Groove Botanicals (GRVE) reports Q3 loss and flags going concern risk

Rhea-AI Filing Summary

Groove Botanicals, Inc. reported another small operating loss with no revenue while pursuing an early-stage EV battery technology strategy. For the nine months ended December 31, 2025, the company recorded a net loss of $104,420, slightly higher than $99,404 a year earlier, and a loss attributable to common stockholders of $268,272.

Total operating expenses were $104,420, driven mainly by general and administrative, legal, rent and consulting costs. The company continues to pay substantial preferred dividends of about $163,852 for the nine-month period, which deepen losses available to common holders.

Liquidity is very constrained. As of December 31, 2025, cash was only $1,494 and total assets were $6,260, against current liabilities of $1,384,394, including related party payables of $719,961 and significant dividends payable on preferred stock. Stockholders’ deficit was $1,378,134. The company discloses substantial doubt about its ability to continue as a going concern and is relying on related-party financing while seeking $500,000 to $5,000,000 of new capital.

Positive

• None.

Negative

• Going concern risk: The company reports recurring losses, minimal cash of $1,494, a stockholders’ deficit of $1,378,134, and explicitly states substantial doubt about its ability to continue as a going concern.
• Heavy leverage to related parties and preferred dividends: Related party payables of $719,961 and large accrued preferred dividends (over $600,000 combined) create structural pressure ahead of common shareholders.
• No revenue and pre-commercial stage: The company has generated no revenue since inception, remains in an early development phase for EV battery technology assets, and still must raise $500,000 to $5,000,000 to fund its business plan.

Insights

Small-cap credit and micro-cap equity analyst

Groove Botanicals shows severe balance-sheet stress, no revenue, and heavy related-party dependence.

Groove Botanicals remains a pre-revenue company, focused on acquiring early-stage EV battery technologies. For the nine months ended December 31, 2025, it posted a net loss of $104,420 on operating expenses of the same amount, broadly flat year over year.

The capital structure is highly stressed. At December 31, 2025, cash was just $1,494, versus current liabilities of $1,384,394, including related party payables of $719,961 and substantial accrued preferred dividends. Stockholders’ deficit reached $1,378,134, and the accumulated deficit climbed to $35,464,854.

Operations are being sustained largely by unsecured advances from a related party—$79,319 of funds received and $4,192 repaid in the nine months ended December 31, 2025. Management and auditors highlight “substantial doubt” about going concern, while the company targets $500,000–$5,000,000 of new funding and continues to carry material internal-control weaknesses.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: December 31, 2025
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________

Commission File Number: 000-23476

GROOVE BOTANICALS, INC.

(Exact name of registrant as specified in its charter)

Nevada		84-1168832
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
310 Fourth Avenue South, Suite 7000 Minneapolis, MN		55415
(Address of principal executive offices)		(Zip Code)

(612)-315-5068

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
None		N/A		N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒     No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒     No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated Filer	☒	Smaller reporting company	☒
		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 7(a)(2)(B) of the Securities Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐     No ☒

As of February 17, 2026, there were 59,643,062 shares of the registrant’s common stock outstanding.

GROOVE BOTANICALS, INC.

TABLE OF CONTENTS

			Page
	PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)			3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			12
Item 3.	Quantitative and Qualitative Disclosures About Market Risk			17
Item 4.	Controls and Procedures			17
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings			18
Item 1A.	Risk Factors			18
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds			18
Item 3.	Defaults Upon Senior Securities			18
Item 4.	Mine Safety Disclosures			18
Item 5.	Other Information			18
Item 6.	Exhibits			18
	SIGNATURES			19

2

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PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Groove Botanicals, Inc.

Condensed Consolidated Balance Sheets

Unaudited

		December 31, 2025				March 31, 2025
ASSETS
Current Assets:
Cash		$	1,494			$	2,042
Prepaid Expenses			4,766				2,478
Total Current Assets			6,260				4,520
TOTAL ASSETS		$	6,260			$	4,520
LIABILITIES & STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts Payable and Accrued Liabilities		$	63,641			$	68,608
Related Party Payable			719,961				608,833
Dividends payable			399,506				290,550
Dividends payable, related party			201,286				146,390
Total Current Liabilities			1,384,394				1,114,381
Total Liabilities			1,384,394				1,114,381
Stockholders’ Equity
Preferred Stock, Series A, $0.10 par value, 100 shares authorized; 100 shares issued and outstanding as of December 31, 2025, and March 31, 2025			10				10
Preferred Stock, Series B, $0.10 par value, 2,000 shares authorized; 1,983 shares issued and outstanding as of December 31, 2025, and March 31, 2025			198				198
Common Stock, $0.001 par value, 200,000,000 shares authorized. and 59,643,062 shares issued and outstanding as of December 31, 2025, and March 31, 2025			59,643				59,643
Additional paid-in capital			34,026,869				34,026,869
Accumulated deficit			(35,464,854	)			(35,196,581	)
Total stockholder’s equity			(1,378,134	)			(1,109,861	)
TOTAL LIABILITIES AND STOCKHOLDER’S DEFICIT		$	6,260			$	4,520

