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Hallmark Venture Group (HLLK) 10-Q shows Q1 loss and going concern risk

Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
10-Q

Rhea-AI Filing Summary

Hallmark Venture Group, Inc. reported a Q1 2026 net loss of $273,496 with no revenue, reflecting that its historical operations have ceased and it now functions as a holding company seeking a new operating business.

Operating expenses fell to $38,571 from $58,010 a year earlier, but other expense remained heavy due to amortization of debt discounts and a $140,937 loss from changes in derivative liability values. Cash was only $1,946 and total assets $1,946 versus liabilities of $176,636, leaving a stockholders’ deficit of $174,690. Management discloses substantial doubt about the company’s ability to continue as a going concern and notes dependence on future equity or debt financing, including frequent use of deeply discounted convertible promissory notes and related derivative liabilities.

Positive

  • None.

Negative

  • Going concern uncertainty: Management reports an accumulated deficit of $5,588,661, minimal cash, no revenue, and substantial doubt about the company’s ability to continue as a going concern.
  • Highly leveraged, dilutive financing structure: Operations are funded largely through discounted convertible promissory notes that generate large derivative losses and repeated common-share issuances, contributing to a stockholders’ deficit of $174,690 as of March 31, 2026.

Insights

Q1 2026 shows no revenue, heavy debt-driven costs, and going concern risk.

Hallmark Venture Group operated with no revenue in Q1 2026 and recorded a net loss of $273,496. The loss is driven largely by non-cash items like $80,865 of debt discount amortization and a $140,937 derivative valuation loss tied to convertible notes.

Liquidity is very thin: cash is $1,946 with total assets of $1,946 against liabilities of $176,636, producing a stockholders’ deficit of $174,690. The company relies on convertible promissory notes with discounted conversion features, which can be dilutive and create volatile derivative liabilities.

Management explicitly states that the absence of operating revenue, accumulated deficit of $5,588,661, and dependence on new financing raise “substantial doubt” about continuing as a going concern. Future filings for periods after March 31, 2026 will be important to see whether new financing or a viable acquisition transaction is secured.

Net loss $273,496 Three months ended March 31, 2026
Net loss prior-year quarter $728,927 Three months ended March 31, 2025 (includes discontinued ops)
Cash balance $1,946 As of March 31, 2026
Total liabilities $176,636 As of March 31, 2026
Stockholders’ deficit $174,690 As of March 31, 2026
Derivative liability $3,758 As of March 31, 2026 (down from $134,433 at Dec. 31, 2025)
Shares outstanding 66,177,020 shares Common stock outstanding as of May 28, 2026
Net operating loss carryforwards $5,891,728 NOL balance as of March 31, 2026
going concern financial
"These factors and uncertainties raise substantial doubt about the Company’s ability to continue as a going concern."
A going concern is a business that is expected to continue its operations and meet its obligations for the foreseeable future, rather than shutting down or selling off assets. This assumption matters to investors because it indicates stability and ongoing profitability, making the business a more reliable investment. Think of it as believing a restaurant will stay open and serve customers, rather than closing down suddenly.
derivative liability financial
"Total derivative liability on March 31, 2026 and December 31, 2025 was $3,758 and $134,433, respectively, which was principally related to convertible notes."
A derivative liability is an obligation a company owes because of a derivatives contract—such as an option, future, swap, or forward—that has moved against it and now has negative value. Think of it like a settled bet that turned into a bill: if market moves go the other way, the company may have to pay cash or deliver assets. Investors care because these liabilities can create sudden losses, add leverage or counterparty risk, and change a company’s true financial exposure beyond its everyday operations.
convertible promissory note financial
"On May 1, 2024, the Company issued a $100,000, 8% convertible promissory note to a non-affiliated third party."
A convertible promissory note is a loan a company takes now that can later be turned into shares instead of being repaid in cash. Think of it as lending money with the option to accept ownership in the business down the road; that matters to investors because it affects who gets paid first, how much ownership existing shareholders keep, and the company’s future valuation and cash needs. Terms such as conversion price, interest and maturity determine the financial impact.
reverse stock split financial
"On April 24, 2025, the Company effected a 1-for-500 reverse stock split of its issued and outstanding common stock."
A reverse stock split is when a company reduces the number of its shares outstanding, making each share more valuable. For example, if you own 100 shares worth $1 each, a 1-for-10 reverse split would turn your 100 shares into 10 shares worth $10 each. Companies often do this to boost their stock price and appear more stable to investors.
discontinued operations financial
"Accordingly, Jubilee Intel, LLC has been presented as a discontinued operation as of December 31, 2024 until March 31, 2025."
Discontinued operations are parts of a company that it has decided to sell or shut down, and no longer plans to run in the future. This matters to investors because it helps them understand which parts of the business are ongoing and which are being phased out, providing a clearer picture of the company’s current performance and future prospects. Think of it like a store closing a department—it no longer contributes to sales or profits.
Revenue $0
Net loss $273,496
Operating expenses $38,571
Other expense, net $234,925
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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 March 31, 2026

 

OR

 

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 000-56477

 

HALLMARK VENTURE GROUP, INC.

(Exact name of registrant as specified in its charter)

 

Florida   34-2001531
(State or other jurisdiction of incorporation or organization)   (I.R.S. Employer Identification No.)

 

1800 N Town Center Drive, STE 100, Las Vegas, NV 89144

(Address of principal executive offices, including zip code)

 

Registrant’s telephone number, including area code: 877-646-4833

 

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

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 par value

 

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, a 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 13(a) of the Exchange 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 May 28, 2026, there were 66,177,020 shares of the registrant’s common stock outstanding.

 

 

 

 

 

 

HALLMARK VENTURE GROUP, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2026

 

TABLE OF CONTENTS

 

PART I FINANCIAL INFORMATION  
Item 1. Financial Statements (Unaudited) 3
  Condensed Balance Sheets as of March 31, 2026 (Unaudited) and December 31, 2025 3
  Condensed Statements of Operations for the Three Months Ended March 31, 2026 and 2025 (Unaudited) 4
  Condensed Statement of Changes in Stockholders’ Deficit for the Three Months Ended March 31, 2026 (Unaudited) 5
  Condensed Statements of Cash Flows for the Three Months Ended March 31, 2026 and 2025 (Unaudited) 6
  Notes to Condensed Financial Statements (Unaudited) 7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 22
Item 3. Quantitative and Qualitative Disclosures About Market Risk 23
Item 4. Controls and Procedures 23
PART II OTHER INFORMATION  
Item 1. Legal Proceedings 24
Item 1A. Risk Factors 24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 24
Item 3. Defaults Upon Senior Securities 24
Item 4. Mine Safety Disclosures 24
Item 5. Other Information 24
Item 6. Exhibits 24
  Signatures 25

 

2

 

 

PART I — FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

HALLMARK VENTURE GROUP, INC.

CONDENSED BALANCE SHEETS

 

   March 31,
2026
   December 31,
2025
 
   (Unaudited)   (Audited) 
ASSETS          
CURRENT ASSETS:          
Cash  $1,946   $3,382 
Note receivable, net        
Total Current assets   1,946    3,382 
           
TOTAL ASSETS  $1,946   $3,382 
           
LIABILITIES AND STOCKHOLDERS’ DEFICIT          
           
CURRENT LIABILITIES:          
Accounts payable and accrued liabilities  $171,556   $191,266 
Due to a related party   826    826 
Convertible notes payable – related party, net of debt discount of $0 and $10,924, respectively       16,402 
Convertible notes payable – net of debt discount of $5,060 and $27,360, respectively   496    52,840 
Accrued interest - related party       751 
Accrued interest       2,350 
Derivative liability   3,758    134,433 
Total Current Liabilities   176,636    398,868 
TOTAL LIABILITIES   176,636    398,868 
           
COMMITMENTS AND CONTINGENCIES   -      
           
STOCKHOLDERS’ DEFICIT:          
Series A Preferred stock, 200,000 shares authorized, $0.001 par value; 100,000 and 100,000 issued and outstanding, respectively   100    100 
Common stock, 2,499,900,000 shares authorized, $0.001 par value; 66,177,020 and 63,994,148 issued and outstanding, respectively   66,178    63,994 
Stock payable   34,690    34,690 
Additional paid-in capital   5,313,003    4,820,895 
Accumulated deficit   (5,588,661)   (5,315,165)
Total Stockholders’ equity (deficit)   (174,690)   (395,486)
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)  $1,946   $3,382 

 

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

 

3

 

 

HALLMARK VENTURE GROUP INC.

