SDCO 10-K/A
SDR Drone, Inc. (SDCO)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Amendment No. 1)
For
the fiscal year ended
OR
For the transition period from ____________ to ____________
Commission
file number
(Exact Name of Registrant as Specified in its Charter)
(State
or other jurisdiction of |
(I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices with Zip Code)
Registrant’s
telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act:
Title of Class
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 Section 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 and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant 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.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
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). ☐
State
the aggregate market value of the voting and non-voting common equity held by non-affiliates: $
As of the date of this filing, there were shares of the issuer’s common stock outstanding.
EXPLANATORY NOTE
HALLMARK VENTURE GROUP, INC.
TABLE OF CONTENTS
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
Forward-Looking Statements
Unless the context indicates otherwise, as used in this Annual Report, the terms “HLLK,” “we,” “us,” “our,” “our company” and “our business” refer, to HALLMARK VENTURE GROUP, INC., including its subsidiaries named herein. Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.” These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.
General Background of the Company
Hallmark Venture Group, Inc. (“we”, “us”, “our” or the “Company”) was originally incorporated in the State of Colorado on July 14, 1995, with the name CPC Office Systems, Inc. On July 12, 1999, the Company changed its name to Homesmart USA, Inc. On March 3, 2006, the Company moved its domicile to Nevada. On March 8, 2006, the Company changed its name to Smart Truck Systems, Inc. On March 6, 2008, the Company changed its name to Speech Phone, Inc. On July 16, 2008, the Company changed its name to Hallmark Venture Group, Inc. On March 22, 2022, the Company redomiciled and became a Florida corporation.
On November 2, 2020, the Company entered into a Plan of Merger and Acquisition Agreement (the “Stonecrest Merger Agreement”), pursuant to which the Company purchased Stonecrest Owner, LLC in exchange for the issuance of 10,000,000 shares of common stock and 100,000 shares of Series A preferred stock to the members of Stonecrest Owner, LLC. On July 12, 2021, the parties agreed to cancel and unwind the transactions contemplated by the Stonecrest Merger Agreement. As a result, all of the shares of common stock and preferred stock that were issued as part of that transaction were canceled.
On January 11, 2024, the Company entered into a Change of Control Agreement (the “CoC Agreement”) by and between John D. Murphy, Jr., the Company’s Director and CEO and JMJ Associates, LLC, an entity controlled by John D. Murphy, Jr. (“Murphy”), and Paul Strickland, the Company’s Director and Secretary, and Selkirk Global Holdings, LLC, and Beartooth Asset Holdings, LLC, both entities controlled by Paul Strickland (“Strickland”), and Steven Arenal and Aurum International Ltd., an entity controlled by Steven Arenal (“Aurum”) and, pursuant to which Murphy, Strickland, and their respective control entities assigned the Series A preferred shares controlled by each to Aurum. Strickland transferred 196,519 in restricted common shares to Aurum. In exchange, Murphy and Strickland retained 5% equity in the Company, post-restructuring, and these shares have an 18-month anti-dilution provision as described in the Anti-Dilution Agreement executed between the Parties. Murphy and Strickland also cancelled debts owed to each by the Company. Strickland cancelled $83,342.25 in debts. Murphy cancelled $74,501 in debts. Murphy received $70,000 from Aurum in exchange for partial debt cancellation delivered into Escrow on February 27, 2024. Aurum received a $77,000 10% convertible promissory note in exchange for partially paying the Company’s debt owed to Murphy.
Pursuant to the CoC Agreement, Murphy and Strickland would assign the Series A preferred shares controlled by each to Aurum, and Strickland was to transfer 196,519 restricted common shares to Aurum. In exchange, Murphy and Strickland would retain a 5% equity interest in the Company on a post-restructuring basis, subject to an 18-month anti-dilution provision as set forth in the Anti-Dilution Agreement executed among the parties. In connection with the CoC Agreement, Murphy and Strickland would have cancelled certain indebtedness owed to them by the Company. Strickland was to cancel $83,342 in outstanding obligations, and Murphy was to cancel $74,501 in outstanding obligations. Murphy was to receive $70,000 from Aurum in partial consideration for the debt cancellation, which would have been delivered into escrow by February 27, 2024. The Company issued Aurum a $77,000 convertible promissory note bearing interest at 10% per annum in partial satisfaction of the Company’s indebtedness to Murphy. All consideration under the CoC Agreement was to be subject to the terms and conditions of the Escrow Agreement executed among the parties.
On January 11, 2024, John D. Murphy, Jr. resigned as Director and Officer of the Company and all other positions he held with the Company.
On January 11, 2024, Paul Strickland resigned as Director and Officer of the Company and all other positions he held with the Company.
On January 11, 2024, Steven Arenal was elected as Director of the Company and appointed Chief Executive Officer, President, and Secretary of the Company.
On February 27, 2024, Steve Arenal and Aurum International Ltd. were given notice of default and failure to perform on the agreements they had signed, and Strickland and Murphy also gave notice of cancellation of all the foregoing agreements.
On February 28, 2024, a special meeting of shareholders was held removing Arenal and reinstating Murphy and Strickland and reversing and canceling all of the foregoing Aurum International Ltd / Arenal agreements.
On February 28, 2024, the Company filed an 8-K disclosing the cancellation, termination, and failure to perform on the aforementioned Arenal / Aurum agreements.
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On March 4, 2024, The Company and its Board of Directors approved a 1:500 reverse split of the Company’s common stock.
On March 7, 2024, The Company filed the Amended and Restated Articles of Incorporation with Florida Secretary of State reflecting the 1:500 reverse split of the Company’s common stock. The reverse split was approved by FINRA effective April 24, 2025.
On September 26, 2024, the Company and its Board of Directors approved the following; i) Agreement and Plan of Reorganization; ii) Change of Control Agreement; iii) Escrow Agreement, iv) Anti-Dilution Agreement; v) Cancellation of the October 6, 2022 Selkirk Global Holdings, LLC Note; vi) Cancellation of the April 6, 2023 Selkirk Global Holdings, LLC Note, vii) Cancellation of the December 12, 2023 Strickland Convertible Exchange Note; viii); and the Company authorized its Secretary to open a bank account in the name of the Company.
On September 26, 2024, the Company and Jubilee Intel, LLC (“Jubilee”) entered into an Agreement and Plan of Reorganization (the “Merger”) whereby the Company acquired 100% membership interests in Jubilee in exchange for 100,000 shares of Series A Preferred Stock. As a result of the Merger, Jubilee became a wholly owned and operating subsidiary of the Company.
On April 24, 2025, the 1:500 reverse split of the Company’s common stock processed by FINRA.
On May 12, 2025, the Company executed a Membership Interest Assignment Agreement with Evan Bloomberg, its former officer and director. Under this agreement, the Company transferred 100% of its membership interest in Jubilee Intel, LLC to Mr. Bloomberg. In exchange, Mr. Bloomberg transferred all 100,000 Series A Preferred Shares of the Company to Selkirk Global Holdings, LLC, an entity controlled by Paul Strickland, the Company’s sole director and officer. This transaction resulted in the demerger of Jubilee Intel, LLC, which ceased to be a wholly owned subsidiary of the Company. Though the demerger contract was executed on May 12, 2025, the Company effectively lost control of Jubilee on March 31, 2025. Accordingly, Jubilee Intel, LLC has been presented as a discontinued operation as of December 31, 2024 until March 31, 2025, the date the Company effectively lost control of it. All other agreements with Mr. Bloomberg were also terminated at that time.
On August 7, 2025, the Company reinstated the related party debts that were cancelled pursuant to the failed Jubilee Merger.
Corporate Information
Our Company’s headquarters is located at 1800 N Town Center Drive, STE 100, Las Vegas, NV 89144. Our telephone number is 877-646-4833.
Implications of Being an Emerging Growth Company
In 2019 the Company qualified as an “emerging growth company” (“EGC”) as defined under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Pursuant to Section 2(a)(19)(B) of the Securities Act, the Company ceased to qualify as an EGC at the end of the fiscal year ended December 31, 2024 — the fifth anniversary of the Company’s initial registration. Accordingly, for fiscal year 2025 and thereafter, the Company is no longer an EGC and is no longer availing itself of the reduced reporting and exemption provisions otherwise available to an EGC.
| ● | not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended (or the Sarbanes-Oxley Act); | |
| ● | reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and | |
| ● | exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. |
| 4 |
During the period in which the Company qualified as an EGC, the Company had elected to avail itself of the extended transition period for complying with new or revised accounting standards. That extended transition period terminated when the Company ceased to qualify as an EGC at the end of fiscal year 2024. All new and revised accounting standards are now being adopted by the Company on the same timeline as other public companies.
ITEM 1A. RISK FACTORS
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and, as such, are not required to provide the information under this Item.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
To
date,
ITEM 2. PROPERTIES
We do not own any real property. Our former Director, John D. Murphy, Jr., provides complimentary office space for our company.
ITEM 3. LEGAL PROCEEDINGS
None
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
PART II.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is quoted under the symbol “HLLK” on the Pink Open Market (f/k/a OTC Pink) published by OTC Markets Group, Inc. (“OTC Pink”), where an established public trading market for our common stock exists. The range of reported high and reported low sales prices per share for our common stock for each fiscal quarter during 2025 and 2024, as reported by NASDAQ and the OTC Markets Group, is set forth below.
| 5 |
Quarterly common stock Price Ranges
| Fiscal Year 2025, Quarter Ended: | High | Low | ||||||
| March 31, 2025 | $ | 2.20 | $ | 1.95 | ||||
| June 30, 2025 | $ | 0.11 | $ | 0.11 | ||||
| September 30, 2025 | $ | 0.29 | $ | 0.29 | ||||
| December 31, 2025 | $ | 0.10 | $ | 0.10 | ||||
| Fiscal Year 2024, Quarter Ended: | High | Low | ||||||
| March 31, 2024 | $ | 0.15 | $ | 0.10 | ||||
| June 30, 2024 | $ | 0.25 | $ | 0.25 | ||||
| September 30, 2024 | $ | 0.35 | $ | 0.35 | ||||
| December 31, 2024 | $ | 3.75 | $ | 1.30 | ||||
At December 31, 2025 there were approximately 1,892 holders of record of our common stock, and approximately 233 beneficial owners of our common stock held in street name.