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 

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 Groove Botanicals, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

		Three Months ended December 31,								Nine Months ended, December 31,
		2025				2024				2025				2024
Expenses:
Selling, General and Administrative Expenses		$	16,041			$	17,255			$	51,523			$	52,187
Rent			3,600				3,600				10,800				11,835
Legal and Professional Expenses			8,476				12,176				34,847				34,132
Consulting Expense			5,750				-				7,250				1,250
Total Operating Expenses			33,867				33,031				104,420				99,404
Operating Loss			(33,867	)			(33,031	)			(104,420	)			(99,404	)
Net (Loss)		$	(33,867	)		$	(33,031	)		$	(104,420	)			(99,404	) )
Dividend on Preferred Stock			54,618				54,618				163,852				163,854
Loss attributed to common stockholders		$	(88,485	)		$	(87,649	) )		$	(268,272	)		$	(263,258	)
Basic and Diluted Earnings (Loss) per Common Share		$	(0.00	)		$	(0.00	)		$	(0.00	)		$	(0.00	)
Weighted Average Common Shares Outstanding – Basic and diluted			59,643,062				59,643,062				59,643,062				59,643,062

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

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Groove Botanicals, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

For the Nine Months Ended December 31, 2025, and 2024

																										Additional
		Series A								Series B																Paid In				Accumulated
		Preferred Stock								Preferred Stock								Common Stock								Capital				Deficit				Total
		Shares				Amount				Shares				Amount				Shares				Amount				Amount				Amount				Amount
Balance, March 31, 2025			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,196,581	)		$	(1,109,861	)
Accrued dividend			-				-				-				-				-				-				-				(54,617	)			(54,617	)
Net (loss)			-				-				-				-				-				-				-				(38,170	)			(38,170	)
Balance, June 30, 2025			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,289,368	)		$	(1,202,648	)
Accrued dividend			-				-				-				-				-				-				-				(54,618	)			(54,618	)
Net (loss)			-				-				-				-				-				-				-				(32,383	)			(32,383	)
Balance, September 30, 2025			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,376,369	)		$	(1,289,649	)
Accrued Dividend			-				-				-				-				-				-				-				(54,618	)			(54,618	)
Net (Loss)			-				-				-				-				-				-				-				(33,867	)			(33,867	)
Balance, December 31, 2025			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,464,854	)			(1,378,134	)

																										Additional
		Series A								Series B																Paid In				Accumulated
		Preferred Stock								Preferred Stock								Common Stock								Capital				Deficit				Total
		Shares				Amount				Shares				Amount				Shares				Amount				Amount				Amount				Amount
Balance, March 31, 2024			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(34,847,277	)		$	(760,557	)
Accrued dividend			-				-				-				-				-				-				-				(54,617	)			(54,617	)
Net (loss)			-				-				-				-				-				-				-				(36,539	)			(36,539	)
Balance, June 30, 2024			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(34,938,433	)		$	(851,713	)
Accrued dividend			-				-				-				-				-				-				-				(54,618	)			(54,618	)
Net (loss)			-				-				-				-				-				-				-				(29,833	)			(29,833	)
Balance, September 30, 2024			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,022,884	)		$	(936,164	)
Accrued Dividend																															(54,618	)			(54,618	)
Net (Loss)																															(33,031	)			(33,031	)
Balance, December 31, 2024			100			$	10				1,983			$	198				59,643,062			$	59,643			$	34,026,869			$	(35,110,533	)		$	(1,023,813	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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Groove Botanicals, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

		For the Nine Months Ended December 31,
		2025				2024
Cash Flow From Operating Activities
Net Loss		$	(104,420	)		$	(99,404	)
Adjustments to reconcile net loss to net cash used in operating activities:
Accrued Payroll			36,000				36,000
Changes in working capital
Decrease (Increase) in Prepaid Expenses			(2,288	)			(3,028	)
Increase (Decrease) in Accounts Payable and Accrued Liabilities			(4,967	)			(22,897	)
Net Cash Used in Operating Activities			(75,675	)			(89,329	)
Cash Flow From Financing Activities
Funds received from Related Party			79,319				88,892
Funds distributed to Related Party			(4,192	)			-
Net Cash From Financing Activities			75,127				88,892
Net Change in Cash			(548	)			(437	)
Cash at Beginning of Year			2,042				1,688
Cash at End of Period		$	1,494			$	1,251
Net cash paid for:
Interest		$	—			$	—
Income Taxes		$	—			$	—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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GROOVE BOTANICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024

