GHST 10-K
GHST World Inc. (GHST)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the fiscal year ended
Or
For the transition period from ___________ to ___________
Commission file number:
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(I.R.S. Employer Identification No.) | |
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common stock, par value $0.001 per share
Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐
Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐
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.
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).
Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | 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
standard provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant
has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report.
If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
The aggregate market value of the voting and non-voting
common equity held by non-affiliates of the registrant, as of December 29, 2024, the last business day of the registrant’s most
recently completed second fiscal quarter, was approximately $
As of October 3, 2025, the issuer had shares of its common stock, $0.001 par value per share, outstanding.
| Audit Firm Id | Auditor Name: | Auditor Location: | ||
| 5525 | Fruci & Associates II, PLLC | Spokane, WA |
TABLE OF CONTENTS
| PAGE | |||
| PART I | |||
| Item 1 | Business | 1 | |
| Item 1A | Risk Factors | 8 | |
| Item 1B | Unresolved Staff Comments | 22 | |
| Item 1C | Cybersecurity | 22 | |
| Item 2 | Properties | 22 | |
| Item 3 | Legal Proceedings | 22 | |
| Item 4 | Mine Safety Disclosures | 22 | |
| PART II | |||
| Item 5 | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 23 | |
| Item 6 | [Reserved] | 24 | |
| Item 7 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 24 | |
| Item 7A | Quantitative and Qualitative Disclosures About Market Risk | 27 | |
| Item 8 | Financial Statements and Supplementary Data | F-1 | |
| Item 9 | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure | 28 | |
| Item 9A | Controls and Procedures | 28 | |
| Item 9B | Other Information | 28 | |
| Item 9C | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections | 28 | |
| PART III | |||
| Item 10 | Directors, Executive Officers and Corporate Governance | 29 | |
| Item 11 | Executive Compensation | 30 | |
| Item 12 | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 31 | |
| Item 13 | Certain Relationships and Related Transactions, and Director Independence | 32 | |
| Item 14 | Principal Accounting Fees and Services | 32 | |
| PART IV | |||
| Item 15 | Exhibits, Financial Statement Schedules | 33 | |
| Item 16 | Form 10-K Summary | 33 |
i
PART I
ITEM 1. BUSINESS.
Cautionary Note Regarding Forward Looking Statements
This Annual Report on Form 10-K (this “Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our new business plan and prospective operations and arrangements involving the construction of solar plants and the sale of electricity and potential transactions and potential future revenue and other benefits of such plan and operations, the development of the Smart Shin Guard and plans to further develop and pursue a market for and begin commercializing the product, future sources of revenue and anticipated timing and efforts relating to revenue-generating activities, our exploration of potential new business opportunities, the implementation of our business plan and expected timelines for meeting objectives, strategic alliances, our capital raising efforts and our liquidity. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods.
Forward-looking statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. We caution you therefore against relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. The results anticipated by any or all of these forward-looking statements might not occur. Important factors, uncertainties and risks that may cause actual results to differ materially from these forward-looking statements include the risks arising from our need for capital any inability to raise sufficient capital by us or our related party partner or otherwise proceed with our business plans, the potential adverse effects of United States tariffs and any retaliatory actions, interest rates, geopolitical conflicts such as those occurring in Israel and Ukraine and negative operational impacts or an economic downturn or recession which may result, which may result in delays or obstacles in or prevent us from raising capital as and when needed or at all, supply chain disruptions, shortages and delays and other potential unforeseen events which may adversely affect our ability to develop, manufacture and sell our products and/or offer any services within the intended timeframes or at all, declines in consumer and business spending, risks and uncertainties surrounding the new business opportunities we seek to pursue in the clean energy sector, and the risks disclosed in our prior filings with the SEC including those described in this Report under “Item 1A - Risk Factors.” We undertake no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.
History
GHST World Inc. (“GHST” or the “Company”) was organized on November 12, 1999, as a Nevada corporation.
On September 21, 2017 we changed our name to “GHST World, Inc.” On March 9, 2021 we filed a registration statement on Form 10 (File No. 000-31705) (the “Form 10”) to register our common stock pursuant to Section 12(g) of the Exchange Act. The Form 10 as amended became effective on May 8, 2021.
On April 3, 2019, we formed GHST Sport Inc. (“GHST Sport”) as a wholly-owned subsidiary of the Company and shifted our business focus to the marketing and sale of technologically-enhanced sports equipment and the acquisition and development of related intellectual property. To that end, on June 30, 2020 we obtained a U.S. patent for our Smart Shin Guard, and in October 2022 we obtained a European patent in Europe which covers five countries (Italy, France, Spain, Germany and the United Kingdom).
On June 29, 2019, the Company acquired all of the capital stock of GHST Art World Inc., a Florida corporation (“GHST Art”), whose principal assets consisted of 119 art paintings and reproductions. GHST Art has not sold any of these items or generated any revenue.
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In April 2019, we formed IoTT World Inc. (“IoTT”), which is an acronym for “Internet of Things Tech,” as our wholly-owned subsidiary which focuses on the research and development of technology and products designed to connect common household and other electronic devices using the Internet. IoTT is still in the early stages of development. IoTT World Inc. will manage the data platform for all sports resulting from the recently signed a joint venture agreement with the Cross-Ing, an artificial intelligence (AI) company, as described below at page 2. IoTT has not sold any of these items or generated any revenue.
In April 2023, the Company formed InSSIDe World, Inc. (“Insside”), a Florida corporation, as its wholly-owned subsidiary, as a development stage business which is which is in the early stages of exploring potential business opportunities.
With regard to our patented technology, we are relying on the ability to raise the necessary capital to exploit the patents we acquired for the Smart Shin Guard. We plan to market and sell this product to athletes, sports teams, organizations and leagues, with an initial focus on professional and amateur soccer (football) teams and leagues, both within the U.S. and abroad.
In addition, in late 2024 and early 2025 the Company has entered into certain agreements for a new clean energy business through Insside. These agreements provide for the Company’s purchase of surface rights of certain land in Italy for solar energy projects, the construction of solar energy plants by a new special purpose entity, Green Capital SRL (“Green Capital”), an Italian company in Bergamo, which is charged with the duty of raising substantial capital to build solar plants, assuming financing is obtained and the sale of electricity from such projects and any separate arrangements we may undertake with respect to the sale of electricity.
We have not generated revenue on a consistent basis or in amounts which are necessary to offset operating losses, and need substantial additional financing to continue the development and commercialization of our business plan and related products and services. However, we expect to generate revenue from the sale of electricity to third parties under separate arrangements which we are in the process of negotiating and structuring, as well as from our existing arrangements with Green Capital if and when Green Capital is able to raise the necessary capital to construct the solar plants contemplated by those arrangements. See Note 1 in the accompanying footnotes to our financial statements contained in this Report. However, no assurances can be given that these efforts will result in us generating material revenue on a consistent basis or at all.
Insside World
Beginning in later calendar year 2024, the Company began adding to its core focus by undertaking to enter the clean energy production and trading sector. Summaries of key agreements the Company’s subsidiary, Insside, has entered to are described below. Management believes that the Company has reached a point where the losses from its existing business are no longer justifiable. As a result, in an attempt to provide shareholder value, Insside has entered into a series of agreements to acquire surface rights which are similar to land leases. In addition, Insside is transacting with a new special purpose entity, Green Capital SRL (“Green Capital”), an Italian company in Bergamo, which is charged with the duty of raising substantial capital to build solar plants. Green Capital will be operated by our Chief Executive Officer, Roberto Castellazzi. Mr. Castellazzi will not receive any compensation for his role with Green Capital during this preliminary phase. Compensation will only be applicable if Green Capital secures the necessary funding and construction of the solar plants begins. At that point, Mr. Castellazzi expects to receive approximately $20,000 for his services in the first year and approximately $40,000 in the second year assuming current exchange rates. Upon construction of two solar plants, the Company’s subsidiary will purchase the electricity and resell it to third parties.
The agreements discussed below and the contemplated business of these entities in this enterprise generally envision that Green Capital will fund and construct the solar plants, and operate such plants when they are completed, with Insside acting as exclusive dealer by purchasing and selling the electricity produced from the plants to third parties, and providing consulting services on the construction and operation of the plants. Green Capital will receive any revenues generated from future energy production and sales. Insside will act as the exclusive distributor of the produced energy, deriving proceeds from its purchase of energy and resale of the energy at market prices. Green Capital is owned by a third party which is subject to a contractual arrangement affording certain rights relating to that entity to the Company’s Chief Executive Officer, including the right to obtain a majority of the equity interests of that entity in the future. The Company and Insside expect to enter into one or more further agreements with Green Capital to evidence and govern the intended economic rights among the parties.
On November 25, 2024, Insside entered into a preliminary agreement to purchase the surface rights of land located in Morro D’Oro, Italy for the construction of a solar plant. The surface area of the land is 62,926 square meters. The agreement is for a term of 20 years. Insside agreed to a per-square meter payment amount for the surface rights and an annual lump sum payment as compensation for the energy produced for the duration of the contract; if Insside is unable to sell the energy produced for at least six consecutive months, then such compensation shall not be payable.
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On November 29, 2024, Insside entered into a preliminary agreement with Green Capital to assign the above purchased surface rights for the term of the agreements for construction. Green Capital is required to raise the capital and build and operate the solar plant. See the “Risk Factors” contained in our quarterly report on Form 10-Q for the fiscal quarter ended December 31, 2024, which was filed with the Securities and Exchange Commission (the “SEC”) on February 19, 2025.
On January 24, 2025, Insside entered into the preliminary agreement to purchase the surface rights of land that is located in Giulianova, Italy for construction of a solar plant. The surface area is 10,230 square meters. The agreement is for a term of 20 years. The parties agreed to a division of the earnings from energy sales as set forth in the agreement beginning 48 months after production of energy commences, as set forth in the agreement. Under the agreement, the seller committed to entrusting our subsidiary with the sale of all energy produced by the plant as the sole “dealer” and to assigning rooftop solar plant construction projects for at least 660 kW. Under the agreement, after the 48 month period following connection of the power plant, the surface right granted thereunder will terminate, and ownership of the plant will be retained by the seller.
On January 27, 2025, Insside entered into a preliminary agreement with Green Capital, to assign the above purchased surface rights for the term of the agreement for construction. Green Capital is required to raise the capital and build and operate the solar plant. See the “Risk Factors” contained in our quarterly report on Form 10-Q for the fiscal quarter ended December 31, 2024, which was filed with the SEC on February 19, 2025.
As a result of the agreements between Insside and Green Capital, Insside has assigned to Green Capital the surface rights and related rights and obligations under the agreements which Insside had entered into with the landowners. These agreements are currently in a waiting phase as Green Capital seeks to locate sources of capital to fund these arrangements. In the meantime, Insside's support and consultancy activities are ongoing, and the building permit applications are currently under review by the applicable authorities.
On December 18, 2024, Insside entered into a preliminary agreement with Ingenera SRL, owner of the two power generation plants currently under construction in Mosciano, Italy, to carry out the activity of dealer for the sale of energy. The agreement is for a term of 20 years and the price reserved €0.14 per kWh produced. The agreement is with the right of withdrawal if within the first 3 months Ingenera does not reach the average rate of €0.14. The sum of €30,000 should paid at the stipulation of the preliminary contract, this amount shall be recovered in the first 8 months of operation in the sale of energy. As of now, The plants have been completed and are now capable of producing energy, and are awaiting connection to the power grid. Insside’s operations will begin only after Ingenera has connected them to the national power grid. Only at that point will a definitive agreement be executed, based on the terms outlined in the preliminary contract dated December 18, 2024.
Because these agreements and the potential business of Insside are preliminary in nature, no assurance can be given that the prospective transactions or operations contemplated thereby will occur or yield the results or benefits intended or anticipated.
In May and June of 2025 we entered into certain preliminary agreements with third party electricity producers which contemplate our purchase of electricity from such producers for resale. We are also negotiating and entering into contracts for our sale of the electricity so acquired to third party traders with a view to generating revenue from the spread of the prices at which we purchase the electricity relative to the prices at which we sell them to the third party traders.
Insside has also invested and intends to continue to invest in the software and resources necessary to develop this structure. In recent weeks, in fact, thanks to the agreement with traders and our internal know-how, we have attracted even greater interest from producers and received multiple offers for which we expect positive feedback.
We have also entered into an agreement to provide energy connection management services to a third party. We intend to continue to search for and pursuant strategic relationships and transactions to continue to develop and expand this line of business
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GHST Sport
In 2018, the Company acquired the rights to the 2015 Italian patent and underlying concept for the Smart Shin Guard in exchange for 2,000,000 shares of common stock which were issued in December 2021. The Company has since been issued a U.S. patent (Patent No. US 10,695,651 B2; “Protection Device for Carrying Out Sports Activities Usable in Data Analysis and Monitoring System, and Relative System and Method for Processing and Calculating the Sent Data”) for the Smart Shin Guard. In October 2022 we received confirmation of the assignment of the European patent for the Smart Shin Guard. In March 2023 we were granted a patent for the Smart Shin Guard in Hong Kong, however we subsequently determined to abandon that patent.
The patents contemplate potential application of the invention within other forms of athletic equipment outside of shin guards used in soccer or similar sports. We may consider expanding our technology to other applications of the invention in the sporting world depending on the results our efforts to market and sell the Smart Shin Guard.
The Smart Shin Guard
The Smart Shin Guard is a shin guard, which is a form of protective equipment placed on the front portion of the lower leg while playing soccer and similar sports, combined with our data collection and analysis technology that monitors players’ individual and collective physical and performance-based metrics and transmits this information to a separate module in real-time. Examples of the information the Smart Shin Guard can collect and analyze for users is covered distance, acceleration, kicking force, collision impact, positioning, directional movement, and performance alerts. This information will vary depending on the version of the product that is used, which will depend on the customers and their particular purposes for using the Smart Shin Guard.
The product is designed for use by teams and individuals to enhance their ability to track player performance, stamina, and conditioning at matches, practices or any other circumstance in which they desire to play the sport. We believe the Smart Shin Guard will provide valuable insight to players, coaches and organizations seeking to gain a competitive advantage over their opponents be assisting with in-game monitoring and pre- and post-game assessment and strategy using our technology. Our goal is to empower coaches, players and teams to make faster and potentially in-game decisions regarding their players, team and strategies in reaction to the data provided and obtain an advantage therefrom that helps them achieve their objectives, both individually and in the leagues in which they compete. Additionally, we believe this product has attractive features for more casual players seeking to track their individual performances for educational, informational, or health-related purposes.
Product Development
The Company completed the Beta testing of the functionality of the Smart Shin Guard in July 2024, and we are seeking to complete final development processes so we can begin producing and selling the product. These processes have been delayed due to our limited capital.
