31, 2026, from $1,902,508 for the three months ended March 31, 2025. The decrease was primarily attributable to reduced administrative and operating costs from the non-recurrence of aggregate discretionary bonus payments to management of $1,020,000.

We anticipate that our operating expenses will increase as we undertake our subsidiary expansion plan. The increase is anticipated to be attributable to administrative and operating costs associated with our business activities and the professional fees associated with our reporting obligations.

Other Expenses

Other expenses decreased to $56,118 for the three months ended March 31, 2026, from $285,418 for the three months ended March 31, 2025. The decrease in other operating expenses was primarily due to reduced interest and discount-related expenses on convertible notes.

Other Income

Other income increased to $36,152 for the three months ended March 31, 2026, from $0 for the three months ended March 31, 2025. The increase in other income was primarily due to the waiver of $35,000 in fees by a service provider.

Net Income (Loss)

Net income was $133,324 for the three months ended March 31, 2026, while net loss for the three months ended March 31, 2025, was $1,259,606. The change was primarily due to the non-recurrence of aggregate discretionary bonus payments to management of $1,020,000.

Liquidity and Capital Resources

As of March 31, 2026, we had cash and cash equivalents of $172,548, total current assets of $7,297,799, and total current liabilities of $18,036,654.

Going Concern

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.

Management evaluated all relevant conditions and events that are reasonably known or reasonably knowable, in the aggregate, as of the date the unaudited consolidated financial statements are issued and determined. The Company’s ability to continue as a going concern is dependent on the Company’s ability to continue to generate sufficient revenues and raise capital within one year from the date of filing.

The Company will require additional financing to fund our operations beyond the near term. Based on our current projections, our existing cash resources will not be sufficient to meet our anticipated operating and other cash needs through March 31, 2027, and for at least 12 months beyond that period, unless we receive such additional financing, including the costs associated with being a public reporting company. Since our own financial resources may be insufficient to satisfy our capital requirements, we may seek to sell additional equity or debt securities in public offerings, private placements or credit facilities. The sale of additional equity securities could result in dilution to our stockholders. The incurrence of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict our operations. Financing may not be available in amounts or on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at all, could limit our ability to expand our business operations and could harm our overall business prospects.

As of March 31, 2026, the Company had received $4,667,537 in loans from its parent company, Fusion Fuel. The loans are not evidenced by separate loan agreements and do not bear contractual interest or specified maturity dates. The loans are subject to the terms of the Stock Purchase Agreement, dated November 18, 2024, among the Company, and certain other stockholders of the Company (the “Fusion Fuel Acquisition Agreement”). Under the Fusion Fuel Acquisition Agreement, Fusion Fuel will make loans of one-half of the net proceeds (or such lesser amount as agreed to by the parties) to QIND from certain capital raises by Fusion Fuel. Such loans will be (i) forgiven upon the Preferred Stock Conversion (as defined in the Fusion Fuel Acquisition Agreement), or (ii) repaid if the Transactions (as defined in the Fusion Fuel Acquisition Agreement) are unwound in accordance with the provisions of the Fusion Fuel Acquisition Agreement. For the 12 months ended March 31, 2027, the Company anticipates that Fusion Fuel, the Company’s parent company, will provide additional financing in connection with the operations of Al Shola Gas. In addition, the Company anticipates that Fusion Fuel will provide all compensation required by our executive officers, other than our Chief Operating Officer and Managing Director Middle East, Sanjeeb Safir. No assurance can be given that any such financing will be available, if and when required. No assurance can be given that previous loans from Fusion Fuel will not be required to be repaid. If we are unable to obtain sufficient funding, it could adversely affect our ability to execute our business plan and meet our obligations.

