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COMMITMENTS AND CONTINGENCIES
3 Months Ended
Mar. 31, 2026
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 8– COMMITMENTS AND CONTINGENCIES

 

Legal Matters

 

In the normal course of business, the Company may be subject to various legal proceedings and claims. Other than the litigation payable described in Note 5, management is not aware of any pending or threatened litigation that would have a material adverse effect on the Company's financial position or results of operations.

 

Contractual Commitments

 

Pursuant to the Master Sales Agreement, RH2 Equity Partners, LP is entitled to receive 1,000,000 shares of post-reverse-split common stock, vesting quarterly over 36 months, in consideration of extended advisory services to be provided to the combined entity. See Notes 7 and 9.

 

During the three months ended March 31, 2026, the Company entered into certain consulting services and independent director advisory agreements. As full and complete consideration for the consulting and advisory services to be rendered, the Company shall issue shares of the Company’s common stock having an aggregate fair market value of $240,000 each for an aggregate of $1,680,000. The number of shares to be issued shall be determined by dividing $1,680,000 by the closing price of the Company’s common stock on the first trading day following the completion of any restructuring event ( “Initial Valuation Date”) as defined in the agreements, or, if no restructuring event occurs, the closing price of the Company’s common stock on the effective dates of the agreements. On the one-year anniversary of the date on which the Initial Valuation Price is determined (the “Valuation Date”), the Company shall determine the lowest closing price of the Company’s common stock during the ten (10) trading days immediately preceding the Valuation Date (the “Anniversary Price”).

 

If the Anniversary price is less than the Initial Valuation Price, the Company shall issue to consultant or director, such additional number of shares as are necessary so that the aggregate fair market value of all shares issued calculated using the Anniversary Price, equals the contractual compensation amount. This adjustment shall operate as a hard minimum value backstop and shall apply automatically without the need for further action by the consultant or director.

 

In the event the trading price of the Company’s common stock increases following the effective date, no reduction, clawback, or forfeiture shall apply.

 

All shares issued pursuant to the agreements shall include piggyback registration rights in the Company’s next registration statement on Form S-1 or Form 1-A, subject to customary underwriter limitations, if any.

 

Risks and Uncertainties

 

The Company's operations are subject to significant risks and uncertainties, including financial, operational, regulatory, and technological risks. Through its Kepler subsidiary, the Company is in an early stage of development with limited operating history and may require substantial additional capital to fund its operations and the commercialization of its fusion energy technology.