In connection with our development efforts for the Smart Shin Guard, on September 23, 2023, we entered into a joint venture agreement with Cross-ING, an AI development company, which contemplates further development of the Smart Shin Guard for soccer and for other sports, with a particular view to developing software for the smart phone application and expanding the products’ use to other sports in addition to soccer. In exchange for these services, we have agreed to pay the service provider the following (i) 40,000 Swiss Francs (approximately $44,068 U.S. Dollars) per milestone achieved under the agreement as determined by a “steering group” comprised of senior representatives from each party, (ii) 4,476,176 shares of the Company’s common stock, and (iii) royalty payments of 1 Swiss Franc (approximately $1.10 U.S. Dollars) per unit sold, for up to 150,000 units.
We are currently seeking vendors to further develop the Smart Shin Guard with the goal of beginning marketing of the product in 2025. To do so, we need to determine and complete the specifications for our product and begin production of a completed product in collaboration with our vendor, which may entail, among other things, obtaining sufficient additional capital. We are also in search of other strategic alliances and potential business opportunities to develop and enhance our business plan and intended product offerings.
To further development of the product, we intend to first produce initial prototypes and to equip a soccer team to serve as a sample for data collection and analysis, with a view to refining the product and its underlying technology and software. This process was previously delayed due to our limited capital and challenges in finalizing specifications and research and development efforts on technology used for positioning data without the use of GPS.
We are also in discussions with prospective strategic partners to market the product when development is completed.
For more information on these and other contemplated features of our Smart Shin Guard, see “Applications and Uses.”
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Applications and Uses
We plan to sell two versions of the Smart Shin Guard which will vary in terms of sophistication of features offered and target demographics of users:
Consumer Kit
The standard version which collects data and provides analysis on basic physical and performance metrics, including covered distance, instantaneous and average speed, movement and direction, acceleration and deceleration, kicking power, shot, pass, tackle, and header identification, and performance alerts. The consumer kit is designed for athletes at all levels ranging from casual players to amateur and professional athletes. The remote access to the information and analysis provided can be accessed by coaches, teammates, friends and family. We expect for the development of the consumer kit, including the corresponding smart phone application, to be completed before the more advanced professional kit described below.
Professional Kit
An advanced version which will be more sophisticated in terms of the types of data collected and the level of analysis and computation. In addition to the statistics available with the consumer kit, the professional kit allows users to collect information on calorie consumption, metabolic power, elevation distance, directional changes and angles, heart rate, positioning map, and team barycenter, which is the center of gravity of a game. The professional kit is designed for and will be marketed primarily toward professional athletes and teams. The development of the professional kit will be a longer process than the consumer kit due to factors including increased sophistication and technical complexity of the data collection and analysis capabilities, contractual terms and limitations in our human and capital resources.
Smart Phone Application
The Company is in the process of developing a smart phone application (“phone app”) for use by customers using the Smart Shin Guard. The phone app will function by receiving and displaying data collected and processed by the Smart Shin Guard. When developed, the phone app will be essential for use in connection with the consumer kit, to the extent such consumers intend to review and use the data provided in real time while training or playing in games. We have developed a prototype of the phone app for the consumer kit, and development for the professional kit, as well as additional continued efforts to improve the application generally, remain ongoing.
Other Subsidiaries
Other than GHST Sport, we have three other subsidiaries. These subsidiaries are still in the developmental stages and do not currently contribute to our business in a significant manner. However, some or all of these subsidiaries may have a more central role in our business in the future, provided we can access the necessary capital, form strategic relationships and otherwise develop and execute a business plan for such subsidiaries. Below is a brief description of each subsidiary.
GHST Art World Inc.
GHST Art is our wholly-owned subsidiary which we acquired on June 29, 2019, together with its portfolio of 119 art paintings and reproductions as its principal assets. We have not sold any of these assets. We are also developing a virtual artist “incubator” and art trading platform and network to assist emerging artists increase their visibility and locate and procure sales of their artwork to consumers. GHST Art is also in the process of founding an online newspaper, and will also provide information on the group's activities. These concepts are still in the development stage and we do not expect to bring them to market or generate revenue therefrom in the short term.
IoTT World, Inc.
IoTT, which is an acronym for “Internet of Things Tech,” is our wholly-owned subsidiary which, with the signing of the joint venture agreement with the AI company Cross-Ing, is planning to provide a series of data platforms for all sports programmed in the joint venture agreement, and no longer just a platform for our SSGs related to soccer. This concept is still in the development stage and we do not expect to bring it to market or generate revenue from it in the short term.
The first database will be for our SSG a database sector in which all the data collected per user of those who buy and wear our SSGs will converge, so that they can be consulted, for a fee, by insiders such as coaches, athletic trainers, technical sports directors, and others involved with the player/team, or by the players themselves, thus creating a large sports database for use in all sports.
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Competition
GHST Sport
With respect to GHST Sport, we will compete directly with sports equipment and apparel developers, wholesalers and retailers, as well as other businesses offering player and team tracking technology, some of which sell similar products to ours, and many of which have significantly greater capital and human resources than we do. For example, we face competition from other businesses which provide smart data tracking and collection technology in the form of wearable sporting equipment, including Soccerment and TibTop, each of which offers wearable shin guards, and Catapult Sports, which offers similar wearable devices, with some level of data collection, analysis and transmission functionalities. Additionally, other sports already deploy similar technology in their gameplay, which have the ability or potential to be expanded to other uses, including soccer. For example, in American football Zebra Technology provides equipment with motion and data tracking systems similar to the functions our product is designed to offer at the professional level, and Zebra and other companies provide similar technology at the collegiate and lower levels. These competitors could enter our target markets and/or seek to prevent us from entering those markets using our technology.
Although our Smart Shin Guard technology uses patented features and processes and we believe the depth of information it can collect, analyze and transmit provides us with an advantage over certain of our prospective competitors, there can be no guarantee that our competitors have not or will not develop and sell technology that is similar or superior to ours and/or that will hinder or limit our ability to access the markets we plan to target. Further, with respect to the phone app for the Smart Shin Guard, there is at least one other similar application called Goalon which allows users to track certain performance metrics directly on their cellular device, and there may be others currently in the market or that are being or may be developed that we will compete with. Additionally, some sporting equipment companies and service providers offer technology or services using different means, such as cameras that collect and transmit team and player data in a manner similar to ours, could be seen as competitors. Offerings of similar equipment and technology to our Smart Shin Guard by any of these competitors will likely create a barrier to market entry for our product and/or render it difficult to develop or grow a customer base, particularly to the extent our potential customers and users have already integrated competitor products and services. Further, while we are not aware of similar wearable devices that are approved by soccer leagues for in-play usage, we have also not obtained such approval for the Smart Shin Guard ourselves, and there can be no assurance that such approval will be obtained.
Insside World
There are a growing number of participants in the clean energy industry as economic, social and environmental factors have enhanced public interest in the production of power through means that reduce the impact on the environment and carbon footprints. Because this constitutes a new business, many of our competitors will be better capitalized and have greater resources and longer operating histories than us, and our competition will vary by the markets we seek to serve, which are presently focused primarily on Italy.
GHST Art
With respect to GHST Art, we expect to face competition from niche art platforms and galleries as well as larger platforms on which artists can display their works, such as Instagram and Facebook. Among our more direct competitors in the artist accelerator and marketing platform businesses are Looklateral, Koones, Lean Artist, Mecenate.online, Rise Art and Saatchi Art. Many of our competitors in this field have access to greater financial resources and business networks and more experience in the industry, which will pose challenges to any future operations and barriers to market entry and growth.
IoTT
With respect to IoTT, a variety of technology research and development companies have already made headway on connecting various devices and otherwise making life easier for consumers using the internet and artificial intelligence. The market is currently saturated with such products, and with companies seeking to develop and evolve such products and underlying concepts as to enhance their functionality. In light of these market conditions and the intense competitive environment in this area, competition will be intense, as will risks inherent therewith including the reality that many competitors have more capital, experience and progress with respect to their offerings than we do and that we may face difficulty in obtaining or protecting intellectual property rights or avoiding the infringement of others in our operations of IoTT.
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Employees
We currently have no full-time employees. Our officers provide services on a part-time basis.
Status as an Emerging Growth Company
Because we have nominal revenues and have never had a registration statement under the Securities Act of 1933 become effective, we are an emerging growth company. An emerging growth company is defined as a company which had annual gross revenues were less than $1.07 billion during its most recently completed fiscal year and have never sold common equity securities under a registration statement. We will continue to be an emerging growth company until the earlier of: (i) the last day of the fiscal year of the Company during which we had total annual gross revenues of $1.07 billion or more; (ii) the last day of the fiscal year of the Company following the fifth anniversary of the date of the Company’s first sale of common equity securities of pursuant to an effective registration statement under the Securities Act; (iii) the date on which the Company has, during the previous three-year period, issued more than $1 billion in non-convertible debt; or (iv) the date on which the Company is deemed to be a “large accelerated filer” as that term is defined in Rule 12b-2 promulgated under the Exchange Act.
The federal securities laws and regulations provide certain exemptions for emerging growth companies with respect to financial information and disclosure requirements in registration statements and periodic reports and certain activities in connection with initial public offerings. The exemptions available to us as a result of our status as an emerging growth company are summarized as follows:
| · | Unlike other reporting companies, we are not required to hold periodic shareholder voting on executive compensation, the frequency of shareholder voting of executive compensation, and golden parachute compensation. |
| · | We are permitted to include less extensive narrative disclosure in our reports filed with the SEC than is required of other reporting companies, particularly in the description of executive compensation. |
| · | We are not required to include a report of our independent registered public accounting firm on the Company’s internal control over financial reporting in our SEC filings. |
| · | We would not be required to comply with new or revised financial accounting standards until private companies (e.g., those that have not had a Securities Act registration statement declared effective and do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. |
| · | We would be exempt from any requirement adopted by the Public Company Accounting Oversight Board in the future providing for a mandatory rotation of companies’ accounting firms. |
| · | We are permitted to submit a registration statement under the Securities Act to the SEC on a confidential basis if the registration statement and all amendments are publicly filed at least 21 days before we were to conduct any road show with respect to such offering. |
| · | We may communicate with prospective investors that are qualified institutional buyers or institutions that are accredited investors to determine interest in a contemplated offering either prior to or after filing a registration statement under the Securities Act. |
Some of the above-described exemptions are also available to smaller reporting companies, and therefore a termination of our status as an emerging growth company would not necessarily result in a requirement that we comply with the default disclosure requirements applicable to reporting companies generally.
We have elected not to use the extended transition period for complying with any new or revised accounting standards under Section 102(b)(1) of the Exchange Act.
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ITEM 1A. RISK FACTORS.
Investing in our common stock involves a high degree of risk. You should carefully consider the following risk factors before deciding whether to invest in the common stock. If any of the events discussed in the risk factors below occur, our business, financial condition, results of operations or prospects could be materially and adversely affected. In such case, the value and marketability of the common stock could decline, and you might lose all or part of your investment.
Summary of Risk Factors
Our business is subject to numerous risks and uncertainties that you should consider before investing in our common stock. Some of the principal risk factors that make an investment in the Company speculative or risky are summarized as follows:
| · | We have generated no material revenue during the last three fiscal years or current fiscal year, and in order to continue as a going concern we require additional capital either through a debt or equity financing. |
| · | Because of the shift in our business model, we face significant uncertainties which intensifies our risk as a going concern. |
| · | We face significant risks due to inability due to various circumstances to proceed with our legacy Smart Shin Guard business plan in a timely manner and our recent shift to a prospective clean energy business. |
| · | We are still in the process of developing our Smart Shin Guard, which is our principal product the development of which has been a lengthy and uncertain process for which we have failed to meet internal forecasts on multiple occasions, and there can be no assurance we will be successful in completing such development or that we can successfully market this product once developed. |
| · | We have a limited operating history and our likelihood of success is contingent upon the problems, expenses, and complications frequently encountered by development stage companies. |
| · | We may have or discover in the future material weaknesses in our internal controls and may face difficulties remediating any such weaknesses; |
| · | In order to generate material revenue, we will need to successfully develop and market our products and services, including the Smart Shin Guard which is our principal product and is still under development; |
| · | Our business is dependent upon our intellectual property which we may be unable to obtain or protect without incurring significant expenses or at all. |
| · | We may become involved in litigation to defend our intellectual property or to defend against infringement claims from third parties, which would be expensive and time consuming and could materially adversely affect our business. |
| · | We are highly dependent on a small number of key personnel, the loss of whom would materially adversely affect our business. |
| · | The industry in which we principally operate is highly competitive, and most of our competitors have greater financial and other resources and capital raising abilities than we do, which will render our efforts to establish a market for our brand and products, including our Smart Shin Guard, particularly challenging. |
| · | Because we will be reliant on a single product, if we are unable to establish a market for our product and generate material revenue, this lack of diversification will be difficult to overcome and investors could lose some or all of their investment. |
| · | There is currently no active market for our securities, there can be no assurance that such a market will ever develop, and the future prices and liquidity of our securities could be unpredictable and volatile. |
| · | Certain events have caused and may continue to cause disruptions in our business and industry, which may hinder our progress and growth prospects. |
Risks Related to the Company
Our ability to continue as a going concern is in doubt absent obtaining adequate new debt or equity financing.
We have limited capital and have accumulated losses through June 30, 2025, of $14,064,797 since inception. Because we do not have sufficient working capital and cash flows for continued operations for at least the next 12 months, our auditors have issued an opinion with an explanatory paragraph regarding our ability to continue as a going concern. Our continued existence is dependent upon us or obtaining the necessary capital to meet our expenditures. We cannot assure you that we will be able to raise adequate capital to meet our future working capital needs.
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Because we expect to need additional capital to fund our growing operations, we may not be able to obtain sufficient capital and may be forced to limit the scope of our operations.
We currently need substantial working capital. The adverse impacts on the global economy or any subsequent or further financial hardship caused by the geopolitical conflicts in Ukraine and Israel, or a resurgence of inflation and increased central banks interest rates in response, along with any recession or market downturn which result, could adversely affect our ability to raise capital. If adequate additional debt and/or equity financing is not available on reasonable terms or at all, we may not be able to remain in business, and we will have to cease operations.
Even if we secure the necessary working capital, we may not be able to negotiate terms and conditions for receiving the additional capital that are acceptable to us. Any future equity capital investments will dilute existing shareholders. In addition, new equity or convertible debt securities issued by us to obtain financing could have rights, preferences and privileges senior to our common stock. We cannot give you any assurance that any additional financing will be available to us, or if available, will be on terms favorable to us.
If we are not successful, you may lose your entire investment.
