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Adapti, Inc. (ADTI) plans to restate 2025 quarters after reverse recap

Filing Impact
(Very High)
Filing Sentiment
(Negative)
Form Type
8-K

Rhea-AI Filing Summary

Adapti, Inc. reported that investors should no longer rely on its previously issued unaudited condensed consolidated financial statements for the quarters ended September 30, 2025 and December 31, 2025, because of material errors in how it accounted for its July 14, 2025 acquisition of Ballengee Group, LLC.

The board, acting as the audit committee, determined on July 14, 2026 that Ballengee Group, while the legal acquiree, should be treated as the accounting acquiror and that the deal should be accounted for as a reverse recapitalization. The transaction involved 6,500,000 Adapti shares, representing about 81.0% of outstanding shares at closing, all issued to James Ballengee, giving him the ability to influence board composition and key shareholder decisions. Adapti states it intends to restate the affected financial statements and has discussed the matter with its independent auditor.

Positive

  • None.

Negative

  • Non-reliance and restatement of quarterly results: Adapti’s unaudited condensed consolidated financial statements for the quarters ended September 30, 2025 and December 31, 2025 contained material accounting errors and should no longer be relied upon, and the company intends to restate these periods.
Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit Report Governance
Previously issued financial statements should no longer be relied upon due to errors or restatements.
Stock Consideration 6,500,000 shares of common stock Shares issued to acquire Ballengee Group, LLC on the July 14, 2025 closing date
Ownership percentage acquired 81.0% Portion of Adapti’s issued and outstanding common stock represented by the Stock Consideration at closing
Affected reporting periods 2 quarters ended September 30, 2025 and December 31, 2025 Previously issued quarterly financial statements that should no longer be relied upon
Fiscal year under preparation Year ended March 31, 2026 Preparation of these financial statements led to identifying the accounting errors
Non-reliance determination date July 14, 2026 Date the board, acting as audit committee, concluded the prior quarters contained material errors
reverse recapitalization financial
"the Transaction should be accounted for as a reverse recapitalization of Ballengee Group"
A reverse recapitalization is a way for a privately held company to become publicly traded by taking control of an existing public company and swapping ownership rather than going through a traditional public offering. For investors it matters because it can quickly change who controls a company and reshape its share structure and value — like a homeowner swapping houses and keys rather than building a new one — so it can create sudden shifts in stock supply, dilution and market expectations.
accounting acquiror financial
"Ballengee Group ... should have been identified as the accounting acquiror in the Transaction"
unaudited condensed consolidated financial statements financial
"previously issued unaudited condensed consolidated financial statements for the quarters ended"
Unaudited condensed consolidated financial statements are a brief, combined snapshot of a company’s finances that merges results from the parent company and its subsidiaries but has not been reviewed by an independent auditor. Investors use them as a quick progress report—like a summarized checklist or snapshot photo—knowing they are less detailed and less independently verified than full audited reports, so they carry more uncertainty and warrant cautious interpretation.
forward-looking statements regulatory
"Certain statements included in this are forward-looking statements within the meaning"
Forward-looking statements are predictions or plans that companies share about what they expect to happen in the future, like estimating sales or profits. They matter because they help investors understand a company's outlook, but since they are based on guesses and assumptions, they can sometimes be wrong.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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FAQ

What did Adapti, Inc. (ADTI) disclose about its recent financial statements?
Adapti disclosed that investors should not rely on its September 30, 2025 and December 31, 2025 quarterly financial statements. Material errors were found in the accounting for its July 14, 2025 Ballengee Group acquisition while preparing results for the year ended March 31, 2026.

Which reporting periods for ADTI are affected by the non-reliance determination?
The affected periods are the quarters ended September 30, 2025 and December 31, 2025. These unaudited condensed consolidated financial statements, filed on November 19, 2025 and February 17, 2026, contained material errors and will be restated.

Why is Adapti, Inc. (ADTI) changing the accounting for the Ballengee Group deal?
Adapti determined that Ballengee Group should be treated as the accounting acquiror and the deal as a reverse recapitalization. Earlier, Adapti had recorded itself as both legal and accounting acquirer, which led to material errors in the affected quarterly financial statements.