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

   2026   2025 
   For the Three Months Ended
March 31,
 
   2026   2025 
Revenue  $   $ 
           
Expenses:          
General and administrative  $4,275   $39,717 
Professional fees   34,296    18,293 
Total operating expenses   38,571    58,010 
Loss from operations   (38,571)   (58,010)
           
Other income (expense):          
Interest expense   (1,338)   (97,752)
Interest waived off   3,566     
Bad debt expense       (105,326)
Amortization of debt discount   (80,865)   (25,000)
Change in fair value of derivative   (140,937)   (15,879)
Loss on issuance of convertible note   (15,351)    
Total other expense   (234,925)   (243,957)
           
Net loss before income taxes   (273,496)   (301,967)
Provision for income tax        
Net loss from continuing operations   (273,496)   (301,967)
Net loss from discontinued operations       (426,960)
Net loss  $(273,496)  $(728,927)
           
Net loss per share – basic and diluted  $(0.01)  $(0.70)
           
Weighted average shares outstanding – basic and diluted   65,610,811    1,047,852 

 

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

 

4

 

 

HALLMARK VENTURE GROUP, INC.

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025

(Unaudited)

 

 

   Shares   Amount   Shares   Amount   payable   Capital   Deficit   Deficit 
   Series A
Preferred Stock
   Common Stock   Stock   Additional
Paid-in
   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   payable   Capital   Deficit   Deficit 
Balance, December 31, 2025   100,000   $100    63,994,148   $63,994   $34,690   $4,820,895   $(5,315,165)  $(395,486)
Stock issued for conversion of debt           1,803,061    1,804        420,704        422,508 
Stock issued for conversion of debt – related party           379,811    380        71,404        71,784 
Net loss                           (273,496)   (273,496)
Balance, March 31, 2026   100,000   $100    66,177,020   $66,178   $34,690   $5,313,003   $(5,588,661)  $(174,690)

 

   Series A
Preferred Stock
   Common Stock   Stock   Additional
Paid-in
   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   payable   Capital   Deficit   Deficit 
Balance, December 31, 2024   100,000   $100    1,047,852   $1,048   $36,130   $2,501,362   $(3,096,015)  $(557,375)
Net loss                           (728,927)   (728,927)
Balance, March 31, 2025   100,000   $100    1,047,852   $1,048   $36,130   $2,501,362   $(3,824,942)  $(1,286,302)

 

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

 

5

 

 

HALLMARK VENTURE GROUP, INC.

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)

 

   2026   2025 
   For the Three Months Ended
March 31,
 
   2026   2025 
Cash Flows from Operating Activities:          
Net loss from continued operations  $(273,496)  $(301,967)
Adjustments to reconcile net loss to net cash used by operating activities:          
Amortization of debt discount   80,865    25,000 
Bad debt expense       105,326 
Change in fair value of derivative   140,937    15,879 
Loss on issuance of convertible note   15,351     
Changes in operating assets and liabilities:          
Accounts payable and accrued expenses   (20,440)   10,888 
Accrued compensation       (56,666)
Accrued interest   (2,294)   50,953 
Due to a related party       6,500 
Assets from discontinued operations       553,962 
Net cash (used) provided by operating activities from continued operations   (59,077)   409,875 
Loss from discontinued operations       (426,960)
Net cash used in operating activities   (59,077)   (17,085)
           
Cash Flows from Financing Activities:          
Proceeds from convertible note payable   57,641    50,000 
Net cash provided by financing activities   57,641    50,000 
           
Net change in cash   (1,436)   32,915 
Cash beginning of period   3,382    3,629 
Cash end of period  $1,946   $36,544 
           
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:          
Cash paid during the period for:          
Interest  $   $46,800 
Income taxes  $   $ 
           
NON-CASH TRANSACTIONS:          
Common stock issued for payment of debt  $132,341   $ 
Common stock issued for payment of debt – related party  $27,346   $ 

 

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

 

6

 

 

HALLMARK VENTURE GROUP, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2026

(Unaudited)

 

NOTE 1 — ORGANIZATION AND OPERATIONS

 

Hallmark Venture Group, Inc., was originally incorporated in the state of Colorado on July 14, 1995, with the name CPC Office Systems, Inc. On July 12, 1999, the Company changed its name to Homesmart USA, Inc. On March 8, 2006, the Company changed its name to Smart Truck Systems, Inc. On March 3, 2006, the Company moved its domicile to Nevada. On March 6, 2008, the Company changed its name to Speech Phone, Inc. On July 16, 2008, the Company changed its name to Hallmark Venture Group, Inc.

 

On May 4, 2020, Living Waters, LLC (“LWLLC”) obtained management control of the Company from its previous CEO and Director, Robert Cashman (“Cashman”), pursuant to a contingent Share Purchase Agreement (the “SPA”), dated as of May 4, 2020, by and among LWLLC and Cashman, whereby certain preferred shares (the “Preferred Shares”) that represent the voting control interest in the Company were to be issued to LWLLC (the “Transaction”).

 

On May 27, 2020, in connection with the Transaction and in accordance with provisions of the SPA, LWLLC assigned the SPA to Medical Southern, LLC (“MSLLC”). On August 13, 2020, all issued and outstanding Preferred Shares were issued to a designee of MSLLC, Top Knot, Inc. USA (“TKIU”).

 

On August 17, 2020, in connection with the Transaction and in accordance with provisions of the SPA, MSLLC assigned the SPA to Stonecrest Acquisition, LLC (“SALLC”). As a consequence of the Transaction, a change of control of the Company occurred. As a result of the Transaction TKIU obtained voting control of the Company. Subsequently, on October 19, 2020, TKIU assigned 100% of the Preferred Shares it held to Endicott Holdings Group, LLC (“Endicott”).

 

On June 20, 2022, Endicott transferred 100% of the preferred shares, and 221,293 of the shares of common stock it held, to Beartooth Asset Holdings, LLC, an entity controlled by the Company’s Secretary, Paul Strickland, resulting in a change of control of the Company.

 

On July 7, 2022, Beartooth Asset Holdings, LLC (an entity controlled by Paul Strickland, the Company’s secretary and a member of its board of directors) transferred 75,000 Series A Preferred Shares to JMJ Associates, LLC, an entity controlled by John D. Murphy, Jr., President and CEO of the Company and a Member of the Board of Directors, resulting in a change of control of the Company.

 

On July 12, 2022, Paul Strickland, the Company’s Principal Financial Officer, became a director of the Company.

 

On January 11, 2024, the Company entered into a Change of Control Agreement (the “CoC Agreement”) between John D. Murphy, Jr., the Company’s Director and Chief Executive Officer, and JMJ Associates, LLC, an entity controlled by Mr. Murphy (“Murphy”); Paul Strickland, the Company’s Director and Secretary, and Selkirk Global Holdings, LLC and Beartooth Asset Holdings, LLC, both entities controlled by Mr. Strickland (“Strickland”); and Steven Arenal and Aurum International Ltd., an entity controlled by Mr. Arenal (“Aurum”).