Summary of Cash Flow

The following table provides detailed information about our net cash flows for the three months ended March 31, 2026, and March 31, 2025:

	Three Months Ended March 31,
	2026			2025
Net cash (used in) provided by operating activities	$	(309,650	)	$	334,816
Net cash (used in) investing activities		(75,057	)		(200,000	)
Net cash provided by financing activities		130,098			669,648
Effect of exchange rate changes on cash and cash equivalents		572			-
Net change in cash and cash equivalents		(254,609	)		134,832
Cash and cash equivalents – beginning of period		426,585			225,582
Cash and cash equivalents – end of period	$	172,548		$	360,414

Net cash used in operating activities was $(309,650) for the three months ended March 31, 2026, and was $(334,816) for the three months ended March 31, 2025. The decrease in net cash used in operating activities was primarily attributable to a change from $1.3 million in net loss to $0.1 million in net income, as well as reduced accounts payable, deposits, prepayments and advances, partially offset by increased related party receivables and reduced other current liabilities.

Net cash used in investing activities was $(75,057) for the three months ended March 31, 2026, and was $(200,000) for the three months ended March 31, 2025. The decrease in net cash used in investing activities was primarily due to reduced payments made toward the purchase consideration payable to ASG shareholders from $0.2 million to $0.02 million, partially offset by additions to fixed assets.

Net cash provided by financing activities was $130,098 for the three months ended March 31, 2026, and was $669,648 for the three months ended March 31, 2025. The decrease in cash provided by financing activities was primarily due to reduced financing from the Company’s parent company (from approximately $0.9 million to approximately $0.2 million), as well as the non-recurrence of proceeds from the issuance of common stock, offset by reduced repayments of convertible notes and bank borrowings.

Summary of Future Lease Obligations

QIND has a virtual office at 505 Montgomery Street, San Francisco, California. The cost per month is $115 and is renewed annually.

Set forth in the table below is information regarding Al Shola Gas’ leased facilities, including the lease term, and annual rent amounts.

Location	Lease Term	Annual Rent
Office at Hamsah Building, O/112, Zabeel Road, Dubai, UAE	May 10, 2025 to May 9, 2026	$	35,416	⁽¹⁾
Office at Hamsah Building, O/307, Zabeel Road, Dubai, UAE	January 7, 2026 to January 6, 2027	$	7,306
Office at Al Yousef Building, Dubai, UAE	January 1, 2026 to December 31, 2026	$	17,698
Gas Warehouse Unit No. L723, Plot No. 0243-0154, Baghdad Street, Al Qusais Industrial Area 2, Al Qusais, Dubai, UAE	March 1, 2026 to February 28, 2027	$	7,110
Gas Store Unit No. L705, Plot No. 0243-0171, Baghdad Street, Al Qusais Industrial Area 2, Al Qusais, Dubai, UAE	March 1, 2026 to February 28, 2027	$	7,110
Warehouse Plot No: 987-1006, Al Layan 1, DIC, Dubai, UAE	March 26, 2025 to March 25, 2026	$	5,455	(1)
Employee Accommodation, 17 Units, Plot No: 483-0, Muhaisanah Second, Dubai, UAE	February 1, 2026 to January 31, 2027	$	166,644
Employee Accommodation, Fortuna Global Real Estate, Dubai, UAE	January 20, 2026 to January 31, 2027	$	26,983
Employee Accommodation, Al Nabbah Real Estate, Dubai, UAE	April 3, 2026 to March 2, 2027	$	10,783
Total		$	284,505

1. The renewal process for these lease agreements is currently in progress.

Property rent expenses for the three months ended March 31, 2026, amounted to the following:

Rent Expense	Amount ($)
Office Rent Expenses	$	14,886
Warehouse/Store Rent Expenses		4,240
Labor Accommodation Rent Expenses		40,268
Total	$	59,394

In addition, the Company has payment obligations under certain vehicle leases.

The following table summarizes the Company’s future lease financial obligations by period in which payment is expected, as of March 31, 2026:

	Short-Term		Long-Term		Total
Property Leases*	$	187,055	$	0	$	187,055
Vehicle Leases	$	157,678	$	201,132	$	358,810
Total Lease Obligations	$	344,733	$	201,132	$	545,865

* Property leases are primarily one-year office, warehouse, store, and employee accommodation leases.