The transfer agent and registrar for our common stock is Liberty Stock Transfer, Inc., 788 Shrewsbury Ave., Suite 2163, Tinton Falls, NJ 07724. Their telephone number is (732) 372-0707, ext. 101.
Dividend Policy
We have never paid any cash dividends and intend, for the foreseeable future, to retain any future earnings for the development of our business. Our Board of Directors will determine our future dividend policy on the basis of various factors, including our results of operations, financial condition, capital requirements and investment opportunities.
Recent Issuance of Unregistered Securities
None.
Securities Authorized for Issuance Under Equity Compensation Plans
None.
Item 6. [Reserved]
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations for the years ended December 31, 2025, and 2024, should be read in conjunction with the financial statements and notes related thereto included elsewhere in this report.
Overview
We have no operations from a continuing business other than the expenditures related to running the Company. All of our historical business operations have ceased.
Management intends to explore and identify business opportunities within the U.S. and other jurisdictions including a potential acquisition of an operating entity through a reverse merger, asset purchase or similar transaction. No assurances can be given that our management can identify and implement a viable business strategy or that any such strategy will result in profits. Our ability to effectively identify, develop and implement a viable plan for our business may be hindered by risks and uncertainties which are beyond our control.
We do not currently engage in any business activities that provide revenue or cash flow. During the next 12-month period we anticipate incurring costs in connection with investigating, evaluating, and negotiating potential business combinations and/or asset acquisitions, filing SEC reports, and consummating the acquisition of an operating business or assets.
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Given our limited capital resources, we may consider a transaction with an entity which has recently commenced operations, is a developing company or is otherwise in need of additional funds for the development of new products, services or assets, or expansion into new markets, or is an established business or an established asset experiencing financial or operating difficulties and needs additional capital. Alternatively, a transaction may involve the acquisition of, or merger with, an entity that desires access to the U.S. capital markets.
As of the date of this Form 10-K/A, our management has not had any discussions with any representative of any other entity regarding a potential business combination or asset acquisition. Any target business or asset that is selected may be financially unstable or in the early stages of development. In such event, we expect to be subject to numerous risks inherent in the business and operations of a financially unstable or early-stage entity. In addition, we may effect a business combination with an entity in an industry characterized by a high level of risk or in which our management has limited experience, and, although our management will endeavor to evaluate the risks inherent in a particular target business or asset, there can be no assurance that we will properly ascertain or assess all significant risks.
Our management anticipates that we will likely only be able to effect just one business combination or asset acquisition due to our limited capital. This lack of diversification will likely pose a substantial risk in investing in the Company for the indefinite future, because it will not permit us to offset potential losses from one venture or operating territory against gains from another. The risks we face will likely be heightened to the extent we acquire a business or assets operating in a single industry or geographical region.
We anticipate that the selection of a target business or asset will be a complex and risk-prone process. Because of general economic conditions, rapid technological advances being made in some industries and shortages of available capital, management believes that there are many firms seeking acquisition opportunities at this time at discounted rates against which we will compete. We expect that any potentially available acquisition opportunities may appear in a variety of different industries or regions and at various stages of development, all of which will likely make the task of comparative investigation and analysis of such opportunities extremely difficult and complicated.
Once we have developed and begun to implement our business plan, management intends to fund our working capital requirements through a combination of our existing funds and future issuances of debt or equity securities. Our working capital requirements are expected to increase in line with the implementation of a business plan and commencement of operations.
Based upon our current operations, we do not have sufficient working capital to fund our operations over the next 12 months. If we are able to close a business combination or other acquisition, it is likely we will need capital as a condition of closing that transaction. Because of the uncertainties, we cannot be sure as to how much capital we need to raise or the type of securities we will be required to issue. In connection with a business combination that is structured as a reverse merger, or in connection with the acquisition of significant assets, we anticipate that we will be required to issue a controlling block of our securities to the target’s shareholders or to the owner of such assets, which will be very dilutive to existing shareholders.
Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences, or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, including acquisition opportunities, which could significantly and materially restrict our business operations.
We anticipate that we will incur operating losses in the next 12 months, principally costs related to our being obligated to file reports with the SEC. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development. Such risks include, but are not limited to, an evolving and unpredictable business model, recognition of revenue sources, and the management of growth. To address these risks, we must, among other things, develop, implement, and successfully execute our business strategy, respond to competitive developments, and attract, retain, and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so could have a material adverse effect on our business prospects, financial condition, and results of operations.
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Going Concern
We have only limited capital. Additional financing is necessary for us to continue as a going concern. The report of the independent registered public accounting firm accompanying our financial statements for the years ended December 31, 2025 and 2024 contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared “assuming that we will continue as a going concern”, which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
Results of Operations
Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024
During the years ended December 31, 2025 and 2024, we had no operations other than incurring expenditures related to running the Company, and we generated no revenues. At December 31, 2024, the Company held a 100% membership interest in Jubilee Intel, LLC, which is now presented as a discontinued operation following the May 12, 2025 demerger and deconsolidation.
For the years ended December 31, 2025 and 2024, we had general and administrative expenses of $97,145 and $22,125, respectively, an increase of $75,020 or approximately 339%. Professional fees were $80,950 and $50,368, respectively, and payroll expenses were $50,000 and $56,666, respectively. Total operating expenses were $228,095 for 2025 as compared to $129,159 for 2024. The increase in operating expenses was primarily due to higher general, administrative and professional fees incurred in connection with the deconsolidation of Jubilee Intel, LLC, continued SEC reporting compliance, and related legal and accounting work.
For the year ended December 31, 2025, we had total other expenses of $1,468,077, which included bad debt expense of $181,268, loss for legal liability of $16,900, other income of $29,840, $154,298 of interest expense (related party and third party), amortization of debt discount of $351,405, a loss on the issuance of convertible debt of $513,526 and a loss of $280,520 from the change in fair value of derivative liabilities. The change in fair value of derivative liabilities resulted from the conversion or extinguishment of convertible notes during the year.
For the year ended December 31, 2024, we had total other expense of $239,672, which included $72,196 of interest expense, amortization of debt discount of $216,768, bad debt expense of $100,000, a loss on the issuance of convertible debt of $278,156, a gain of $161,623 from the change in fair value of derivative liabilities, and also includes the gain of $265,824 from forgiveness of debt.
We had a net loss from continuing operations of $1,696,172 for the year ended December 31, 2025, compared to a net loss (as restated) of $368,832 from continuing operations for the year ended December 31, 2024. Including discontinued operations, the 2024 net loss was $672,060. The increase in net loss in 2025 was primarily driven by the unfavorable change in fair value of derivative liabilities, higher amortization of debt discount and loss on issuance of convertible debt.
Our major expenses consist of fees to consultants, lawyers and accountants incurred in connection with our obligation to file periodic reports with the SEC, which entails payment of professional fees to accountants and lawyers. Otherwise, we do not expect the level of our operating expenses to change in the future until we implement a business plan or effect an acquisition.
Liquidity and Capital Resources
At December 31, 2025 and 2024, we had $3,382 and $3,629 of cash on hand (respectively), and there were total outstanding liabilities of $398,868 and $1,497,644, respectively, a portion of which were amounts owed to a related party. The working capital deficits were $395,486 and $1,377,722, respectively.
For the year ended December 31, 2025, the Company used $150,524 of cash in operating activities as compared to $252,273 for the year ended December 31, 2024. The decrease was primarily due to reduced operating outflows following the deconsolidation of Jubilee Intel, LLC. Net cash provided by financing activities for the year ended December 31, 2025 was $150,277 as compared to $355,902 for the year ended December 31, 2024. The Company used no cash in investing activities in 2025 compared to $100,000 in 2024.
Paul Strickland, our Secretary and Director, individually, and through Selkirk Global Holdings, LLC, an entity controlled by him, is funding some of our limited operations by making advances of funds to cover our operating expenses. The advances are repayable upon demand and the obligations bear 6% interest. We expect that Mr. Strickland, directly or through Selkirk Global Holdings, LLC, will continue to fund some of our operations until we complete an acquisition or earlier if he sells his interest in the Company, and that we will continue to require additional financing to maintain our existence as a shell company for the next twelve months.
Our management is not required to fund our operations by any contract or other obligation. In the event that we undertake to complete an acquisition that requires financing, we will likely depend on an outside source for such financing. However, we have not identified any debt or equity financing sources that can be relied upon to provide such financing.
Critical Accounting Policies
Refer to Note 2 of our financial statements contained elsewhere in this Form 10-K/A for a summary of our critical accounting policies and recently adopting and issued accounting standards.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
HALLMARK VENTURE GROUP, INC.
INDEX TO FINANCIAL STATEMENTS
| F-1 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Hallmark Group, Inc.
Opinion on the Financial Statements
Restatement of Previously Issued Financial Statements
As discussed in Note 18 – Restatement to the consolidated financial statements, the accompanying consolidated financial statements for the years ended December 31, 2025, and 2024 have been restated to correct misstatements and to disclose information identified subsequent to the issuance of our previously issued report.
Going Concern Uncertainty
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company’s losses from operations and accumulated deficit 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 3. 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 audit, 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) related 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 are no critical audit matters.
/S/
We have served as the Company’s auditor since 2025.
April 27, 2026, except for the matters described in Note 2, 5, 7, 10, 16, 17, 18 and 19, as to which the date is May 27, 2026.
| F-2 |
HALLMARK VENTURE GROUP, INC.