 

Pursuant to the CoC Agreement, Murphy and Strickland would assign the Series A preferred shares controlled by each to Aurum, and Strickland was to transfer 196,519 restricted common shares to Aurum. In exchange, Murphy and Strickland would retain a 5% equity interest in the Company on a post-restructuring basis, subject to an 18-month anti-dilution provision as set forth in the Anti-Dilution Agreement executed among the parties. In connection with the CoC Agreement, Murphy and Strickland would have cancelled certain indebtedness owed to them by the Company. Strickland was to cancel $83,342 in outstanding obligations, and Murphy was to cancel $74,501 in outstanding obligations. Murphy was to receive $70,000 from Aurum in partial consideration for the debt cancellation, which would have been delivered into escrow by February 27, 2024. The Company issued Aurum a $77,000 convertible promissory note bearing interest at 10% per annum in partial satisfaction of the Company’s indebtedness to Murphy. All consideration under the CoC Agreement was to be subject to the terms and conditions of the Escrow Agreement executed among the parties.

 

7

 

 

In connection with the foregoing, the Company relocated its principal place of business to 626 Wilshire Boulevard, Suite 410, Los Angeles, California 90017.

 

On January 11, 2024, John D. Murphy, Jr. resigned as Director and Officer of the Company and all other positions he held with the Company.

 

On January 11, 2024, Paul Strickland resigned as Director and Officer of the Company and all other positions he held with the Company.

 

On January 11, 2024, Steven Arenal was elected as Director of the Company and appointed Chief Executive Officer, President, and Secretary of the Company.

 

On February 27, 2024, Steve Arenal and Aurum International Ltd. were given notice of default and failure to perform on the agreements they had signed, and Strickland and Murphy also gave notice of cancellation of all the foregoing agreements.

 

On February 28, 2024, a special meeting of shareholders was held removing Arenal and reinstating Murphy and Strickland and reversing and canceling all of the foregoing Aurum International Ltd / Arenal agreements.

 

On February 28, 2024, the Company filed an 8-K disclosing the cancellation, termination, and failure to perform on the aforementioned Arenal / Aurum agreements.

 

On March 4, 2024, the Company and its Board of Directors approved a 1:500 reverse split of the Company’s common stock.

 

On March 4, 2024, the shareholders required to vote approved the Board’s 1:500 reverse split of the Company’s common stock.

 

On March 7, 2024, the Company filed the Amended and Restated Articles of Incorporation with Florida Secretary of State reflecting the 1:500 reverse split of the Company’s common stock.

 

On September 26, 2024, the Company and its Board of Directors approved the following; i) Agreement and Plan of Reorganization; ii) Change of Control Agreement; iii) Escrow Agreement, iv) Anti-Dilution Agreement; v) Cancellation of the October 6, 2022 Selkirk Global Holdings, LLC Note; vi) Cancellation of the April 6, 2023 Selkirk Global Holdings, LLC Note, vii) Cancellation of the December 12, 2023 Strickland Convertible Exchange Note; viii); and the Company authorized its Secretary to open a bank account in the name of the Company.

 

On September 26, 2024, the Company and Jubilee Intel, LLC (“Jubilee”) entered into an Agreement and Plan of Reorganization (the “Merger”) whereby the Company acquired 100% membership interests in Jubilee in exchange for the issuance of 100,000 shares of its Series A Preferred Stock. As a result of the Merger, Jubilee became a wholly owned and operating subsidiary of the Company.

 

On May 12, 2025, the Company executed a Membership Interest Assignment Agreement with Evan Bloomberg, its former officer and director. Under this agreement, the Company transferred 100% of its membership interest in Jubilee Intel, LLC to Mr. Bloomberg. In exchange, Mr. Bloomberg transferred all 100,000 Series A Preferred Shares of the Company that he held to Selkirk Global Holdings, LLC, an entity controlled by Paul Strickland, the Company’s sole director and officer. This transaction resulted in the demerger of Jubilee Intel, LLC, which ceased to be a wholly owned subsidiary of the Company. Accordingly, Jubilee Intel, LLC has been presented as a discontinued operation as of December 31, 2024 until March 31, 2025, the date the Company effectively lost control of it (Note 15). All other agreements with Mr. Bloomberg were also terminated at that time.

 

8

 

 

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The accompanying unaudited condensed financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results that may be expected for the full fiscal year ending December 31, 2026. These condensed financial statements should be read in conjunction with the audited consolidated financial statements and the related footnotes thereto for the year ended December 31, 2025 included in the Company’s Annual Report on Form 10-K/A.

 

Use of Estimates

 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the 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. Actual results could differ from these estimates and these differences could be material.

 

The most significant estimates made by management in the preparation of the financial statements relate to the estimates used to calculate the fair value of certain liabilities, the derivative liability, present value of note payable and the valuation of notes receivable. Management bases its estimates on historical experience and on other various assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from such estimates under different assumptions and conditions.

 

Principles of Consolidation

 

The accompanying financial statements include the accounts of the Company and its wholly owned subsidiary in which the Company has a controlling financial interest during the year ended December 31, 2025. All significant intercompany transactions and balances are eliminated in consolidation.

 

The Company evaluates its ownership interests in accordance with applicable consolidation guidance to determine whether control exists. When the Company loses control of a subsidiary, it derecognizes the assets, liabilities, and any noncontrolling interests of that subsidiary as of the date control is lost. Any resulting difference between (i) the carrying value of the net assets derecognized and (ii) the consideration received, if any, is recognized as a gain or loss in the statements of operations.

 

Refer to Note 1 for the deconsolidation of Jubilee.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with an original maturity date of three months or less at the time of purchase to be cash equivalents. The Company has cash of $1,946 and $3,382 as of March 31, 2026 and December 31, 2025, respectively.

 

Related Party Transactions

 

Under ASC 850 “Related Party Transactions” an entity or person is considered to be a “related party” if it has control, significant influence or is a key member of management personnel or affiliate. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company, in accordance with ASC 850 presents disclosures about related party transactions and outstanding balances with related parties.

 

9

 

 

Derivative Financial Instruments

 

The Company evaluates warrants issued with notes payable and embedded conversion features of convertible notes under ASC 480 and ASC 815 to determine appropriate classification. Instruments that are not indexed to the Company’s own stock or do not meet equity classification criteria under ASC 815-40 are classified as derivative liabilities.

 

Derivative liabilities are recorded at fair value upon issuance and remeasured at each reporting date, with changes in fair value recognized in the statements of operations as other income (expense). Fair value is estimated using the Black-Scholes option pricing model and classified within Level 3 of the fair value hierarchy under ASC 820.

 

Proceeds from notes payable and convertible notes with associated derivative liabilities are allocated first to the derivative liability at fair value, with the residual allocated to the host debt instrument and recorded as a debt discount, which is amortized to interest expense over the note term using the straight line method.

 

Fair Value of Financial Instruments

 

The fair value is an exit price representing the amount that would be received to sell an asset or required to transfer a liability in an orderly transaction between market participants. As such, fair value of a financial instrument is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or a liability.

 

A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:

 

  Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
  Level 2: Observable inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
  Level 3: Unobservable inputs reflecting our own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participants assumptions that are reasonably available.

 

The Company’s financial instruments reported at their fair values consist of derivative liabilities. The Company’s derivative liabilities had a fair value of $3,758 and $134,433 as of March 31, 2026 and December 31, 2025, respectively. The decrease is primarily attributable to the payoff and conversion of the third party and related party convertible notes during the year. These instruments are in level 3 of the fair value hierarchy.

 

When determining fair value, whenever possible, the Company uses observable market data and relies on unobservable inputs only when observable market data is not available. As of March 31, 2026 and December 31, 2025, the Company did not have any level 1 or 2 financial instruments. On March 31, 2026 and December 31, 2025 the Company’s level 3 financial instruments were derivative liabilities.

 

The following table presents the Company’s assets and liabilities that are measured at fair value on a non-recurring basis.

