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| STOCKHOLDERS’ EQUITY | NOTE 8 - STOCKHOLDERS’ EQUITY
Preferred Stock
The Company is authorized to issue shares of Preferred Stock, Series D, par value $ per share.
The Company is authorized to issue shares of Preferred Stock, Series E, par value $ per share.
The Company is authorized to issue shares of Preferred Stock, Series F, par value $ per share.
As of March 31, 2026, and December 31, 2025, the Company had shares of preferred stock issued and outstanding.
Preferred Stock Penalties
On March 31, 2019, the Company entered into certain agreements with investors pursuant to which the Company issued convertible preferred stock and warrants. Each of the series of preferred stock and warrants required the Company to reserve shares of common stock in the amount equal to two times the common stock issuable upon conversion of the preferred stock and exercise of the warrants. The Company did not comply in part due to the Company's attempts to manage the Delaware tax which increases to a maximum of $200 thousand as the authorized capital increases without the simultaneous increase in the number of shares outstanding. In May 2020 following stockholder approval at a special meeting the Company effected a reincorporation from Delaware to Nevada and a simultaneous increase in the Company's authorized common stock from shares to shares. As of December 31, 2019, the Company estimated that approximately $6.0 million in penalties was owed (prior to any waivers of penalties) to holders of preferred stock. Subsequent to December 31, 2019, the Company received waivers from a substantial number of the preferred shareholders with respect to these penalties. The Company has agreed to issue to the holders of Series D Preferred Stock an aggregate of additional shares of Series D Preferred Stock (valued at $1.9 million) as consideration for the waivers. The Company accrued this cost during the year ended December 31, 2019. Additionally, certain holders of Series E and Series F Preferred Stock have not waived the penalties. The Company accrued $309 thousand as of December 31, 2019, related to these Series E and Series F Preferred holders. Due to the Company's ongoing liquidity problems, the Company will be required to cease operations if faced with material payment requests from investors who did not agree to waive the penalties. The total accrued penalty amount of $2.2 million was included in accrued expenses on the balance sheet during the year ended December 31, 2019. The $1.9 million accrual was reclassified to equity during the three months ended March 31, 2020, as a result of the Company's issuance of the shares of Series D Preferred Stock. As of March 31, 2026, and December 31, 2025, the remaining balance of $309 thousand is included in accrued expense on the consolidated balance sheets.
Common Stock
The Company is authorized to issue shares of common stock, par value $ per share. As of March 31, 2026, and December 31, 2025, the Company had and shares of common stock outstanding, respectively.
Shares issued in private offerings
During the second quarter of 2025, the Company entered into a series of securities purchase agreements with investors to sell and issue an aggregate of shares of common stock, par value $0.0001 of the Company at a purchase price of $1.50 per share for aggregate proceeds to the Company of approximately $1.9 million.
On March 30, 2026, the Company entered into a securities purchase agreement with investors to sell and issue an aggregate of shares of common stock, par value $0.0001 of the Company at a purchase price of $0.68 per share for aggregate proceeds to the Company of approximately $1 million.
Shares issued upon conversion of note payable
On August 12, 2025, the debt holders of the Novo Note and the Company entered into a Debt Conversion Agreement, whereas the parties agreed to the complete conversion of all outstanding debt principal, accrued interest, and any penalties into shares of the Company’s common stock at a conversion price of $2.00 per share. As of the conversion date, there was $1.2 million of outstanding principal and $298 thousand of accrued interest, which were converted into an aggregate of shares of common stock. As of March 31, 2026, shares had been issued, with the remaining shares expected to be issued at a future date (See Note 7).
Shares issued in connection with purchase of intangible assets
During 2024 and 2025, the Company issued shares of its common stock as consideration in connection with certain technology license agreements and asset acquisitions. Additional details regarding the related transactions are described in Note 5 – Goodwill and Intangible Assets.
GoLogiq, Inc.
On February 23, 2024, the Company entered into a Technology License and Commercialization Agreement with GoLogiq, Inc. granting the Company a worldwide exclusive license to develop and commercialize certain fintech technologies.
As consideration for the license, the Company issued shares of common stock, valued at $647 thousand, based on the quoted trading price on the grant date, to GOLQ per the agreement, based on the quoted trading price on the grant date and a total of 1,961,755 common shares were issued and outstanding of the Company (See Note 5).
Savitr Tech OU (“Savitr”)
On February 19, 2025, the Company entered into an Asset Purchase Agreement with Savitr Tech OU to acquire certain telecommunications, billing and AI software assets.
During 2025, the Company issued the following shares of common stock as equity consideration under the agreement:
These issuances satisfied the Company’s equity obligations under the Savitr acquisition agreement (See Note 5).
Aqua Software Technologies Inc.
On March 28, 2025, the Company entered into an Asset Purchase Agreement with Aqua Software Technologies Inc. to acquire certain telecommunications billing and AI software assets.
As non-cash consideration for the acquisition, the Company issued shares of common stock, valued at approximately $3.8 million based on the Nasdaq closing price on the acquisition date of $1.82 (See Note 5).
NexGenAI Holding Group, Inc
On June 3, 2025, the Company entered into an Asset Purchase Agreement with NexGenAI Holding Group, Inc. to acquire certain artificial intelligence and software infrastructure assets.
The purchase price totaled $2.3 million, payable through restricted shares issued in four installments based on the Company’s 10-day volume weighted average price (VWAP) prior to issuance.
