COMMITMENTS AND CONTINGENCIES |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Commitments and Contingencies Disclosure [Abstract] | |
| COMMITMENTS AND CONTINGENCIES | NOTE 11 – COMMITMENTS AND CONTINGENCIES
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. Except as set forth below, we are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse effect on our business, financial condition or operating results.
On October 25, 2024, Arena Special Opportunities Fund, LP and other related entities (“Arena”) filed a lawsuit in New York State Court (the “Action”). The complaint for the lawsuit alleges, among other things, a purported breach of contract based on an alleged equity conditions failure. The Company believes that the Action lacks merit. In the event this Action is not summarily dismissed, the Company intends to vigorously defend against it.
On April 20, 2026, the Company received a letter from the Staff of the Listing Qualifications Department (the “Staff”)of the Nasdaq Stock Market LLC (the “Nasdaq”) notifying the Company that because it has not yet filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the “2025 Form 10-K”) with the SEC, Nasdaq determined that the Company no longer complied with the filing requirement set forth in Nasdaq Listing Rule 5250(c)(1) (“Listing Rule 5250(c)(1)”).
The Staff informed the Company that is had 60 calendar days to submit a plan to regain compliance with Listing Rule 5250(c)(1).
On May 21, 2026, the Company received an additional delinquency notification letter from Nasdaq due to the Company’s failure to timely file its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2026 (the “First Quarter Form 10-Q”). The Staff informed the Company that is had until June 22, 2026 to submit a plan to regain compliance with Listing Rule 5250(c)(1). On June 15, 2026, the Company filed the 2025 Form 10-K with the SEC. On June 16, 2026, the Company received a letter from Nasdaq stating that it evidenced partial compliance with Listing Rule 5250(c)(1) by filing the 2025 Form 10-K but that it was still not in compliance with Listing Rule 5250(c)(1) due to its failure to file the First Quarter Form 10-Q. On June 22, 2026, the Company submitted its plan to regain compliance with Listing Rule 5250(c)(1) to Nasdaq. The Staff accepted the Company’s plan to regain compliance and granted the Company an exception until July 31, 2026, to evidence compliance with the Rule. On July 29, 2026, the Company filed the First Quarter Form 10-Q. On July 30, 2026, the Company received notification from the Staff that it had determined that the Company complies with the Listing Rule 5250(c)(1) and that the listing matter is now closed.
Employee Matter
In April 2026, the Company identified and terminated a former non-officer employee in its logistics function who had improperly diverted certain hauling work to an outside entity and engaged in related improper conduct. The conduct did not have a material effect on the Company’s financial position, results of operations, or cash flows.. The Company has reviewed the matter, including outreach to potentially affected customers, and does not believe its ultimate resolution will have a material effect on the Company’s financial position, results of operations, or cash flows. No provision for loss has been recorded, as management has not concluded that a loss is probable or reasonably estimable.
As a precautionary measure, the Company has withheld $350,000 that would otherwise be payable to a related party and reclassified that amount within liabilities pending completion of its review. The withheld amount will be released to the related party if the review is completed without a resulting liability to the Company, or applied against any amounts ultimately determined to be owed to the Company. The Company’s review is ongoing, and the Company is pursuing available remedies against the former employee.
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