 

At March 31, 2026

 

   Quoted Prices in Active Markets for Identical Assets (Level 1)   Significant Other Observable Inputs
(Level 2)
   Significant Unobservable Inputs
(Level 3)
 
Liabilities               
Derivative Liability          $3,758 

 

10

 

 

At December 31, 2025

 

   Quoted Prices in Active Markets for Identical Assets (Level 1)   Significant Other Observable Inputs
(Level 2)
   Significant Unobservable Inputs
(Level 3)
 
Liabilities               
Derivative Liability          $134,433 

 

Basic and Diluted Income (Loss) Per Share

 

The Company computes earnings (loss) per share (“EPS”) in accordance with ASC 260, “Earnings per Share” which requires presentation of both basic and diluted EPS on the face of the statement of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all diluted potential common shares outstanding during the period. 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 warrants or stock or conversion of stock. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

 

For periods with a net loss the effect of any potentially dilutive shares is anti-dilutive and they have been excluded from dilutive EPS.

 

Discontinued Operations

 

The Company accounts for discontinued operations in accordance with ASC 205-20, Presentation of Financial Statements – Discontinued Operations. The disposal of a component or group of components is classified as a discontinued operation if the disposal represents a strategic shift that has, or will have, a major effect on the Company’s operations and financial results. This includes the sale, abandonment, or other disposal of legal entities, business segments, or significant components.

 

Upon meeting the criteria for discontinued operations, the results of operations, including any gain or loss on disposal, are presented separately in the consolidated statements of operations for all periods presented. Assets and liabilities of discontinued operations are presented separately in the consolidated balance sheets. The results of operations of the discontinued component are still reported separately in the consolidated statement of operations.

 

Management evaluates and updates the classification of operations as discontinued when relevant events occur, such as the approval of a sale plan, abandonment, or completion of disposal.

 

Segment Reporting

 

The Company uses the “management approach” to identify its reportable segments. This approach is based on the internal organizational structure used by management for making operational decisions and assessing the performance of the business.

 

The Company previously operated through two reportable segments. Through May 12, 2025, the Company, through its subsidiary Jubilee, operated an Advertising segment that launched and managed Yahoo partner advertisements and provided a SaaS platform for third parties to run such advertisements. This segment subsequently ceased to meet the criteria for classification as a continuing operation and was therefore reclassified as a discontinued operation. As a result of this reclassification, all prior period segment information has been recast to conform to the current period presentation.

 

11

 

 

Following this reclassification, the Company operates through a single reportable segment, the Holding Segment. The Holding Segment includes corporate functions such as finance, legal, human resources, and executive management, and represents the parent-level activities of the Company, including the identification and pursuit of new business opportunities. This segment will provide financing support to other operating units, and corporate-level expenses are recorded within this segment.

 

As the Company operates as a single reportable segment, no further disaggregated segment information is required to be disclosed under ASC 280, Segment Reporting. Financial information related to the discontinued Advertising segment operations is presented separately in Note 15 — Discontinued Operations.

 

Reverse Stock Split

 

On April 24, 2025, the Company effected a 1-for-500 reverse stock split of its issued and outstanding common stock (the “Reverse Stock Split”). As a result of the Reverse Stock Split, each 500 shares of issued and outstanding common stock were converted into one. The par value of the common stock remained unchanged at $0.001 per share.

 

In accordance with Staff Accounting Bulletin (“SAB”) Topic 4C and ASC 260-10-55-12, the reverse stock split has been retrospectively reflected in these financial statements for all periods presented, including the balance sheets and statements of stockholders’ equity. All share and per-share amounts — including earnings per share and weighted-average shares outstanding — have been restated to give effect to the reverse stock split.

 

No fractional shares were issued in connection with the Reverse Stock Split. Any fractional shares resulting from the split were rounded up to the next whole share, consistent with the Company’s corporate charter. This accounting policy ensures the comparability of share-related information across all periods presented.

 

The reverse stock split did not affect the total dollar amount of common stock or total stockholders’ equity.

 

Allowance for Credit Losses

 

The Company applies the CECL model under ASC 326 to estimate expected credit losses on financial assets, including trade receivables, notes receivable, and held-to-maturity debt securities. CECL requires consideration of historical loss experience, current conditions, and reasonable forecasts over the asset’s contractual life.

 

As of the reporting date, the Company recorded a material allowance for credit losses related to an outstanding note receivable, establishing a full reserve for the entire balance of the note and the related interest receivable.

 

The allowance is reassessed at each reporting period, and changes are recognized in the income statement as credit loss expense. The Company has considered the recent guidance and does not have receivables that would require this level of analysis in determining the net realizable balance of accounts receivable.

 

Income taxes

 

The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

FASB Accounting Standards Codification Topic 740, Income Taxes (“ASC 740”), clarifies the accounting for uncertainty in income taxes recognized in the financial statements. ASC 740 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. Income tax positions must meet a more-likely-than-not recognition threshold to be recognized. ASC 740 also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have determined that the Company does not have uncertain tax positions on its tax returns for the years 2025, and prior. Based on the evaluation of the 2025 transactions and events through March 31, 2026, the Company does not believe it has any material uncertain tax positions that require measurement.

 

12

 

 

The IRS requires all domestic corporations in existence for any part of the tax year to file an income tax return whether or not they have taxable income. The Company incurred a loss for the fiscal years ended December 31, 2025, and 2024 and has not filed tax returns for either year. The Company has not received any notifications from the IRS. Reported tax benefits and valuation allowances are the Company’s best estimate of its tax positions and have not been reviewed by the taxing authority.

 

Our policy is to recognize interest and/or penalties related to income tax matters in income tax expense. We had no accrual for interest or penalties on our balance sheets at March 31, 2026 and December 31, 2025, and have not recognized interest and/or penalties in the statement of operations for the periods ended March 31, 2026 and December 31, 2025.

 

The Company is subject to taxation in the United States and the State of Nevada.

 

The Company has not filed federal or applicable state income tax returns for the fiscal years ended December 31, 2025 and 2024. Accordingly, those tax years remain open to examination by the respective tax authorities once filed.

 

Commitments And Contingencies

 

The Company accounts for contingencies in accordance with ASC 450-20. Liabilities for loss contingencies, including claims, assessments, litigation, fines, penalties, and other matters, are recognized when it is probable that a liability has been incurred and the amount can be reasonably estimated.

 

If a loss contingency is reasonably possible but not probable, or if the amount cannot be reasonably estimated, the Company discloses the nature of the contingency and an estimate of the possible loss or range of loss, if determinable.

 

Concentration And Credit Risk

 

Financial instruments which potentially subject the Company to credit risk consist of cash. Cash is maintained with a major financial institution in the USA that is creditworthy. The Company maintains cash in bank accounts insured up to $250,000 by the Federal Deposit Insurance Corporation (“FDIC”). On March 31, 2026 and December 31, 2025, no cash balances were in excess of federally insured limits.

 

Recently Issued Accounting Pronouncements

 

ASU 2023-09, Income Taxes (Topic 740) — Improvements to Income Tax Disclosures. This ASU requires enhanced disclosures in the rate reconciliation and disaggregation of income taxes paid by federal, state, and foreign jurisdiction. The standard was effective for public business entities for annual periods beginning after December 15, 2024. The Company adopted ASU 2023-09 effective January 1, 2025. As the Company recognized no income tax expense and made no income tax payments during the quarter ended March 31, 2026, and maintains a full valuation allowance against its deferred tax assets, the adoption did not have a material impact on the Company’s financial statements or disclosures.

 

ASU 2024-03, Income Statement — Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires disaggregated disclosure of certain income statement expense line items within the notes to financial statements. For smaller reporting companies, the standard is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company does not expect this standard to have a material impact on its financial statements given the limited nature of its expense categories.

 

The Company periodically evaluates newly issued accounting standards and has not identified any other recently issued pronouncements expected to have a material effect on its financial statements.