Prospective investors should be aware that if we are not successful in our new business, their entire investment in the Company could become worthless. Even if the Company is successful, we can provide no assurances that investors will derive a profit from their investment. Even if we can raise sufficient capital or generate revenue, we cannot guarantee any resulting proceeds to us will be sufficient for us to grow our operations and become profitable. In past periods we have failed to meet anticipated or desired milestones for our product development within the timelines originally projected, in part due to our limited capital and other resources as well as external factors. These delays and limitations raise questions as to our ability to achieve our goals within the time periods desired or at all. If we are not successful, you may lose your entire investment.
Because we have a limited operating history to evaluate our company, the likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delay frequently encountered by a new company.
Since we have a limited operating history under our current business model, which we are frequently adjusting in pursuit of new business opportunities, it is difficult for investors to evaluate our business and prospects. You must consider our prospects in light of the risks, expenses and difficulties we face as an early stage company with a limited operating history. Investors should evaluate an investment in our company in light of the uncertainties encountered by start-up companies in a highly competitive industry such as ours, which contains significant barriers to market entry. There can be no assurance that our efforts will be successful or that we will be able to attain profitability.
Because of the shift in our business model, we face significant uncertainties which intensifies our risk as a going concern.
Since we have not yet been able, for various reasons, to monetize our Smart Shin Guard business and due to the strains it put on our working capital limitations, we are developing, in parallel, a clean energy model. That business model is unproven as it affects us, subject to material business risks affecting any new venture, we and our management have limited experience in it, is dependent upon third parties to provide significant financing expected to range from approximately $7 million to $10 million based on current exchange rates, and is also dependent upon services from Green Capital which we do not own, regulation by local, Italian and European Union authorities and political and economic factors in Italy. In addition, the contracts for our initial planned operations in the clean energy industry are preliminary in nature, and no assurances can be given that definitive agreements or material new operations or revenue generating activities will result. We may for example be unable to secure a sufficient quantity of contracts for the sale of electricity that we acquire wholesale from producers, or be unable to locate purchasers at favorable prices or at all, resulting in losses in these endeavors and increased strain on our financial condition and operating results. Additionally, the clean energy sector and our plans within it are capital intensive, and we may invest substantial capital into these planned operations that ultimately do not generate material revenue or do not otherwise result in the benefits sought, which outcome would be particularly harmful given our limited access to capital. All of these and other risks intensify our ability to conduct business on a going concern basis.
We face significant risks due to inability due to various circumstances to proceed with our legacy Smart Shin Guard business plan in a timely manner and our recent entry into the clean energy business.
We have limited capital and have accumulated losses through June 30, 2025, of $14,064,797. Due in part to our limited capital, our reliance upon our Chairman & CEO for loans, and limited personnel, we have to-date been unable to complete development of and commercialize the Smart Shin Guard. Our management is focused on both projects, but no assurances can be given that either of our business plans will be successful or proceed as intended or desired, in which case you could lose some or all of your investment.
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Because GHST is in the development stage of each of its planned businesses and its business plan is unproven, we may fail to generate material revenue or achieve profitability.
GHST is relying primarily upon its U.S. patented sports equipment technology which we intend to market and sell in the U.S. and foreign athletic markets to individual players, teams and organizations interested in the Smart Shin Guard’s data collecting capabilities. We have not sold our products, and do not presently have inventory available for sale. Our development process for the Smart Shin Guard has repeatedly been delayed from original projected timeframes due to our small size and lack of capital. If this trend continues and we fail to commercialize the product before our patents expires in our target markets, we could fail to generate material revenue or establish brand recognition necessary to achieve our goals and provide value to our shareholders. We cannot assure you that assuming we obtain sufficient financing, we will be able to successfully market our product in any of the target countries, derive any material revenue or attain profitability. Further, with the addition of InSSIDe World which is in its early stages of developing a business plan for potential new business opportunities with an initial focus on clean energy, in addition to our legacy focus on the Smart Shin Guard and the other early stage businesses we are developing or considering as described in this Report, our management team may be divided among multiple projects, and may be unable to allocate and use our limited resources in an efficient or effective manner. Further, each industry in which we seek to operate through the aforementioned businesses and business plans poses unique challenges, including intense competition, regulatory requirements, and limitations on qualified personnel and market opportunity, which gives rise to further risks and uncertainties that are particularly present for us as we continue in the early development stage of each prospective business. The time and resources invested in these projects could ultimately be fruitless or fail to yield the benefits or results sought for our business, and could result in material harm to our financial condition and ability to continue as a going concern. If we are not successful in marketing the Smart Shin Guard and/or developing other business as presently intended, it is likely that you will lose your entire investment.
Because our business model is new, our growth strategy may not be achievable and may not result in profitability.
We may not be able to implement our growth strategy reflected in our business plan rapidly enough as to achieve profitability. Our growth strategy is dependent on a number of factors, including market acceptance of the Smart Shin Guard with respect to GHST Sport and establishing the necessary relationships and infrastructure with respect to Insside. We cannot assure you that we and collaborators will raise sufficient capital or otherwise develop and execute on our business plans in a manner necessary to generate material revenue or become profitable.
Among other things, implementation of our growth strategy would be adversely affected by the following:
| · | we may not be able to attract sufficient customers/subscribers for our product(s); |
| · | our research and development, manufacturing and marketing costs may be materially more than we anticipate which will affect our future gross profit margins; |
| · | a decline in general market conditions may prevent us from successfully establishing a customer base or raising capital as required; |
| · | if our product proceeds to the commercialization phase, we may fail to adequately protect or maintain our intellectual property, especially if the development phase continues to be delayed or prolonged; |
| · | we may face significant litigation from competitors with intellectual property rights for products that are similar to ours, the occurrence of which would not only divert our management’s time and attention, but involve prohibitive legal and other defense costs; and |
| · | because we do not have any agreements to manufacture our products, our future costs may impact our ability to price our products at a level which generates future sales. |
Our business will depend, to a large extent, upon our intellectual property.
We rely on our patents in certain jurisdictions to protect our Smart Shin Guard technology. These patents and any future patent(s) we can obtain will be critical to our ability to market our product in applicable jurisdictions without the risk of reverse engineering of our technology. In the event that we are unable to secure, maintain or enforce such patents, the marketability and viability of our product could be adversely affected, including by being vulnerable to reverse engineering in any jurisdiction where the patent did not issue. While we received the patent grants in U.S., Italy, France, Spain, Germany and the United Kingdom, there can be no assurance that other patents needed to pursue our goals and achieve our objectives will be secured or maintained. For example, while in October 2022 we received approval of our European patent application covering up to 36 countries, in 2023 we made the decision to limit payment of the corresponding fees to receive the official patent grant to select jurisdictions within Europe, while allowing the patents to lapse in other European jurisdictions for failure to pay the fee, in order to manage costs. Further, we were granted a patent in Hong Kong in March 2023 but subsequently abandoned that patent. We cannot predict with certainty the potential consequences of this course of action for our future operations in Europe and Asia. In the event we are unable to obtain, maintain or protect our patents and the intellectual property related to our technology, the value of our intellectual property and our ability to generate revenue therefrom could be materially adversely affected.
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If we cannot protect intellectual property rights related to our current or future products, we may not be able to compete effectively in our markets.
We rely upon a combination of patents, trade secret protection and confidentiality agreements to protect the intellectual property related to our current or future products. The strength of our patent in the sports logistics and technology field involves complex legal questions and can be uncertain. Our international patents may fail to result in adequate protection in the countries in which we desire to market and sell our products. Even for our issued patents, third parties may challenge their validity, enforceability or scope, which may cause such patents to be narrowed or invalidated. Even if unchallenged, our patents and may not adequately protect our intellectual property or prevent others from designing around our claims.
If we fail to maintain, monitor or enforce patents we hold or if their breadth or strength of protection is threatened, it could threaten our ability to commercialize our products. Issued patents may be found invalid and unenforceable or challenged by third parties. Patents have a limited lifespan. In the United States, the natural expiration of a patent is 20 years after it is filed, although various extensions may be available. The life of a patent, and the protection it affords, is limited. When the patent life has expired for a product, we will become vulnerable to competition from similar products or generic versions attempting to replicate our Smart Shin Guard or other products we may develop or acquire in the future. Further, if we continue to experience delays in our product development efforts, and/or encounter delays in production, distribution or in regulatory or league approvals, the time during which we will be able to market and commercialize a product candidate under patent protection could be significantly reduced, and as a result we may be unable to establish material or consistent revenue streams, brand recognition or markets for our product before competitors use our designs or processes to market similar products.
In addition to patent protection, we rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable, processes for which patents are difficult to enforce and any other elements of our product development processes that involve proprietary know-how, information or technology not covered by patents. As a general practice, our employees, consultants, advisors and any third parties who have access to our proprietary know-how, information or technology enter into confidentiality agreements. Nonetheless, our trade secrets and other confidential proprietary information may be disclosed and competitors may otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.
The laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States. We may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad, particularly given our present business plan involves marketing and sales efforts on countries located outside of the United States. If we are unable to prevent material disclosure of the non-patented intellectual property related to our technologies to third parties, and there is no guarantee we will have any such enforceable trade secret protection, we may not be able to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, results of operations and financial condition.
Third-party intellectual property infringement claims may prevent or delay our development and commercialization efforts.
Our commercial success depends in part on our avoiding infringement on the patents and proprietary rights of third parties. There is substantial technology litigation, both within and outside the United States, involving patent and other intellectual property rights, including patent infringement lawsuits, interferences, oppositions, and reexaminations and other post-grant proceedings before the U.S. Patent and Trademark Office, and corresponding foreign patent offices. U.S. and foreign issued patents and pending patent applications, which are owned by third parties, may exist in the fields in which we are pursuing patents for our product. As the sports logistics and technology industries expand and more patents are issued, the risk increases that our products may be subject to claims of infringement of the patent rights of third parties.
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Third parties may assert that we are employing their proprietary technology without authorization. There may be third-party patents or patent applications with claims to materials, concepts, or methods of manufacture related to the use or manufacture of our products. Because patent applications can take many years to issue, there may be patent applications currently pending that may later result in patents that our products may infringe. Third parties may obtain patents in the future and claim that use of our technologies infringes on these patents. If any third-party patents were to be held by a court of competent jurisdiction to cover the manufacturing process of our products, the holders of any such patents may be able to block our ability to commercialize such products unless we obtained a license under the applicable patents, or until such patents expire. Similarly, if any third-party patents were to be held by a court of competent jurisdiction to cover aspects of our concepts, processes for manufacture or methods of use, the holders of any such patents may be able to block our ability to develop and commercialize the applicable product unless we obtained a license or until such patent expires. In either case, such a license may not be available on commercially reasonable terms or at all.
Parties making intellectual property claims against us may obtain injunctive or other equitable relief, which could block our ability to further develop and commercialize our products. Defense of these claims, regardless of their merit, involves substantial litigation expense and would involve a substantial diversion of our management’s attention from our business. Because of the costs involved in defending patent litigation, we currently lack and may in the future lack the capital to defend our intellectual property rights. If a claim of infringement against us succeeds, we may have to pay substantial damages, possibly including treble damages and attorneys’ fees for willful infringement, pay royalties, redesign our infringing products or obtain one or more licenses from third parties, which may be impossible or require substantial time and monetary expenditure.
We may be involved in lawsuits to protect or enforce our patents or other intellectual property rights, which could be expensive, time-consuming and unsuccessful.
We rely on a patent on the Smart Shin Guard to protect our intellectual property rights. In the United States, we have a patent and also have patents in certain jurisdictions in Europe. Competitors may infringe our patents or otherwise take action against our intellectual property rights. To counter such infringement, interference or similar adverse occurrence, we may be required to file infringement or similar claims, or we may be required to defend the validity or enforceability of our intellectual property rights, including our patents, which can be expensive and time-consuming and may force us to divert our limited resources. In an infringement proceeding, a court may decide that either one or more of our patents is not valid or is unenforceable, or may refuse to stop the other party from using the technology at issue because our patents do not cover that technology. An adverse result in any litigation or defense proceedings could put one or more of our patents at risk of being invalidated or interpreted narrowly and could put our patent applications at risk of not issuing. Any difficulties or inability to obtain or maintain a patent in a jurisdiction for which we hold or seek patent protection would materially adversely harm our business.
Interference proceedings provoked by third parties or brought by us may be necessary to determine the priority of inventions regarding our patents. An unfavorable outcome could require us to cease using the related technology or to license rights to it from the prevailing party. Our business could be harmed if the prevailing party does not offer us a license on commercially reasonable terms or at all. Our defense of litigation or interference proceedings may fail and, even if successful, may cause us to incur substantial costs and distract the attention of our management and other employees. We may not be able to prevent misappropriation of our intellectual property rights, particularly in countries where the laws may not protect those rights as fully as in the United States.
Because of the substantial amount of discovery required in intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. There could also be public announcements of the results of hearings, motions or other interim proceedings or developments. If investors perceive these results to be negative, it could have a material adverse effect on the price of our securities.
We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed confidential information of third parties.
We may be subject to claims asserting that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed confidential information of our employees’ former employers or other third parties. We may also be subject to claims that former employers or other third parties have an ownership interest in our patents. Litigation may be necessary to defend against these claims. There is no guarantee of success in defending these claims, and if we succeed, litigation could cause substantial cost and be a distraction to our management and other employees.
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Artificial intelligence presents risks and challenges that can negatively impact our business.
Artificial intelligence-based platforms and tools are increasingly being used in the industries in which we operate and seek to operate. Additionally, we develop and use artificial intelligence technology into our products and operations, including the Smart Shin Guard which will depend to some extent on artificial intelligence to function as intended. As with many technological innovations, artificial intelligence presents risks and challenges that could impact our business. Many of our competitors have begun utilizing artificial intelligence tools to aid in the development of competitive products.
As artificial intelligence expands, our competitors, which may have significantly greater financial and human capital resources, may use artificial intelligence to further their research efforts and advance competitive products and services to those we offer or intend to offer.
Further, any third-party collaborators may incorporate artificial intelligence technology into their business without disclosing this to us, and the providers of these artificial intelligence technology may not meet existing or rapidly evolving regulatory or industry standards with respect to privacy and data protection. If our third-party collaborators who use artificial intelligence technology experience an actual or perceived breach related incident because of the use of artificial intelligence, we may lose valuable intellectual property, confidential information, and suffer reputational damage. Further, bad actors around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities involving the theft and misuse of personal information, confidential information, and intellectual property. Any of these outcomes could damage our reputation, result in the loss of valuable property and information, and adversely impact our business.
If we cannot manage our growth effectively, we may not become profitable.
Businesses, including development stage companies such as ours which often grow rapidly, tend to have difficulty managing their growth. If we are able to successfully market our products and services, we will likely need to expand our management team and other key personnel by recruiting and employing experienced executives and key employees and/or consultants capable of providing the necessary support.