(Unaudited)

NOTE 1 – ORGANIZATION AND OPERATIONS

Current Operations

Groove Botanicals, Inc. (the “Company”), (formerly known as Avalon Oil & Gas, Inc.), was originally incorporated in Colorado on April 25, 1991, under the name Snow Runner (USA), Inc. The Company was the general partner of Snow Runner (USA) Ltd.; a Colorado limited partnership to sell proprietary snow skates under the name “Sled Dogs” which was dissolved in August 1992. In late 1993, the Company relocated its operations to Minnesota and in January 1994 changed our name to Snow Runner, Inc. In November 1994 we changed our name to the Sled Dogs Company. On May 25, 1999, we filed articles of merger with Xdogs.com Inc., changing our state of domicile to Nevada. On June 22, 2005, the Corporation changed our name from XDOGS.com, Inc. to Avalon Oil and Gas, Inc. On May 14, 2018, the Corporation changed our name from Avalon Oil and Gas, Inc., to Groove Botanicals, Inc. Until August 2, 2021, when we filed a 15-12B to suspend duty to file reports under sections 13 and 15(d) of the securities exchange act of 1934, we were a reporting company. Subsequently, on September 14, 2023, we filed a Form 10 with the Securities and Exchange Commission, which became effective 60 days later.

Since inception we have operated unsuccessfully, in various different industries. Currently, we plan to assemble a portfolio of early-stage EV Battery Technologies developed from Universities in Norway, Sweden and Finland, and seek grants from the State of Minnesota Department of Economic Development to find and identify corporate partners to commercialize these technologies and ultimately produce revenues for the Company. The Company does not currently own any patents or technologies related to the EV battery industry, and the process to acquire patents and technologies can be costly, and as such, the Company is not guaranteed to acquire any such patents.

Management believes that the technologies available in the specialized energy industry present a stable business model with high growth potential and we are actively working towards an impactful acquisition in this space.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited financial statements included in our Annual Report on Form 10-K for the year ended March 31, 2025.

In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three and nine-month periods have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year.

Basis of Consolidation

The Company’s condensed consolidated financial statements include the accounts of Groove Botanicals, Inc., and its two 100% controlled non-operating subsidiaries formed in Wyoming, Biotrex, Inc., and Maxidyne, Inc. Intercompany accounts and transactions have been eliminated in consolidation.

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GROOVE BOTANICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024

(Unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Use of Estimates

The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the valuation of derivative liability, stock compensation and beneficial conversion feature expenses. Actual results could differ from those estimates.

Financial Instruments

The Company's financial instruments primarily consist of cash and cash equivalents, accounts payable and accrued liabilities, related party payables, dividends payable and other debt. The carrying values of the Company's financial instruments approximate fair value. FASB ASC 820, Fair Value Measurements and Disclosures ("ASC 820") establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories: Level 1—Quoted market prices for identical assets or liabilities in active markets or observable inputs; Level 2—Significant other observable inputs that can be corroborated by observable market data; and Level 3—Significant unobservable inputs that cannot be corroborated by observable market data. The Company believes that the carrying amounts of cash and cash equivalents, accounts payable, related party payables, accrued dividends and debt approximate fair value based on either their short-term nature or on terms currently available to the Company in financial markets.

Net Loss Per Share

The Company computes net income (loss) per share in accordance with ASC 260, Earning per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As the Company has continued to report operating losses for the periods covered by this report, the impact of potentially dilutive securities would be anti-dilutive and therefore is not presented.

Income Taxes

The Company is taxed as a C corporation for income tax purposes. The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company records tax positions taken or expected to be taken in a tax return based upon the amount that is more likely than not to be realized or paid, including in connection with the resolution of any related appeals or other legal processes. Accordingly, the Company recognizes liabilities for certain unrecognized tax benefits based on the amounts that are more likely than not to be settled with the relevant taxing authority. The Company recognizes interest and/or penalties related to unrecognized tax benefits as a component of income tax expense.

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GROOVE BOTANICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024

(Unaudited)

Recent Accounting Standard Adopted:

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07 – Improvements to Reportable Segment Disclosures, which enhances the disclosures required for reportable segments in annual and interim financial statements, including additional, more detailed information about a reportable segment’s expenses. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-07 for the year ended March 31, 2025, retrospectively to all periods presented in the financial statements. The adoption of this ASU had no impact on reportable segments identified and had no effect on the Company’s financial position, results of operations, or cash flows.

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2023-09 – Improvements to Income Tax Disclosures, which enhances the transparency and decision usefulness of income tax disclosures. The standard is effective for public companies for annual periods beginning after December 15, 2024. Early adoption is available. The Company adopted ASU 2023-09 for the year beginning April 1, 2025.  The adoption of this ASU had no impact on the Company’s financial position, results of operations, or cash flows.