How did the Ballengee Group acquisition affect control of Adapti (ADTI)?
At closing, Adapti issued 6,500,000 shares of common stock as consideration, representing about 81.0% of its outstanding shares. All went to James Ballengee, giving him the ability to elect or remove directors and significantly influence shareholder-approved corporate actions.

Has Adapti (ADTI) involved its independent auditor in addressing the errors?
Yes. Adapti’s board, acting as audit committee, reached its July 14, 2026 conclusion after discussions with its independent registered public accounting firm, Victor Mokuolu, CPA PLLC, and company consultants regarding the proper accounting for the Ballengee Group transaction.

What does Adapti, Inc. (ADTI) say about future restated financials?
Adapti states it intends to restate the affected quarterly financial statements, but notes in forward-looking statements that the restatement process or later events could require additional adjustments beyond the current accounting reclassification of the Ballengee Group transaction.
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 17, 2026 (July 14, 2026)

 

ADAPTI, INC.

(Exact name of Registrant as Specified in Its Charter)

 

Nevada   000-53336   01-0884561

(State or Other Jurisdiction

of Incorporation)

  

(Commission

File Number)

  

(IRS Employer

Identification No.)

 

2278 Monitor St.,    
Dallas, Texas   75207
(Address of Principal Executive Offices)   (Zip Code)

 

Registrant’s telephone number, including area code: (775) 375-1500

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol(s)   Name of each exchange on which registered
N/A   N/A   N/A

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 

 

Item 4.02 Non-Reliance on Previously Issued Financial Statements or a Related Audit report or Completed Interim Review.

 

Background

 

On July 18, 2025, Adapti, Inc. (the “Company”) filed a Current Report on Form 8-K disclosing that on July 14, 2025 (the “Closing Date”) it had acquired all of the outstanding equity interests of Ballengee Group, LLC (“Ballengee Group”) from its members (the “Transaction”) in exchange for, among other consideration, the issuance of 6,500,000 shares of the Company’s common stock, par value $0.001 per share (the “Stock Consideration”). Upon completion of the Transaction, the Stock Consideration represented approximately 81.0% of the Company’s issued and outstanding shares of common stock. On the Closing Date, James Ballengee, the Ballengee Group’s principal and sole equity holder, received all of the Stock Consideration. Accordingly, on the Closing Date, Mr. Ballengee acquired the ability to elect or remove members of the Company’s board of directors, and thereby control its management; and significantly control the outcome of corporate actions requiring shareholder approval, including mergers and other changes of corporate control, going private transactions, and other extraordinary transactions. The Company is not aware of any arrangements, including any pledge by any person of securities of the Company, the operation of which may at a subsequent date result in a further change in control of the Company.

 

Non-Reliance

 

On July 14, 2026, in preparation of the Company’s financial statements for the fiscal year ended March 31, 2026, the Company’s board of directors (“Board”), acting in its capacity as the audit committee of the Board, concluded that the Company’s previously issued unaudited condensed consolidated financial statements for the quarters ended September 30, 2025 and December 31, 2025, filed with the SEC on November 19, 2025 and February 17, 2026, respectively, should no longer be relied upon as a result of material errors relating to the accounting treatment of the Transaction.

 

The Transaction was originally accounted for on the basis that the Company was both the legal and accounting acquiror. Following further analysis, and based on discussions with the Company’s independent registered public accounting firm and Company consultants, the Board determined that Ballengee Group, although the legal acquiree, should have been identified as the accounting acquiror in the Transaction.

 

Also, immediately prior to the completion of the Transaction, the Company had minor operations but held an intangible asset that would be used in the consolidated entity’s operations on a go-forward basis. Based on these facts, the Company determined that the Transaction should be accounted for as a reverse recapitalization of Ballengee Group. 

 

The Board has discussed the matters disclosed herein with Victor Mokuolu, CPA PLLC, its independent registered public accounting firm.

 

Forward-Looking Statements

 

Certain statements included in this Form 8-K are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding the Company’s intent to restate the Affected Financial Statements. These statements are subject to risks and uncertainties, including the risk that the process of preparing the restated Affected Financial Statements or other subsequent events would require the Company to make additional adjustments to its financial statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Except as required by law, the Company assumes no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: July 17, 2026 Adapti, Inc.
     
  By:  /s/ Adam Nicosia
    Adam Nicosia
    Chief Executive Officer

 

 

Source: View Original Filing on SEC EDGAR

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