As described elsewhere in this Report, in addition to our Smart Shin Guard and the renewable energy project of InSSIDe, the developments of which remain our principal business focus, we are in the process of developing and/or pursuing business plans for GHST Art, IoTT, and each of which involves a unique business model and would take substantial time and resources to execute and develop into a revenue generating enterprise. We cannot assure you that our management will be able to manage our growth effectively or successfully. Our failure to meet these challenges could cause us to lose money, and your investment could be lost.
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It may be difficult to predict our financial performance because our quarterly operating results may fluctuate.
Our revenue and operating results may vary significantly from quarter-to-quarter due to a variety of factors, many of which are beyond our control. You should not rely on period-to-period comparisons of our results of operations as an indication of our future performance. Our results of operations may fall below the expectations of market analysts and our own forecasts. If this happens, the market price of our common stock may fall significantly. The factors that may affect our quarterly operating results include the following:
| · | the rate at which we are able to develop and distribute our product; |
| · | our introduction and pursuit of new business ventures such as Insside’s clean energy business and the results and consequences of such endeavors; |
| · | the usage by subscribers of our interactive technology; |
| · | seasonal patterns in the athletic and sporting goods industry and other industries we target; |
| · | worsening economic conditions such as those caused by inflation and interest rate hikes in response which cause customers to reduce spending of goods and services such as those we intend to offer; |
| · | changes in the regulatory environment, including regulation of advertising, that may negatively impact our marketing practices; |
| · | the adoption of new accounting pronouncements, or new interpretations of existing accounting pronouncements, that impact the manner in which we account for, measure or disclose our results of operations, financial position or other financial measures; and |
| · | costs related to the launch or acquisition of new technologies or businesses. |
Expenditures by customers also tend to be cyclical, reflecting overall economic conditions as well as budgeting and buying patterns of athletes, teams, leagues and the general public. Any economic decline may alter prospective customers’ and strategic partners’ current or prospective spending abilities or priorities and limit our sales, or may delay sales with such parties, and could materially and adversely affect our business, results of operations and financial condition.
We relay and expect to continue to rely on outside consultants and employees who may be difficult to control and may expose to liability and/or limit our ability to grow our operations as desired or at all.
Due to our limited capital, we will rely on the outside consultants and employees to develop and market our products and/or expand our business models. In the event that one or more of these consultants or employees terminates their services to with the Company, fails to follow management’s instructions or becomes unavailable, we may see adverse effects to our business and face difficulty locating and retaining suitable replacements. Further, because we will operate in multiple countries, language barriers and complications with respect to monitoring our personnel is more likely than a more localized approach. There can no assurance that our employees or consultants will stay with us or can be adequately controlled, or that we will be able to retain replacements on favorable terms or at all, in which case our business could be harmed.
We will rely on third parties to sell our products, and if any of these third parties alter, restrict access to or discontinue their relationships with us, or experience technical difficulties, our ability to market our product(s) would be diminished and our business, revenue and financial results could be harmed.
We will rely on a combination of direct sales, licensing agreements, and the use of our website to sell our Smart Shin Guard and any other products or services we have or may develop or acquire. Similarly, we may rely on third party consultants and suppliers in any future business opportunities we may pursue. If our website or one or more of these third parties experiences a security breach or outage, or any third party through which we sell or to whom we license our products or services terminates or adversely modifies the terms of their engagement with us, our ability to develop and grow a customer base decline and our ability to reach potential customers would be negatively affected, causing our revenues and financial results to be harmed. Additionally, we could be exposed to potential liability and losses, and/or reputational harm, in the event these third parties fail to perform as contracted or deliver products or materials that fail to meet specifications, customer expectations, or safety or other regulatory requirements.
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Economic downturns and market conditions beyond our control could adversely affect our business, financial condition and results of operations.
Our business will depend on the overall demand for our products and services, including the Smart Shin Guard and any future business opportunities we pursue, and on the economic health of the markets and prospective customers we aim to access. Further, the Smart Shin Guard can be categorized as a “non-essential” product, causing demand for such a product to be sensitive to adverse economic and spending trends. Economic downturns or unstable market conditions may cause prospective customers to decrease or pause their budgets, or decline to incur expenditures on non-essential items, which could reduce spending on our product and adversely affect our business, financial condition and results of operations. While interest rates in the U.S. and Europe have started to recede, any increase in inflation may lead to a reversal and harm these economics. In addition, the duration of geopolitical conflicts and their impact are at best uncertain, and continuation may result in reduced demand for our products or other adverse consequences on us and the industries in which we operate. Because our management team is based in Italy, our operations may face enhanced exposure to risks arising from the geopolitical conflicts than our competitors in North America or elsewhere. The U.S. and global economies appear to be potentially be approaching a recession with uncertain and potentially severe impacts upon public companies and us. We cannot predict how this will affect our ability to continue and complete the development of and/or market for our product, but the impact may be adverse and the duration of any such consequences are unpredictable. Among other adverse consequences, our prospective vendors or customers, in response to a reduced access to capital or anticipated or actual reduction and consumer spending, could elect not to engage in business with us, which would materially adversely harm our ability to generate revenue and financial condition.
If we are unable to meet competitive challenges, we may not successfully market our patented product.
There are several companies that have developed products and technology that collect, analyze and transmit physical and performance-based information about players and teams. While we believe our product is unique in that it is both wearable while playing and collects and quickly transmits a greater depth of information and analysis than most comparable devices currently in the market, there can be no assurance that this feature will be adequate to attract new customers or convince players and teams using similar or related technology from switching to the Smart Shin Guard. Further, we will be competing for a limited number of prospective customers in the area of professional and amateur soccer, many of whom may not be willing or able to purchase our products at the prices we desire or at all. Our competitors will include major sports apparel firms and technology and data firms with greater name recognition and/or existing relationships with prospective customers. See “Business-Competition”. Some of these competitors offer wearable devices that are similar to ours and are already being commercialized in professional and amateur sports. While we believe the Smart Shin Guard will have unique attributes that will render it attractive to customers, we cannot guarantee this alone will enable us to effectively compete for the limited number of consumers in the soccer world, particularly given the prolonged research and development processes we have underwent which have been delayed due to a lack of sufficient capital. Further, while the development process for our Smart Shin Guard continues and until we can adequately establish and scale production and sales capabilities, our competitors will continue to have a time advantage over us to continue to develop, improve upon and market their competing or alternative products and reduce or limit our ability to compete with them.
Specifically, most of our competitors have longer operating histories and greater resources than us, and could focus their substantial financial resources to develop or sustain a competing business model and develop products or services that are more attractive to potential customers than what we offer. Our competitors may also offer similar products and services at prices below cost and/or devote significant sales forces to competing with us for customers, endorsements, or key personnel, any of which could improve their competitive positions. Similar challenges will be present in other ventures we pursue or may in the future pursue. Any of these competitive factors could make it more difficult for us to attract and retain customers or personnel or force us to lower our prices in order to compete, which would in turn reduce our market share and revenue. We can provide no assurance our management will be successful in navigating this complex competitive landscape, in which case our financial condition would be adversely affected.
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Because we will be reliant on a small number of products to be sold to a limited number of prospective customers, we will face significant risks associated with a lack of diversification.
We anticipate that the majority of our operations, particularly in the short term, will be focused on the continued development of our clean energy business and on the development, marketing and sale of our Smart Shin Guard, which products have a relatively limited application and a narrow group of potential customers. Any unexpected developments with respect to these prospective customers or related vendors or organizations would therefore materially harm our ability to establish, maintain or grow a significant market position. Demand for our products may fluctuate in response to new products that emerge or changes to the industries on which they rely, or due to unexpected natural or uncontrollable events.
Any adverse trends or events affecting the customers or markets we seek to target could result in a decline in the demand for our products or the price point at which prospective customers will be willing to purchase it, and in such event we will not have material alternative products or services to offset such negative effects to our business. If we fail to generate material sales of our products for any of the foregoing reasons, your investment in us would be materially harmed.
Because our success will depend to a large extent on our ability to develop and grow a market for our products, you may lose your investment.
In order to be successful, we will need to establish a market for our products. There can be no assurance that anyone will purchase our products at the prices we need to generate material revenue or at all. Additionally, if the U.S. or European markets enter a recession, spending for products such as ours, and the potential customers to whom we might sell our products and services, could decline dramatically. Further, even if we do attract some customers, there can be no assurance that enough customers will purchase our products or that they will continue to purchase our products in sufficient volumes to produce the cash flow needed to sustain our operations, in which case your entire investment could be lost.
We may encounter difficulty obtaining approval for the Smart Shin Guard for in-game use by soccer leagues, which could hinder or eliminate any competitive advantage with respect to our Smart Shin Guard.
A material aspect of the Smart Shin Guard’s potential attractive features for consumers, particularly professional and amateur soccer players and teams, is its relatively small size and integration into a shin guard, which is already used in games and therefore does not add additional bulk or weight to a player’s normal in-game apparel. However, many soccer leagues impose restrictions and policies on the apparel and equipment that players may wear during games. As such, we will likely need to obtain approval for the Smart Shin Guard’s use by the soccer leagues of teams we market the product to in order for those teams to use the product in-game. There can be no assurance we will obtain such approval in any or a sufficient number of leagues. Leagues may be hesitant to allow our product to be used in games for a variety of reasons, including potential safety concerns, concerns that such use would confer on certain teams an unfair advantage at the expense of others, or simply reluctance to change. If we are unable to obtain approval for in-game use in leagues, soccer teams and players in those leagues may be unable to use our product in-game or in real-time, which would reduce the usefulness of our product to them and limit our ability to sell our product or generate material revenue therefrom. If we are unable to convince soccer leagues to allow players’ and teams’ in-game use of our product, it could materially harm our business and results of operations.
The failure to obtain endorsements from athletes or teams could significantly impair our ability to market the Smart Shin Guard.
A key component of our business plan and marketing strategy currently contemplates obtaining endorsements from prominent athletes or teams to market our Smart Shin Guard. As of the date of this filing, we have not obtained any such endorsements. Our ability to obtain any such endorsements will likely be dependent on future funding. Because of our limited capital, there can be no assurance that we can procure any endorsements, in which case our business could be adversely affected.
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We may be exposed to liabilities under the Foreign Corrupt Practices Act, and any determination that we violated the Foreign Corrupt Practices Act could have a material adverse effect on our business.
Because we intend to operate in foreign markets, we will be subject to the Foreign Corrupt Practice Act (the “FCPA”), and other laws that prohibit improper payments or offers of payments to foreign governments (as well as similar laws in the United States). We expect to have operations and distribution channels in jurisdictions creating the potential for corrupt practices by our employees, consultants or agents. We may employ sales personnel or independent contractors who may be viewed as our agents or otherwise expose us to liability under the FCPA. While we intend to comply fully with the FCPA and similar anti-bribery laws in conducting our business abroad, we cannot guarantee that we will be able to control the conduct of our employees and contractors to prevent corrupt practices. The potential penalties for violating the FCPA include anti-bribery laws and criminal or civil sanctions, including a fine of up to $2 million per violation. If we were to be found in violation of the FCPA or local anti-bribery laws, the resultant penalties and collateral consequences could negatively affect our business, operating results and financial condition.
We plan to conduct a substantial portion of our business in foreign markets, which will expose us to the risks of trade or foreign exchange restrictions, increased tariffs, foreign currency fluctuations, disruptions or conflicts with our third-party importers and similar risks associated with foreign operations.
Our current business plan includes expansion into multiple foreign markets exposing our Company to risks associated with foreign operations. For example, a foreign government may impose trade or foreign exchange restrictions or increased tariffs, or otherwise limit or restrict our ability to import products into a country, any of which could negatively impact our operations. We are also exposed to risks associated with foreign currency fluctuations by selling our products to consumers in foreign markets. Accordingly, strengthening of the Euro which is our primary currency versus a foreign currency could have a negative impact on us. Additionally, we may be negatively impacted by conflicts with or disruptions caused or faced by third-party importers, as well as conflicts between such importers and local governments or regulating agencies. Our operations in some markets also may be adversely affected by political, economic and social instability in foreign countries, as well as economic tensions between governments, the implementation of new or increased tariffs and other changes in international trade policies. Finally, since we plan to operate in the European Union, the impact of the war between Russia and Ukraine, the war in Israel, and/or economic sanctions between or among countries, as well as general geopolitical issues in Europe, may adversely affect our operations in the European Union.
Another risk associated with our international operations is the possibility that a foreign government may impose foreign currency remittance restrictions. Due to the possibility of government restrictions on transfers of cash out of the country and control of exchange rates, we may not be able to immediately repatriate cash at the official exchange rate. If this should occur, or if the official exchange rate devalues, it may have a material adverse effect on our business, assets, financial condition, liquidity, results of operations or cash flows.
Some of our contracts have been and are expected to be in foreign jurisdictions and currencies, and if we do not comply with transfer pricing, customs duties, value added taxes, and similar regulations, then we may be subjected to additional taxes, duties, interest and penalties in material amounts, which could harm our operating results and financial condition.
Because we operate and plan to operate in countries outside of the United States, we will be subject to transfer pricing and other tax regulations designed to ensure that our intercompany transactions are consummated at prices that have not been manipulated to produce a desired tax result, that appropriate levels of income are reported as earned by our United States or local entities, and that we are taxed appropriately on such transactions. In addition, our operations will be subject to regulations designed to ensure that appropriate levels of customs duties are assessed on the importation of our products. Further, we have executed and expect to continue to enter into contracts with third parties in foreign jurisdictions and involving foreign currencies, and we therefore face the risk of foreign currency fluctuations which could cause increased operating expenses and reduced revenues, in addition to other uncertainties and contingencies incident to doing business in another country some of which are described elsewhere in these Risk Factors.
The imposition of new taxes, even pass-through taxes such as value added taxes, could have an impact on our perceived product pricing and will likely require that we increase prices in certain jurisdictions, and therefore could have a potential negative impact on our business and results of operations. If they arise, the ultimate resolution of these matters may take several years, and the outcome is uncertain. If the Internal Revenue Service or any foreign taxing authorities were to successfully challenge our transfer pricing practices or our positions regarding the payment of income taxes, customs duties, value added taxes, withholding taxes, sales and use taxes, and other taxes, we could become subject to higher taxes, we may determine it is necessary to raise prices in certain jurisdictions accordingly, and our revenue and earnings and our results of operations could be adversely affected.
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If we fail to comply with U.S. and foreign laws related to privacy, data security, and data protection, it could adversely affect our operating results and financial condition.
We are or may become subject to a variety of laws and regulations including the European Union’s General Data Protection Regulation (the “GDPR”) regarding privacy, data protection, and data security. These laws and regulations are continuously evolving and developing. The scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting, particularly with respect to foreign laws.
