ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Organization and Basis of Presentation | Organization and Basis of Presentation
The condensed consolidated financial statements contained in this report are unaudited. In the opinion of management, the condensed consolidated financial statements include all adjustments, which are of a normal recurring nature, necessary to present fairly the Company’s financial position as of June 30, 2026, and results of operations, changes in stockholders’ deficit and cash flows for the three and six months ended June 30, 2026 and 2025. All material intercompany accounts and transactions are eliminated in consolidation. These condensed consolidated financial statements and notes are presented in accordance with the rules and regulations of the SEC relating to interim financial statements and in conformity with U.S. GAAP. Certain information and note disclosures have been condensed or omitted in the condensed financial statements pursuant to SEC rules and regulations, although the Company believes that the disclosures made herein are adequate to make the information not misleading. The condensed unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (collectively the “2025 Annual Report”) filed with the SEC on April 1, 2026.
The operating results for any interim period are not necessarily indicative of the operating results to be expected for any other interim period or the full fiscal year.
|
| Liquidity and Going Concern | Liquidity and Going Concern
The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business.
As of June 30, 2026, the Company had negative working capital of $636,262, an accumulated deficit of $12,856,961, a cash balance of $194,596, and short- term notes payable and accrued interest of $832,998. Further, during the six months ended June 30, 2026, the Company incurred a net loss of $177,193 and used cash in operations of $139,526.
These liquidity conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company has funded its corporate overhead and its business development activities through debt financing; however, such funding has not been sufficient to fund the acquisition of, or launch of, a new business operation.
The Company is actively seeking alternative sources of liquidity, including but not limited to accessing the capital markets, strategic partnerships, or other alternative financing measures. There can be no assurance that such equity or debt financing will be available on acceptable terms, or at all. Additionally, instability in, or tightening of the capital markets, could adversely affect our ability to access the capital markets on terms acceptable to us. An economic recession or a slow recovery could adversely affect our business and liquidity. The lack of operating income from products and the financial condition of the Company are also hindering efforts to locate working capital funding.
The Company has sought to establish or acquire a new business line in order to generate a sustained revenue flow. Despite a sustained effort by management, these efforts have not succeeded as of the date of the filing of this Form 10-Q. As discussed below, the Company was seeking a transaction with eBliss Global, Inc., a private maker of electronic motor bicycles or “e-bikes”, and the two companies were conducting due diligence and discussions to explore the feasibility of a corporate transaction, including a possible merger or similar transaction, since the signing of a May 14, 2026 Letter of Intent, which Letter of Intent was initially effective May 14, 2026 and was amended by Amendment Number One to the Letter of Intent, effective July 8, 2026 (as amended, the “Letter of Intent”). However, on August 1, 2026, the Company received an emailed, signed letter from the chief executive officer of eBliss Global, Inc. (“eBliss”) terminating the Letter of Intent between the Company and eBliss. The Company intends to continue its search for a new business line to create a sustained or sustainable revenue flow, but those efforts may not succeed and the Company’s financial condition may reach a point where sustaining those efforts or continuing operations becomes impossible. Subject to no unexpected increase in operation costs or expenditures, the Company believes that it has sufficient cash to sustain corporate operations and efforts to establish a new business line through fiscal year 2026.
Unless the Company succeeds in raising additional capital through debt or equity financing or successfully increases cash generated from operations or established a new business line with revenue flow, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern for a period of one year after the date these financial statements are issued. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
|
| Nature of Business | Nature of Business
The Company has its principal executive offices in Deerfield Beach, Florida.
On March 3, 2026, the Company issued an unsecured promissory note to eBliss Global, Inc. (“eBliss”), a private early-stage Delaware corporation engaged in the development and production of e-mobility solutions, in the principal amount of $250,000 (the “eBliss Note”). The eBliss Note bears simple interest at seven percent (7%) per annum, with all principal and accrued interest due in a single lump-sum payment on March 4, 2027. The eBliss Note is unsecured and is not convertible into equity securities. In connection with the eBliss Note, the Company agreed to a 90-day “no shop” provision that restricted the Company from soliciting or pursuing specified third-party transactions; that provision expired on or about June 3, 2026 and was superseded by the “no shop” provision in the Letter of Intent described below. See Note 2 for additional information regarding the eBliss Note.
On May 14, 2026, the Company and eBliss entered into a non-binding Letter of Intent (the “Letter of Intent” or “LOI”) to negotiate a possible acquisition by the Company of 100% of the issued and outstanding shares of eBliss in a transaction intended to qualify as a tax-free reorganization under Section 351 of the Internal Revenue Code. The LOI contained a mutual “no shop” provision and did not obligate either party to enter into any definitive agreement or to consummate any transaction. On July 8, 2026, the parties entered into Amendment Number One to the LOI, which extended the exclusivity period, the “no shop” provision, and the expiration date of the LOI to August 31, 2026. The LOI was filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Commission on May 15, 2026.
On August 1, 2026, eBliss provided the Company notice of termination of the Letter of Intent. Under Section 6(b) of the Letter of Intent, termination is effective upon thirty-five days’ prior written notice; accordingly, the Letter of Intent, including its “no shop” provision, will terminate on or about September 4, 2026. The Company and eBliss did not reach or enter into any definitive agreement with respect to any transaction contemplated by the Letter of Intent. The termination of the Letter of Intent does not affect the Mutual Non-Disclosure Agreement, dated November 17, 2025, between the Company and eBliss, or the eBliss Note, each of which remains in effect. See Note 7 – Subsequent Events.
The Company’s effort to establish or acquire a new business line has been hampered by limited working capital and a lack of tangible assets to enable asset based loan. The Company has sought working capital for establishing a new business line from time to time, but those efforts have resulted in loans that are sufficient to sustain corporate operations but not sufficient to purchase or start a new business line to create a steady revenue flow. The Company is uncertain about its prospects for establishing a new business line as of the date of the filing of this Form 10-Q.
