SNBH 10-Q
Sentient Brands Holdings Inc. (SNBH)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
For
the quarterly period ended
For the transition period from _________________ to _________________
Commission
File Number:
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices) (zip code)
Registrant’s
telephone number:
Securities registered pursuant to Section 12(b) of the Act: None.
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by 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 is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No
As of August 11, 2026, there were shares of common stock, par value $ per share, issued and outstanding. A reverse recapitalization of the common stock at a ratio of 1-for-30 became effective January 2, 2026, and all share amounts herein are presented on a post-split basis. As described in Note 14, an aggregate of 455,496 of the issued and outstanding shares has been irrevocably surrendered to the Company for cancellation and is pending cancellation by the Company’s transfer agent. These shares are included in the number of shares issued and outstanding as of the date of filing.
SENTIENT BRANDS HOLDINGS INC.
FORM 10-Q QUARTERLY REPORT
TABLE OF CONTENTS
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PART I – FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) for smaller reporting companies. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. These statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
SENTIENT BRANDS HOLDINGS INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (Unaudited) | (Audited) | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable | ||||||||
| Prepaid expenses | ||||||||
| Prepaid fulfilment fees | ||||||||
| TOTAL CURRENT ASSETS | ||||||||
| Fixed Assets (net) | ||||||||
| Intangible Assets (net) | ||||||||
| Goodwill | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Short-term loans payable | ||||||||
| Notes payable | ||||||||
| Convertible notes payable | ||||||||
| Accrued interest | ||||||||
| Derivative liability | ||||||||
| Acquisition credits | ||||||||
| TOTAL CURRENT LIABILITIES | ||||||||
| TOTAL LIABILITIES | ||||||||
| Commitments and contingencies (Note 12) | ||||||||
| STOCKHOLDERS’ DEFICIT | ||||||||
| Preferred Stock - Par Value of $; | ||||||||
| shares authorized; and | ||||||||
| shares issued and outstanding as of June 30, | ||||||||
| 2026 and December 31, 2025, respectively | ||||||||
| Common Stock - Par Value of $; | ||||||||
| shares authorized; | ||||||||
| and shares issued and outstanding, respectively | ||||||||
| as of June 30, 2026 and December 31, 2025 | ||||||||
| Additional paid-in capital | ||||||||
| Common stock subscription | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| TOTAL STOCKHOLDERS’ DEFICIT | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES & STOCKHOLDERS’ DEFICIT | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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SENTIENT BRANDS HOLDINGS INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
UNAUDITED
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Unaudited | Restated | Unaudited | Restated | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| Cost of revenue | ||||||||||||||||
| Gross profit (loss) | ( | ) | ( | ) | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Advertising and marketing | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Legal and professional | ||||||||||||||||
| Management fees | ||||||||||||||||
| TOTAL OPERATING EXPENSES | ||||||||||||||||
| INCOME (LOSS) FROM OPERATIONS | ( | ) | ( | ) | ( | ) | ||||||||||
| Other Income (Expenses) | ||||||||||||||||
| Derivative gain (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
| Settlement of legal claims | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total Other Income (Expenses) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| NET LOSS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| NET LOSS PER COMMON SHARE - BASIC AND DILUTED | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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SENTIENT BRANDS HOLDINGS INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT
UNAUDITED
| Common Stock | Preferred Stock | Common Stock to be | Paid in | Accumulated | ||||||||||||||||||||||||||||
| June 30, 2026 | Shares | Amount | Shares | Amount | issued | Capital | Deficit | Total | ||||||||||||||||||||||||
| Balance - December 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
| Common stock issued from 2026 Employee Stock Plan | - | |||||||||||||||||||||||||||||||