In particular, there are numerous U.S. federal, state, and local laws and regulations and foreign laws and regulations regarding privacy and the collection, sharing, use, processing, disclosure, and protection of personal data. Such laws and regulations often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions. For example, the GDPR includes operational requirements for companies that receive or process personal data of residents of the European Union that are broader and more stringent than those previously in place in the European Union and in most other jurisdictions around the world. The GDPR includes significant penalties for non-compliance, including fines of up to €20 million or 4% of total worldwide revenue. Additionally, in June 2018, California enacted the California Consumer Privacy Act (the “CCPA”). In November 2020, the CCPA was amended by Proposition 24, the California Consumer Privacy Act, which extends the CCPA. The CCPA requires covered companies to provide California consumers with new disclosures and will expand the rights afforded consumers regarding their data. Fines for noncompliance may be up to $7,500 per violation. The costs of compliance with, and other burdens imposed by, the GDPR, CCPA, and similar laws may limit the use and adoption of our products and services and/or require us to incur substantial compliance costs, which could have an adverse impact on our business.
Since the CCPA was enacted, the U.S. currently has at least 20 states - California, Colorado, Connecticut, Delaware, Indiana, Iowa, Kentucky, Maryland, Minnesota, Montana, Nebraska, New Hampshire, New Jersey, Oregon, Rhode Island, Tennessee, Texas, Utah and Virginia, that have comprehensive data privacy laws in place, or enacted comprehensive data privacy laws set to soon take effect. An additional seven states have enacted narrower privacy laws - Florida, Maine, Michigan, Nevada, New York, Vermont, and Washington. So far during the 2024 legislative cycle, at least four states have introduced comprehensive privacy bills that address a range of issues, including protecting biometric identifiers and health data, or governing the activities of specific entities. However, this patchwork approach to privacy legislation could pose compliance and liability risks for companies that have multistate operations. Proposed and enacted bills in various states have similar rights in preexisting privacy legislation but differ in implementation and enforcement. In June 2024 the American Privacy Rights Act of 2024 was introduced in the U.S. House of Representatives and was subsequently referred to the House Committee on Energy and Commerce has and is not yet adopted. As introduced, this proposed legislation would establish requirements for how companies handle personal data by, among other things, limiting the collection, processing, and transfer of personal data, prohibiting companies from transferring individuals’ personal data without their affirmative express consent, establishing a right to access, correct, and delete personal data, requiring companies to provide individuals with a means to “opt out” of the transfer of non-sensitive covered data and the right to opt out of the user of their personal information for targeted advertising, requiring companies to implement security practices aimed at protecting personal data, and imposing enforcement actions and the possibility of civil proceedings for violations. Proposed federal legislation, like the American Privacy Rights Act of 2024, will likely continue to be debated and, at some point, may be enacted in some form.
We intend to strive to comply with all applicable laws, policies, legal obligations, and industry codes of conduct relating to privacy, data security, and data protection. Our limited resources may adversely affect our compliance effort. Given that the scope, interpretation, and application of these laws and regulations are often uncertain and may be in conflict across jurisdictions, it is possible that these obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices. Any failure or perceived failure by us or third party service providers to comply with our privacy or security policies or privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personal data, may result in governmental enforcement actions, litigation, or negative publicity, and could have an adverse effect on our operating results and financial condition.
Governments are continuing to focus on privacy and data security, and it is possible that new privacy or data security laws will be passed or existing laws will be amended in a way that is material to our business. Any significant change to applicable laws, regulations, or industry practices regarding the personal data of our employees, agents or customers could require us to modify our practices and may limit our ability to expand or sustain our salesforce or bring our products to market. Changes to applicable laws and regulations in this area could subject us to additional regulation and oversight, any of which could significantly increase our operating costs and materially affect our operating results and financial condition.
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Risks Related to Our Common Stock
Because of our lack of liquidity, we have funded our operations and expenditures primarily through the incurrence of debt and the satisfaction of such debt through the issuance of shares of our common stock, the result of which is continued dilution to existing shareholders and downward pressure on our stock price.
As disclosed under “Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations,” due to our lack of revenue and continued capital requirements, in recent years we have relied heavily on incurring indebtedness from shareholders and other third parties and repaying that indebtedness in shares of our common stock. We expect this trend to continue unless we are able to fund another source of capital, which may include issuing other forms of securities with terms that could limit our operational flexibility, subordinate the rights of shareholders or have other negative features. Further, we have in the past and may in the future issue shares for consideration that is well below the market price of our common stock as reflected on the OTCID Basic Market. For example, in December 2021 and February 2022, following a 1-for-100 reverse split and an agreement with certain of our lenders, we issued a total of 118,663,761 shares to lenders in satisfaction of $225,259 in indebtedness at a per share price of approximately $0.0019 per share, below the fair market value of the shares based on accounting principles.
The result of our continuing to fund our operations through the issuance of shares of common stock has been and will continue to be the dilution of our shareholders’ ownership interest in the Company. In addition, the introduction of additional shares imposes downward pressure on our stock price, particularly given the limited and sporadic nature of trading in our common stock. Unless we are unable to raise sufficient capital by non-dilutive mean which is unlikely, or generate material revenue from our operations which may not come to fruition in the near term or at all, we expect we will need to continue to issue shares of common stock causing further dilution and potentially cause our stock price to decline further, which would have a material adverse effect on existing shareholders.
Our registration under the Exchange Act could be revoked by the SEC if we fail to file required reports.
If we fail to file reports as required under the Exchange Act, we may lose our registration as a reporting company. While we intend to comply with the Exchange Act’s reporting requirements moving forward, and we may be unable to comply in the future as we did in the past. For example, in June 2009, the SEC revoked our registration under the Exchange Act for failure to file required reports. Following that action, the Company expended resources to again become a reporting company with the SEC in 2010; however, it was never able to file an annual report on Form 10-K and ultimately withdrew its registration in 2013. Following our registration in 2021, the heightened expenditures of being a public reporting company continue to impose challenges to us and strain our very limited resources.
If we are unable to comply with the SEC reporting provisions in the future, such failure will affect the liquidity of our common stock and act as a depressant to the price, particularly if in such event we are also unable to maintain our OTCID Basic Market quotation using the alternative reporting system, which would result in the loss of a two-way trading market for our common stock. We cannot assure you we will not become delinquent and/or withdraw or have our reporting status revoked again.
Currently there is no active public market for our common stock, and we cannot predict the future prices or the amount of liquidity.
Currently, there is no active public market for our common stock and one may never develop. Our common stock trades sporadically on the OTCID Basic Market under the symbol “GHST.” We do not know if an active market will develop even if are successful in completing the development of our Smart Shin Guard and commercializing that product, or if we are able to further develop and execute other aspects of our business plan.
The OTCID Basic Market generally is not an active market. Further, our common stock has only traded sporadically. In order to move to a higher market, such as the OTCQB, we are required to pay $10,000 per year. Even if our common stock begins trading on the OTCQB, investors should be aware that the OTCQB is not as liquid as major national securities exchanges.
These stock market and industry factors may adversely affect the market price of our common stock.
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Because of our limited working capital, we lack required internal controls and unless we remediate them, we may be hampered in a number of ways, which could materially and adversely affect us.
Our management and directors are based in Italy and other European countries. Although our accounting and legal professionals, as well as our auditors, are based in the United States, our lack of familiarity with United States federal and Delaware law has adversely affected us and may continue to adversely affect us as follows:
| · | Due to our limited size, we do not segregate our accounting functions which creates a material weakness; |
| · | The lack of controls may ultimately cause errors in our financial statements; |
| · | As we expand our business, we may fail to comply with local laws that could result in fines and the inability to do business; and |
| · | Once our common stock publicly trades, investors may react to our lack of internal controls by selling our stock and depressing the price. |
As a public company in the United States, we are required to maintain internal control over financial reporting and disclosure controls and procedures. These controls and other procedures are designed to ensure that information required to be disclosed by us in the reports that we file with the SEC is disclosed accurately and is recorded, processed, summarized and reported within the time periods specified in SEC rules.
Ensuring that we have adequate controls and procedures in place to help produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be evaluated frequently. We will incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies relating to internal controls, which could materially adversely affect our results of operations.
Subject to raising sufficient capital, we plan to take steps to remediate our material weaknesses, including hiring a principal financial officer with knowledge of generally accepted accounting principles as well as reporting and disclosure obligations. As our business expands we intend to retain additional consultants as required. If we fail to maintain proper and effective internal controls in future periods, we could become subject to potential review by the SEC or other regulatory authorities, which could require additional financial and management resources, could compromise our ability to run our business effectively and could cause investors to lose confidence in our financial reporting.
The SEC has sued multiple public companies in the past alleging in part that they had violated Section 13(b) of the Exchange Act resulting from their failure to remediate material weaknesses in their internal control over financial reporting over an extensive period of time. Three of these companies had remediated their material weaknesses at the time the lawsuits were filed. If the SEC Staff investigates us and following that investigation a lawsuit is filed alleging that we have and/or have not remediated our material weaknesses, we will face the following risks:
| · | It will divert our management’s attention from our core business of developing, marketing and selling the Smart Shin Guard; |
| · | We will incur substantial legal fees in connection with both the investigation and the lawsuit if it is filed; |
| · | If we are sued, we may be required to pay a civil monetary penalty in addition to other remedies the SEC or a court may impose; |
| · | Any public disclosure may cause investors to sell our stock which may result in a material decline in our stock price that will cause investors to lose money; and |
| · | Our existing stockholders will experience more dilution as we are required to raise capital at a lower price per share. |
Because all of our officers and directors reside outside of the United States, it will be difficult for investors to sue them personally in the United States and may be difficult to enforce any judgment against their assets, which are located outside of the United States.
Our officers and directors reside in and are based in Italy and other European countries. In the event that investors sue them in the United States alleging that any registration statement, report or proxy filed with the SEC or other disclosure in connection with the purchase or sale of our common stock violates the United States federal and/or state securities laws, they may claim that they are not subject to suit individually in the United States. If a court later determines that these individuals may be sued in the United States and there is an adverse judgment against all or some of these directors, it may be difficult to enforce a United States judgment in the home countries of the defendants.
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Due to SEC Rule 15c2-11 under the Exchange Act, our common stock may become subject to limitations or reductions on stock price, liquidity or volume.
On September 16, 2020, the SEC adopted amendments to Rule 15c2-11 under the Exchange Act. This Rule applies to broker-dealers who quote securities listed on over-the-counter markets such as our common stock. The Rule as amended prohibits broker-dealers from publishing quotations on OTC markets for an issuer’s securities unless they are based on current publicly available information about the issuer. The amended Rule also limits the Rule’s “piggyback” exception, which allows broker-dealers to publish quotations for a security in reliance on the quotations of a broker-dealer that initially performed the information review required by the Rule, to issuers with current publicly available information or issuers that are up-to-date in their Exchange Act reports.
This Rule could harm the liquidity and/or market price of our common stock by either preventing our shares from being quoted or driving up our costs of compliance. If we cannot or do not provide or maintain current public information about our Company our stockholders may face difficulties in selling their shares of our common stock at desired prices, quantities or times, or at all, as a result of the amendments to the Rule.
We are subject to the “penny stock” rules which will adversely affect the liquidity of our common stock.
The SEC has adopted regulations which generally define “penny stock” to be an equity security that has a market price of less than $5.00 per share, subject to specific exemptions. The market price of our common stock on the OTCID Basic Market is presently less than $5.00 per share and therefore we are considered a “penny stock” company according to SEC rules. Further, we do not expect our stock price to rise above $5.00 in the foreseeable future. The “penny stock” designation requires any broker-dealer selling our securities to disclose certain information concerning the transaction, obtain a written agreement from the purchaser and determine that the purchaser is reasonably suitable to purchase the securities. These rules limit the ability of broker-dealers to solicit purchases of our common stock and therefore reduce the liquidity of the public market for our shares.
Broker-dealers are increasingly reluctant to permit investors to buy or sell speculative unlisted stock and often impose costs which make it uneconomical for small shareholders to do so. Moreover, as a result of apparent regulatory pressure from the SEC and the Financial Industry Regulatory Authority (“FINRA”), a growing number of broker-dealers decline to permit investors to purchase and sell or otherwise make it difficult to sell shares of penny stocks. The “penny stock” designation may have a depressive effect upon our common stock price.
Our stock price may be volatile because of factors beyond our control.
Any of the following factors could affect the market price of our common stock:
| · | our failure to generate material revenue; |
| · | our failure to achieve and maintain profitability; |
| · | actual or anticipated variations in our quarterly results of operations; |
| · | announcement by us of the commencement of or the progress of any litigation; |
| · | our failure to meet anticipated results with respect to the development and distribution of products to consumers and others; |
| · | the failure of our products or services we may offer in the future to operate as expected; |
| · | complaints received from consumers and other users; and |
| · | our failure to remain current with our Exchange Act filing requirements. |
In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted. A securities class action suit against us could result in substantial costs and divert our management’s time and attention, which would otherwise be used to benefit our business.
Because of FINRA sales practice requirements which affect broker-dealers, the market price for our common stock will be adversely affected.
FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy shares of our common stock, which may limit your ability to buy and sell our common stock and have an adverse effect on the market for our shares.
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In the future, we may issue preferred stock which could make it more difficult for a third party to acquire us and could depress our stock price.
Our Board of Directors may issue one or more series of preferred stock that have more than one vote per share. This could permit our Board of Directors to issue preferred stock to investors who support our management and us and permit our management to retain control of our business. Additionally, issuance of preferred stock could block an acquisition resulting in both a drop in our stock price and a decline in interest of our common stock.
Since we intend to retain any earnings for development of our business for the foreseeable future, you will likely not receive any dividends for the foreseeable future.
We have not and do not intend to pay any dividends in the foreseeable future, as we intend to retain any earnings for development and expansion of our business operations. As a result, you will not receive any dividends on your investment for an indefinite period of time.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
ITEM 1C. CYBERSECURITY.
Like all companies that utilize technology, we
are subject to threats of breaches of our technology systems. To mitigate the threat to our business, we aim to take a comprehensive approach
to cybersecurity risk management.
ITEM 2. PROPERTIES
GHST maintains its headquarters in Palm Beach Gardens, FL. The headquarters are in an executive suite environment where services are provided on an as-needed basis. Our officers spend limited time in the United States.
ITEM 3. LEGAL PROCEEDINGS.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
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PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Our common stock is not listed on any securities exchange, and is quoted on the OTCID Basic Market under the symbol “GHST.” Because our common stock is not listed on a securities exchange and its quotations on OTCID Basic Market are limited and sporadic, there is currently no established public trading market for our common stock.