 

13

 

 

NOTE 3 — GOING CONCERN

 

The accompanying condensed 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 of March 31, 2026, the Company had an accumulated deficit of $5,588,661. Net loss and net cash flows used in operating activities for the three months ended March 31, 2026, was $273,496 and $59,077, respectively. As of March 31, 2026, the Company had cash of $1,946. In May 2025, the Company discontinued its only operating segment, Jubilee Intel LLC, which generated revenues. The Company requires additional funds to support its operations and to achieve its business development goals, the attainment of which are not assured.

 

These factors and uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might incur in the event the Company cannot continue in existence. Management intends to seek additional capital from new equity securities offerings, debt financing and debt restructuring to provide funds needed to increase liquidity, fund internal growth and fully implement its business plan. However, management can give no assurance that these funds will be available in adequate amounts, or if available, on terms that would be satisfactory to the Company.

 

The timing and amount of the Company’s capital requirements will depend on a number of factors, including maintaining its status as a public company and supporting shareholder and investor relations.

 

NOTE 4 — NOTE RECEIVABLE

 

On May 2, 2024, the Company entered into a $100,000 promissory note agreement with an independent, non-affiliated third party. The note had a term of 180 days and bore interest at 8% per annum.

 

As of December 31, 2024, the note was in default, and the Company recorded a full allowance for credit losses on the outstanding principal balance and related accrued interest. The Company continued to maintain the full allowance as of December 31, 2025. As of March 31, 2026, the note remains in default, and the Company continued to maintain a full allowance on the outstanding balance and related accrued interest, including additional accrued interest recorded during the three months ended March 31, 2026.

 

Description  March 31, 2026   December 31, 2025 
Notes receivable - current portion  $115,752   $113,752 
Allowance for doubtful accounts   (115,752)   (113,752)
Notes receivable, net  $   $ 

 

NOTE 5 — ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

 

An unrelated third party paid $26,381 on behalf of the Company to settle certain accounts payable balances outstanding as of December 31, 2024. In exchange, the Company issued an unsecured, non-interest-bearing convertible note on July 21, 2025, with a stated maturity date of July 22, 2026. The note was subsequently converted into 239,827 shares of common stock on July 22, 2025.

 

During the year ended December 31, 2025, certain vendors issued a demand for payments of outstanding balances through legal counsel and third-party collection agencies. The Company evaluated these matters and recorded the related liabilities in its consolidated financial statements, as management believes such amounts are probable and reasonably estimated.

 

The following table presents the Company’s accounts payable and accrued liabilities balance as of March 31, 2026 and December 31, 2025.

 

Description  March 31, 2026   December 31, 2025 
Credit cards  $9,333   $9,098 
Accrued liabilities   141,351    141,351 
Deposits payable   20,872    20,872 
Accrued expenses   -    19,945 
Accounts payable and accrued liabilities  $171,556   $191,266 

 

14

 

 

NOTE 6 — CONVERTIBLE NOTE PAYABLE — RELATED PARTY

 

On December 5, 2023, the Company issued a Convertible Exchange Note to John Murphy, for $144,501. The Note was unsecured, non-interest bearing, and matures on December 4, 2024. The note was convertible into shares of common stock at a 50% average closing trading price for the twenty-five days prior to conversion. On March 8, 2024, $70,000 of the outstanding balance was repaid using funds provided by an investor pursuant to an escrow arrangement entered into by the Company. On July 21, 2025, Mr. Murphy converted this note into 1,275,702 shares of common stock. As of March 31, 2026, and December 31, 2025, the balance of the note is $0 and $0, respectively.

 

On October 6, 2022, the Company issued a 10% Convertible Promissory Note to Selkirk Global Holdings, LLC with a face value of $50,000. The Note bore interest at 10% per annum and matured on October 5, 2023. The note was convertible into shares of common stock at a conversion price equal to 55% of the average closing price of the Company’s common stock during the twenty consecutive trading days prior to the conversion date. On August 12, 2025, Selkirk Global Holdings, LLC converted the note into 941,363 shares of common stock. As of March 31, 2026 and December 31, 2025, the balance of the note was $0 and $0, respectively.

 

On April 6, 2023, the Company issued a 10% Convertible Promissory Note to Selkirk Global Holdings, LLC with a face value of $50,000. The Note bore interest at 10% per annum, compounded monthly, and matured on April 5, 2024. The note was convertible into shares of common stock at a conversion price equal to 55% of the average closing price of the Company’s common stock during the twenty consecutive trading days prior to conversion. On August 12, 2025, Selkirk Global Holdings, LLC converted the note into 402,038 shares of common stock. As of March 31, 2026 and December 31, 2025, the balance of the note was $0 and $0, respectively.

 

On December 12, 2023, the Company issued a Convertible Exchange Note to Paul Strickland. The note was unsecured, non-interest-bearing, and matured on December 12, 2023. On August 7, 2025, the note was converted into 83,753 shares of common stock. As of March 31, 2026 and December 31, 2025, the balance of the note was $0 and $0, respectively.

 

In connection with the acquisition of Jubilee Intel, LLC in fiscal year 2024, debt obligations totaling $103,284, including accrued interest, owed to Selkirk Global Holdings, LLC (“Selkirk”) and Paul Strickland under the notes described above were cancelled as part of the merger consideration. In May 2025, following the termination of the merger agreement and the Company’s transfer of its membership interest in Jubilee Intel, LLC, the previously cancelled debt was reinstated, including the continuation of accrued interest under the original terms.

 

As a result, the Company recognized the reinstated debt of $103,284, including accrued interest, as a liability on its consolidated balance sheet. Additional interest expense of $11,542 was accrued through the date of conversion in accordance with the original note terms, which bore interest at 10% per annum. In August 2025, the outstanding balances, including accrued interest, were converted into an aggregate of 1,427,156 shares of common stock. As of March 31, 2026 and December 31, 2025, the balance of the note was $0 and $0, respectively.

 

On July 17, 2025, the Company issued a 6% Convertible Promissory Note to Selkirk Global Holdings, LLC with a face value of $50,000. The Note bears interest at 6% per annum, compounded monthly, and matures on July 16, 2026. The note is convertible into shares of common stock at a conversion price equal to a 50% discount to the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On February 9, 2026, Selkirk Global Holdings, LLC elected to convert the outstanding principal of $27,326 and accrued interest of $20 into 379,811 shares of the Company’s common stock.

 

As of March 31, 2026, the principal balance, accrued interest, and unamortized debt discount related to the note were $0, $0, and $0, respectively. As of December 31, 2025, the outstanding principal balance, accrued interest, and unamortized debt discount were $27,326, $751, and $10,924, respectively.

 

15

 

 

NOTE 7 — CONVERTIBLE NOTES PAYABLE

 

On March 1, 2024, the Company issued a $100,000, 6% demand promissory note (the “Note”) to a non-affiliated third party. The Note matured on August 28, 2024, 180 days from the date of issuance. The Note was issued in exchange for the holder making direct payments of certain Company expenses, including $70,000 used to settle amounts owed to the Company’s Chief Executive Officer and Director. On May 6, 2024, the Note, with an outstanding balance of $103,986, was assigned to another non-affiliated third party. Subsequently, the Note was replaced with a new promissory note dated May 30, 2025, in the amount of $103,986. Any accrued interest under the original and replacement notes was cancelled and was not required to be repaid. On August 5, 2025, the holder elected to convert the outstanding balance into 611,682 shares of the Company’s common stock. As of March 31, 2026 and December 31, 2025, the outstanding balance of the note was $0 and $0, respectively.

 

On May 1, 2024, the Company issued a $100,000, 8% convertible promissory note (the “Note”) to a non-affiliated third party. The Note bore interest at 8% per annum and matured on April 30, 2025. In connection with the issuance of the Note, the Company entered into a warrant subscription agreement pursuant to which the holder was issued 100,000 warrants, exercisable within one year from the date of issuance at an exercise price of $1.00 per share. The Note was convertible into shares of the Company’s common stock at a conversion price equal to 25% of the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On June 2, 2025 and June 3, 2025, the holder elected to convert all of the outstanding balance of the note, including accrued interest of $9,973; $75,766 of the note was converted into 2,559,650 shares and; $34,207 of the note including accrued interest was converted into 1,147,884 shares of the Company’s common stock, respectively. As of March 31, 2026, and December 31, 2025, the outstanding principal balance of the Note was $0 and $0, respectively, and accrued interest was $0 and $0, respectively. As of March 31, 2026, and December 31, 2025 and 2024, the unamortized debt discount was $0 and $0, respectively.