Convertible Notes

The Company’s outstanding debt obligations as of March 31, 2026, consisted primarily of convertible promissory notes, which are as follows:

																		Cumulative Repayments										Cumulative Conversions																		Total Balance Remaining
Lender	Date of Issue		Maturity Date		Initial Interest Rate (%)			Default Interest Rate (%)			Original Principal Amount		Total Default Interest/Fees Incurred Since Issuance (Before Repayments and Conversions)			Total Interest Accrued Since Issuance (Before Repayments and Conversions)			Principal Repayments		Default Interest and Fees Repayments		Accrued Interest Repayments		Total Repayments			Principal Converted			Default Interest and Fees Converted			Accrued Interest Converted			Total Amount Converted			Conversion Price per Share			Total Number of Common Shares Issued			Principal Outstanding		Default Interest and Fees Outstanding		Accrued Interest Outstanding		Total Balance Remaining
											$		$			$			$		$		$		$			$			$			$			$			$						$		$		$		$
RB Capital Partners Inc.		August 3, 2022		August 3, 2024		7	%		-			1,100,000		-			282,052			-		-		-		-			-			-			-			-			-	(1)		-			1,100,000		-		282,052		1,382,052
RB Capital Partners Inc.		March 17, 2023		March 16, 2025		7	%		-			200,000		-			41,412			57,705		-		-		57,705			-			-			-			-			-	(2)		-			142,295		-		41,412		183,707
Jefferson Street Capital LLC		May 23, 2023		February 23, 2024		6.5	%		15	%		220,000		138,963			30,531			-		-		-		-			220,000	(3)		36,509	(3)		16,486	(3)		272,995	(3)		-	(3)		13,524,647	(3)		-		102,454		14,045		116,499
Sky Holdings Ltd		June 16, 2023		December 16, 2023		7	%		-			550,000		-			97,796			-		-		-		-			77,000	(4)		-			35,863	(4)		112,863	(4)		0.0375	(4)		3,009,680	(4)		473,000		-		61,933		534,933
Lorlev 26 Irrevocable Trust		December 20, 2023		December 20, 2024		-	(5)		-			100,000		-			29,000			100,000				5,000		105,000	(6)		-			-			-			-	(7)		-			-			-		-		24,000		24,000
Exchange Listing LLC		February 6, 2024		August 6, 2024		10	%		20	%		35,000		-			13,879			-		-		-		-			-			-			-			-	(8)		-			-			35,000		-		13,879		48,879
Jefferson Street Capital LLC⁽⁹⁾		May 21, 2024		February 21, 2025		10	%		15	%		71,500		44,769			18,290			-		-		-		-			71,500			44,769			1,500			117,769	(10)		-			61,995,097			-		-		16,790		16,790
J.J. Astor & Co⁽¹¹⁾		September 20, 2024		June 30, 2025		0	%		16	%		405,000		37,462	(12)		77,779			308,963		37,462		-		346,425			-			-			-			-	(13)		-			-			96,037		-		77,779		173,816
Total												2,681,500		221,195			590,739			466,668		37,462		5,000		509,130			368,500			81,278			53,849			503,627			-			78,529,424			1,846,332		102,454		531,890		2,480,676

(1)

The note may be converted by the holder at the initial conversion price of $1.00 per share, subject to adjustment.

(2)

The note may be converted by the holder at the initial conversion price of $1.00 per share, subject to adjustment

(3)

The note may be converted by the holder at the initial conversion price of $0.35 per share, subject to adjustment. Upon an event of default, the holder may convert the note using the common stock’s lowest trading price during the period commencing on the date of default discounted by 35%. $1,500 will be added to principal for each conversion. As of March 31, 2026, the holder had converted an aggregate of $272,995, consisting of $220,000 of principal, $36,509 of default interest and fees, and $16,486 of accrued interest into 13,524,647 shares of common stock at a conversion price determined in accordance with the event of default conversion terms set forth in the Note, as the Note was in default at the time of conversion.