CONSOLIDATED BALANCE SHEETS
| December 31, 2025 | December 31, 2024 | |||||||
| (Restated) | (Restated) | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS: | ||||||||
| Cash | $ | $ | ||||||
| Note receivable, net | ||||||||
| Due from related parties | ||||||||
| Assets from discontinued operations | ||||||||
| Total Current assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| CURRENT LIABILITIES: | ||||||||
| Accounts payable and accrued liabilities | $ | $ | ||||||
| Due to related parties | ||||||||
| Convertible notes payable – related party, net of debt discount of $ | ||||||||
| Convertible notes payable – net of debt discount of $ and $, respectively | ||||||||
| Notes payable | ||||||||
| Accrued interest - related party | ||||||||
| Accrued interest | ||||||||
| Settlement liability | ||||||||
| Derivative liability | ||||||||
| Liabilities from discontinued operations | ||||||||
| Total Current Liabilities | ||||||||
| TOTAL LIABILITIES | ||||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| STOCKHOLDERS’ DEFICIT: | ||||||||
| Series A Preferred stock, shares authorized, $ par value; and issued and outstanding, respectively | ||||||||
| Common stock, shares authorized, $ par value; and issued and outstanding, respectively | ||||||||
| Stock payable | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total Stockholders’ equity (deficit) | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | $ | ||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-3 |
HALLMARK VENTURE GROUP INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the Years Ended December 31, | ||||||||
| 2025 | 2024 | |||||||
| (Restated) | (Restated) | |||||||
| Revenue | $ | $ | ||||||
| Expenses: | ||||||||
| General and administrative | $ | $ | ||||||
| Professional fees | ||||||||
| Compensation expense | ||||||||
| Total operating expenses | ||||||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other income (expense): | ||||||||
| Interest expense | ( | ) | ( | ) | ||||
| Gain on forgiveness of debt | ||||||||
| Bad debt expense | ( | ) | ( | ) | ||||
| Amortization of debt discount | ( | ) | ( | ) | ||||
| Change in fair value of derivative | ( | ) | ||||||
| Loss on issuance of convertible note | ( | ) | ( | ) | ||||
| Loss for legal liability | ( | ) | ||||||
| Interest waived off | ||||||||
| Total other expense | ( | ) | ( | ) | ||||
| Net loss before income taxes | ( | ) | ( | ) | ||||
| Provision for income tax | ||||||||
| Net loss from continued operations | ( | ) | ( | ) | ||||
| Net loss from discontinued operations | ( | ) | ||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Net loss per share – basic and diluted | $ | ) | $ | ) | ||||
| Weighted average shares outstanding – basic and diluted | ||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-4 |
HALLMARK VENTURE GROUP, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
Series A Preferred Stock | Common Stock | Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Payable | Capital | Deficit | Deficit | |||||||||||||||||||||||||
| Balance, December 31, 2023 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
| Common stock issued for payment on settlement liability | — | |||||||||||||||||||||||||||||||
| Forgiveness of debt related party | — | — | ||||||||||||||||||||||||||||||
| Cancellation of shares | — | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Net Loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, December 31, 2024 (Restated) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Stock issued for corporate restructuring | — | ( | ) | |||||||||||||||||||||||||||||
| Stock issued for services | — | ( | ) | |||||||||||||||||||||||||||||
| Stock issued for conversion of debt | — | |||||||||||||||||||||||||||||||
| Stock issued for conversion of debt – related party | — | |||||||||||||||||||||||||||||||
| Contributed capital | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Deconsolidate Jubilee | — | — | ||||||||||||||||||||||||||||||
| Net Loss (Restated) | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, December 31, 2025 (Restated) | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-5 |
HALLMARK
VENTURE GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2025 | 2024 | |||||||
| (Restated) | (Restated) | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss from continued operations | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net income to net cash used by operating activities: | ||||||||
| Change in fair value of derivative | ( | ) | ||||||
| Loss on issuance of convertible debt | ||||||||
| Bad debts | ||||||||
| Gain on forgiveness of debt | ( | ) | ||||||
| Amortization of Debt Discount | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Due to related parties | ||||||||
| Due from related parties | ( | ) | ||||||
| Accounts payable and accrued expenses | ||||||||
| Accrued interest - related party | ( | ) | ||||||
| Accrued interest | ( | ) | ||||||
| Assets from discontinued operations | ( | ) | ||||||
| Liabilities from discontinued operations | ||||||||
| Net cash provided by (used in) operating activities from continued operations | ( | ) | ||||||
| Loss from discontinued operations | ( | ) | ||||||
| Net cash provided by (used in) operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Issuance of note receivable | ( | ) | ||||||
| Net cash provided by investing activities | ( | ) | ||||||
| Cash flows from financing activities: | ||||||||
| Proceeds from convertible note payable - related party | ||||||||
| Proceeds from convertible note payable | ||||||||
| Repayments of convertible note payable | ( | ) | ||||||
| Repayments of note payable | ( | ) | ( | ) | ||||
| Proceeds from note payable | ||||||||
| Net cash provided by (used in) financing activities | ||||||||
| Net change in cash | ( | ) | ||||||
| Cash at beginning of period | ||||||||
| Cash at end of period | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for taxes | $ | $ | ||||||
| NON-CASH TRANSACTIONS | ||||||||
| Common stock issued in satisfaction of settlement liability | $ | |||||||
| Stock issued for corporate restructuring | $ | |||||||
| Common stock issued for services | $ | |||||||
| Common stock issued for conversion of debt | $ | $ | ||||||
The accompanying notes are an integral part of these consolidated financial statements.
| F-6 |
HALLMARK VENTURE GROUP, INC.
Notes to Financial Statements
December 31, 2025
NOTE 1 — ORGANIZATION AND OPERATIONS
Hallmark Venture Group, Inc., was originally incorporated in the state of Colorado on July 14, 1995, with the name CPC Office Systems, Inc. On July 12, 1999, the Company changed its name to Homesmart USA, Inc. On March 8, 2006, the Company changed its name to Smart Truck Systems, Inc. On March 3, 2006, the Company moved its domicile to Nevada. On March 6, 2008, the Company changed its name to Speech Phone, Inc. On July 16, 2008, the Company changed its name to Hallmark Venture Group, Inc.
On May 4, 2020, Living Waters, LLC (“LWLLC”) obtained management control of the Company from its previous CEO and Director, Robert Cashman (“Cashman”), pursuant to a contingent Share Purchase Agreement (the “SPA”), dated as of May 4, 2020, by and among LWLLC and Cashman, whereby certain preferred shares (the “Preferred Shares”) that represent the voting control interest in the Company were to be issued to LWLLC (the “Transaction”).
On May 27, 2020, in connection with the Transaction and in accordance with provisions of the SPA, LWLLC assigned the SPA to Medical Southern, LLC (“MSLLC”). On August 13, 2020, all issued and outstanding Preferred Shares were issued to a designee of MSLLC, Top Knot, Inc. USA (“TKIU”).
On August 17, 2020, in connection with the Transaction and in accordance with provisions of the SPA, MSLLC assigned the SPA to Stonecrest Acquisition, LLC (“SALLC”). As a consequence of the Transaction, a change of control of the Company occurred. As a result of the Transaction TKIU obtained voting control of the Company. Subsequently, on October 19, 2020, TKIU assigned % of the Preferred Shares it held to Endicott Holdings Group, LLC (“Endicott”).
On June 20, 2022, Endicott transferred % of the preferred shares, and of the shares of common stock it held, to Beartooth Asset Holdings, LLC, an entity controlled by the Company’s Secretary, Paul Strickland, resulting in a change of control of the Company.
On July 7, 2022, Beartooth Asset Holdings, LLC (an entity controlled by Paul Strickland, the Company’s secretary and a member of its board of directors) transferred Series A Preferred Shares to JMJ Associates, LLC, an entity controlled by John D. Murphy, Jr., President CEO of the Company and a Member of the Board of Directors, resulting in a change of control of the Company.
On July 12, 2022, Paul Strickland, the Company’s Principal Financial Officer, became a director of the Company.
On January 11, 2024, the Company entered into a Change of Control Agreement (the “CoC Agreement”) between John D. Murphy, Jr., the Company’s Director and Chief Executive Officer, and JMJ Associates, LLC, an entity controlled by Mr. Murphy (“Murphy”); Paul Strickland, the Company’s Director and Secretary, and Selkirk Global Holdings, LLC and Beartooth Asset Holdings, LLC, both entities controlled by Mr. Strickland (“Strickland”); and Steven Arenal and Aurum International Ltd., an entity controlled by Mr. Arenal (“Aurum”).
Pursuant
to the CoC Agreement, Murphy and Strickland would assign the Series A preferred shares controlled by each to Aurum, and Strickland
was to transfer restricted
common shares to Aurum. In exchange, Murphy and Strickland would retain a
In connection with the foregoing, the Company relocated its principal place of business to 626 Wilshire Boulevard, Suite 410, Los Angeles, California 90017.
On January 11, 2024, John D. Murphy, Jr. resigned as Director and Officer of the Company and all other positions he held with the Company.
On January 11, 2024, Paul Strickland resigned as Director and Officer of the Company and all other positions he held with the Company.
| F-7 |
On January 11, 2024, Steven Arenal was elected as Director of the Company and appointed Chief Executive Officer, President, and Secretary of the Company.
On February 27, 2024, Steve Arenal and Aurum International Ltd. were given notice of default and failure to perform on the agreements they had signed, and Strickland and Murphy also gave notice of cancellation of all the foregoing agreements.
On February 28, 2024, a special meeting of shareholders was held removing Arenal and reinstating Murphy and Strickland and reversing and canceling all of the foregoing Aurum International Ltd / Arenal agreements.
On February 28, 2024, the Company filed an 8-K disclosing the cancellation, termination, and failure to perform on the aforementioned Arenal / Aurum agreements.