 

On March 7, 2025, the Company issued a $50,000, 8% convertible promissory note (the “Note”) to a non-affiliated third party. The Note bore interest at 8% per annum and had a maturity date of March 6, 2026. The Note was convertible into shares of the Company’s common stock at a conversion price equal to 50% of the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On June 3, 2025, the holder elected to convert a portion of the outstanding balance of the Note, including accrued interest of $986, into 856,908 shares of the Company’s common stock. The Note, including all accrued interest, was fully converted during the year ended December 31, 2025. As of March 31, 2026, and December 31, 2025, the outstanding principal balance of the Note was $0 and $0, respectively, and accrued interest was $0 and $0, respectively.

 

On July 8, 2025, the Company issued a 6% convertible promissory note (the “Note”) to a non-affiliated third party with a face value of up to $50,000. The Note bore interest at 6% per annum, compounded monthly, and matured on July 7, 2026. The Note was convertible into shares of the Company’s common stock at a conversion price equal to 50% of the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On August 25, 2025, the Company amended the Note to increase the face value from $50,000 to $100,000. On January 8, 2026, the Company received an additional $10,000 of funding under the Note for the payment of audit fees. On January 12, 2026, the debt holder elected to convert the outstanding principal balance of $90,200 into 1,555,172 shares of the Company’s common stock and waived accrued interest of $2,532, thereby retiring the Note in full. As of March 31, 2026 and December 31, 2025, the outstanding principal balance of the Note was $0 and $80,200, respectively, and accrued interest was $0 and $2,350, respectively. The unamortized debt discount balance was $0 as of March 31, 2026, compared to $27,360 as of December 31, 2025.

 

On May 15, 2025, the Company issued six 6% convertible promissory notes to a non-affiliated third party with an aggregate principal amount of $232,187. The notes bore interest at 6% per annum, compounded monthly, and matured on November 14, 2025. The notes were convertible into shares of the Company’s common stock at a conversion price equal to a 20% discount to the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On June 2, 2025, the holder elected to convert the outstanding principal and accrued interest under all six notes into 2,385,946 shares of the Company’s common stock. As a result, an aggregate of $232,186.71 of debt was retired, and no principal or interest remained outstanding. As of March 31, 2026, and December 31, 2025, the outstanding principal balance of the Note was $0 and $0, respectively, and accrued interest was $0 and $0, respectively.

 

16

 

 

The notes were convertible, at the option of the holder, into shares of the Company’s common stock at a conversion price determined pursuant to the terms of the notes. The Company evaluated the conversion features under ASC 815, Derivatives and Hedging, and determined that the features required bifurcation and classification as derivative liabilities. Accordingly, the Company recognized the derivative liabilities at fair value on the issuance dates, with a corresponding offsetting debt discount. The derivative liabilities were subsequently remeasured at fair value at each reporting date, with changes in fair value recognized in the consolidated statements of operations. Upon conversion of the notes during the year ended December 31, 2025 and the three months ended March 31, 2026, the related derivative liabilities were extinguished.

 

On May 14, 2025, the Company issued a $80,000, 6% convertible exchange note (the “Exchange Note”) to a non-affiliated third party in exchange for the cancellation of a prior on-demand promissory note dated November 19, 2024. The Exchange Note bore interest at a guaranteed rate of 6% per annum and matured on November 13, 2025. The Exchange Note was convertible into shares of the Company’s common stock at a conversion price equal to a 20% discount to the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On June 3, 2025, the holder elected to convert $76,316 of the outstanding principal into shares of the Company’s common stock. On August 5, 2025, the holder converted the remaining outstanding principal balance of $3,684 into shares of common stock, resulting in full conversion of the principal amount. Accrued interest of approximately $4,800 was waived by the holder in connection with the settlement of the Exchange Note. As of March 31, 2026, and December 31, 2025, the outstanding principal balance of the Note was $0 and $0, respectively, and accrued interest was $0 and $0, respectively.

 

On May 30, 2025, the Company issued a $100,000, 6% convertible exchange note (the “Note”) to a non-affiliated third party in exchange for the cancellation of an existing promissory note dated May 1, 2024. The Note bore interest at a guaranteed rate of 6% per annum and matured on November 30, 2025. The Note was convertible into shares of the Company’s common stock at a conversion price equal to a 20% discount to the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On August 5, 2025, the holder elected to convert the outstanding principal balance of $103,986 into 611,682 shares of the Company’s common stock, resulting in full settlement of the Note. Accrued interest of approximately $6,239 was waived by the holder in connection with the settlement of the Note. As of March 31, 2026, and December 31, 2025, the outstanding principal balance of the Note was $0 and $0, respectively, and accrued interest was $0 and $0, respectively.

 

On February 12, 2026, the Company issued a new 6% Convertible Promissory Note to a non-affiliated third party with a total face value of $100,000. The Note bears interest at 6% per annum, compounded monthly, and matures on February 11, 2027. The Note is convertible into shares of common stock at a conversion price equal to a 25% discount to the average closing price of the Company’s common stock during the ten consecutive trading days prior to the conversion date. On March 5, 2026, the debt holder entered into an Assignment of Debt Agreement assigning $39,841 of debt under the Note to an unrelated third party. Subsequently, the note holder provided additional funding of $7,800 under the Note. On March 10, 2026, the note holder elected to convert $42,141 into 247,889 shares of the Company’s common stock. The Note remains active, and additional funding tranches may occur. As of March 31, 2026, the outstanding principal balance and accrued interest related to the Note were $5,500 and $56, respectively.

 

As of March 31, 2026, the total amount due to a loan holder was $5,500 and $56 of principal and interest, respectively. The convertible note balance reported on March 31, 2026 is $496, net of debt discount of $5,060.

 

As of December 31, 2025, the total amount due to a loan holder was $80,200 and $2,350 of principal and interest, respectively. The convertible note balance reported on December 31, 2025 is $52,840, net of debt discount of $27,360.

 

17

 

 

NOTE 8 — DERIVATIVE LIABILITY

 

The Company has various convertible notes outstanding that require derivative liability considerations for its conversion features. Total derivative liability on March 31, 2026 and December 31, 2025 was $3,758 and $134,433, respectively, which was principally related to convertible notes.

 

      
Balance at December 31, 2024  $510,154 
Decrease to derivative due to repayment   (1,223,594)
Increase to derivative due to new issuances   591,882 
Derivative loss due to mark to market adjustment   255,991 
Balance at December 31, 2025   134,433 
Decrease to derivative due to conversion   (334,604)
Increase to derivative due to new issuances   62,992 
Derivative loss due to mark to market adjustment   140,937 
Balance at March 31, 2026  $3,758 

 

The following table summarizes the weighted average key inputs used in the Black-Scholes model for all outstanding conversion feature derivative liabilities as of the measurement dates:

 

    March 31, 2026     December 31, 2025  
Input   Weighted Avg.     Range     Weighted Avg.     Range  
Stock price   $ 0.22     $ 0.22     $ 0.10     $ 0.10  
Exercise price (conversion price)   $ 0.318     $ 0.212     $ 0.079     $ 0.079  
Risk-free interest rate     3.72 %     3.68 %     3.59 %     3.59 %
Expected term (years)     0.87       0.87       0.52       0.520.54  
Expected volatility     500.73 %     581.29 %     555.020 %     546.69% - 559.16 %
Dividend yield     -       -       -       -  

 

NOTE 9 — STOCK PAYABLE

 

The Company’s prior related party settlement liability included a requirement to issue shares of the Company’s common stock to cover litigation and legal expenses associated with the settlement agreement. The settlement originally provided for the issuance of 5,000,000 shares of common stock.