(4)

The note was initially convertible by the holder at the initial conversion price of $0.35 per share. On May 16, 2024, the note was amended to have a conversion price equal to $0.0375 per share. As of March 31, 2026, the holder had converted $77,000 of principal and $35,863 of accrued interest into 3,009,680 shares of common stock at a conversion price of $0.0375 per share.

(5)

20% interest will be charged on the day the Company receives funding in connection with an initial public offering, and thereafter 15% per annum will be charged.

(6)

On September 2, 2025, the lender and the Company entered into a settlement agreement to resolve amounts outstanding under this note. Pursuant to the settlement agreement, the parties agreed to settle the $100,000 principal amount, together with $29,000 of accrued interest as of June 30, 2025 (notwithstanding that $29,589 of interest had accrued under the note as of June 30, 2025), for an aggregate settlement amount of $129,000. The settlement amount is payable in installments consisting of an initial payment of $30,000 due by September 10, 2025, followed by monthly payments of $15,000 due on the 15th of each month thereafter until the settlement amount is paid in full.

(7)

The note may be converted by the holder at an initial conversion price equal to a 50% discount of the Company’s listing price, subject to adjustment.

(8)

The note may be converted by the holder at the initial conversion price equal to the price reflecting a discount of 35% to the volume weight average price of the Company’s common stock for the five days before any conversion, subject to adjustment.

(9)

Ilustrato Pictures International Inc. is a guarantor under the note.

(10)

The note may be converted by the holder at the initial conversion price of $0.03 per share, subject to adjustment. Upon an event of default, the holder may convert the note using the common stock’s lowest trading price during the period commencing on the date of default discounted by 20%. $1,500 will be added to principal for each conversion. As of March 31, 2026, the holder had converted an aggregate of $117,769, consisting of $71,500 principal, $44,769 of default interest and fees, and $1,500 of accrued interest into 61,995,097 shares of common stock at a conversion price determined in accordance with the event of default conversion terms set forth in the Note, as the Note was in default at the time of conversion.

(11)

The note ranks senior to other debt and is secured by all assets of the Company.

(12)

Reflects a default fee equal to an increase of principal outstanding to 110% of the principal outstanding due to the occurrence of an event of default under the note.

(13)

The note may be converted by the holder at the initial conversion price equal to 80% of the average of the four lowest volume weighted average closing prices of the Company’s common stock over the 20 trading days immediately prior to each permitted conversion of the note, subject to adjustment. The Company is required to file a resale registration statement with the SEC within 60 days of any default or event of default and register for resale all shares of common stock issued under the note within 90 days of any default or event of default.

Related-Party Debt

Impact of Acquisitions

Historically, a significant component of our growth has been through the acquisition of businesses in our targeted sectors. We typically incur upfront costs as we incorporate and integrate acquired businesses into our operating philosophy and operational excellence. This includes consolidation of supplies and raw materials, optimized logistics and production processes, and other restructuring and improvement initiatives. The benefits of these integration efforts and upcoming planned acquisitions may not positively impact our financial results in the short term but have historically been the case in the medium to long term.

Critical Accounting Estimates

The “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section is based on the Company’s unaudited consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP). The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and judgments that affect reported amounts and related disclosures. On an ongoing basis, management evaluates and updates its estimates. Management employs judgment in making its estimates but they are based on historical experience and currently available information and various other assumptions that the Company believes to be reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities that are not readily available from other sources. Actual results could differ from those estimates. Management believes that its judgment is applied consistently and produces financial information that fairly depicts the results of operations for all periods presented.

Significant estimates include estimates used to review the Company’s impairments and estimations of long-lived assets, revenue recognition of Contract-based revenue, allowances for uncollectible accounts, and the valuations of non-cash capital stock issuances. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Further, refer to the Company’s significant accounting policies as described in Note 2 of the unaudited consolidated financial statements.