Recent Accounting Standard Not Yet Adopted:

In November 2024, the FASB issued ASU 2024-03, – Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). This ASU requires disclosures about specific types of expenses included in the expense captions presented on the face of the statement of operations as well as disclosures about selling expenses. The standard is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company will evaluate the full extent of the adoption of ASU 2024-03 but believes it will not have a material impact on its consolidated financial statements and disclosures.

NOTE 3 – GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the consolidated financial statements, the Company has incurred recurring net losses since its inception and has raised limited capital. The Company had a net loss of $104,420 and $99,404 for the nine months ended December 31, 2025, and December 31, 2024, respectively. The Company’s accumulated deficit was $35,464,854 and $35,196,581 as of December 31, 2025, and March 31, 2025, respectively. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company is taking certain steps to provide the necessary capital to continue its operations. These steps include but are not limited to: 1) focus on our new business model and 2) raising equity or debt financing. Our auditors express substantial doubt about our ability to continue as a going concern.

NOTE 4 – CASH

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of December 31, 2025, the Company’s cash consisted of non-restricted cash.

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GROOVE BOTANICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024

(Unaudited)

NOTE 5 – RELATED PARTY TRANSACTIONS

The Company had related party payables of $719,961 and $608,833 as of December 31, 2025, and March 31, 2025, respectively. These amounts consist of funds contributed by the management for the purpose of providing financing during periods of low or negative cashflow in order to cover essential costs of continuing operations, as well as funds payable to management as compensation. On an annual basis the Company accrues $48,000 of wages payable to its CEO, Kent Rodriguez, under the terms of a four-year employment agreement entered into April 1, 2020, which designates monthly payments due Mr. Rodriguez in the amount of $4,000. On July 30, 2024, the Company and Mr. Kent Rodriguez agreed to extend the term of this Employment Contract, which expired on March 31, 2024, for a further two-year term to March 31, 2026, retroactive to April 1, 2024, on the same terms and conditions.

During each of the nine months ended December 31, 2025, and 2024, the Company accrued $30,000 in preferred dividends from the Series A preferred shares to Mr. Kent Rodriguez, the sole shareholder of the Series A Preferred shares. Upon conversion the number of shares of common stock to be exchanged for the Series A Preferred shares shall equal 51% of the then fully diluted issued and outstanding common stock at the time of conversion. Further the Company accrued dividends of $24,896 in each of the nine months ended December 31, 2025, and 2024 with respect to 18.6% of the Series B Preferred shares controlled by Kent Rodriguez.

NOTE 6 – PREFERRED STOCK

The Company is authorized to issue 1,000,000 shares of Preferred Stock. We have authorized 100 shares of Series A Preferred Stock and 2,000 shares of Series B Preferred Stock, respectively, both with a par value of $0.10. As of December 31, 2025, and December 31, 2024, there were 100 and 1,983 shares issued and outstanding for Series A Preferred Stock and Series B Preferred Stock, respectively.

Series A Preferred Stock holds designations of cash dividends at the rate of 8% of the amount per share of Series A Preferred Stock per annum in the form of “Preferred Dividends”, voting rights on an as-converted to Common Stock basis, liquidation preferences, and conversion rights in which each share of Series A Preferred Stock shall, upon conversion, represent 0.51% of the then “Fully-Diluted Shares Outstanding” of the Company. On January 12, 2018, our Board of Directors agreed to amend Designation of the Series A Convertible Preferred Stock be amended by changing the ratio for conversion, in Article IV, subparagraph (a), from 0.4% to 0.51% so that upon conversion the number of shares of common stock to be exchanged shall equal 51% of the then issued and outstanding common stock. In addition, on January 12, 2018, the Company and the Series A Holder agreed to forgive all accrued interest to date on Series A, and to pause any accruals until April 1, 2023. The Series A Convertible Preferred Stock carries liquidating preference, over all other classes of stock, equal to the amount paid for the stock plus any unpaid dividends. Currently the value of the liquidation preference is $500,000, the amount of debt that the related party converted into the preferred stock. If this Preferred Stock were to be redeemed by the holder, it would result in an aggregate of the $500,000 liquidation preference, on a per share basis, this would equal $5,000 per share. The Company and Series A Preferred Holder agreed to forgive all accrued interest and arrearages in preferred share dividends of Series A Preferred Stock through March 31, 2023. Dividends began to accrue on the Series A Preferred Stock as of April 1, 2023. During the three and nine months ended December 31, 2025, and 2024, the holder of the Series A preferred shares, Mr. Kent Rodriguez, CEO, accrued $10,000 and $30,000, respectively in preferred dividends from the Series A preferred shares. A total of $110,000 and $80,000 in accrued dividends with respect to the Series A preferred shares held by Mr. Rodriquez was outstanding at December 31, 2025, and March 31, 2025, respectively.