On
March 4, 2024, the Company and its Board of Directors approved a
On March 4, 2024, the shareholders required to vote approved the Board’s
On
March 7, 2024, the Company filed the Amended and Restated Articles of Incorporation with Florida Secretary of State reflecting the
On September 26, 2024, the Company and its Board of Directors approved the following; i) Agreement and Plan of Reorganization; ii) Change of Control Agreement; iii) Escrow Agreement, iv) Anti-Dilution Agreement; v) Cancellation of the October 6, 2022 Selkirk Global Holdings, LLC Note; vi) Cancellation of the April 6, 2023 Selkirk Global Holdings, LLC Note, vii) Cancellation of the December 12, 2023 Strickland Convertible Exchange Note; viii); and the Company authorized its Secretary to open a bank account in the name of the Company.
On
September 26, 2024, the Company and Jubilee Intel, LLC (“Jubilee”) entered into an Agreement and Plan of Reorganization
(the “Merger”) whereby the Company acquired
On
May 12, 2025, the Company executed a Membership Interest Assignment Agreement with Evan Bloomberg, its former officer and director. Under
this agreement, the Company transferred
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as found in the Accounting Standards Codification (“ASC”), and the Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”) and are expressed in US Dollars.
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates and these differences could be material.
| F-8 |
The most significant estimates made by management in the preparation of the financial statements relate to the estimates used to calculate the fair value of certain liabilities, the derivative liability, present value of note payable and the valuation of notes receivable. Management bases its estimates on historical experience and on other various assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ materially from such estimates under different assumptions and conditions.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary in which the Company has a controlling financial interest as of December 31, 2024. All significant intercompany transactions and balances are eliminated in consolidation.
The Company evaluates its ownership interests in accordance with applicable consolidation guidance to determine whether control exists. When the Company loses control of a subsidiary, it derecognizes the assets, liabilities, and any noncontrolling interests of that subsidiary as of the date control is lost. Any resulting difference between (i) the carrying value of the net assets derecognized and (ii) the consideration received, if any, is recognized as a gain or loss in the consolidated statements of operations.
Refer to Note 1 for the deconsolidation of Jubilee.
Cash and Cash Equivalents
The
Company considers all highly liquid investments with an original maturity date of three months or less at the time of purchase to be
cash equivalents. The Company has cash of $
Reclassifications
Certain reclassifications have been made to prior periods to conform with current reporting. These reclassifications did not affect net income, total assets, liabilities or equity reported.
Related Party Transactions
Under ASC 850 “Related Party Transactions” an entity or person is considered to be a “related party” if it has control, significant influence or is a key member of management personnel or affiliate. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. The Company, in accordance with ASC 850 presents disclosures about related party transactions and outstanding balances with related parties.
Derivative Financial Instruments
The Company evaluates warrants issued with notes payable and embedded conversion features of convertible notes under ASC 480 and ASC 815 to determine appropriate classification. Instruments that are not indexed to the Company’s own stock or do not meet equity classification criteria under ASC 815-40 are classified as derivative liabilities.
Derivative liabilities are recorded at fair value upon issuance and remeasured at each reporting date, with changes in fair value recognized in the statements of operations as other income (expense). Fair value is estimated using the Black-Scholes option pricing model and classified within Level 3 of the fair value hierarchy under ASC 820.
Proceeds from notes payable and convertible notes with associated derivative liabilities are allocated first to the derivative liability at fair value, with the residual allocated to the host debt instrument and recorded as a debt discount, which is amortized to interest expense over the note term using the effective interest method.
Fair Value of Financial Instruments
The fair value is an exit price representing the amount that would be received to sell an asset or required to transfer a liability in an orderly transaction between market participants. As such, fair value of a financial instrument is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or a liability.
| F-9 |
A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:
| ● | Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. | |
| ● | Level 2: Observable inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. | |
| ● | Level 3: Unobservable inputs reflecting our own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participants assumptions that are reasonably available. |
The Company’s financial instruments
reported at their fair values consist of derivative liabilities. The Company’s derivative liabilities had a fair value of $
When determining fair value, whenever possible, the Company uses observable market data, and relies on unobservable inputs only when observable market data is not available. As of December 31, 2025 and 2024, the Company did not have any level 1 or 2 financial instruments. On December 31, 2025 and 2024 the Company’s level 3 financial instruments were derivative liabilities.
The following table presents the Company’s assets and liabilities that are measured at fair value on a non-recurring basis.
At December 31, 2025
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||
| Liabilities | ||||||||||||
| Derivative Liability | $ | |||||||||||
| F-10 |
At December 31, 2024
| Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||
| Liabilities | ||||||||||||
| Derivative Liability | $ | |||||||||||
The Company computes earnings (loss) per share (“EPS”) in accordance with ASC 260, “Earnings per Share” which requires presentation of both basic and diluted EPS on the face of the statement of operations. Basic EPS is computed by dividing net income (loss) available to common shareholders by the weighted average number of shares outstanding during the period. Diluted EPS gives effect to all diluted potential common shares outstanding during the period. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of warrants or stock or conversion of stock. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
As
of December 31, 2025, the Company had
potential dilutive shares of common stock from convertible preferred stock, approximately
shares from convertible debt, and
For periods with a net loss the effect of any potentially dilutive shares is anti-dilutive and they have been excluded from dilutive EPS.
Revenue Recognition
The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. The core principle of ASC 606 is that revenue is recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company applies the following five-step model to achieve that core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the Company satisfies a performance obligation
The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services and may include fixed amounts, variable amounts, or both. When determining the transaction price, the Company considers the effects of variable consideration, constraints on estimates of variable consideration, the existence of a significant financing component, noncash consideration, and consideration payable to a customer.
During the years ended December 31, 2025 and 2024, the Company did not generate any revenues, as it has not yet identified or commenced a revenue-generating line of business since the deconsolidation of Jubilee.
Accounts Receivable
In considering the collectability of accounts receivable, the Company takes into account the legal obligation for payment by the customer, as well as the financial capacity of the customer to fund its obligation to the Company. The carrying amount of accounts receivable represents the maximum credit exposure on this balance. Management individually reviews all delinquent accounts receivable balances and based on an assessment of current creditworthiness, estimates the portion, if any, of the balance that will not be collected and would directly write-off these balances. Management considers a number of factors, including the age of the receivables, current economic conditions and other information management obtains regarding the financial condition of customers. The policy for determining the past due status is based on the contractual payment terms of each customer. Once collection efforts by the Company are exhausted, the determination for directly writing off uncollectible receivables is made. The Company reported no accounts receivables on December 31, 2025 and 2024.
Discontinued Operations
The Company accounts for discontinued operations in accordance with ASC 205-20, Presentation of Financial Statements – Discontinued Operations. The disposal of a component or group of components is classified as a discontinued operation if the disposal represents a strategic shift that has, or will have, a major effect on the Company’s operations and financial results. This includes the sale, abandonment, or other disposal of legal entities, business segments, or significant components.
Upon meeting the criteria for discontinued operations, the results of operations, including any gain or loss on disposal, are presented separately in the consolidated statements of operations for all periods presented. Assets and liabilities of discontinued operations are presented separately in the consolidated balance sheets. The results of operations of the discontinued component are still reported separately in the consolidated statement of operations.
| F-11 |
Management evaluates and updates the classification of operations as discontinued when relevant events occur, such as the approval of a sale plan, abandonment, or completion of disposal.
Segment Reporting
The Company uses the “management approach” to identify its reportable segments. This approach is based on the internal organizational structure used by management for making operational decisions and assessing the performance of the business.
The Company previously operated through two reportable segments. Through May 12, 2025, the Company, through its subsidiary Jubilee, operated an Advertising segment that launched and managed Yahoo partner advertisements and provided a SaaS platform for third parties to run such advertisements. This segment subsequently ceased to meet the criteria for classification as a continuing operation and was therefore reclassified as a discontinued operation. As a result of this reclassification, all prior period segment information has been recast to conform to the current period presentation.
Following this reclassification, the Company operates through a single reportable segment, the Holding Segment. The Holding Segment includes corporate functions such as finance, legal, human resources, and executive management, and represents the parent-level activities of the Company, including the identification and pursuit of new business opportunities. This segment will provide financing support to other operating units, and corporate-level expenses are recorded within this segment.
As the Company operates as a single reportable segment, no further disaggregated segment information is required to be disclosed under ASC 280, Segment Reporting. Financial information related to the discontinued Advertising segment operations is presented separately in Note 17 — Discontinued Operations.
Reverse Stock Split
On
April 24, 2025,
In accordance with Staff Accounting Bulletin (“SAB”) Topic 4C and ASC 260-10-55-12, the reverse stock split has been retrospectively reflected in these consolidated financial statements for all periods presented, including the balance sheets and statements of stockholders’ equity. All share and per-share amounts — including earnings per share and weighted-average shares outstanding — have been restated to give effect to the reverse stock split.
No fractional shares were issued in connection with the Reverse Stock Split. Any fractional shares resulting from the split were rounded up to the next whole share, consistent with the Company’s corporate charter. This accounting policy ensures the comparability of share-related information across all periods presented.
The reverse stock split did not affect the total dollar amount of common stock or total stockholders’ equity.
Allowance for Credit Losses
The Company applies the CECL model under ASC 326 to estimate expected credit losses on financial assets, including trade receivables, notes receivable, and held-to-maturity debt securities. CECL requires consideration of historical loss experience, current conditions, and reasonable forecasts over the asset’s contractual life.
As of the reporting date, the Company recorded a material allowance for credit losses related to an outstanding note receivable, establishing a full reserve for the entire balance of the note and the related interest receivable.
| F-12 |
The allowance is reassessed at each reporting period, and changes are recognized in the income statement as credit loss expense. The Company has considered the recent guidance and does not have receivables that would require this level of analysis in determining the net realizable balance of accounts receivable.