We consider the following accounting estimate to be the most critical in understanding the judgments that are involved in preparing our unaudited consolidated financial statements:

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Recently Issued Accounting Pronouncements

The Company has evaluated all recently issued accounting pronouncements and has implemented all standards that are currently in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that any recently issued accounting pronouncements will have a material impact on its financial position, results of operations, or cash flows.

ASU 2017-04, Simplifying the Test for Goodwill Impairment, has been effective for fiscal years beginning after December 15, 2019, and has been adopted by the Company. Under this standard, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, limited to the total goodwill allocated to that reporting unit. The Company applies this simplified one-step impairment test in its annual goodwill assessment. As noted above, no impairment was identified as of March 31, 2026.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

As a “smaller reporting company,” we are not required to provide the information required by this Item.

Item 4. Controls and Procedures.

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Interim Chief Financial Officer, have evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) prior to the filing of this Quarterly Report. Based on that evaluation, our Chief Executive Officer and Interim Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

Changes in Internal Control Over Financial Reporting

During the period covered by this Quarterly Report, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are not currently aware of any such legal proceedings or claims that we believe will have a material adverse effect on our business, financial condition, or operating results.

Settlement and Release Agreement with Lucosky Brookman

In September 2025, the Company entered into a Settlement and Release Agreement (the “Lucosky Settlement Agreement”) with Lucosky Brookman LLP (“Lucosky Brookman”), the Company’s former legal counsel, to resolve an outstanding obligation of approximately $568,706. Under the terms of the Lucosky Settlement Agreement, the Company agreed to pay a total settlement amount of $250,000 in five equal monthly installments of $50,000, due monthly from September 2025 through January 2026. Upon receipt of the full settlement amount, the parties agreed to exchange mutual general releases of all claims. If the Company failed to pay the full settlement amount by January 31, 2026, Lucosky Brookman retains the right to seek collection of the full outstanding balance, less amounts previously paid. As of March 31, 2026, the Company had not paid the full settlement amount and owed $125,000 to Lucosky Brookman.

Item 1A. Risk Factors.

As a “smaller reporting company,” we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

Other than as disclosed below, during the three months ended March 31, 2026, any equity securities that were not registered under the Securities Act and that were not previously disclosed in a Current Report on Form 8-K.

On January 12, 2026, the Company issued 5,655,811 shares of common stock to Jefferson Street Capital LLC for the conversion of $1,500.00 of accrued and unpaid interest, $37,269.38 in default principal and $1,500.00 in fees, totaling $40,269.38 pursuant to the holder’s conversion notice under a convertible note issued on May 21, 2024.

On May 21, 2024, the Company issued the convertible promissory note to Jefferson Street Capital in a principal amount of $71,500 (purchase price of $65,000), bearing interest at 10% per annum (with default interest at 15% per annum), with equal consecutive monthly payments commencing five months from the issue date, with a final maturity date of February 21, 2025. Ilustrato Pictures International Inc., a Nevada corporation, is a guarantor under the note. The note may not be prepaid in whole or in part except as otherwise set forth therein; however, the Company has the right, upon not less than five trading days’ prior written notice, to prepay the outstanding balance at 110% of the then-outstanding balance. The holder has the right, from the date of the note through the later of the maturity date or the date of payment of the default amount, to convert all or any part of the outstanding and unpaid amount into shares of our common stock at a fixed conversion price of $0.03 per share, subject to equitable adjustments for stock splits, stock dividends, rights offerings, combinations, recapitalizations, reclassifications, extraordinary distributions, and similar events, and further subject to anti-dilution adjustment in the event of a dilutive issuance at a lower price. In no event may the holder convert any portion of this note if, after giving effect to the conversion, the holder and its affiliates would beneficially own more than 4.99% of our outstanding common stock, and this limitation may not be waived. $1,500 will be added to principal under the note for each conversion. Events of default include, among other things, failure to pay principal or interest when due (with a five-day cure period), failure to issue conversion shares, breach of covenants, appointment of a receiver, bankruptcy or insolvency, delisting, failure to comply with Exchange Act reporting requirements, cessation of operations, and failure to disclose the note and guaranty in SEC filings. Upon certain events of default, the note becomes immediately due and payable at 150% of the outstanding amount; upon other specified events, at 200% of the outstanding amount.