Series B Preferred Stock holds designations of being ranked junior to the Series A Preferred Stock, cash dividends at the rate of 9% of the amount per share of Series B Preferred Stock per annum in the form of “Preferred Dividends”, a dividend received deduction for federal income tax purposes, liquidation preferences ranked junior to the Series A Preferred Stock, redemption of the Series B Preferred Stock by the Company at 105% of the Stated Value, plus accrued and unpaid Dividends, if prior to the two year anniversary of the Issuance Date, or at 100% of the State Value, plus accrued and unpaid Dividends, if on or after the two year anniversary of the Issuance Date, no voting rights, and right

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GROOVE BOTANICALS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED DECEMBER 31, 2025 AND 2024

(Unaudited)

NOTE 6 – PREFERRED STOCK (continued)

to notice of certain corporate actions. All accrued dividends on the Series B were settled through March 31, 2023, and none remained outstanding at March 31, 2023. Dividends began to accrue on the Series B Preferred Stock as of April 1, 2023. During the nine months ended December 31, 2025, and 2024, the holders of the Series B preferred shares accrued $133,853 in preferred dividends from the Series B preferred shares. A total of $490,792 and $356,940 in Preferred B dividends was outstanding at December 31, 2025 and March 31, 2025, respectively, including dividends accrued for the benefit of Mr. Kent Rodriguez, CEO, of $8,299 and $24,896 for each respective three and nine-month period ended December 31, 2025 and 2024. Mr. Rodriguez holds 18.6% of the Series B preferred shares.

A summary of accrued dividends payable with respect to the Series A and B Preferred shares on the Company’s balance sheets are set out below. Dividends accrued for the benefit of the Company’s CEO are included in Dividends payable, related party:

Schedule of dividends payable, related party
		December 31, 2025 $				March 31, 2025 $
Dividends payable			399,506				290,550
Dividends payable, related party			201,286				146,390

NOTE 7 – COMMON STOCK

The Company is authorized to issue 200,000,000 shares of Common Stock, with a par value of $0.001.

The Company did not issue any shares of common stock during the nine months ended December 31, 2025, or December 31, 2024, and had 59,643,062 shares of common stock issued and outstanding as of December 31, 2025, and March 31, 2025, respectively.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

As of December 31, 2025, the Company has a month-to-month verbal lease agreement with the landlord, in which the Company pays $1,200 on a monthly basis.

NOTE 9 – SUBSEQUENT EVENTS

Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855 and has determined that no material subsequent events exist through the date of this filing other than as set out below.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q contains predictions, estimates and other forward-looking statements relating to future events or our future financial performance. In some cases, you   can identify forward-looking statements by terminology such as “may,” “should,” “intends,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors including the risks set forth in the section entitled “Risk Factors” in our Amendment No. 2 to our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (the “SEC”) on August 25, 2025, that may cause our actual results, performance or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements.

Forward-looking statements represent our management’s beliefs and assumptions only as of the date of this Report. You should read this Report with the understanding that our actual future results may be materially different from what we expect.

All forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made, except as required by federal securities and any other applicable law.

The management’s discussion and analysis of our financial condition and results of operations are based upon our consolidated unaudited financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

The following discussion of our financial condition and results of operations should be read in conjunction with the notes to the consolidated unaudited financial statements appearing elsewhere in this Report and the Company’s audited financial statements for the fiscal year ended March 31, 2025 included in our Amendment No. 2 to our Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (the “SEC”) on August 25, 2025, along with the accompanying notes. As used in this Quarterly Report, the terms “we,” “us,” “our” and the “Company” means Groove Botanicals, Inc.

The Company relies primarily on its current sole officer and director, Kent Rodriguez to manage its day-to-day business and has outsourced professional services to third parties in an effort to maintain lower operational costs.

Mr. Rodriguez, as the holder of the Company’s issued and outstanding shares of the Company’s Series A Preferred Stock, holds 51% of the voting rights of the Company. He will be able to influence the outcome of all corporate actions requiring the approval of our stockholders.

Plan of Operations

On September 14, 2023, we filed a registration statement on Form 10-12g which was deemed effective by the Securities and Exchange Commission (“SEC”) on November 8, 2023.

We plan to assemble a portfolio of early-stage EV Battery Technologies developed from Universities in Norway, Sweden and Finland, and seek grants from the State of Minnesota Department of Economic Development to find and identify corporate partners to commercialize these technologies and ultimately produce revenues for the Company.

We do not currently have any products. We are working to assemble a portfolio of early-stage EV Battery Technologies.