Income taxes
The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
FASB Accounting Standards Codification Topic 740, Income Taxes (“ASC 740”), clarifies the accounting for uncertainty in income taxes recognized in the financial statements. ASC 740 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. Income tax positions must meet a more-likely-than-not recognition threshold to be recognized. ASC 740 also provides guidance on measurement, derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have determined that the Company does not have uncertain tax positions on its tax returns for the years 2024, and prior. Based on the evaluation of the 2025 transactions and events, the Company does not believe it has any material uncertain tax positions that require measurement.
The IRS requires all domestic corporations in existence for any part of the tax year to file an income tax return whether or not they have taxable income. The Company incurred a loss for the fiscal years ended December 31, 2025, and 2024 and has not filed tax returns for either year. The Company has not received any notifications from the IRS. Reported tax benefits and valuation allowances are the Company’s best estimate of its tax positions and have not been reviewed by the taxing authority.
Our policy is to recognize interest and/or penalties related to income tax matters in income tax expense. We had no accrual for interest or penalties on our consolidated balance sheets at December 31, 2025 or 2024, and have not recognized interest and/or penalties in the consolidated statement of operations for the period ended December 31, 2025 and 2024.
The Company is subject to taxation in the United States and the State of Nevada.
The Company has not filed federal or applicable state income tax returns for the fiscal years ended December 31, 2025 and 2024. Accordingly, those tax years remain open to examination by the respective tax authorities once filed.
Commitments And Contingencies
The Company accounts for contingencies in accordance with ASC 450-20. Liabilities for loss contingencies, including claims, assessments, litigation, fines, penalties, and other matters, are recognized when it is probable that a liability has been incurred and the amount can be reasonably estimated.
If a loss contingency is reasonably possible but not probable, or if the amount cannot be reasonably estimated, the Company discloses the nature of the contingency and an estimate of the possible loss or range of loss, if determinable.
Concentration And Credit Risk
Financial
instruments which potentially subject the Company to credit risk consist of cash. Cash is maintained with a major financial institution
in the USA that is creditworthy. The Company maintains cash in bank accounts insured up to $
Recently Issued Accounting Pronouncements
ASU 2023-09, Income Taxes (Topic 740) — Improvements to Income Tax Disclosures. This ASU requires enhanced disclosures in the rate reconciliation and disaggregation of income taxes paid by federal, state, and foreign jurisdiction. The standard was effective for public business entities for annual periods beginning after December 15, 2024. The Company adopted ASU 2023-09 effective January 1, 2025. As the Company recognized no income tax expense and made no income tax payments during the year ended December 31, 2025, and maintains a full valuation allowance against its deferred tax assets, the adoption did not have a material impact on the Company’s consolidated financial statements or disclosures.
ASU 2024-03, Income Statement — Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires disaggregated disclosure of certain income statement expense line items within the notes to financial statements. For smaller reporting companies, the standard is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company does not expect this standard to have a material impact on its consolidated financial statements given the limited nature of its expense categories.
| F-13 |
The Company periodically evaluates newly issued accounting standards and has not identified any other recently issued pronouncements expected to have a material effect on its consolidated financial statements.
NOTE 3 - GOING CONCERN
The Company’s financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates continuity of operations, the realization of assets, and payments of liabilities in the normal course of business.
As
of December 31, 2025, the Company had an accumulated deficit of $
These factors and uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might incur in the event the Company cannot continue in existence. Management intends to seek additional capital from new equity securities offerings, debt financing and debt restructuring to provide funds needed to increase liquidity, fund internal growth and fully implement its business plan. However, management can give no assurance that these funds will be available in adequate amounts, or if available, on terms that would be satisfactory to the Company.
The timing and amount of the Company’s capital requirements will depend on a number of factors, including maintaining its status as a public company and supporting shareholder and investor relations.
NOTE 4 – NOTE RECEIVABLE
On
May 2, 2024, the Company entered into a $
As
of December 31, 2024, the note was in default, and the Company determined that an allowance for the full amount of the note was required,
as the note was considered potentially uncollectible. Accordingly, the Company recorded a full allowance for credit losses on the outstanding
principal balance and related accrued interest of $
As
of December 31, 2025, the note remains outstanding and in default. The Company continues to maintain a full allowance for credit losses
on the outstanding principal balance and all related accrued interest, including additional accrued interest of $
| Description | December 31, 2025 | December 31, 2024 | ||||||
| (Restated) | ||||||||
| Notes receivable - current portion | $ | $ | ||||||
| Allowance for doubtful accounts | ( | ) | ( | ) | ||||
| Notes receivable, net | $ | $ | ||||||
NOTE 5 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
On
September 20, 2024, Hallmark Venture Group, Inc. entered into a debt cancellation agreement with a vendor, pursuant to which $
| F-14 |
An
unrelated third party paid $
During the year ended December 31, 2025, certain vendors issued a demand for payments of outstanding balances through legal counsel and third-party collection agencies. The Company evaluated these matters and recorded the related liabilities in its consolidated financial statements, as management believes such amounts are probable and reasonably estimated.
The following table presents the Company’s accounts payable and accrued liabilities balances as of December 31, 2025 and 2024.
| Description | December 31, 2025 | December 31, 2024 | ||||||
| (Restated) | (Restated) | |||||||
| Legal fees | $ | $ | ||||||
| Credit cards | ||||||||
| Accrued liabilities | ||||||||
| Deposits payable | ||||||||
| Accrued expenses | ||||||||
| $ | $ | |||||||
NOTE 6 – CONVERTIBLE NOTE PAYABLE – RELATED PARTY
On
December 5, 2023, the Company issued a Convertible Exchange Note to John Murphy, for $
On
October 6, 2022, the Company issued a
On
April 6, 2023, the Company issued a
On
December 12, 2023, the Company issued a convertible exchange note to Paul Strickland. The note was unsecured, non-interest-bearing, and
matured on December 12, 2023. On August 7, 2025, the note was converted into shares of common stock. As of December 31, 2025 and
2024, the balance of the note was $
In
connection with the acquisition of Jubilee Intel, LLC in fiscal year 2024, debt obligations totaling $
As
a result, the Company recognized the reinstated debt of $
On
July 17, 2025, the Company issued a
| F-15 |
NOTE 7 – CONVERTIBLE NOTES PAYABLE
On
March 1, 2024, the Company issued a $
On
May 1, 2024, the Company issued a $
On
March 7, 2025, the Company issued a $
On
July 8, 2025, the Company issued a
On
May 15, 2025, the Company issued six
The notes were convertible, at the option of the holder, into shares of the Company’s common stock at a conversion price determined pursuant to the terms of the notes. The Company evaluated the conversion features under ASC 815, Derivatives and Hedging, and determined that the features required bifurcation and classification as derivative liabilities. Accordingly, the Company recognized a derivative liability at fair value on the issuance date, with an offsetting debt discount. The derivative liability was subsequently remeasured at fair value at each reporting date, with changes in fair value recognized in the consolidated statements of operations. Upon conversion of the notes during the year ended December 31, 2025, the related derivative liability was extinguished.
On
May 14, 2025, the Company issued a $
| F-16 |
On
May 30, 2025, the Company issued a $
As
of December 31, 2025, the total amount due to a loan holder was $
As
of December 31, 2024, the total amount due to a loan holder was $
NOTE 8 – SETTLEMENT LIABILITY
On
November 3, 2020, the Company entered into a settlement agreement to resolve outstanding obligations totaling $
On
March 28, 2024, the settlement agreement, including an outstanding balance of approximately $
On
August 8, 2025, the holder elected to convert the outstanding balance into shares of the Company’s common stock in full
satisfaction of the obligation. As of December 31, 2025 and 2024, the settlement liability had a balance of $
NOTE 9 – NOTES PAYABLE
On
October 9, 2024, the Company authorized the issuance of up to $
| F-17 |
On
October 15, 2024, the Company issued a $
On
October 28, 2024, the Company issued a $
On
November 4, 2024, the Company issued a $
On
November 15, 2024, the Company issued a $
On
November 19, 2024, the Company issued a $
On
December 20, 2024, the Company issued a $
On February 7, 2025, the Company converted an outstanding line of credit
balance of $
As
of December 31, 2025, the outstanding principal and accrued interest were $
NOTE 10 – DERIVATIVE LIABILITY
The
Company has various convertible notes outstanding that require derivative liability considerations for its conversion features. Total
derivative liability on December 31, 2025 was $
| Balance at December 31, 2023 | $ | |||
| Decrease to derivative due to repayments | ( | ) | ||
| Increase to derivative due to new issuances | ||||
| Derivative gain due to mark to market adjustment | ( | ) | ||
| Balance at December 31, 2024 | ||||
| Decrease to derivative due to repayment | ( | ) | ||
| Increase to derivative due to new issuances | ||||
| Derivative loss due to mark to market adjustment | ||||
| Balance at December 31, 2025 | $ |
The following table summarizes the weighted average key inputs used in the Black-Scholes model for all outstanding conversion feature derivative liabilities as of the measurement dates:
| December 31, 2025 | December 31, 2024 | |||||||||||||||
| Input | Weighted Avg. | Range | Weighted Avg. | Range | ||||||||||||
| Stock price | $ | $ | $ | $ | ||||||||||||
| Exercise price (conversion price) | $ | $ | $ | $ | - | |||||||||||
| Risk-free interest rate | % | % | % | % | ||||||||||||
| Expected term (years) | ||||||||||||||||
| Expected volatility | % | % | % | % | ||||||||||||
| Dividend yield | ||||||||||||||||
| F-18 |
NOTE 11 – STOCK PAYABLE
The Company’s related party settlement liability (Note 8) includes a requirement to issue shares of the Company’s common stock to cover litigation and legal expenses associated with the settlement agreement. The settlement originally provided for the issuance of shares of common stock.
On March 28, 2024, the settlement agreement was assigned to a non-affiliated third party. On May 6, 2024, the liability was further assigned to another non-affiliated third party.