 

On March 28, 2024, the settlement agreement was assigned to a non-affiliated third party. On May 6, 2024, the liability was further assigned to another non-affiliated third party.

 

The settlement agreement does not contain provisions for adjustment of the number of shares in the event of a reverse stock split. Accordingly, the Company continues to account for the obligation based on the original 5,000,000 shares.

 

The value of the stock payable was determined as $50,000 on the settlement date November 3, 2020, which was deemed to be the grant date of the stock at a per unit stock price of $0.01 per share. The Company issued in partial settlement of this obligation 1,387,000 shares of common stock on November 5, 2020, at a value of $13,870; and 144,007 shares of common stock on May 20, 2025, at a value of $1,440.

 

The remaining shares to be issued at March 31, 2026 and December 31, 2025 were 3,468,993 and 3,468,993, respectively. The remaining balance of the stock payable liability was $34,690 and $34,690 as of March 31, 2026 and December 31, 2025, respectively.

 

NOTE 10 — WARRANTS

 

On May 1, 2024, the Company issued under a Warrant Subscription Agreement for 200 warrants (post-split), exercisable within one year of the execution date of the agreement at a price of $500 (post-split). These warrants were expired during the year ended December 31, 2025.

 

The assumptions used to determine the fair value of the Warrants as follows:

 

Expected life (years)   1.00 
Risk-free interest rate   5.21%
Expected volatility   353.02%
Dividend yield   0%

 

18

 

 

On October 9, 2024, the Company authorized the issuance of up to $500,000 in non-convertible promissory notes with the attached warrants. Purchasers of the notes were issued 12 warrants (post split) to purchase common stock. The warrants are exercisable at a price of $500 per share (post-split) and shall expire two years after the issuance date.

 

The assumptions used to determine the fair value of the Warrants as follows:

 

      
Expected life (years)   2.00 
Risk-free interest rate   3.95%
Expected volatility   323.21%
Dividend yield   0%

 

As of March 31, 2026, the Company had 12 warrants outstanding to purchase shares of common stock at an exercise price of $500 per share, with a weighted average remaining contractual term of approximately 0.60 years. There was no warrant activity during the three months ended March 31, 2026.

 

  

Number of

Warrants

  

Weighted

Average

Exercise Price

  

Weighted

Average

Remaining

Contract

Term

  

Intrinsic

Value

 
Outstanding, December 31, 2024   212   $500    .41   $ 
Issued      $         
Expired   (200)  $         
Exercised      $         
Outstanding, December 31, 2025   12   $500    0.85   $ 
Issued      $         
Expired      $         
Exercised      $         
Outstanding, March 31, 2026   12   $500    0.60   $ 

 

NOTE 11 — COMMON STOCK

 

On May 20, 2025, the Company issued 144,007 shares of common stock for legal fees associated with the settlement liability (Note 9).

 

On June 2, 2025, a debt holder converted $232,187 of principal and accrued interest, respectively, into 2,449,227 shares of common stock (see Note 7).

 

On May 16, 2025, the Company issued 50 million shares of common stock to Beartooth Asset Holdings, Inc. (“Beartooth”) a related party as a corporate restructuring transaction in preparation for a potential merger. The Company had not entered into any agreement or obligation for a specific merger transaction.

 

On July 21, 2025, John D. Murphy, Jr. retired $74,501 of debt by converting 1,275,702 shares of common stock pursuant to the terms of the December 5, 2023 note.

 

On August 5, 2025, an unrelated party retired $103,986 of debt by converting into 611,682 shares of common stock pursuant to the terms of the May 30, 2025 note.

 

On August 5, 2025, an unrelated party retired $3,684 of debt by converting into 21,671 shares of common stock pursuant to the terms of the May 14, 2025 note.

 

On August 5, 2025, an unrelated party retired $146,799 of debt by converting into 1,346,780 shares of common stock pursuant to the terms of the November 30, 2020, 3a10 stipulated settlement.



19

 

 

On August 7, 2025, Paul Strickland, the Company’s sole director and officer, retired $7,119 of debt by converting into 83,753 shares of common stock pursuant to the terms of the December 12, 2023, convertible exchange note.

 

On August 12, 2025, Selkirk retired $75,309 of debt by converting into 941,363 shares of common stock pursuant to the terms of the October 6, 2022 note.

 

On August 12, 2025, Selkirk retired $32,163 of debt by converting into 402,038 shares of common stock pursuant to the terms of the June 5, 2023, note.

 

Refer Note 5 and 7 for the common stock issued in conversion of debt to an unrelated party.

 

Refer Note 6 for the common stock issued in conversion of debt to related parties.

 

NOTE 12 — PREFERRED STOCK

 

The Company is authorized to issue 200,000 shares of $0.001 par value Series A preferred stock. The Company increased the number of authorized shares of the Series A preferred stock from 100,000 to 200,000 on January 19, 2021. Each share of the Series A Preferred Stock is convertible at the option of the holder into 900 shares of common stock. The holder has voting rights of 100,000 votes for each share of preferred stock held and shall be paid twice the amount of dividends issued by the Company to common shareholders on a pro rata basis with the number of preferred shares held.

 

NOTE 13 — RELATED PARTY TRANSACTIONS

 

On February 24, 2026, Beartooth Asset Holdings, LLC, an entity managed by Mr. Strickland, executed an Irrevocable Stock Power transferring 50,000,000 shares of the Company’s restricted common stock to the Hallmark Venture Group, Inc. Acquisition Account in connection with anticipated corporate restructuring. The shares had originally been issued to Beartooth on May 16, 2025.

 

Refer note 6 for the related parties transactions.

 

As of March 31, 2026 and December 31, 2025, the Company had a Due to Related Party balance of $826.

 

NOTE 14 — INCOME TAX

 

For the periods ending March 31, 2026 and December 31, 2025, there was no provision for income taxes and deferred tax assets have been entirely offset by valuation allowances.

 

As of March 31, 2026 and December 31, 2025, the Company had net operating loss carry forwards of approximately $5,892,000 and $5,618,000, respectively. The carry forwards expire through the year 2044. The Company’s net operating loss carry forwards may be subject to annual limitations, which could reduce or defer the utilization of the losses as a result of an ownership change as defined in Section 382 of the Internal Revenue Code.

 

The tax computations are as follows:

 

  

March 31,

2026

  

December 31,

2025

 
Net losses before taxes  $(273,496)  $(1,969,172)
Adjustments to arrive at taxable income/loss          
Permanent differences:        
Temporary differences:        
Taxable (loss)   (273,496)   (1,969,172)
           
Current Year Taxable (loss)   (273,496)   (1,969,172)
NOL carried forward prior year (tax return)   (5,618,232)   (3,922,060)
NOL carried forward at period end  $(5,891,728)  $(5,618,232)
           
Deferred Tax Asset - Federal Rate (21%)   (123,727)   (1,179,829)
Deferred Tax Asset - State Rate        
Total Deferred Tax Asset   (123,727)   (1,179,829)
           
Valuation Allowance   (123,727)   (1,179,829)
Deferred tax per books  $   $ 

 

20

 

 

NOTE 15 — DISCONTINUED OPERATIONS

 

Subsequent to March 31, 2025, Jubilee Intel, LLC is no longer a wholly-owned subsidiary of the Company. The revenues and costs associated with this business are displayed as losses from discontinued operations.

 

Net loss from discontinued operations for the three months ended March 31, 2025, was comprised of the following components:

 

Discontinued operations - net loss  March 31, 2025 
Revenue     
Service revenue  $ 
Revenue total  $ 
      
Expenses:     
General and administrative - cost of revenue  $38,169 
General and administrative - other costs   74,127 
Bad debts   314,664 
Expenses total   426,960 
Net loss from discontinued operations   (426,960)
      
Discontinued operations - cash flows     
Net loss for the period from discontinued operations  $(426,960)
Net cash used by operating activities from discontinued operations  $(426,960)

 

NOTE 16 — SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, Subsequent Events, management evaluated subsequent events through the date these condensed financial statements were issued and noted no material subsequent events requiring disclosure.