As the Company continues its business development and asset acquisitions, the Company anticipates our capital needs to be between $500,000 and $5,000,000 (varying based on growth strategies).

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Results of Operations

Three Months Ended December 31, 2025, and December 31, 2024

Revenue

We have not generated any revenue since our inception and do not expect to generate any revenue from the sale of products in the near future.

Net Loss

We reported a net loss attributable to common stockholders of $88,485 in the three months ending December 31, 2025 as compared to a loss of $87,649 in the three months ended  December 31, 2024, including accrued dividends on our Series A and B Preferred stock of $54,618 in each of the three months ended December 31, 2025 and 2024, respectively.

		Three Months ended
		December 31,
		2025				2024
Net sales		$	—			$	—
Operating expenses:
Selling, General and Administrative Expenses			16,041				17,255
Rent			3,600				3,600
Legal and Professional Expenses			8,476				12,176
Consulting Expense			5,750				-
Total operating expenses			33,867				33,031
Income (loss) from operations			(33,867	)			(33,031	)
Net income (loss)		$	(33,867	)		$	(33,031	)
Dividends on Preferred Stock			54,618				54,618
Net (loss) attributable to common stockholders		$	(88,485	)		$	(87,649	)

Operating Expenses

Total operating expenses for the three months ending December 31, 2025 of $33,867 increased slightly as compared to the total operating expenses recorded for the three months ended December 31, 2024 of $33,031. The slight increase in operating expenses for the three months ended December 31, 2025 was mainly due to an increase in consulting fees of $5,750 offset by a decrease in legal and professional expenses of $3,700 due to a decrease in audit fees and filing fees and a decrease in general expenses in the period ended December 31, 2025.

Dividends on Preferred Stock

Dividends on Preferred Stock for the three-month period ended December 31, 2025, and 2024 remained constant, at $54,618 for each period. These dividends on preferred stock are required subject to the designation of the preferred stock and contribute to the net loss attributable to our common stockholders.

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Nine Months Ended December 31, 2025, and December 31, 2024

Revenue

We have not generated any revenue since our inception and do not expect to generate any revenue from the sale of products in the near future.

Net Loss

We reported a net loss attributable to common stockholders of $268,272 in nine months ending December 31, 2025, as compared to a loss of $263,258 in the six months ended December 31, 2024, which includes accrued dividends on our Series A and B Preferred stock of $163,852 in the nine months ended December 31, 2025 and $163,854 in the nine months ended December 31, 2024.

		Nine Months ended
		December 31,
		2025				2024
Net sales		$	—			$	—
Operating expenses:
Selling, General and Administrative Expenses			51,523				52,187
Rent			10,800				11,835
Legal and Professional Expenses			34,847				34,132
Consulting Expense			7,250				1,250
Total operating expenses			104,420				99,404
Income (loss) from operations			(104,420	)			(99,404	)
Net income (loss)		$	(104,420	)		$	(99,404	)
Dividends on Preferred Stock			163,852				163,854
Net (loss) attributable to common stockholders		$	(268,272	)		$	(263,258	)

Operating Expenses

Total operating expenses for the nine months ended December 31, 2025 of $104,420 increased by approximately 5% as compared to the total operating expenses recorded for the nine months ending December 31, 2024 of $99,404. General and administrative expenses remained relatively constant at $52,187 (2024) and $51,523 (2025). Legal and professional expenses also remained relatively constant at $34,232 (2024) and $34,847 (2025)... Rent expense reflected a small decrease of $1,035 or 12% from 2024 to 2025. Consulting fees increased by $6,000 from $1,250 (2024) to $7,250 (2025) mainly due to the Company executing a social media contract under which it made payments of $5,000 during the nine months ended December 31, 2025 with no comparable expense in the nine months ended December 31, 2024.

Dividends on Preferred Stock

Dividends on Preferred Stock for the nine-month periods ended December 31, 2025 and 2024 remained constant, at $163,854 (2024) and $163,852 (2025) for each period. These dividends on preferred stock are required subject to the designation of the preferred stock and contribute to the net loss attributable to our common stockholders.

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Operating Activities

		For the Nine Months Ended December 31,
		2025				2024
Net Cash Used in Operating Activities		$	(75,675	)			(89,329	)
Net Cash From Investing Activities			—				—
Net Cash From Financing Activities			75,127				88,892
Net Change in Cash			(548	)			(437	)
Cash at End of Period		$	1,494			$	1,251

Net cash used by operating activities was $75,675 for the nine months ended December 31, 2025, compared to $89,329 for the nine months ended December 31, 2024.

Net cash used in operating activities for the nine months ending December 31, 2025, was primarily the result of a net loss of $104,420, offset by non-cash items including accrued payroll of $36,000, and changes in working capital related to an increase in prepaid expenses of $2,288 and a decrease in accounts payable and accrued liabilities of $4,967.