The following table reflects the high and low bid information for our common stock for each fiscal quarter during the fiscal years ended June 30, 2025 and 2024. This information was obtained from OTCID Basic Market and reflects inter-dealer prices without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.
| COMMON STOCK MARKET PRICE | ||||||||
| HIGH | LOW | |||||||
| Fiscal Year Ended June 30, 2025: | ||||||||
| First Quarter | $ | 0.07 | $ | 0.02 | ||||
| Second Quarter | $ | 0.21 | $ | 0.04 | ||||
| Third Quarter | $ | 0.11 | $ | 0.03 | ||||
| Fourth Quarter | $ | 0.06 | $ | 0.03 | ||||
| COMMON STOCK MARKET PRICE | ||||||||
| HIGH | LOW | |||||||
| Fiscal Year Ended June 30, 2024: | ||||||||
| First Quarter | $ | 0.078 | $ | 0.031 | ||||
| Second Quarter | $ | 0.065 | $ | 0.033 | ||||
| Third Quarter | $ | 0.067 | $ | 0.027 | ||||
| Fourth Quarter | $ | 0.09 | $ | 0.04 | ||||
Holders
As of October 3, 2025, there were approximately 596 shareholders of record of the Company's common stock. We believe that additional beneficial owners of our common stock hold shares in street name.
Shares Eligible for Future Sale
All of the outstanding shares of common stock of the Company are restricted securities and cannot be sold under Rule 144 until at least six months have passed since payment, and the other requirements of Rule 144(i)(1)(ii) have been satisfied, including the Company being current in its SEC periodic reporting obligations.
In general, Rule 144 provides that any non-affiliate of the Company, who has held restricted common stock for at least six-months, is entitled to sell their restricted stock freely, provided that the Company stays current in its SEC filings.
An officer, director or other person in control of the Company may sell after six months with the following restrictions: (i) the Company is current in its SEC filings, (ii) certain manner of sale provisions, (iii) the filing of a Form 144, and (iv) volume limitations limiting the sale of shares within any three-month period to a number of shares that does not exceed 1% of the total number of outstanding shares. A person who has ceased to be an affiliate at least three months immediately preceding the applicable sale and who has owned such shares of common stock for at least one year may sell the shares under Rule 144 without regard to any of the limitations described above.
Such shares may be sold outside of the United States. Further, such shares may be sold to purchasers in the United States under Section 4(a)(1) of the Securities Act if paid for more than two years ago and if the seller is not an affiliate of the Company. However, some broker-dealers and transfer agents will not accept legal opinion relying on Section 4(a)(1).
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Equity Compensation Plan Information
The Company does not have any securities authorized for issuance or outstanding under an equity compensation plan or equity compensation grants made outside of such a plan.
Dividend Policy
We have not paid cash dividends on our common stock and do not plan to pay such dividends in the foreseeable future. Our Board of Directors will determine our future dividend policy on the basis of many factors, including results of operations, capital requirements, and general business conditions.
Unregistered Sales of Equity Securities
All unregistered sales of equity securities through the period covered by this Report have previously been disclosed.
ITEM 6. [Reserved]
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Certain statements in “Management’s Discussion and Analysis and Plan of Financial Condition and Results of Operations” are forward-looking statements that involve risks and uncertainties. Words such as may, will, should, would, anticipates, expects, intends, plans, believes, seeks, estimates and similar expressions identify such forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s analysis only as of the date hereof. You should read the following discussion in conjunction with our financial statements, which are included elsewhere in this Report. We assume no obligation to update these forward-looking statements to reflect actual results or changes in factors or assumptions affecting forward-looking statements. Our actual results could differ materially from those discussed in the forward-looking statements. See “Cautionary Note Regarding Forward Looking Statements” and “Risk Factors” contained in the forepart of this Report for more information.
Overview
Our principal business focus has been seeking to exploit a patent and obtain and exploit future patents for the Smart Shin Guard. We have also added to this focus the operations of Insside, which is in the early stages of developing a clean energy business with an initial focus on wholesale electricity sales and the development of solar energy infrastructure in Italy, which will be subject to a third party accessing capital. We also have development stage businesses for IoTT, an internet technology business, and GHST Art. We have generated nominal revenue and need substantial additional financing to market our services.
Plan of Operation
Smart Shin Guard
On June 30, 2020, we obtained the intellectual property rights to the Smart Shin Guard and began efforts to implement our new business model of developing and marketing advanced wearable sports tracking and analysis devices, with an initial focus on soccer. In June 2020 we were issued the U.S. patent for our product, in 2022 we obtained a European patent for Italy, France, Spain, Germany and the United Kingdom and in March 2023 we obtained a Hong Kong patent. While we believe we have sufficient capital to fund our initial operations, we anticipate we will need additional funding to expand our operations and market and sell our product, including for the following expenses:
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| · | Complete the development of our Smart Shin Guard and the related phone app; |
| · | Compensating out management and key personnel; |
| · | Obtain the raw materials needed for our manufacturing of our products, including pursuant to contracts with third party suppliers we may enter into to procure the same; |
| · | Arrange for the production of Smart Shin Guards and factory and warehouse space for the such production (which we may be required to outsource to a third party or parties); |
| · | Develop relationships with soccer leagues, teams and players in order to both locate potential customers and establish business relationships to assist with advertising to the general public; |
| · | Develop, maintain and protect our intellectual property rights including patent(s) in applicable jurisdictions; |
| · | Communicate with and advocate for our product to FIFA and other soccer leagues and regulators to allow for widespread in-game use of our product in professional settings. |
We are currently seeking to complete the development of our product, which process has been prolonged due to our limited capital and human resources. Additionally, the planned smart phone application and the professional kit version of our product are expected to take a longer time to develop than the consumer kit due to the increased complexity of its functionality. These elements of our business plan to be the focal point of our development efforts as of the date of this Report.
After we have completed product development efforts and assuming successful completion of the same which will depend, among other things, on our ability to raise or otherwise access sufficient capital and the performance of third parties on which we rely or will rely, we intend to then turn our attention towards manufacturing the product and establishing a market for selling our product. Because our product focuses on soccer, or “football,” we plan to focus these efforts on countries located in Europe, where the sport is most popular and well-funded, and teams and players may be more likely to subscribe to our offerings. We expect that our ability to have success during this stage will depend on a number of factors which may be beyond our control, including our ability to have patents issued in target jurisdictions, our ability to complete product development and manufacturing efforts on schedule, and our ability to obtain strategic partnerships from professional teams or athletes to assist us in our marketing efforts. See “Risk Factors” in this Report.
Insside
In late 2024 and 2025 the Company entered into certain agreements for a new clean energy business through its subsidiary Insside. These agreements provide for the Company’s lease of certain land in Italy for solar energy projects, the construction of solar energy plants by a Green Capital assuming financing is obtained and the sale of electricity from such projects and any separate arrangements we may undertake with respect to the sale of electricity. In May and June 2025 we entered into certain preliminary agreements for our purchase and sale of electricity from and to third parties See “Item 1 – Business” and the footnotes accompanying our financial statements contained in this Report for more information.
Other Subsidiaries
Our other subsidiaries remain in the development stage, as we continue to develop business plans for their respective goals.
Headquarters
We are currently headquartered in Palm Beach Gardens, FL where we maintain an executive office for occasional use; however our directors and officers are located in Italy and other European countries. We believe our presence in these locations will be useful in initiating our marketing strategy, in which we plan to focus our efforts on European countries and access the U.S. capital markets to fund our operations.
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Need for League Approval
As discussed in “Risk Factors,” the Smart Shin Guard’s value, particularly with respect to professional teams and players, will in large part be determined by our ability to obtain approval for in-game use of the product from FIFA, UEFA Champions League, Serie A (Italy), Ligue 1 (France), and the English Premier League, as well as other prominent international and national soccer leagues that attract a significant number of viewers. Management believes that due to our product’s small size and design to be used as a wearable shin guard, which equipment is already used in games, we should be able to obtain such approval, but any difficulties or delays in obtaining this consent from target leagues could result in limitations to the prospective market for our product and/or require us to allocate capital and time towards obtaining such approval.
Critical Accounting Policies and Estimates
The methods, estimates, and judgments that we use in applying our accounting policies impact the results that we report in our financial statements. Some of our accounting policies may require us to make difficult and subjective judgments, often as a result of the need to make estimates regarding matters that are inherently uncertain. Certain estimates involve certain assumptions that if incorrect could create a material adverse impact on GHST’s results of operations and financial condition. Our most significant estimates and judgement involve our revenue recognition policy and how it’s applied to existing and future contracts. We believe that the following policy from the financial statements are followed closely, but contracts are complex and they often require interpretation. The Company did not identify any critical accounting estimates for FY 2025.
The following is a discussion of critical accounting policies:
Revenue Recognition
The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. The provisions of ASC Topic 606 require the following steps to determine revenue recognition: (1) Identify the contract(s) with a customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to the performance obligations in the contract; and (5) Recognize revenue when (or as) the entity satisfies a performance obligation.
The Company derives most of its revenues to date from consulting services provided to the energy sector for the construction of solar energy plants . These services are contractual and contain identified performance obligations and are historically paid by the customer at the signing of the consulting contract. The Company recognizes revenues only when these identifiable performance obligations are satisfied. Payments that are received from customers in advance of when services are satisfactorily completed are reflected as deferred revenue on the accompanying consolidated balance sheets. Going forward the Company expects to be receiving revenues from longer-term surface rights agreements for energy production as described in Note 1. The Company will follow the revenue recognition policies as described above for the contracts.
Results of Operations
The following discussion should be read in conjunction with the financial statements and notes thereto included elsewhere in this report.
Fiscal Year Ended June 30, 2025 Compared to the Fiscal Year Ended June 30, 2024.
We had $60,469 in revenue in the fiscal year ended June 30, 2025 (“FY 2025”) relating to InSSIDe’s activities in the field of renewable energy, and revenue of $40,916 in the fiscal year ended June 30, 2024 (“FY 2024”) relating to InSSIDe’s activities in the field of renewable energy, and we sustained net losses of $182,848 and $511,284, respectively, in those periods. Our expenses consisted of general and administrative expenses and patent development in each period, with a decline in general and administrative expenses in FY 2025 accounting for the reduction in net loss compared to FY 2024.
We do not expect to generate material revenue unless and until we can implement our business plan and begin marketing and selling our products and services in sufficient quantities, which has been delayed due to a combination of our limited capital resources and external forces resulting in delays in the development of our business, which has and until completed will continue to adversely affect our marketing capabilities. In addition, our focus on multiple businesses beginning in recent periods may further delay these efforts and our operating results given our limited resources and personnel.
In order to become profitable, we will need to complete the development of a functional product and thereafter establish a sufficient market for our product, including internationally, to offset our development, manufacturing and advertising costs, and our ability to do so will be subject to a number of factors, many of which will be beyond our control. We will also need to access sufficient capital, form strategic alliances and develop an adequate market with respect to any future business opportunities we may pursue.
| 26 |
Liquidity and Capital Resources
Net Cash used in Operating Activities:
For FY 2025, the Company used net cash of $163,701 in operating activities as compared to $164,551 for FY 2024. In FY 2024, we had stock compensation of $324,523 in FY 2024 compared to $0 in FY 2025.
Cash Flows provided by Financing Activities:
Cash flows from financing activities for FY 2025 were $147,917 compared to $143,358 for FY 2024. Cash flows from financing activities arose from advances from related parties in each period.
Cash Flows from Investing Activities:
For FY 2025 and FY 2024, the Company had no cash flows from investing activities.
We have approximately $15,900 in available cash as of October 3, 2025. As reflected in the Financial Statements contained elsewhere in this Report, management has expressed substantial doubt about our ability to continue as a going concern during the fiscal year ended June 30, 2025, unless we can raise the required capital or generate material revenue to fund our operations.
We do not have sufficient capital to support our operations for the next 12 months and will dependent upon on the proceeds from a financing, which may consist of sales of our common stock, the issuance of debt securities and/or issuance of securities convertible into shares of our common stock, any of which could have a dilutive effect on our existing shareholders. We intend to continue to raise capital from existing investors if and to the extent possible. We estimate that we will need to raise at least $250,000 in order to meet our working capital needs for the next 12 months. As described elsewhere in this Report, we plan to phase in our expenses and grow our business as working capital is available.
There can be no assurances that we will be able to raise additional capital. The inability to raise capital would adversely affect our ability to achieve our business objectives. In addition, if our operating performance during the next 12 months is below our expectations, our liquidity and ability to operate our business could be adversely affected. We continue to monitor macro-economic factors such as inflationary pressures, heightened central bank interest rates and recessionary fears, as well as trends within the industries in which we operate or plan to operate, all of which may affect our working capital requirements and ability to raise funding for our operations within the timeframes desired, on favorable terms or at all. See “Risk Factors.”
Significant Accounting Policies and Recent Accounting Pronouncements
Please see the notes to our Financial Statements for information about our Significant Accounting Policies and Recent Accounting Pronouncements.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
| 27 |
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
INDEX TO FINANCIAL STATEMENTS
| Page | |
| Report of Independent Registered Public Accounting Firm - Fruci & Associates II, PLLC (PCAOB ID 5525) | F-2 |
| Consolidated Balance Sheets – As of June 30, 2025 and 2024 |
F-3 |
| Consolidated Statements of Operations – For the Years Ended June 30, 2025 and 2024 |
F-4 |
| Consolidated Statements of Changes in Stockholders’ Deficit – For the Years Ended June 30, 2025 and 2024 |
F-5 |
| Consolidated Statements of Cash Flows – For the Years Ended June 30, 2025 and 2024 |
F-6 |
| Notes to Consolidated Financial Statements | F-7 - F-13 |
| F-1 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of GHST World, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of GHST World, Inc. and Subsidiaries (“the Company”) as of June 30, 2025 and 2024, and the related consolidated statements of operations, changes in stockholders’ deficit, and cash flows for each of the years in the two-year period ended June 30, 2025, and the related notes (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024 and the results of its operations and its cash flows for each of the years in the two-year period ended June 30, 2025, in conformity with accounting principles generally accepted in the United States of America.
Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company had net losses, an accumulated deficit, stockholders’ deficit, and negative cash flows from operating activities. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
Critical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there were no critical audit matters.
We have served as the Company’s auditor since 2023.
October 14, 2025
| F-2 |
GHST World Inc.
Consolidated Balance Sheets
| June 30, 2025 | June 30, 2024 | |||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable | ||||||||
| Total Current Assets | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Stockholders’ Deficit | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Advances from related parties | ||||||||
| Common stock payable | ||||||||
| Deferred revenue | ||||||||
| Total Current Liabilities | ||||||||
| Commitments and Contingencies (Note 7) | ||||||||
| Stockholders’ Deficit | ||||||||
| Preferred stock, $ par value; shares authorized; | ||||||||
| Series A, shares issued and outstanding at June 30, 2025 and 2024 | ||||||||
| Series B, shares issued and outstanding at June 30, 2025 and 2024 | ||||||||
| Common stock, $ par value, shares authorized; shares issued at June 30, 2025 and 2024 |
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| Additional paid-in-capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Stockholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities and Stockholders' Deficit | $ | $ | ||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-3 |
GHST World Inc.
