| SCHEDULE OF DISCONTINUED OPERATIONS |
The
following table provides the components of assets and liabilities related to discontinued operations that were included in the Company’s
Consolidated Balance Sheets for the periods presented:
SCHEDULE OF DISCONTINUED OPERATIONS
| | |
March 31, | | |
December 31, | |
| | |
2026 | | |
2025 | |
| Current assets | |
| | | |
| | |
| Accounts receivable, net | |
$ | 31,200 | | |
$ | 16,200 | |
| Prepaids | |
| 17,333 | | |
| 51,663 | |
| Current assets related to discontinued operations | |
$ | 48,533 | | |
$ | 67,863 | |
| | |
| | | |
| | |
| Current liabilities | |
| | | |
| | |
| Accrued bonuses and commissions (1) | |
$ | 704,132 | | |
$ | 1,125,371 | |
| Accrued royalties and expenses | |
| 9,128 | | |
| 108,107 | |
| Current liabilities related to discontinued operations | |
$ | 713,260 | | |
$ | 1,233,478 | |
| (1) | Accrued
bonuses and commissions is comprised of severance for terminated THP employees. |
The
assets and liabilities included in discontinued operations represent balances that are expected to be collected and expenses to be paid
as part of the winding down of THP.
The
following table provides the operating results of discontinued operations that were included in the Company’s Consolidated Statements
of Operations for the periods presented:
| | |
2026 | | |
2025 | |
| | |
Three
Months Ended March 31, | |
| | |
2026 | | |
2025 | |
| Net revenue | |
$ | 16,358 | | |
$ | - | |
| | |
| | | |
| | |
| Operating expenses | |
| | | |
| | |
| Selling, general, and administrative expenses | |
| 255,442 | | |
| 2,311,402 | |
| Research and development | |
| - | | |
| 163,779 | |
| Depreciation and amortization(1) | |
| - | | |
| 430,378 | |
| Total operating expenses | |
| 255,442 | | |
| 2,905,559 | |
| | |
| | | |
| | |
| Operating loss | |
| (239,084 | ) | |
| (2,905,559 | ) |
| | |
| | | |
| | |
| Other income (expense) | |
| | | |
| | |
| Other income(2) | |
| 300,000 | | |
| - | |
| Loss on disposal of property and equipment | |
| - | | |
| (1,258 | ) |
| Total other income (expense) | |
| 300,000 | | |
| (1,258 | ) |
| | |
| | | |
| | |
| Net income (loss) from discontinued operations | |
$ | 60,916 | | |
$ | (2,906,817 | ) |
| (1) | Depreciation
expense of $5,461 was reclassified as continuing operations in the three months ended March
31, 2025 and is therefore no longer reflected in discontinued operations. |
| | | |
| (2) | Other
income relates to due diligence payments received to compensate the Company for costs incurred
to maintain limited operations of certain software, technology and cloud related services
while an interested party conducted its due diligence. In March 2026, the due diligence period
ended and was not extended. |
The
following table provides operating cash flow information for discontinued operations for the periods presented:
| | |
2026 | | |
2025 | |
| | |
Three
Months Ended March 31, | |
| | |
2026 | | |
2025 | |
| Operating Activities: | |
| | | |
| | |
| Depreciation and amortization | |
$ | - | | |
$ | 430,378 | |
| Loss on disposal of property and equipment | |
| - | | |
| 1,258 | |
| Share-based compensation | |
| - | | |
| 129,408 | |
| Accounts receivable, net | |
| (15,000 | ) | |
| - | |
| Prepaid and other assets | |
| 34,330 | | |
| (214,147 | ) |
| Accrued royalties and expenses | |
| (98,979 | ) | |
| (103,830 | ) |
| Accrued bonuses and commissions | |
| (421,239 | ) | |
| (329,231 | ) |
| Supplemental noncash investing and financing activities: | |
| | | |
| | |
| Non-monetary exchange to acquire intangible assets | |
$ | - | | |
$ | 2,084,278 | |
|