Net cash used in operating activities for the nine months ended December 31, 2024, was primarily the result of a net loss of $99,404, offset by non-cash items including accrued payroll of $36,000, an increase in prepaid expenses of $3,028 and a decrease in accounts payable and accrued liabilities of $22,897.

Investing Activities

There was no investing activity during each of the nine months ended December 31, 2025 and 2024.

Financing Activities

Net cash provided by financing activities was $75,127 for the nine months ended December 31, 2025 which relates to advances from a replated party of $79,319 in the form of unsecured advances and repayments to a related party of $4,192, compared to advances of $88,892 from a related party with no repayments recorded for the nine months ended December 31, 2024. Advances from the related party are all unsecured with no specific terms of repayment.

Liquidity and Capital Resources

We are in need of additional cash resources to maintain our operations. As of December 31, 2025, we had cash of $1,494 and prepaid expenses of $4,766. We are in the early stage of development and have experienced net losses to date and have not generated revenue from operations, which raises substantial doubt about our ability to continue as a going concern. There are a number of conditions that we must satisfy before we will be able to acquire, license and acquire products and intellectual property, not the least of which is negotiating and financing any acquisitions. We are in the process of identifying and establishing strategic partners and technologies in order to establish a market and generate commercial orders by customers and licensing which will include effective marketing and sales capabilities for any products. We do not currently have sufficient resources to accomplish any of these conditions necessary for us to generate revenue and expect to incur increasing operating expenses. We will require substantial additional funds for operations, the service of debt and to fund our business objectives. There can be no assurance that financing, whether debt or equity, will always be available to us in the amount required at any particular time or for any particular period or, if available, that it can be obtained on terms favorable to us. If additional funds are raised by the issuance of equity securities, such as through the issuance and exercise of warrants, then existing stockholders will experience dilution of their ownership interest. If additional funds are raised by the issuance of debt or other equity instruments, we may be subject to certain limitations in our operations, and issuance of such securities may have rights senior to those of the then existing stockholders. We currently have no agreements, arrangements or understandings with any person or entity to obtain funds through bank loans, lines of credit or any other sources.

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Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the consolidated financial statements, the Company has incurred recurring net losses since its inception and has raised limited capital. The Company had a net loss of $104,420 and $99,404 for the nine months ended December 31, 2025, and December 31, 2024, respectively. The Company’s accumulated deficit was $35,464,854 and $35,196,581 as of December 31, 2025, and March 31, 2025, respectively. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustment relating to the recoverability and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company is taking certain steps to provide the necessary capital to continue its operations. These steps include but are not limited to: 1) focus on our new business model and 2) raising equity or debt financing. Our auditors express substantial doubt about our ability to continue as a going concern.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Estimates

The financial statements are prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”). The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, costs and expenses and related disclosures. We base our estimates on historical experience, as appropriate, and on various other assumptions that we believe are reasonable under the circumstances. Changes in the accounting estimates are reasonably likely to occur from period to period. Accordingly, actual results could differ significantly from the estimates made by our management. We evaluate our estimates and assumptions on an ongoing basis. To the extent that there are material differences between these estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected. Our significant accounting policies are more fully discussed in Note 2 to our unaudited condensed financial statements contained herein.

Use of Estimates

The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, such estimates were made by the Company for the valuation of derivative liability, stock compensation and beneficial conversion feature expenses. Actual results could differ from those estimates.

Recent Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07 – Improvements to Reportable Segment Disclosures, which enhances the disclosures required for reportable segments in annual and interim financial statements, including additional, more detailed information about a reportable segment’s expenses. The standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-07 for the year ended March 31, 2025, retrospectively to all periods presented in the financial statements. The adoption of this ASU had no impact on reportable segments identified and had no effect on the Company’s financial position, results of operations, or cash flows.

In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2023-09 – Improvements to Income Tax Disclosures, which enhances the transparency and decision usefulness of income tax disclosures. The standard is effective for public companies for annual periods beginning after December 15, 2024. Early adoption is available. The Company adopted ASU 2023-09 for the year beginning April 1, 2025.  The adoption of this ASU had no impact on the Company’s financial position, results of operations, or cash flows.