| Subscribed common shares issued | - | ( | ) | |||||||||||||||||||||||||||||
| Net loss for the year | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balances June 30, 2026 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
| June 30, 2025 | Common Stock | Preferred Stock | Common Stock to be | Paid in | Accumulated | |||||||||||||||||||||||||||
| (restated) | Shares | Amount | Shares | Amount | issued | Capital | Deficit | Total | ||||||||||||||||||||||||
| Balance - December 31, 2024 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
| Common stock issued in settlement of accounts payable | - | |||||||||||||||||||||||||||||||
| Subscribed common shares issued | - | |||||||||||||||||||||||||||||||
| Common stock issued for converted debt and accrued interest | - | ( | ) | |||||||||||||||||||||||||||||
| Common stock issued for services | - | |||||||||||||||||||||||||||||||
| Common stock sold to investors not issued | - | - | ||||||||||||||||||||||||||||||
| Conversion of debt and accrued interest into common stock not issued | - | - | ||||||||||||||||||||||||||||||
| Preferred shares retired to treasury | - | ( | ) | ( | ) | |||||||||||||||||||||||||||
| Net loss for the year | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balances June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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SENTIENT BRANDS HOLDINGS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
| For the six months ended | ||||||||
| 2026 | 2025 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Depreciation & amortization expenses | ||||||||
| Issuance of common stock for services | ||||||||
| Interest expense | ||||||||
| Derivative gain (loss) | ( | ) | ||||||
| Issuance of common stock for debt and interest | ||||||||
| Changes in operating assets and liabilities: | - | - | ||||||
| Accounts receivable | ( | ) | ( | ) | ||||
| Prepaid expenses | ( | ) | ||||||
| Inventory | ( | ) | ||||||
| Acquisition credits issued for subsidiaries | ||||||||
| Prepaid fulfilment costs | ( | ) | ||||||
| Accounts payable and accrued expenses | ( | ) | ||||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES | ||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Investment in intangible assets | ( | ) | ||||||
| Investment in fixed assets | ( | ) | ||||||
| NET CASH USED BY INVESTMENT ACTIVITIES | ( | ) | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Net proceeds from sale of common stock | ||||||||
| Proceeds from short-term loans | ||||||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | ||||||||
| INCREASE IN CASH | ||||||||
| CASH-BEGINNING OF PERIOD | ||||||||
| CASH-END OF PERIOD | $ | $ | ||||||
| Supplemental schedule of non-cash financing activity: | ||||||||
| Shares issued for converted debt and interest | $ | $ | ||||||
| Shares issued for consulting services | $ | |||||||
| Shares issued for previously purchased common stock | $ | $ | ||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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SENTIENT BRANDS HOLDINGS INC.
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2026 AND 2025 (UNAUDITED)
NOTE 1. ORGANIZATION AND NATURE OF OPERATIONS
Business Description
SENTIENT BRANDS HOLDINGS INC. (“SNBH” or the “Company”) is a next-generation brand platform focused on the acquisition, development, and commercialization of premium and functional consumer packaged goods (“CPG”).
Nature of Operations and Principal Products/Channels
The Company’s core operations are conducted through its condensed consolidated subsidiaries: AIG-F&B, Inc. (AIGFB), a wholly-owned Nevada subsidiary serving as a manufacturing and distribution platform for food, beverage, and wellness CPG products including the Original New York Seltzer® and Arctic Frost® brands; and Aqua Emergency, Inc. (AE NV), a specialized manufacturer and distributor of emergency water and MREs holding the exclusive license for American Red Cross® licensed products in our categories.
Effective January 1, 2026, the Company was scheduled to acquire all outstanding shares of Wyoming Bears, Inc. (WYB), a California-based distributor of consumer packaged goods, to 100% ownership pursuant to an amendment to the Share Exchange Agreement approved December 31, 2025. The parties have agreed to defer the acquisition and change of control until October 1, 2026. The Company is focusing on growing its current subsidiaries and remediating its balance sheet and overhead prior to an additional acquisition. As a result, no results for WYB were included in these condensed consolidated interim financial statements.