Health, Fitness and Social Industries. During 2024, the Company commenced its business development efforts for a business line or possible software development project focused on year-round health, fitness and social activities (this business line being referred to as “HFS” or “HFS business”).
The Company’s HFS business development efforts were suspended in March 2026 in connection with the “no shop” restrictions described above. Upon expiration or earlier termination of the “no shop” provision, the Company will no longer be restricted from soliciting or pursuing third-party transactions with respect to the HFS business and may resume its HFS business development efforts. There can be no assurance that any resumed business development efforts will be successful.
The Company’s operations through June 30, 2026 consisted of only one reportable segment for financial reporting purposes, Corporate Business Development.
Concentrations of Credit Risk
Cash is deposited with major banks in the United States. From time to time, such deposits may be in excess of insured limit. Generally, the FDIC limit per bank is $250,000. Any loss incurred or a lack of access to such funds above the FDIC limit could have a significant adverse impact on the Company’s financial condition, results of operations and cash flows.
Fair Value of Financial Instruments
The carrying amounts of cash, prepaid expenses, accounts payable and accrued expenses, approximate their fair value due to their short-term nature.
The carrying amounts of the Company’s debt approximates fair value as the stated interest rates are consistent with current market rates for similar instruments.
|
| Earnings (Loss) Per Common Share |
Basic loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the six months ended June 30, 2026 and 2025. Diluted loss per common share includes the effect of potentially dilutive securities only when their effect is dilutive. For the six months ended June 30, 2026 and 2025, the Company reported a net loss; therefore, all potentially dilutive common stock equivalents were excluded from diluted loss per common share because their effect would have been anti-dilutive. Accordingly, basic and diluted loss per common share were the same for each period presented.
For the three and six months ended June 30, 2026, potentially dilutive securities excluded from diluted loss per common share consisted of shares issuable upon exercise of stock options and shares issuable upon conversion of shares of Series B-1 Convertible Preferred Stock. For the three and six months ended June 30, 2025, potentially dilutive securities excluded from diluted loss per common share consisted of shares issuable upon exercise of stock options, shares issuable upon exercise of warrants, and shares issuable upon conversion of shares of Series B-1 Convertible Preferred Stock.
|
| Comprehensive Loss | Comprehensive Loss
The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 220.10, “Reporting Comprehensive Income (Loss)”. Comprehensive loss is a more inclusive financial reporting methodology that includes disclosure of certain financial information that historically has not been recognized in the calculation of net loss. Since the Company has no items of other comprehensive loss, comprehensive loss is equal to net loss.
|
| Income Taxes | Income Taxes
The Company is subject to income taxes in the U.S. federal jurisdiction and the state of Florida.
The Company accounts for income taxes under the provisions of Financial Accounting Standards Board (“FASB” Accounting Standards Codification (“ASC”) Topic 740 Income Taxes. ASC 740 requires recognition of deferred income tax assets and liabilities for the expected future income tax consequences, based on enacted tax laws, of temporary differences between the financial reporting and tax bases of assets and liabilities. The Company and its U.S. subsidiaries file consolidated income tax returns.
Deferred tax assets are reduced by a valuation allowance when, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Due to the Company’s history of losses, the Company has recorded a valuation allowance against its net deferred tax assets. For the six months ended June 30, 2026 and 2025, the Company recorded no income tax benefit due to the full valuation allowance recorded against its net deferred tax assets.
The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement.
The Company’s policy is to record interest and penalties associated with unrecognized tax benefits as additional income taxes in the statement of operations. As of January 1, 2026, the Company had no unrecognized tax benefits, or any tax related interest or penalties, and it does not expect significant changes in the amount of unrecognized tax benefits to occur within the next twelve months. There were no changes in the Company’s unrecognized tax benefits during the six months ended June 30, 2026. The Company did not recognize any interest or penalties during 2026 related to unrecognized tax benefits.
Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgement to apply. The Company is subject to U.S. federal, state and local tax examinations by tax authorities generally for a period of 3 years from the later of the due date of the related return or the date the return is filed.
|
| Stock Based Compensation |
The Company accounts for stock-based compensation in accordance with FASB ASC Topic 718, Compensation—Stock Compensation. ASC 718 requires the measurement and recognition of compensation expense for share-based payment awards, including stock options, based on the estimated grant-date fair value of the awards.
The Company estimates the fair value of stock option awards on the date of grant using an option-pricing model. Compensation expense is recognized on a straight-line basis over the requisite service period of the awards. The Company accounts for forfeitures as they occur.
Stock-based compensation expense recognized for the six months ended June 30, 2026 and 2025 was $.
|
| Use of Estimates | Use of Estimates
The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures. Actual results could differ from those estimates.
Recently Issued Accounting Pronouncements
In November 2024, the FASB issued ASU 2024-04, Debt—Debt with Conversions and Other Options, clarifying requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. This ASU is effective for annual reporting periods beginning after December 15, 2025, and interim periods within those annual reporting periods, with early adoption permitted. The Company adopted this standard on January 1, 2026. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and disclosures.
|
| Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted
In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”), and in January 2025, the FASB issued Accounting Standards Update No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date (“ASU 2025-01”). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for us for our annual reporting for fiscal 2028 and for interim period reporting beginning in fiscal 2029 on a prospective basis. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its consolidated financial statements and disclosures.
The Company continually assesses any new accounting pronouncements to determine their applicability to the Company. Where it is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company undertakes a study to determine the consequence of the change to its financial statements and assures that there are proper controls in place to ascertain that the Company’s financials properly reflect the change.
|