The settlement agreement does not contain provisions for adjustment of the number of shares in the event of a reverse stock split. Accordingly, the Company continues to account for the obligation based on the original shares.
The
value of the stock payable was determined as $
The
remaining shares to be issued at December 31, 2025 and 2024 were and , respectively. The
remaining balance of the stock payable liability was $
NOTE 12 – WARRANTS
On
May 1, 2024, the Company issued under a Warrant Subscription Agreement for
The assumptions used to determine the fair value of the Warrants as follows:
| Expected life (years) | ||||
| Risk-free interest rate | % | |||
| Expected volatility | % | |||
| Dividend yield | % |
On
October 9, 2024, the Company authorized the issuance of up to $
| Expected life (years) | ||||
| Risk-free interest rate | % | |||
| Expected volatility | % | |||
| Dividend yield | % |
Number of Warrants | Weighted Average Exercise Price | Weighted Average Remaining Contract Term | Intrinsic Value | |||||||||||||
| Outstanding, December 31, 2023 | $ | — | $ | |||||||||||||
| Issued | $ | — | ||||||||||||||
| Expired | $ | — | — | |||||||||||||
| Exercised | $ | — | — | |||||||||||||
| Outstanding, December 31, 2024 (Restated) | $ | $ | ||||||||||||||
| Issued | $ | — | — | |||||||||||||
| Expired | ( | ) | $ | — | — | |||||||||||
| Exercised | $ | — | — | |||||||||||||
| Outstanding, December 31, 2025 | $ | $ | ||||||||||||||
| F-19 |
NOTE 13 – COMMON STOCK
On
January 5, 2024, the Company issued shares of its common stock to a debt holder for conversion of $
On September 26, 2024, Beartooth Asset Holding, LLC, an entity controlled by Paul Strickland, agreed to cancel shares of common stock as part of the merger agreement.
On May 20, 2025, the Company issued shares of common stock for legal fees associated with the settlement liability (Note 8).
On
June 2, 2025, a debt holder converted $
On May 16, 2025, the Company issued million shares of common stock to Beartooth Asset Holdings, Inc. (“Beartooth”) a related party as a corporate restructuring transaction in preparation for a potential merger. The Company had not entered into any agreement or obligation for a specific merger transaction.
On
July 21, 2025, John D. Murphy, Jr. retired $
On
August 5, 2025, an unrelated party retired $
On
August 5, 2025, an unrelated party retired $
On
August 5, 2025, an unrelated party retired $
On
August 7, 2025, Paul Strickland, the Company’s sole director and officer, retired $
On
August 12, 2025, Selkirk retired $
On
August 12, 2025, Selkirk retired $
During the year ending December 31, 2025, an unrelated party converted $ and $ of principal and interest, respectively, into shares of common stock; however, an unrelated party entered into separate agreements to sell or transfer its shares in the Company to other unrelated parties.
The shares were issued in settlement of outstanding liabilities and were measured at the carrying value of the debt extinguished. Accordingly, the transactions were accounted for as debt settlements, with the carrying amounts of the liabilities reclassified to common stock and additional paid-in capital.
Refer Note 5 and 7 for the common stock issued in conversion of debt to an unrelated parties
NOTE 14 – PREFERRED STOCK
The
Company is authorized to issue shares of $ par value Series A preferred stock. The Company increased the number of authorized
shares of the Series A preferred stock from to on January 19, 2021. Each share of the Series A Preferred Stock is convertible
at the option of the holder into shares of common stock.
| F-20 |
The Company has shares of Series A Preferred Stock issued and outstanding as of December 31, 2025 and 2024, respectively. At December 31, 2025, Selkirk Global holding was the holder of all of the outstanding shares of Series A Preferred Stock and at December 31, 2024 Evan Bloomberg was the holder of all of the outstanding shares of Series A Preferred Stock, acquired from John D. Murphy, Jr. and Paul Strickland in conjunction with the Jubilee Intel, LLC transaction.
NOTE 15 – OTHER RELATED PARTY TRANSACTIONS
| Name of Related Party | Related Relationship | |
| Evan Bloomberg | (1) | |
| John D. Murphy Jr. | ||
| Paul Strickland | ||
| Selkirk Global Holdings, LLC |
| (1) |
Loans and Cash Advances
Refer to Note 6 for the convertible notes issued to the related parties.
Refer to Note 13 for shares issued to the related parties.
NOTE 16 – INCOME TAX
For the years ending December 31, 2025 and 2024, there was no provision for income taxes and deferred tax assets have been entirely offset by valuation allowances.
As
of December 31, 2025 and 2024, the Company had net operating loss carry forwards of approximately $
The tax computations are as follows:
December 31, 2025 | December 31, 2024 | |||||||
| (Restated) | (Restated) | |||||||
| Net losses before taxes | $ | ( | ) | $ | ( | ) | ||
| Adjustments to arrive at taxable income/loss | ||||||||
| Permanent differences: | ||||||||
| Temporary differences: | ||||||||
| Taxable income (loss) | ( | ) | ( | ) | ||||
| Current Year Taxable (loss) income | ( | ) | ( | ) | ||||
| NOL carried forward prior year (tax return) | ( | ) | ( | ) | ||||
| NOL carried forward at period end | $ | ( | ) | $ | ( | ) | ||
| Deferred Tax Asset - Federal Rate ( | ( | ) | ( | ) | ||||
| Deferred Tax Asset - State Rate | ||||||||
| Total Deferred Tax Asset | ( | ) | ( | ) | ||||
| Valuation Allowance | ( | ) | ( | |||||
| Deferred tax per books | $ | $ | ||||||
| F-21 |
NOTE 17 – DISCONTINUED OPERATIONS AND DECONSOLIDATION
As of December 31, 2025, Jubilee is no longer a wholly-owned subsidiary of the Company and has been deconsolidated as of December 31, 2025. The assets and liabilities associated with this business were displayed as assets and liabilities from discontinued operations as of December 31, 2024. Additionally, the revenues and costs associated with this business are displayed as losses from discontinued operations for the year ended December 31, 2024.
Total assets and liabilities included in discontinued operations were as follows:
| December 31, 2025 | December 31, 2024 | |||||||
| Assets from Discontinued Operations: | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable | ||||||||
| Total assets from discontinued operations | $ | $ | ||||||
| Liabilities from Discontinued Operations: | ||||||||
| Accounts payable and accruals | $ | $ | ||||||
| Loan payable | ||||||||
| Due to a related party | ||||||||
| Total liabilities from discontinued operations | $ | $ | ||||||
In the statement of operations there is no reported gain on deconsolidated for the year ended December 31, 2025 due to the gain from deconsolidation netting against the previous loss incurred from discontinued operations resulting in zero financial impact on statement of operations.
NOTE 18 – RESTATEMENT
For the year ended December 31, 2025
During 2026, the Company’s management identified errors in its previously issued consolidated financial statements as of and for the year ended December 31, 2025. Upon completing its evaluation, management determined that these errors were material, individually and in the aggregate, to the previously issued financial statements and that restatement was required.
Accordingly, the Company has restated its consolidated financial statements as of and for the year ended December 31, 2025, in accordance with ASC 250-10, Accounting Changes and Error Corrections. The restated consolidated financial statements supersede the previously issued financial statements for the period then ended and should be read in their place.
Convertible
notes payable and accrued interest: Management determined that the July 8, 2025 Convertible Note Payable was understated by $
Derivatives
fair value adjustment at conversion: Management determined that at conversion the fair value adjustment of the derivative liability should
have impacted the additional paid in capital balance rather than change in fair value of derivative liabilities.
Aggregate
effect on net loss and accumulated deficit:
For the year ended December 31, 2024
During 2025, management of the Company identified errors in its previously issued consolidated financial statements as of and for the year ended December 31, 2024. Upon completing its evaluation, management determined that these errors were material, individually and in the aggregate, to the previously issued financial statements and that restatement was required.
Accordingly, the Company has restated its consolidated financial statements as of and for the year ended December 31, 2024, in accordance with ASC 250-10, Accounting Changes and Error Corrections. The restated consolidated financial statements supersede the previously issued financial statements for the period then ended and should be read in their place.
In addition to the error corrections described below, two items have been presented on a retrospective basis in the accompanying consolidated financial statements. These items are not error corrections and are described as follows:
Discontinued Operations — Jubilee. Management determined during 2025 that Jubilee meets the criteria for classification as a discontinued operation under ASC 205-20, Presentation of Financial Statements — Discontinued Operations. Accordingly, the results of operations, assets, and liabilities attributable to Jubilee have been reclassified and presented separately as discontinued operations for all periods presented. This reclassification represents a change in financial statement presentation and does not affect previously reported net loss attributable to the Company as a whole.
Reverse Stock Split. The Company effected a 1-for-500 reverse stock split during 2025. In accordance with ASC 260-10, Earnings Per Share, all share and per-share data in the accompanying consolidated financial statements and notes thereto have been retroactively adjusted to reflect the reverse stock split for all periods presented. This adjustment represents a capital structure change and does not constitute a correction of an error.
| F-22 |
Revenue
and Accounts Receivable. The Company determined that certain revenue and corresponding accounts receivable balances recorded during the
year ended December 31, 2024 did not satisfy the performance obligation criteria required for recognition under ASC 606, Revenue from
Contracts with Customers, based on information available as of the reporting date.
Allowance
for Credit Loss — Note Receivable. The Company held a note receivable, including accrued interest, with a carrying value of $105,326
as of December 31, 2024. Management determined that collection of this balance was not probable as of the reporting date and that a full
allowance for credit loss should have been recorded.
Misclassification
of Cash and Related Party Transactions. Management determined that a cash balance included within the Company’s consolidated balance
sheet as of December 31, 2024 was attributable to a related party and did not represent an asset of the Company.
Unaccrued
Interest Expense. The Company failed to accrue interest expense on outstanding debt obligations for a portion of the year ended December
31, 2024, representing a period-end cutoff error.