Consolidated Statements of Operations
| For the Years Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Revenues | $ | $ | ||||||
| Operating expenses: | ||||||||
| General and administrative expenses | ||||||||
| Patent development costs | ||||||||
| Total operating expenses | ||||||||
| Other Income(expense): | ||||||||
| Other expense | ( | ) | ( | ) | ||||
| Total Other Income (expense) | ( | ) | ( | ) | ||||
| Loss Before Income taxes | ( | ) | ( | ) | ||||
| Provision for Income taxes | ( | ) | ( | ) | ||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Net loss per common share | ||||||||
| Basic | $ | ( | ) | $ | ( | ) | ||
| Diluted | $ | ( | ) | $ | ( | ) | ||
| Weight average number of common shares outstanding- | ||||||||
| Basic | ||||||||
| Diluted | ||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-4 |
GHST World Inc.
Consolidated
Statements of Changes in Stockholders' Deficit
For the Years Ended June 30, 2025 and 2024
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Preferred Stock Series A |
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Preferred Stock Series B |
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Common Stock | |
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Additional Paid in |
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Accumulated |
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Total Stockholders' |
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| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||||||||
| Balance June 30, 2023 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
| Issuance of common stock for services | — | — | ||||||||||||||||||||||||||||||||||
| Net loss for the year ended June 30, 2024 | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance June 30, 2024 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||||||
| Net loss for the year ended June 30, 2025 | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Balance June 30, 2025 | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-5 |
GHST World Inc.
Consolidated Statements of Cash Flows
| For the Years Ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock compensation | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | ( | ) | ||||||
| Accounts payable and accrued expenses | ||||||||
| Deferred revenue | ||||||||
| Net Cash Used In Operating Activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Advances from related parties | ||||||||
| Net Cash Provided By Financing Activities | ||||||||
| Net increase (decrease) in cash | ( | ) | ( | ) | ||||
| Cash - beginning of period | ||||||||
| Cash - end of period | $ | $ | ||||||
| SUPPLEMENTARY DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Cash paid during the year/period for: | ||||||||
| Interest | $ | $ | ||||||
| Taxes | $ | $ | ||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-6 |
GHST WORLD, INC.
Notes to Consolidated Financial Statements
June 30, 2025 and 2024
NOTE 1- ORGANIZATION, DESCRIPTION OF BUSINESS
Background
GHST World Inc. (“the Company”), is a Delaware corporation that was incorporated on November 12, 1999. The Company is a holding company for various technology and other activities. The Company has acquired and is developing several patents in the technology sector and projects in the field of renewable energy.
Recent Developments
The Company is adding to its core focus by undertaking to enter the clean energy production and trading sector. Summaries of key agreements the Company’s subsidiary, Insside World Inc. (“Insside”), has entered to are described below. Management believes that the Company has reached a point where the losses from its existing business are no longer justifiable. As a result, in an attempt to provide shareholder value, Insside has entered into a series of agreements to acquire surface rights which are similar to land leases. In addition, Insside is transacting with a new special purpose entity, Green Capital SRL (“Green Capital”), an Italian company in Bergamo, which is charged with the duty of raising substantial capital to build solar plants. Upon construction of two solar plants, the Company’s subsidiary will purchase the electricity and resell it to third parties.
The agreements discussed below and the contemplated business of these entities in this enterprise generally envision that Green Capital will fund and construct the solar plants, and operate such plants when they are completed, with Insside acting as exclusive dealer by purchasing and selling the electricity produced from the plants to third parties, and providing consulting services on the construction and operation of the plants. Green Capital will receive any revenues generated from future energy production and sales. Insside will act as the exclusive distributor of the produced energy, deriving proceeds from its purchase of energy at fixed prices and resale of the energy at market prices. Green Capital is owned by a third party which is subject to a contractual arrangement affording certain rights relating to that entity to the Company’s Chairman & CEO, including the right to obtain a majority of the equity interests of that entity in the future. The Company and Insside expect to enter into one or more further agreements with Green Capital to evidence and govern the intended economic rights among the parties.
On November 25, 2024, Insside entered into a
preliminary agreement to purchase the surface rights of land located in Morro D’Oro, Italy for the construction of a solar
plant. The surface area of the land is
On November 29, 2024, Insside entered into a preliminary
agreement with Green Capital to assign the above purchased surface rights for the term of the agreements for construction.
On January 24, 2025, Insside entered into the
preliminary agreement to purchase the surface rights of land that is located in Giulianova, Italy for construction of a solar plant. The
surface area is
| F-7 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
On January 27, 2025, Insside entered into a preliminary agreement with Green Capital, to assign the above purchased surface rights for the term of the agreement for construction. Green Capital is required to raise the capital and build and operate the solar plant. See “Risk Factors.” contained in our quarterly report on Form 10-Q for the fiscal quarter ended December 31, 2024, which was filed with the SEC on February 19, 2025.
As a result of the agreements between Insside and Green Capital, Insside has assigned to Green Capital the surface rights and related rights and obligations under the agreements which Insside had entered into with the landowners. These agreements are currently in a waiting phase as Green Capital seeks to locate sources of capital to fund these arrangements. In the meantime, Insside's support and consultancy activities are ongoing, and the building permit applications are currently under review by the applicable authorities.
On December 18, 2024, Insside entered into a preliminary
agreement with the owners of the two power generation plants built to date and awaiting connection to the power grid in Mosciano, Italy,
to carry out the activity of dealer for the sale of energy. The agreement is for a term of
On March 27, 2025, Insside entered into a procurement
agreement with Ingenera SRL, establishing a partnership for customer acquisition. Ingenera is expected to identify suitable and interested
customers through its network of qualified contacts.
Because these agreements and the potential business of Insside are preliminary in nature, no assurance can be given that the prospective transactions or operations contemplated thereby will occur or yield the results or benefits intended or anticipated.
Insside has invested and intends to continue to invest in the software and resources necessary to develop this structure. We are currently in negotiations with other energy producers to purchase electricity from them and expand this line of business.
NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION
Liquidity and Going Concern
The financial statements have been prepared on
a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course
of business for the foreseeable future. The Company had net losses of $
| F-8 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
Management believes these conditions raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the date these financial statements were issued. The ability to continue as a going concern is dependent upon profitable future operations, positive cash flows, and additional financing. These financial statements do not include any adjustments related to the recovery and classification of recorded asset amounts and classifications of liabilities that might be necessary should the Company be unable to continue as a going concern.
Management intends to raise money in the future through investors as needed to support its working capital needs. Currently the Company intends to raise capital from its existing shareholders and from the possible sale of a minority interest in its subsidiaries. Management cannot provide any assurances that the Company will be successful in completing these undertakings and accomplishing any of its plans.
Principles of Consolidation
The consolidated financial statements include the accounts of the following wholly owned subsidiaries:
- GHST Art World, Inc
- GHST Sport Inc.
- IoTT world Inc.
- Insside World Inc.
All intercompany balances and transactions have been eliminated in consolidation.
Concentration
The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash. The Company places its cash with financial institutions of high credit worthiness. At times, its cash with a particular financial institution may exceed any applicable government insurance limits. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it is a credit counterparty, and as such, it believes that any associated credit risk exposures are limited.
For the years ended June 30, 2025 and 2024, the Company receives all its revenues and deferred revenues from just a few customers. The Company is dependent on related parties for short term funding, who have provided a significant portion of the funding through June 30, 2025.
Foreign Currency
Transaction gains and losses are recognized in earnings. The Company is subject to foreign exchange rate fluctuations in connection with the Company’s international transactions as certain vendor payments and repayments of related party advances are done in foreign currency.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.
Such estimates and assumptions impact, among others, the following: fair value of share-based payments and deferred taxes.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from estimates.
Cash
Cash are amounts held at local banks. The Company had
| F-9 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
Risks and Uncertainties
The Company is undertaking a new business venture that is inherently subject to significant risks and uncertainties, including financial, operational, technological and other risks that could potentially have a risk of business failure.
Revenue Recognition
The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606, the core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. The provisions of ASC Topic 606 require the following steps to determine revenue recognition: (1) Identify the contract(s) with a customer; (2) Identify the performance obligations in the contract; (3) Determine the transaction price; (4) Allocate the transaction price to the performance obligations in the contract; and (5) Recognize revenue when (or as) the entity satisfies a performance obligation.
The Company derives most of its revenues to date from consulting services provided to the energy sector for the construction of solar energy plants. These services are contractual and contain identified performance obligations and are historically paid by the customer at the signing of the consulting contract. The Company recognizes revenues only when these identifiable performance obligations are satisfied. Payments that are received from customers in advance of when services are satisfactorily completed are reflected as deferred revenue on the accompanying consolidated balance sheets. Going forward the Company expects to be receiving revenues from longer-term surface rights agreements for energy production as described in Note 1. The Company will follow the revenue recognition policies as described above for the contracts.
Accounts Receivable
Accounts receivables are recorded at the invoiced
amount. The Company regularly reviews its receivables on a customer-by-customer basis and evaluates whether an allowance for doubtful
accounts is necessary based on any known or perceived collection issues. As of June 30, 2025 and 2024, the Company did
Fair Value
The carrying value of cash, other assets, accounts and other payable approximate their fair value based on the liquidity or the short-term maturities of these instruments. The fair value hierarchy promulgated by GAAP consists of three levels:
- Level one — Quoted market prices in active markets for identical assets or liabilities.
- Level two — Inputs other than level one inputs that are either directly or indirectly observable; and
- Level three — Unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect those assumptions that a market participant would use.
Determining which category an asset or liability
falls within the hierarchy requires significant judgment. The Company evaluates its hierarchy disclosures each quarter. The Company
has
Impairment of Long-Lived Assets
The Company accounts for impairment of long-lived assets in accordance with Accounting Standards Codification (“ASC”) 360, Property, Plant and Equipment, (“ASC 360”). Long-lived assets for the Company consist primarily of other assets and patents. In accordance with ASC 360, the Company periodically evaluates long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When triggering event indicators are present, the Company obtains appraisals on an asset-by-asset basis and will recognize an impairment loss when the sum of the appraised values is less than the carrying amounts of such assets. The appraised values, based on reasonable and supportable assumptions and projections, require subjective judgments. Depending on the assumptions and estimates used, the appraised values projected in the evaluation of long-lived assets can vary within a range of outcomes. The appraisals consider the likelihood of possible outcomes in determining the best estimate for the value of the assets.
| F-10 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
Research and Development
Research and development costs are expensed as incurred. These costs consist primarily of costs related to the development of new products.
Segment Information
The Company operates as a single operating segment and single reportable segment. Operating segments are defined as components of a business that can earn revenue and incur expenses and for which discrete financial information is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and assess performance. The Company’s CODM, the Chief Executive Officer, allocates resources and assesses performance based upon condensed consolidated financial information due to the interconnected relationship of the Company’s products to the same customers, therefore manages its business as a single operating segment.
Income Taxes
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and the respective tax bases. Deferred tax assets, including tax loss and credit carryforwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.
The effect of income tax positions is recognized only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.
The Company applies the fair value method of ASC 718, Share Based Payment, in accounting for its stock-based compensation. This accounting standard states that compensation cost is measured at the grant date based on the value of the award and is recognized over the service period, which is usually the vesting period, if any. We measure stock-based compensation using the fair market value of the Company’s common stock on the date of the grant.
Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the periods presented. Diluted net loss per common share is computed using the weighted average number of common shares outstanding for the period, and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options, stock warrants, convertible debt instruments or other common stock equivalents. Potentially dilutive securities are excluded from the computation if their effect is anti-dilutive. The Company had potentially dilutive securities outstanding for the years ended June 30, 2025 or 2024.
| F-11 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
Recent Accounting Pronouncements
In November 2023, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. All disclosure requirements under ASU 2023-07 are required for public entities with a single reportable segment. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis, with early adoption permitted. The Company implemented this new guidance during the year ended June 30, 2025 with no impact on the Company’s consolidated financial statements.
In December 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a company’s effective tax rate reconciliation and requires disclosure of income taxes paid by jurisdiction. The amendments are effective for fiscal years beginning after December 15, 2024, which require us to adopt the provisions for the year ended June 30, 2026 Form 10-K. The amendments should be applied prospectively; however, retrospective application is permitted. Management does not expect this ASU to have a material impact on our disclosures.
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, which requires, for each relevant expense caption on the income statement, detailed disclosure amounts for purchases of inventory, employee compensation, depreciation, and intangible asset amortization. In addition, this ASU requires companies to include amounts already required by GAAP in the same disclosure, provide a qualitative description of remaining amounts not separately disaggregated, and disclose the amount of total selling expenses along with the companies’ definition of selling expenses. The amendment is effective for fiscal years beginning after December 15, 2026, which would require us to adopt the provisions during the year ended June 30, 2028 Form 10-K. Early adoption is permitted. The amendments should be applied prospectively; however, retrospective application is permitted. Management is currently evaluating this ASU to determine its impact on our disclosures.
We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company.
NOTE 3- PATENTS
The Company obtained a US patent dated June 30,
2020, which is a protection device used in sporting activity with monitoring capabilities. The Company has also obtained a European and
Hong Kong Patent for the same device in March 2023. The Company has incurred a total of $
NOTE 4- COMMON STOCK PAYABLE
The Company has an agreement with certain investors
to convert their investment into common stock of the Company at a price equal to the average value of the stock over the previous six
months. The conversion was contingent on the Company effectuating a
NOTE 5- RELATED PARTY TRANSACTIONS
At June 30, 2025 and 2024, the Company owed related
parties a total of $
As shown in Note 4, the Company has committed
to converting certain debts to equity. Included in the debts is $
See Note 1 – Recent Developments at page F-7 for related party transactions relating to Green Capital.
| F-12 |
GHST WORLD, INC. Notes to Consolidated Financial Statements June 30, 2025 and 2024 |
NOTE 6 - STOCKHOLDERS’ DEFICIT
Preferred Stock Series A and B
The Company is authorized to issue a total shares of any
class of Preferred stock. There are currently shares of Series A Preferred Stock and shares of Preferred
Series B Stock issued and outstanding, Series A Preferred Stock is entitled to
NOTE 7 - COMMITMENTS AND CONTINGENCIES
Legal Matters
From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. There are no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations.
Note 8 - INCOME TAXES
The company accounts for income taxes under ASC
740, Income Taxes, which requires the recognition of deferred tax assets and liabilities based on the difference between the financial
statement basis and tax basis of assets and liabilities by using enacted tax rates in effect for the year. The company had
The following is a reconciliation of income tax rate:
| June 30, 2025 | June 30, 2024 | |||||||
| Federal tax rate | % | % | ||||||
| State tax rate | % | % | ||||||
| Federal tax benefit of State Taxes | ( | )% | ( | )% | ||||
| Combined effective tax rate | % | % | ||||||
| Less valuation allowance | ( | )% | ( | )% | ||||
| Tax rate | % | % | ||||||
NOTE 9 - SUBSEQUENT EVENTS
The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date that the consolidated financial statements were issued for potential recognition or disclosure. Such subsequent events that would have required adjustment or disclosure in the consolidated financial statements are set forth below.