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Recent Accounting Standard Not Yet Adopted:

In November 2024, the FASB issued ASU 2024-03, – Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). This ASU requires disclosures about specific types of expenses included in the expense captions presented on the face of the statement of operations as well as disclosures about selling expenses. The standard is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The Company will evaluate the full extent of the adoption of ASU 2024-03 but believes it will not have a material impact on its consolidated financial statements and disclosures.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company and are not required to provide this information.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, as of December 31, 2025, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, our principal executive officer and principal financial officer have concluded that, based on the material weaknesses discussed below, our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed by us in reports filed or submitted under the Securities Exchange Act were recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Act Commission’s rules and forms and that our disclosure controls are not effectively designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is accumulated and communicated to management, including our principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Our internal controls and procedures are not effective for the following reasons: (i) there is an inadequate segregation of duties consistent with control objectives as management is comprised of only one person, who is the Company’s principal executive officer and principal financial officer and, (ii) the Company does not have a formal audit committee with a financial expert, and thus the Company lacks the board oversight role within the financial reporting process.

In order to mitigate the foregoing material weakness, we have engaged an outside accounting consultant with significant experience in the preparation of financial statements in conformity with GAAP to assist us in the preparation of our financial statements to ensure that these financial statements are prepared in conformity with GAAP. We will continue to monitor the effectiveness of this action and make any changes that our management deems appropriate.

We would need to hire additional staff to provide greater segregation of duties. Currently, it is not feasible to hire additional staff to obtain optimal segregation of duties. Management will continue to reassess this matter to determine whether improvement in segregation of duty is feasible. In addition, we would need to expand our board to include independent members.

Going forward, we intend to evaluate our processes and procedures and, where practicable and resources permit, implement changes in order to have more effective controls over financial reporting.

Changes in Internal Control over Financial Reporting

During the period covered by this report, there were no changes in our internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. The Company’s property is not the subject of any pending legal proceedings.

ITEM 1A. RISK FACTORS

The Company is a smaller reporting company and is not required to provide this information.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

Exhibit Number		Exhibit
31		Certification of the Principal Executive Officer and Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32		Certification of the Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)
101		Inline XBRL (Extensible Business Reporting Language). The following materials from this Quarterly Report on Form 10-Q for the period ended December 31, 2025, are formatted in Inline XBRL: (i) condensed consolidated balance sheets of Groove Botanicals, Inc., (ii) condensed consolidated statements of operations of Groove Botanicals, Inc., (iii) condensed consolidated statements of operations and comprehensive income/(loss) of Groove Botanicals, Inc., (iv) condensed consolidated statements of changes in equity of Groove Botanicals, Inc., (v) condensed consolidated statements of cash flows of Groove Botanicals, Inc. and (vi) notes to condensed consolidated financial statements of Groove Botanicals, Inc. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
104		Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL.

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Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	GROOVE BOTANICALS, INC.
Date: February 20, 2026	By:	/s/ Kent Rodriguez
		Ken Rodriguez
		Chief Executive Officer and Chief Financial Officer (Principal Executive Officer and Principal Financial and Accounting Officer)

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FAQ

What were Groove Botanicals (GRVE) results for the nine months ended December 31, 2025?

Groove Botanicals reported a net loss of $104,420 for the nine months ended December 31, 2025, compared with $99,404 a year earlier. Including preferred dividends, the loss attributable to common stockholders was $268,272, reflecting ongoing operating costs without any revenue generation.

Does Groove Botanicals (GRVE) generate any revenue from its operations?

Groove Botanicals has not generated any revenue since inception and does not expect near-term product revenue. The company is still assembling a portfolio of early-stage EV battery technologies and has not yet commercialized products or secured licensing arrangements that would produce operating income.

What is the financial condition of Groove Botanicals (GRVE) as of December 31, 2025?

As of December 31, 2025, Groove Botanicals had cash of $1,494, total assets of $6,260, and current liabilities of $1,384,394. Stockholders’ deficit totaled $1,378,134, highlighting a highly leveraged balance sheet with significant obligations relative to available resources.

Why is there substantial doubt about Groove Botanicals’ ability to continue as a going concern?

The company cites recurring net losses, an accumulated deficit of $35,464,854, minimal cash, and limited capital raised as reasons. Management and auditors state these conditions raise substantial doubt about Groove Botanicals’ ability to continue operating without securing additional equity or debt financing.

How reliant is Groove Botanicals (GRVE) on related-party financing?

Groove Botanicals depends heavily on related-party support. Related party payables were $719,961 as of December 31, 2025. During the nine-month period, the company received $79,319 of unsecured advances from a related party and repaid $4,192, with no fixed repayment terms disclosed.

What is Groove Botanicals’ current business plan in the EV battery sector?

The company plans to assemble a portfolio of early-stage EV battery technologies sourced from universities in Norway, Sweden, and Finland. It aims to secure Minnesota state grants and corporate partners to commercialize these technologies, but currently owns no EV battery patents or related technologies.

How much new capital does Groove Botanicals (GRVE) say it needs?

Groove Botanicals estimates its future capital needs between $500,000 and $5,000,000, depending on growth strategies. These funds would support operating expenses, debt servicing, business development, and potential acquisitions or licenses of EV battery technologies necessary to begin generating revenue.