Unaccrued Vendor Obligations. The Company failed to record certain vendor invoices and payable balances as of December 31, 2024, representing
a period-end cutoff error.
Accrued
Compensation Payments. The Company recorded accrued compensation liabilities and subsequently made payroll payments; however, such payments
were not applied against the accrued compensation balance, resulting in a duplicate recognition of payroll expense. Management determined
that the accrued compensation balance was overstated as of December 31, 2024.
Aggregate Effect on Net Loss and Accumulated Deficit
Basic and diluted net loss per share for the year ended December 31, 2024 was $(0.56) as restated, reflecting the aggregate effect of the restatement adjustments on net loss. All per-share and share amounts have been retroactively adjusted to reflect the 1-for-500 reverse stock split for all periods presented.
| F-23 |
NOTE 19 – SUBSEQUENT EVENTS
In accordance with ASC 855-10, Subsequent Events, management evaluated subsequent events through the date the financial statements were issued and noted material subsequent events requiring disclosure in these financial statements.
On
January 15, 2026, a debt holder converted $
On
February 9, 2026, Selkirk Global Holdings, LLC converted $
On
February 12, 2026, the Company issued a new
On February 24, 2026, Beartooth Asset Holdings, LLC, an entity managed by Mr. Strickland, executed an Irrevocable Stock Power transferring shares of the Company’s restricted common stock to the Hallmark Venture Group, Inc. Acquisition Account. This transfer was made in connection with an anticipated corporate restructuring. The shares had originally been issued to Beartooth on May 16, 2025, pursuant to a Board Resolution for anticipated corporate restructuring purposes.
On
March 5, 2026, the debt holder entered into an Assignment of Debt Agreement whereby the debt holder assigned $
On
March 10, 2026, a note holder converted $
| F-24 |
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Management’s Report Disclosure Controls and Procedures
During the fourth quarter of the year ended December 31, 2025, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered in this report, our disclosure controls and procedures were not effective to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended, are recorded, processed, summarized and reported within the required time periods specified in the Commission’s rules and forms and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Our principal executive officer and principal financial officer, do not expect that our disclosure controls and procedures or our internal controls will prevent all error or fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
Management’s Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is a process designed to provide reasonable, but not absolute, assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. 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 the policies or procedures may deteriorate.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
Our management assessed the effectiveness of the Company’s internal control over financial reporting at December 31, 2025, and this assessment identified the following material weaknesses in our internal control over financial reporting.
| ● | Due to our size and limited resources, we currently do not employ the appropriate accounting personnel to ensure (a) we maintain proper segregation of duties, (b) that all transactions are entered timely and accurately, and (c) we properly account for complex or unusual transactions; | |
| ● | Due to our size and scope of operations, we currently do not have an independent audit committee in place; | |
| ● | Due to our size and limited resources, we have not properly documented a complete assessment of the effectiveness of the design and operation of our internal control over financial reporting. |
In making its assessment of internal control over financial reporting, management used the criteria issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Because of the material weaknesses described in the preceding paragraphs, management concluded that, at December 31, 2025, the Company’s internal control over financial reporting was not effective based on those criteria.
| 9 |
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or reasonably likely to materially affect, our internal control over financial reporting.
Attestation Report of Independent Public Accounting Firm
This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting because as a smaller reporting company we are not subject to attestation by our independent registered public accounting firm pursuant to rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.
ITEM 9B. OTHER INFORMATION
ITEM 9C. DISCLOSURES REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not Applicable
Part III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following table sets forth the names, ages, and titles of our executive officers and directors.
| Name | Age | Position(s) | ||
| Paul Strickland | 50 | Secretary, Principal Financial Officer, and sole Director |
Paul Strickland – Mr. Strickland has served as Secretary of the Company since August 2020 and as a director of the Company since July 2022. Mr. Strickland has two decades of international business experience within the finance, entertainment, private equity, agriculture, mining, manufacturing, and technology sectors. Since 2013, Mr. Strickland has served as a board member of public and private companies in North America and Asia. In 2017, Mr. Strickland formed Selkirk Global Holdings, a private holding company. Through Selkirk Global Holdings, Mr. Strickland serves as an officer and sits on the board of several small publicly traded companies across a wide variety of sectors, focusing on restructuring activities and corporate governance issues. From 2015-2018, Mr. Strickland was the managing member of USA Milk Processing, LLC. He served as secretary and director of Supurva Healthcare Group, Inc. from 2017 to 2020 and currently serves as secretary of that company. He has served as secretary and director of VG Life Sciences, Inc. from 2017 to present, secretary and director of Jammin Java Corp from 2017 to present, secretary and director of High Performance Beverages Co. from 2017 to present, secretary and director of Humble Energy, Inc. from 2020 to present, secretary and director of Paradigm Oil and Gas, Inc. from 2020 to 2023, and sole director and officer of FONU2, Inc. since March 2021. From June 2020 to May 2022, Mr. Strickland served as secretary of Bayport International Holdings, Inc. Since September 2022, Mr. Strickland has served as the sole director and officer of iTOKK, Inc. He received his Bachelor’s Degree in Foreign Language and International Affairs, with a minor in Asian Studies and Chinese Language, from the University of Puget Sound in 1998. He is fluent in Mandarin Chinese.
| 10 |
None of our directors or officers are related to each other. There are no arrangements or understandings with any of our principal stockholders, customers, suppliers, or any other person, pursuant to which any of our directors or executive officers were appointed.
No officer or director has, during the past five years, been involved in (a) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time, (b) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses), (c) any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities or (d) a finding by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.
Director Independence
Our Board of Directors may establish the authorized number of directors from time to time by resolution. Our Board of Directors is currently comprised of one member.
Audit committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Exchange Act, subject to the transition rule that is applicable to a newly public company. In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the Board of Directors, or any other board committee accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries; or be an affiliated person of the listed company or any of its subsidiaries.
Role of the Board of Directors in Risk Oversight
The Board of Directors is responsible for assessing the risks facing our company and considers risk in every business decision and as part of our business strategy. The Board of Directors recognizes that it is neither possible nor prudent to eliminate all risk, and that strategic and appropriate risk-taking is essential for us to compete in our industry and in the global market and to achieve our growth and profitability objectives. Effective risk oversight, therefore, is an important priority of the Board of Directors.
While the Board of Directors oversees our risk management, management is responsible for day-to-day risk management processes. Our Board of Directors expects management to consider risk and risk management in each business decision, to proactively develop and monitor risk management strategies and processes for day-to-day activities and to effectively implement risk management strategies that are adopted by the Board of Directors. The Board of Directors expects to review and adjust our risk management strategies at regular intervals or as needed.
| 11 |
Code of Business Conduct
Our Board of Directors has adopted a code of business conduct and ethics, the “Code of Business Conduct,” to ensure that our business is conducted in a consistently legal and ethical manner. Our policies and procedures cover all major areas of professional conduct, including employee policies, conflicts of interest, protection of confidential information, and compliance with applicable laws and regulations.
Board Committees
Our board does not currently have a standing Audit Committee, Compensation Committee or Nominating/Corporate Governance Committee due the board’s limited size and the Company’s limited operations. The entire Board of Directors performs all functions that would otherwise be performed by committees. Given the present size of our Board, it is not practical for us to have committees other than those described above, or to have more than two directors on such committees. If we are able to grow our business and increase our operations, we intend to expand the size of our board and our committees and allocate responsibilities accordingly.
ITEM 11. EXECUTIVE COMPENSATION
The table below summarizes all compensation awarded to, earned by, or paid to each named executive officer and director for our last two completed fiscal years for all services rendered to us.
Summary Compensation Table
| Name and Principal Position | Year | Salary | Bonus | Stock Awards ($) (4) | Option Awards ($) (3) | Non-Equity Incentive Plan Compensation ($) | Nonqualified Deferred Compensation Earnings ($) | All Other Compensation ($) (2) | Total | ||||||||||||||||||||||||||
| Evan Bloomberg (Former) | 2025 | $ | 45,000 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 45,000 | ||||||||||||||||||
| Former President, CEO, Director (resigned May 12, 2025) | 2024 | $ | 102,329 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | 102,329 | ||||||||||||||||||
| Paul Strickland | 2025 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||
| Secretary, Principal Executive Officer, Principal Financial Officer, sole Director | 2024 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||||
Employment Agreements
On October 23, 2024, the Company entered into a Management Agreement with Evan Bloomberg whereby Mr. Bloomberg agreed to provide management/CEO services to the Company for a two-year term (automatically renewable for successive one-year periods), in exchange for (i) an annual salary in the amount of $340,000, (ii) performance bonuses of up to 2.5% of the quarterly revenue generated by the Company, and (iii) $1,000,000 in shares of Company common stock. This Management Agreement was terminated effective May 12, 2025, in connection with Mr. Bloomberg’s resignation from all positions with the Company and the demerger of Jubilee Intel, LLC.
Outstanding Equity Awards at Fiscal Year-End
As of December 31, 2025, no equity awards were outstanding.
| 12 |
Director Compensation
As of the date of this filing, we do not have any compensation agreements in place with any of our directors.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The following table sets forth, as of the date of this filing, information regarding the beneficial ownership of each class of our voting securities by: (i) our officers and directors; (ii) all of our officers and directors as a group; and (iii) each person known by us to beneficially own 5% or more of any class of our outstanding voting securities. Generally, a person is deemed to be a “beneficial owner” of a security if that person has or shares the power to dispose or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which the person has the right to acquire beneficial ownership within 60 days.