Basis of Presentation
The unaudited condensed consolidated interim financial statements have been prepared in conformity with the U.S. Securities and Exchange Commission (“SEC”) requirements for smaller reporting companies on Form 10-Q. All material intercompany balances and transactions have been eliminated in consolidation.
Effective
January 2, 2026, the Company executed a
These statements should be read in conjunction with the audited condensed consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC.
Going Concern
The
accompanying condensed consolidated interim financial statements have been prepared assuming
the Company will continue as a going concern. The Company has incurred losses since inception and has an accumulated deficit of
$
| 7 |
To address these challenges, management is executing a strategic plan focused on the following areas:
| ● | Operational Efficiency: The Company has implemented strict cost-control measures, including a policy requiring detailed activity reporting on all professional service invoices and the suspension of board fees, to reduce general and administrative (G&A) overhead. | |
| ● | Revenue Scaling: We are prioritizing the growth of our existing CPG subsidiaries, AIG-F&B, Inc. and Aqua Emergency, Inc., by leveraging product innovation and expanding distribution channels within our core wellness and emergency preparedness markets. | |
| ● | Liquidity and Capital Access: We are actively pursuing additional working capital through potential strategic partnerships and equity financing opportunities. | |
| ● | Balance Sheet Restructuring: We are in discussions with the convertible note holder to restructure terms and conditions including conversion pricing, equity conversion and interest rate reductions. |
There can be no assurance that these initiatives will be successful or that the Company will achieve sustainable profitability. If we are unable to secure additional financing on satisfactory terms, our business and financial condition could be materially and adversely affected.
NOTE 2. RESTATEMENTS
The Results of Operations and the respective unaudited condensed consolidated interim Financial Statements for the three and six months ended June 30, 2025 have been restated. The restatement of previously issued financial statements resulted from errors and omissions related to record keeping, accounting, management operations, debt and equity arrangements which indicated a failure in the design or operation of certain controls. Specifically:
There
was a change in calculation of interest expense related to the existing convertible note payable to compound interest as specified in
the note documents versus simple interest recorded by the Company. This change in calculation resulted in $
It
was discovered that the derivative value of the embedded conversion of one feature of a convertible note payable and three warrant grants
were not recognized in the periods prior to 2026. This resulted in an adjustment to a derivative loss of $
There
was an adjustment for the three months ended March 31, 2025 of $
Subsequent to the filing of the Form 10-Q on May 14, 2026, the Company discovered these errors in the comparative presentation of the Condensed Consolidated Statements of Stockholders’ Deficit and Condensed Consolidated Statements of Cash Flows for the three month period ended March 31, 2025. These errors had no impact on the Company’s previously reported condensed consolidated statements of operations, total assets, or total liabilities.
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of condensed consolidated interim financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates.
Cash
The Company considers all short-term highly liquid investments with an original maturity date of purchase of three months or less to be cash equivalents. The Company had no cash equivalents for the periods presented.
Revenue Recognition
Revenue is recognized under ASC Topic 606, Revenues from Contracts with Customers, when control of goods is transferred to customers. The Company’s revenues are generated through its condensed consolidated subsidiaries AIG-F&B, Inc. (wholesale distribution) and Aqua Emergency, Inc. (product sales, shipping, and subscription-based programs). Revenues are presented net of intercompany eliminations.
| 8 |
Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding. Diluted earnings per share gives effect to dilutive potential common shares outstanding during the period. For periods in which the Company reports a net loss, potentially dilutive securities are excluded because their effect would be anti-dilutive.
In accordance with ASC Topic 718, Compensation – Stock Compensation, the Company measures compensation cost for share-based awards at fair value on the grant date and recognizes expenses over the vesting period. During the six months ended June 30, 2026, the Company issued shares of common stock, recorded at $ per share, under the Sentient Brands Holdings, Inc. 2026 Employee Benefit Plan in settlement of $ of previously accrued employee benefit plan expense (see Note 11).