The following installments were issued during 2025 and 2026:
As of March 31, 2026 and December 31, 2025 the Company recorded a $0 and $500 thousand stock consideration payable related to the final installment to be issued (See Note 5).
Everythink
On August 12, 2025, the Company entered into an Asset Purchase Agreement with Everythink Innovation Limited to acquire certain EDGE data center, telecom contracts, and AI infrastructure assets.
As part of the purchase consideration, the Company issued shares of common stock, valued at $ per share, or approximately $3.8 million (See Note 5).
Equity Incentive Plans
The Company maintains the 2021 Equity Incentive Plan (the “2021 Plan”) and the 2024 Equity Incentive Plan (the “2024 Plan”), which provide for the grant of equity-based awards to employees, directors, consultants, and other service providers. Awards that may be granted under the plans include stock options, restricted stock, stock appreciation rights (“SARs”), and restricted stock units (“RSUs”).
The plans are administered by the Board of Directors or the Compensation Committee, whom determine the terms and conditions of awards granted under the plans.
Equity-based awards are accounted for in accordance with ASC 718, Compensation—Stock Compensation, which requires compensation expense to be recognized based on the grant-date fair value of the awards over the applicable vesting period.
Additional information regarding the 2021 Plan and 2024 Plan, including authorized shares and plan terms, is disclosed in Note 9.
Shares issued for services
During the period ended March 31, 2026 and the year ended December 31, 2025, the Company issued shares of common stock under its 2021 Equity Incentive Plan and 2024 Equity Incentive Plan to directors, consultants, employees, and service providers in exchange for services rendered. The fair value of the shares was determined based on the quoted market price of the Company’s common stock on the respective grant or issuance dates.
On January 3, 2025, the Company agreed to grant shares of fully vested common stock under the 2021 Plan to non-executive members of the Board which shall vest immediately, restricted stock units from the Plan which shall vest monthly in equal increments over three years from the Effective Date of which 66,667 vested during the year ended December 31, 2025, and an additional vested during the three months ended March 31, 2026. Additionally, shares were granted to the chairman of the Board during the year ended December 31, 2025, which vested immediately. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $6.08 and in aggregate of $ million. As of March 31, 2026, the Company has issued of the fully vested shares, with shares remaining to be issued.
On March 19, 2025, the Company agreed to grant shares of fully vested common stock under the 2024 Plan to employees and agents of the Company. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $2.11 and in aggregate of $ thousand. As of March 31, 2026, the Company has issued all of the agreed upon shares.
On April 4, 2025, the Company agreed to grant shares of fully vested common stock under the 2021 Plan to the newly elected non-executive member of the Board which shall vest immediately, restricted stock units from the Plan which shall vest monthly in equal increments over three years from the Effective Date of which 12,500 vested during the year ended December 31, 2025 and an additional vested during the three months ended March 31, 2026. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $1.7 and in aggregate of $ thousand. As of March 31, 2026, the Company has issued of the fully vested shares, with shares remaining to be issued.
On April 7, 2025, the Board of Directors of the Company approved a Management Consulting Agreement (the “Agreement”) with Quantum PR OU (the “Consultant”), a strategic advisory and communications consulting firm. The Agreement became effective on April 8, 2025, and has a term of twelve (12) months, unless earlier terminated in accordance with its terms. Pursuant to the Agreement, the Consultant will provide the Company with strategic advisory services, including general promotional activities within the business and investment community, as well as guidance on financing initiatives and international business development. In consideration for the consulting services, On April 29, 2025, the Company issued shares of its common stock to the Consultant in consideration for the consulting services for twelve months. The fair market value of the shares on the date of issuance was $1.63 per share, for an aggregate value of $ thousand.
On April 22, 2025, the Company issued shares of its common stock to a consultant of the Company that was previously accounted for under shares to be issued in a previous year.
On May 23, 2025, the Company issued shares of its common stock to a consultant of the Company as a finder’s fee for facilitating the Savitr relationship on behalf of the Company. The fair market value of the shares on the date of issuance was $1.76 per share, for an aggregate value of $67 thousand. The issuance was made as compensation for services rendered.
On November 10, 2025, the Company agreed to grant shares of fully vested common stock under the 2024 Plan to consultants of the Company, which were all issued on November 11, 2025. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $1.37 and in aggregate of $ thousand.
On September 16, 2025, the Company issued shares of its common stock to a former consultant of the Company as part of a settlement agreement. The fair market value of the shares on the date of issuance was $1.85 per share, for an aggregate value of $93 thousand. The issuance was recognized as stock-based compensation during the year ended December 31, 2025.
Shares issued to employees for compensation
On August 11, 2025, the Company agreed to grant restricted stock units from the 2024 Plan to the CEO of the Company which shall vest quarterly in equal increments over one year from the Effective Date of employment, of May 7, 2025, which vested during the year ended December 31, 2025. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $1.74 and in aggregate of $ thousand. As of March 31, 2026, the Company has t issued any of the shares.
On December 30, 2025, the Company agreed to grant shares of fully vested common stock under the 2024 Plan to a former executive of the Company as a part of the separation agreement. The value of the fully vested shares granted was determined by the value of the stock on the quoted trading price of $0.95 and in aggregate of $ thousand. As of March 31, 2026, the Company has issued all of the shares.
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