The address of each holder listed below, except as otherwise indicated, is c/o HALLMARK VENTURE GROUP, INC., 1800 N Town Center Drive, STE 100, Las Vegas, NV 89144.
| Name of Beneficial Owner 5% Beneficial Owners | Shares of Common Stock Beneficially Owned** | Percent of Common Stock Beneficially Owned(1)** | Shares of Series A Preferred Stock Beneficially Owned(2)** | Percent of Series A Preferred Stock Beneficially Owned** | Number of Voting Shares Beneficially Owned** | Percent of Voting Shares Beneficially Owned(3)** | ||||||||||||||||||
| Nicosel, LLC (1) | 3,623,943 | 5.5 | % | 0 | 0 | 3,741,531 | 2.35 | % | ||||||||||||||||
| Selkirk Global Holdings, LLC(2)(3)(5) | 1,806,965 | 2.74 | % | 100,000 | 100 | % | 91,806,965 | 59.62 | % | |||||||||||||||
| Directors and Officers | ||||||||||||||||||||||||
| Paul L. Strickland, Secretary and Director (2)(3)(5) | 1,806,965 | 2.74 | % | 100,000 | 100 | % | 91,806,965 | 59.62 | % | |||||||||||||||
| All directors and executive officers as a group (1 person) | 1,806,965 | 2.74 | % | 100,000 | 100 | % | 91,806,965 | 59.62 | % | |||||||||||||||
| (1) | Nicosel, LLC is an entity controlled by Mr. Salvatore Lauria. |
| (2) | The address for Mr. Strickland, Selkirk Global Holdings, LLC, is 120 State Ave. NE, Olympia, WA 98501. |
| (3) | Unless otherwise indicated, all shares are owned directly by the beneficial owner. |
| (4) | Based on 63,994,148 shares of common stock outstanding as of December 31, 2025. Shares of common stock underlying convertible securities held by any person, which securities are currently exercisable or exercisable within 60 days of December 31, 2025, are deemed outstanding for purposes of computing the percentage ownership of the person holding such convertible securities, but are not deemed outstanding for purposes of computing the percentage ownership of any other person. |
| (5) | Consists of 100,000 shares of Series A Convertible Preferred Stock. Each share is convertible into 900 shares of the common stock of the Company. These shares are held by Selkirk Global Holdings, LLC, an entity controlled by Mr. Strickland, the Secretary and a member of the Board of Directors of the Company. Due to his control position with Selkirk Global Holdings, LLC, Mr. Strickland may be deemed to be the beneficial owner of the shares owned by Selkirk Global Holdings, LLC. Mr. Strickland disclaims any beneficial ownership of these securities, except to the extent of his pecuniary interest therein. |
| 13 |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
We are a party to certain related party transactions, as described below.
Loans from Paul Strickland
On December 31, 2023, Mr. Strickland forgave the $2,750 due to him. The amount was credited to paid in capital. As of December 31, 2025 and 2024, the outstanding balance due to Mr. Strickland was $0 and $0, respectively.
In addition, during the year ending December 31, 2023, the Company and its Board of Directors approved a $7,119, 0% convertible exchange note to Paul Strickland (“Holder”), Secretary and Director of the Company (the “Note”). The Note matures December 11, 2024 and is convertible into the Company’s common stock at a price equal to 50% of the average closing price of the Company’s common stock during the 25 consecutive trading days prior to the date on which the Holder elects to convert all or part of the Note. The Note is fully funded and has been issued to Holder in exchange for having made direct payments of Company expenses. The Note was in default.
This note was canceled as part of the merger agreement on September 24, 2024. However, upon the deconsolidation of Jubilee in FY2025 due to the demerger, the note was reinstated.
On August 7, 2025, Mr. Strickland converted the entire balance owed to him into 83,753 shares of common stock.
As of December 31, 2025 and 2024, the outstanding balance due pursuant to this Note to Mr. Strickland was $0 and $0, respectively.
Convertible Notes
On October 5, 2022, the Company issued a $50,000, 10% convertible promissory note to Selkirk Global Holdings, LLC, (the “Note”), an entity controlled by Paul Strickland, the Company’s sole director and officer. The Note matures October 5, 2023, has a 10% OID and is convertible into the Company’s common stock at a price equal to 55% of the average closing price of the Company’s common stock during the 20 consecutive trading days prior to the date on which the holder elects to convert all or part of the Note. The Note is being funded through the direct payment of Company expenses. The Note was in default.
This note was canceled as part of the merger agreement on September 24, 2024. However, upon the deconsolidation of Jubilee in FY2025 due to the demerger, the note was reinstated.
On August 12, 2025, Selkirk Global Holdings, LLC converted the entire balance owed to it into 941,363 shares of common stock.
As of December 31, 2025 and 2024, the outstanding balance due pursuant to this Note to Mr. Strickland was $0 and $0, respectively.
On April 6, 2023, the Company issued a $50,000, 10% convertible promissory note to Selkirk Global Holdings, LLC, (the “Note”). The Note matures April 5, 2024, has a 10% OID and is convertible into the Company’s common stock at a price equal to 55% of the average closing price of the Company’s common stock during the 20 consecutive trading days prior to the date on which the holder elects to convert all or part of the Note. The Note is being funded through the direct payment of Company expenses.
This note was canceled as part of the merger agreement on September 24, 2024. However, upon the deconsolidation of Jubilee in FY2025 due to the demerger, the note was reinstated.
On August 12, 2025, Selkirk Global Holdings, LLC converted the entire balance owed to it into 402,038 shares of common stock.
As of December 31, 2025 and 2024, the outstanding balance due pursuant to this Note to Mr. Strickland was $0 and $0, respectively.
On July 17, 2025, the Company issued a $50,000, 6% convertible promissory note to Selkirk Global Holdings, LLC, (the “Note”), an entity controlled by Paul Strickland, the Company’s sole director and officer. The Note matures July 16, 2026, and is convertible into the Company’s common stock at a price equal to 50% of the average closing price of the Company’s common stock during the 10 consecutive trading days prior to the date on which the holder elects to convert all or part of the Note. The Note is being funded through the direct payment of Company expenses.
As of December 31, 2025, the outstanding balance due pursuant to this Note to Mr. Strickland was $27,326.46.
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Settlement Liability
On November 3, 2020, the Company entered into a settlement agreement with Green Horseshoe, LLC., Inc. on its past due notes payable with a principal balance of $285,206 and accrued interest of $296,670 representing a total amount of the settlement of $581,876. The settlement amount is non-interest bearing.
The agreement calls for the Company’s transfer agent to issue free-trading common shares to Green Horseshoe, LLC at a conversion rate of 50% of the average closing price of the Company’s shares for the 10 prior trading days prior to any issuance notice issued by Green Horseshoe, LLC. The Settlement Agreement also calls for the issuance of a fixed number of common shares (the “Settlement Shares”), totalling 5,000,000, to be issued at the current market price, subject to a 9.9% beneficial ownership cap.
On March 28, 2024, Green Horseshoe, LLC assigned the Settlement Agreement, Court Order, and balance of debt of $146,799 to the debt holder, a non-affiliate of the Company.
On May 6, 2024, this liability was assigned to the debt holder, a non-affiliate of the Company (Note 8).
The Company issued in partial settlement of this obligation 1,387,000 shares of common stock on November 5, 2020, at a value of $13,870; and 144,007 shares of common stock on May 20, 2025, at a value of $1,440.
The remaining shares to be issued at December 31, 2025 and 2024 were 3,468,993 and 3,613,000 respectively. The remaining balance of the stock payable liability was $34,690 and $36,130 as of December 31, 2025 and 2024, respectively
Statement of Policy
All future transactions between us and our officers, directors or five percent stockholders, and respective affiliates will be on terms no less favorable than could be obtained from unaffiliated third parties and will be approved by a majority of our independent directors who do not have an interest in the transactions and who had access, at our expense, to our legal counsel or independent legal counsel.
To the best of our knowledge, during the past three fiscal years, other than as set forth above, there were no material transactions, or series of similar transactions, or any currently proposed transactions, or series of similar transactions, to which we were or are to be a party, in which the amount involved exceeds $120,000, and in which any director or executive officer, or any security holder who is known by us to own of record or beneficially more than 5% of any class of our common stock, or any member of the immediate family of any of the foregoing persons, has an interest (other than compensation to our officers and directors in the ordinary course of business).
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
Below is the aggregate amount of fees billed for professional services rendered by our principal accountants with respect to our last two fiscal years.
| 2025 | 2024 | |||||||
| Audit fees | $ | 61,450 | $ | 37,868 | ||||
| Audit related fees | $ | - | $ | |||||
| Tax fees | $ | - | $ | - | ||||
| All other fees | $ | - | $ | - | ||||
| Total | $ | 61,450 | $ | 37,868 | ||||
All of the professional services rendered by principal accountants for the audit of our annual financial statements that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the last two fiscal years were approved by our board of directors.
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Audit Fees
Consist of fees billed for professional services rendered for the audit of our financial statements and review of interim consolidated financial statements included in quarterly reports and services that are normally provided by the principal accountants in connection with statutory and regulatory filings or engagements.
Audit Related Fees
Consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees”.
Tax Fees
Consist of fees billed for professional services for tax compliance, tax advice and tax planning. These services include preparation of federal and state income tax returns for the year ended December 31, 2025.
All Other Fees
Consist of fees for products and services other than the services reported above.
Policy for Approval of Audit and Permitted Non-Audit Services
The Board of Directors will pre-approve audit services and non-audit services to be provided by our independent auditors before the accountant is engaged to render these services. The Board of Directors may consult with management in the decision-making process, but may not delegate this authority to management.
PART IV
ITEM 15. EXHIBITS
| Exhibit Number | Description | |
| 10.1 | Management Agreement (E. Bloomberg) | |
| 31.1 | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (*) | |
| 31.2 | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (*) | |
| 32.1 | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (*) | |
| 101.INS* | Inline XBRL Instance Document. | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document. | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
Item 16. FORM 10-K/A SUMMARY
None.
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SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| HALLMARK VENTURE GROUP, INC. | ||
| Date: May 28, 2026 | BY: | /s/ Paul Strickland |
| Chief Executive Officer, Principal Financial Officer, Director | ||
| BY: | /s/ Paul Strickland | |
| Secretary, Director | ||
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