 

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

 

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q, and our audited financial statements and related notes thereto for the year ended December 31, 2025 included in our Annual Report on Form 10-K/A.

 

Forward-Looking Statements

 

This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Factors that could cause or contribute to such differences include those discussed under the headings “Risk Factors” in our Annual Report on Form 10-K and elsewhere in this Quarterly Report. Forward-looking statements speak only as of the date hereof, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

 

Overview

 

We have no operations from a continuing business other than expenditures related to running the Company. All of our historical business operations have ceased. Management intends to explore and identify business opportunities within the U.S. and other jurisdictions, including a potential acquisition of an operating entity through a reverse merger, asset purchase or similar transaction. No assurances can be given that our management can identify and implement a viable business strategy or that any such strategy will result in profits.

 

We do not currently engage in any business activities that provide revenue or cash flow. During the next 12-month period, we anticipate incurring costs in connection with investigating, evaluating, and negotiating potential business combinations and/or asset acquisitions, filing reports with the SEC, and consummating any acquisition of an operating business or assets.

 

Results of Operations

 

Three Months Ended March 31, 2026 Compared to Three Months Ended March 31, 2025

 

Revenue. We had no revenue during the three months ended March 31, 2026 or 2025.

 

Operating Expenses. Total operating expenses for the three months ended March 31, 2026 were $38,572, consisting of professional fees of $34,296 (audit, accounting and legal), and general and administrative expenses of $4,276. Total operating expenses for the three months ended March 31, 2025 were $58,010, consisting of professional fees of $18,293 and general and administrative expenses of $37,717.

 

Other Income (Expense). Other income (expense) for the three months ended March 31, 2026 included interest expense of $1,338, amortization of debt discount of $80,865, a loss for the change in fair value of derivative liability of $140,937, and loss on issuance of convertible note of $15,351. For the three months ended March 31, 2025, the Company incurred total other expense of $243,957, which was comprised of $97,752 in interest expense, $105,326 in bad debt expense, $25,000 in amortization of debt discount and $15,879 in change in fair value of derivative,

 

Our net loss for the three months ended March 31, 2026 was $273,496 compared to $728,927 for the three months ended March 31, 2025. For the three months ended March 31, 2025, the Company incurred a net loss from discontinued operations of $426,960, resulting in a net loss of $728,927.

 

Liquidity and Capital Resources

 

As of March 31, 2026, we had cash of $1,946 compared to $3,382 as of December 31, 2025. We had negative working capital and a stockholders’ deficit at both dates. We have historically funded our operations through the issuance of convertible promissory notes, with note holders paying expenses directly to vendors on our behalf. We do not currently have any committed sources of additional funding, and we cannot guarantee that we will be able to obtain any such funding in the future on acceptable terms or at all.

 

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During the three months ended March 31, 2026, we received aggregate funding of $57,641 under the February 12, 2026 6% Convertible Promissory Note issued to the debt holders, all of which was utilized to pay third-party vendor obligations directly by the lender. As of March 31, 2026, the outstanding principal balance under that Note was approximately $5,500 and the remaining was converted.

 

We will continue to require additional funding to support our operations, satisfy our existing obligations and maintain our reporting status, including the payment of professional fees, transfer-agent fees and SEC filing-related expenses. There can be no assurance that we will be able to obtain additional funding on terms acceptable to us or at all. The condition of our business raises substantial doubt about our ability to continue as a going concern.

 

Critical Accounting Policies and Estimates

 

Refer to Note 2 to the accompanying Financial Statements for the three months ended March 31, 2025, for a condensed discussion of our critical accounting policies and to our Form 10-K/A for the year ended December 31, 2025, for a full discussion of our critical accounting policies and procedures.

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a smaller reporting company, we are not required to provide the information otherwise required by this Item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, our principal executive officer and principal financial officer concluded that, as of March 31, 2026, our disclosure controls and procedures were not effective due to the material weaknesses described in our Annual Report on Form 10-K for the year ended December 31, 2025, which include (i) lack of segregation of duties, (ii) absence of an independent audit committee, and (iii) limited documentation of the design and operation of internal control over financial reporting. The Company is a single-employee, single-officer company with limited resources. Notwithstanding the existence of material weaknesses, management believes that the condensed financial statements included in this report fairly present, in all material respects, the financial position, results of operations and cash flows of the Company for the periods presented, in conformity with U.S. GAAP.

 

Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting during the quarter ended March 31, 2026 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

 

From time to time, we may be involved in various claims, lawsuits, and disputes arising in the ordinary course of business. As of the date of this report, the Company is not a party to any material legal proceedings.

 

ITEM 1A. RISK FACTORS

 

As a smaller reporting company, we are not required to provide the information otherwise required by this Item.

 

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

 

On January 15, 2026, a debt holder converted $90,200, from the Convertible Note dated July 7, 2025, into 1,555,172 shares of common stock, paying the note in full.

 

On February 9, 2026, Selkirk Global Holdings, LLC converted $27,346, from the Convertible Note dated July 17, 2025, into 379,811 shares of common stock, paying the note in full.

 

On March 10, 2026, a Note holder elected to convert $42,141 (representing the assigned principal of $39,841 plus additional principal of $2,300) into 247,889 shares of the Company’s common stock.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

ITEM 6. EXHIBITS

 

31.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended.

 

32.1 Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

101.INS Inline XBRL Instance Document.

 

101.SCH Inline XBRL Taxonomy Extension Schema Document.

 

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document.

 

101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document.

 

101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document.

 

101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document.

 

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

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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.

 

  HALLMARK VENTURE GROUP, INC.
   
Date: May 28, 2026 By: /s/ Paul Strickland
    Paul Strickland
    President, Chief Executive Officer, Chief Financial Officer and Director
    (Principal Executive Officer and Principal Financial Officer)

 

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FAQ

What were Hallmark Venture Group (HLLK) Q1 2026 revenues and net loss?

Hallmark Venture Group reported no revenue for Q1 2026 and a net loss of $273,496. The loss reflects ongoing corporate and financing costs without any operating business, including professional fees and significant non-cash expenses from debt discount amortization and derivative revaluation.

What is Hallmark Venture Group’s cash and debt position as of March 31, 2026?

As of March 31, 2026, cash totaled only $1,946 and total assets were $1,946. Current liabilities were $176,636, including accounts payable, a small remaining convertible note balance, and a $3,758 derivative liability, resulting in a stockholders’ deficit of $174,690.

Does Hallmark Venture Group (HLLK) have an operating business in Q1 2026?

The company states it has no ongoing operating business in Q1 2026. Historical operations, including the Jubilee Intel LLC advertising segment, have been discontinued, and management is focused on identifying a new operating business via merger, asset purchase, or similar transaction.

Why does the Hallmark Venture Group 10-Q mention substantial doubt about going concern?

The filing cites an accumulated deficit of $5,588,661, Q1 2026 operating and net losses, cash of only $1,946, no revenue-generating operations, and reliance on external financing. These factors together raise substantial doubt about Hallmark Venture Group’s ability to continue as a going concern.

How is Hallmark Venture Group (HLLK) financing its activities in Q1 2026?

The company primarily uses convertible promissory notes from third parties and related parties. In Q1 2026, it received $57,641 under a 6% convertible note and saw multiple conversions of debt into common stock, creating derivative liabilities and potential shareholder dilution.

How many Hallmark Venture Group shares are outstanding, and what changes occurred?

As of May 28, 2026, Hallmark Venture Group had 66,177,020 common shares outstanding. During the period, several convertible notes and related-party obligations were converted into common stock, and earlier reverse stock splits are reflected retrospectively in all share figures.