On February 23, 2026, Fusion Fuel converted 8,500 shares of Series B Convertible Preferred Stock, par value $0.001 per share, into 8,500,000 shares of common stock, pursuant to the Company’s Certificate of Designation of Series B Convertible Preferred Stock of the Company (the “Series B Certificate of Designation”). The conversion was effected for no cash consideration, in accordance with the Series B Certificate of Designation.

Each of these securities was offered and sold by the Company in a transaction that was exempt from the registration requirements of the Securities Act, in reliance on Section 4(a)(2) thereof.

Purchases of Equity Securities

No repurchases of our common stock were made during the three months ended March 31, 2026.

Item 3. Defaults Upon Senior Securities.

The following convertible promissory notes were in default as of March 31, 2026:

	(i)	a convertible note in the original principal amount of $1,100,000 issued to RB Capital Partners Inc. (“RB Capital Partners”), which matured on August 3, 2024, as to which the Company defaulted in the amount of $1,254,422, and had a total amount in arrearage of $1,391,545 as of May 15, 2026;
	(ii)	a convertible note in the original principal amount of $200,000 issued to RB Capital Partners, which matured on March 16, 2025, as to which the Company defaulted in the amount of $228,038, and had a total amount in arrearage of $184,935 as of May 15, 2026;
	(iii)	a convertible note in the original principal amount of $220,000 issued to Jefferson Street Capital LLC (“Jefferson Street Capital”), which matured on February 23, 2024, as to which the Company defaulted in the amount of $340,963, and had a total amount in arrearage of $118,420 as of May 15, 2026;
	(iv)	a convertible note in the original principal amount of $550,000 issued to Sky Holdings Ltd, which matured on December 16, 2023, as to which the Company defaulted in the amount of $569,303, and had a total amount in arrearage of $539,015 as of May 15, 2026;
	(v)	a convertible note in the original principal amount of $100,000 issued to Lorlev 26 Irrevocable Trust, which matured on December 20, 2024, as to which the Company defaulted in the amount of $120,000, and had a total amount in arrearage of $9,000 as of May 15, 2026;
	(vi)	a convertible note in the original principal amount of $35,000 issued to Exchange Listing LLC, which matured on August 6, 2024, as to which the Company defaulted in the amount of $36,755, and had a total amount in arrearage of $49,785 as of May 15, 2026;
	(vii)	a convertible note in the original principal amount of $71,500 issued to Jefferson Street Capital, which matured on February 21, 2025, as to which the Company defaulted in the amount of $117,818, and had a total amount in arrearage of $17,094 as of May 15, 2026; and
	(viii)	a convertible note in the original principal amount of $405,000 issued to J.J. Astor & Co., which matured on June 30, 2025, as to which the Company defaulted in the amount of $412,088, and had a total amount in arrearage of $162,085 as of May 15, 2026.

For a further description of terms and repayment status with respect to the above convertible notes, see Part 1. Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Non-Related Party Debt”.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

We have no information to disclose that was required to be disclosed in a Current Report on Form 8-K during the three months ended March 31, 2026, but was not reported.

None of our directors or “officers,” as defined in Rule 16a-1(f) under the Exchange Act, adopted or terminated a Rule 10b5-1 trading plan or arrangement or a non-Rule 10b5-1 trading plan or arrangement, as defined in Item 408(c) of Regulation S-K, during the fiscal quarter ended March 31, 2026.

Quality Industrial Corp. 10-Q