Depreciation and Amortization
Property,
plant and equipment is depreciated on a straight-line basis over estimated useful lives of
Derivative Financial Instruments
The
Company evaluates all financial instruments for bifurcation of embedded derivatives under ASC Topic 815, Derivatives and Hedging. For the three months ended June
30, 2026 and 2025, a loss of $
Fair Value of Financial Instruments
The
Company measures derivative liabilities at fair value using Level 3 unobservable inputs (Black-Scholes model). The derivative
liability was $
The unobservable inputs used for the Black-Scholes model are as follow:
| Fair Value at | Fair Value at | Range | Range | |||||||||||||||
| December 31, 2025 | June 30, 2026 | Valuation Technique | Unobservable Input | December 31, 2025 | June 30, 2026 | |||||||||||||
| $ | $ | Black-Scholes Option Pricing Model | Expected Volatility | % | % | |||||||||||||
| Risk-Free Interest Rate | % | % | ||||||||||||||||
| Expected Term (Years) | ||||||||||||||||||
| Dividend Yield | % | % | ||||||||||||||||
| Underlying Yield | $ | $ | ||||||||||||||||
The derivative liabilities for the three and six months ended June 30, 2026:
| Three Months Ended | Six Months Ended | |||||||
| Derivative Liabilities | June 30, 2026 | June 30, 2026 | ||||||
| Beginning Balance | $ | $ | ||||||
| Total gains (losses) recognized in earnings | ( | ) | ||||||
| Transfers/Issuances/Settlements | ||||||||
| Ending Balance | $ | $ | ||||||
Income Taxes
Income
taxes are accounted for under ASC Topic 740, Income Taxes. The Company has significant deferred tax assets arising from net operating loss carry
forwards, which are fully offset by a valuation allowance as management has determined that realization is not more likely than not.
Segment Reporting
The Company applies ASC Topic 280, Segment Reporting, in determining reportable segments for its financial statement disclosure. Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s CODM is its Interim Chief Executive Officer (“CEO”). The Company has determined that it operates as a single operating segment and has one reportable segment.
Impairment of Long-Lived Assets
Long-lived assets and certain identifiable intangible assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of an impairment loss for long-lived assets and certain identifiable intangible assets that management expects to hold, and use is based on the fair value of the asset. Long-lived assets and certain identifiable intangible assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.
| 9 |
Recently Issued Accounting Standards
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (FASB) that may have an impact on the Company’s accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future either will not have an impact on its accounting or reporting or that such impact will not be material to its condensed consolidated interim financial position, results of operations, and cash flows when implemented, except as follows:
ASU 2024-04, Improvements to Accounting for Certain Convertible Instruments: This standard simplifies the accounting for instruments like the Company’s acquisition credits payable and convertible notes by eliminating specific separation models, which is expected to reduce future complexity and may result in a non-cash adjustment upon adoption in 2027.
The Company continues to evaluate the accounting and enhanced disclosure requirements of this standard.
NOTE 4. PREPAID FULFILLMENT COSTS
Prepaid
fulfillment costs represent amounts prepaid to third-party co-manufacturers for inventory and drop-shipment fulfillment services.
Prepaid fulfillment costs were $
NOTE 5. FIXED ASSETS
Fixed assets consist of the following:
June 30, 2026 (Unaudited) | December 31, 2025 (Audited) | |||||||
| Machinery and equipment | $ | $ | ||||||
| Product artwork | ||||||||
| Machinery and equipment – SNBH | ||||||||
| Computers and equipment – SNBH | ||||||||
| Total fixed assets, gross | ||||||||
| Accumulated depreciation | ( | ) | ( | ) | ||||
| Fixed assets, net | $ | $ | ||||||
The
SNBH fixed assets were fully depreciated as of the year ended December 31, 2025. Depreciation expense on the remaining machinery and
equipment and product artwork was $
NOTE 6. INTANGIBLE ASSETS AND GOODWILL
Intangible assets and goodwill consist of the following:
June 30, 2026 (Unaudited) | December 31, 2025 (Audited) | |||||||
| Licenses – Aqua Emergency, Inc. | $ | $ | ||||||
| Goodwill | ||||||||
| Website development | ||||||||
| Total intangible assets and goodwill, gross | ||||||||
| Accumulated amortization | ( | ) | ( | ) | ||||
| Intangible assets and goodwill, net | $ | $ | ||||||
Goodwill
of $
Amortization
expenses for Website Development were $
| 10 |
NOTE 7. SHORT-TERM LOANS PAYABLE
Short-term
loans payable consists of advances from related parties for operating expenses. The balance of $
NOTE 8. NOTES PAYABLE
On August 19, 2025, the Company
issued a note payable to Stephen Spanos in exchange for an account payable related to certain services rendered to the Company.