As of June 30, 2025, the Company had shares outstanding, including restricted shares and non-restricted shares. On August 11, 2025, restricted shares converted to non-restricted shares, resulting in restricted shares and non-restricted shares outstanding. The total number of outstanding shares was not affected.
F-13
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
Not applicable.
ITEM 9A. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures as of June 30, 2025 were not effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms because of a material weakness in the Company’s internal control over financial reporting. Specifically, the Company did not maintain effective controls and procedures to support the identification of, accounting for, and the evaluation and disclosure of the valuation for impairment of intangible and other assets, the valuation for stock-based non-cash issuances, and revenue recognition including with respect to material contingencies related to the revenue and the deferred liabilities.
In addition, the Company did not maintain effective controls to identify, and maintain segregation of duties to authorize and approve, support the identification of, accounting for, and the disclosure of related-party transactions and non-routine transactions, as one individual, the Chief Executive Officer, initiates related-party transactions and non-routine transactions and also reviews, evaluates and approves these same transactions.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:
| · | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
| · | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and |
| · | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.
Our management assessed the effectiveness of our internal control over financial reporting based on the parameters set forth above and has concluded that as of June 30, 2025, our internal control over financial reporting was not effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (“US GAAP”) as a result of the following material weaknesses:
| · | The Company does not have sufficient segregation of duties within accounting functions. |
| · | The Company does not have written documentation of our internal controls policies and procedures. |
| · | A substantial portion of the Company’s financial reporting is carried out by an outside accounting firm. |
| · | The Company’s human resources, processes and systems are not sufficient to enable the production of timely and accurate financial statements in accordance with US GAAP. |
We plan to rectify these weaknesses by establishing written policies and procedures for our internal control of financial reporting and hiring additional accounting personnel at such time as we raise sufficient capital to do so.
ITEM 9B. OTHER INFORMATION.
Insider Trading Arrangements and Policies
During the quarter ended June 30, 2025, no director
or officer of the Company
Other Information
None.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.
Not applicable.
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following is a list of our directors and executive officers. All directors serve one-year terms or until each of their successors are duly qualified and elected. The officers are elected by the Board of Directors.
| Name | Age | Position(s) | ||||
| Roberto Castellazzi | 43 | Chief Executive Officer and Chairman of the Board of Directors | ||||
| Massimo Trebbi | 60 | President | ||||
| Marcello Appella | 70 | Chief Financial Officer | ||||
| Giovanni Lavati | 60 | Secretary, Treasurer and Director | ||||
| Fabrizio Castellazzi | 41 | Director |
Roberto Castellazzi has been the Company’s Chief Executive Officer since February 27, 2025 and Chairman of the Board of Directors since December 2024.
Massimo Trebbi has been the Company’s President since February 27, 2025. Since 2013, Mr. Trebbi serves as director of Just Bo Ltd. Mr. Trebbi has also served as Vice President of UDSA, a non-profit organization to develop a project for young people affected by autism since September 2020. Mr. Trebbi has also served as director of EMC Impresa S.R.L. since 2024.
Marcello Appella served as the Company’s Co-Chief Financial Officer since March 2019 and became the Company’s sole Chief Financial Officer in February 2025. Since 1996, Mr. Appella is the Chief Executive Officer and owner of ADI Sarl.
Giovanni Lavati has been a director of the Company since May 13, 2016. Since 2016, Mr. Lavati is the Project Manager for Expertise SRL. Mr. Lavati was appointed a director because of his experience and skill in managing businesses.
Fabrizzio Castellazzi has been a director of GHST since February 27, 2025. Since May 2022, Mr. Castellazzi currently serves as the Sales Manager of Reabilita Sport Tech S.R.L. Mr. Castellazzi has also served as the Sports Director of S.S. Cosmos since July 2025. From March 2020 to April 2022, Mr. Castellazzi served as Production Manager of Logisticati S.R.L.
Family Relationships
Roberto Castellazzi, the Company’s Chief Executive Officer and Chairman of the Board of Directors, is the brother of Fabrizio Castellazzi, the Company’s director.
Director Independence
Our Board has determined that each of our directors with the exceptions of Messrs. Roberto Castellazzi and Giovanni Lavati are independent under the Nasdaq Stock Market listing rules.
Committees of the Board of Directors
We presently do not have an audit committee, compensation committee, or other committee or committees performing similar functions, as our board of directors and management believe that until recently it has been premature at the early stage of our Company’s business development to form an audit, compensation or other committees. Each member of our Board considers candidates for directorship and executive officer and director compensation. Presently, our full Board of Directors fills the role of the audit committee.
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Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires our directors, executive officers, and persons who own more than 10% of our common stock to file initial reports of ownership and changes in ownership of our common stock and other equity securities with the SEC. These individuals are required by the regulations of the SEC to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of the forms furnished to us, and written representations from reporting persons, we believe that all filing requirements applicable to our officers, directors and 10% beneficial owners were complied with for the fiscal year ended June 30, 2025.
Code of Ethics & Insider Trading Policy
Our Board has adopted a Code of Ethics that applies to all of our employees, including our Chief Executive Officer and Chief Financial Officer. Although not required, the Code of Ethics also applies to our directors. The Code of Ethics provides written standards that we believe are reasonably designed to deter wrongdoing and promote honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships, full, fair, accurate, timely and understandable disclosure and compliance with laws, rules and regulations, including insider trading, corporate opportunities and whistleblowing or the prompt reporting of illegal or unethical behavior. A copy of our Code of Ethics is filed as Exhibit 14.1.
Our Board
Shareholder Communications
Although we do not have a formal policy regarding communications with the Board, shareholders may communicate with the Board by writing to us at GHST World, Inc., 3001 PGA Blvd., Suite 305, Palm Beach Gardens, FL 33410. Shareholders who would like their submission directed to a member of the Board may so specify, and the communication will be forwarded, as appropriate.
ITEM 11. EXECUTIVE COMPENSATION.
Summary Compensation Table
The officers of the Company have not received any compensation paid, distributed nor accrued from the Company for the last two fiscal years.
Director Compensation
The directors of the Company have not received any compensation paid, distributed nor accrued from the Company for the last two fiscal years.
| 30 |
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
The following table sets forth the number of shares of GHST’s voting stock beneficially owned as of October 14, 2025, by (i) those persons known by GHST to be owners of more than 5% of GHST’s common stock, (ii) each director of GHST, (iii) all Named Executive Officers (as defined in Item 6), and (iv) all executive officers and directors of GHST as a group:
| Title of Class | Name and Address of Beneficial Owner | Amount and Nature
of Beneficial | Percentage of Common Stock+ | Percent
of Voting Power (1) | ||||||||||
| Directors and Executive Officers: | ||||||||||||||
| Common Stock and Preferred Stock | Roberto Castellazzi(2)(3) | 17,469,768 | 13.4 | % | 41.9 | %(4) | ||||||||
| Common Stock | Massimo Trebbi (3) | 0 | * | * | ||||||||||
| Common Stock | Marcello Appella(3) | 0 | * | * | ||||||||||
| Common Stock | Giovanni Lavati(2)(3) | 17,180,420 | 13.2 | % | 6.1 | % | ||||||||
| Common Stock | Fabrizio Castellazzi(2) | 7,004,500 | 5.4 | % | 2.5 | % | ||||||||
| Common Stock | All directors and executive officers as a group (5 persons) | 41,654,688 | 32.0 | % | 50.6 | % | ||||||||
| 5% Shareholders: | ||||||||||||||
| Preferred Stock | Bank Investments Inc.(5) | 1,800 | * | 16.1 | % | |||||||||
-------
* Less than 1%
+ N/A to the Series A (as defined in footnote (1)). As such, shares of Series A and underlying voting power are not included in this percentage.
| (1) | Represents voting power. Applicable percentages are based on 130,201,179 shares of common stock and 6,000 shares of Series A Preferred Stock (the “Series A”) with 150,000,000 votes outstanding, adjusted as required by rules of the SEC beneficial ownership is determined under the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock subject to options, warrants and convertible notes currently exercisable or convertible, or exercisable or convertible within 60 days are deemed outstanding for computing the percentage of the person holding such securities but are not deemed outstanding for computing the percentage of any other person. It does not include options held by our management, which are subject to performance standards. Unless otherwise indicated in the footnotes to this table, GHST believes that each of the shareholders named in the table has sole voting and investment power with respect to the shares indicated as beneficially owned by them. |
| (2) | A director. |
| (3) | An executive officer. |
| (4) | Includes 4,000 shares of Series A. Each share of Series A is entitled to 25,000 votes per share. Does not include 2,000 shares of Series B Preferred Stock which has a liquidation preference of $27.50 per share. |
| (5) | Consists of 1,800 shares of Series A. Each share of Series A is entitled to 25,000 votes per share. Address is 45 Rockefeller Plaza Suite 2000 NY. Francesco Pegioani is the President of this entity and holds voting and dispositive control of the securities. |
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
Set forth below is a brief description of the transactions since July 1, 2023 in excess of $122.80, which is 1% of the average of our total assets for FY 2025 and FY 2024 in which the Company was a participant and in which any director or executive officer of the Company, any known 5% or greater stockholder of the Company or any immediate family member of any of the foregoing persons, had a direct or indirect material interest as defined in Item 404(a) of Regulation S-K. As permitted by the SEC rules, discussion of employment relationships or transactions involving the Company’s executive officers and directors, and compensation solely resulting from such employment relationships or transactions, or service as a director of the Company, as the case may be, has been omitted to the extent disclosed in the Executive Compensation or the Director Compensation section of this Report, as applicable.
As of October 9, 2025 the Company owed related parties a total of $465,764. These related party loans are unsecured, non-interest bearing and are due on demand. Included in these loans are amounts advanced by Esterino Castellazzi, the former Company’s President and former Chairman of the Board of Directors, who advanced $142,959 in FY 2024 and $36,260 in fiscal year ended September 30, 2023. In fiscal year 2025, the Company borrowed $147,917 from Roberto Castellazzi, the Company’s Chief Executive Officer and Chairman of the Board. These loans were primarily used to fund ordinary operating expenses and development activities related to InSSIDe’s clean energy projects and the Smart Shin Guard program. All such loans are non-interest bearing, unsecured, and repayable upon availability of funds; however, in order not to burden the Company’s financial position, they may in the future be settled through the issuance of shares, as has been done previously. Following the passing of former Chairman and President Esterino Castellazzi, Roberto Castellazzi has continued to provide financial support to the Company under similar non-interest-bearing terms, in order to continue operations.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
All of the services provided and fees charged by our independent registered public accounting firm, were approved by our Board of Directors. The following table shows the fees paid to our independent registered public accounting firm for the fiscal years ended June 30, 2025 and 2024.
| Year Ended June 30, | ||||||||
| 2025 (2) | 2024 (2) | |||||||
| Audit Fees (1) | $ | 24,000 | $ | 58,000 | ||||
| Audit Related Fees | 14,250 | — | ||||||
| Tax Fees | — | — | ||||||
| All Other Fees | — | — | ||||||
| Total | $ | 38,250 | $ | 58,000 | ||||
_________
| (1) | Audit fees relate to the audits of our annual financial statements and the review of our interim quarterly financial statements. |
| (2) | Represents fees paid to Fruci & Associates II, PLLC, the Company’s current independent registered public accounting firm, for FY 2025. |
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PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
| Incorporated by Reference |
Filed or Furnished | |||||||||
| Exhibit # | Exhibit Description | Form | Date | Number | Herewith | |||||
| 2.1 | Certificate of Merger | 10-K | 2/18/2010 | 3.2 | ||||||
| 3.1 | Amended and Restated Certificate of Incorporation | 10-12G | 3/9/2021 | 3.1 | ||||||
| 3.1(a) | Certificate of Amendment to Certificate of Incorporation (Reverse Stock Split) | 10-Q | 11/15/2021 | 3.2 | ||||||
| 3.1(b) | Certificate of Amendment to Certificate of Incorporation (Decrease in Authorized Capital) | 10-Q | 11/15/2021 | 3.3 | ||||||
| 3.1(c) | Certificate of Designation | 10-K | 2/18/2010 | 3.3 | ||||||
| 3.2 | Amended and Restated Bylaws | 10-12G | 3/9/2021 | 3.3 | ||||||
| 14.1 | Code of Ethics | 10-K | 10/13/23 | 14.1 | ||||||
| 19.1 | Insider Trading Policy | 10-K | 10/13/23 | 19.1 | ||||||
| 21.1 | List of Subsidiaries | 10-K | 10/11/24 | 21.1 | ||||||
| 31.1 | Certification of Principal Executive Officer (302) | Filed | ||||||||
| 31.2 | Certification of Principal Financial Officer (302) | Filed | ||||||||
| 32.1 | Certification of Principal Executive and Principal Financial Officers (906) | Furnished* | ||||||||
| 101.INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | Filed | ||||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | Filed | ||||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | Filed | ||||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | Filed | ||||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | Filed | ||||||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | Filed | ||||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||||
*This exhibit is being furnished rather than filed and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.
** Portions of this exhibit have been omitted as permitted by the rules of the SEC. The information excluded is both (i) treated by the Company as private or confidential and (ii) not material. The Company undertakes to submit a marked copy of this exhibit for review by the SEC staff, to the extent it has not been previously provided, and provide supplemental materials to the SEC staff promptly upon request.
Copies of the exhibits referred to above will be furnished at no cost to our shareholders who make a written request to GHST World Inc., 3001 PGA Blvd., Suite 305, Palm Beach Gardens, FL 33410.
ITEM 16. FORM 10-K SUMMARY.
Not applicable.
| 33 |
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.
| GHST World Inc. | |||
| Dated: | October 14, 2025 | By: | /s/ Roberto Castellazzi |
| Roberto Castellazzi, Chief Executive Officer and Director | |||
| (Principal Executive Officer) | |||
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| Dated: | October 14, 2025 | By: | /s/ Roberto Castellazzi |
| Roberto Castellazzi, Chief Executive Officer and Director | |||
| (Principal Executive Officer) | |||
| Dated: | October 14, 2025 | By: | /s/ Marcello Appella |
| Marcello Appella, Chief Financial Officer | |||
|
(Principal Financial Officer)
| |||
| Dated: | October 14, 2025 | By: | /s/ Fabrizio Castellazzi |
| Fabrizio Castellazzi, Director | |||
| Dated: | October 14, 2025 | By: | /s/ Giovanni Lavati |
| Giovanni Lavati, Director | |||
34