Principal is $
NOTE 9. CONVERTIBLE NOTES PAYABLE AND DERIVATIVE LIABILITY
Convertible
notes payable consists entirely of the GA3 Consortium convertible notes with a principal balance of $
For
the three months ended June 30, 2026 and 2025, a loss of $
These
convertible notes were in default upon the maturity date of each which occurred on April 28, 2022 for the first note in the amount
of $
NOTE 10. ACQUISITION CREDITS PAYABLE
Acquisition
credits payable of $
NOTE 11. STOCKHOLDERS’ DEFICIT
Preferred Stock
The Company has shares of Preferred Stock authorized at $ par value. As of June 30, 2026 and December 31, 2025, shares of Preferred Series B stock were issued and outstanding.
Common Stock
The
Company has shares of Common Stock authorized at $ par value. As of June 30, 2026, shares were issued and
outstanding,
On January 2, 2026, the Company issued shares of its common stock to an individual in exchange for cash that had been received in February 2025.
On April 23, 2026, the Company issued shares from its 2026 Employee Benefit Plan.
On June 25, 2026, the Company issued shares from its 2026 Employee Benefit Plan.
There were other shares issued in the six months ended June 30, 2026.
Employee Benefit Plan – 2026
On
March 5, 2026, the Board of Directors approved the issuance of up to
shares of common stock under the Sentient Brands Holdings, Inc. 2026 Employee Benefit Plan at $
The Form S-8 was filed with the U.S. Securities and Exchange Commission (SEC) on February 2, 2026 authorizing shares of common stock to be issued to employees and contractors.
| 11 |
NOTE 12. COMMITMENTS AND CONTINGENCIES
On
February 6, 2026, Gregg Templeton filed a Statement of Claim with the American Arbitration Association claiming Failure to Pay Wage,
Failure to Reimburse Expenses; Statutory Wage Violation under New York Law; Fraud and Unjust Enrichment. The AAA rejected the claim due
to the procedural process and improper venue election. After rejection by AAA, Templeton’s legal counsel advised the Company of
his intention to petition a New York Court to accept the complaint under an arbitration demand. The petition was filed on March 25, 2026.
The claim related to an Employment Agreement dated on or about February 28, 2019. On May 30, 2025, the Company received a demand letter
from an attorney representing the contractor in the amount of $
NOTE 13. RELATED PARTY TRANSACTIONS
As
of June 30, 2026, $
On
August 19, 2025, the Company issued a note payable to Stephen Spanos, the former CFO, in exchange for an account payable related to certain
services rendered to the Company. Principal is $
NOTE 14. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through August 11, 2026, the date these financial statements were available to be issued.
Effective January 1, 2026, the Company was scheduled to acquire all outstanding shares of Wyoming Bears, Inc. (WYB), a California-based distributor of consumer packaged goods, to 100% ownership pursuant to an amendment to the Share Exchange Agreement approved December 31, 2025. The parties have agreed to defer the acquisition and change of control until October 1, 2026. The Company is focusing on growing its current subsidiaries and remediating its balance sheet and overhead prior to an additional acquisition. As a result, no results for WYB were included in these condensed consolidated interim financial statements.
Compliance and Restitution Initiative; Settlement Agreements
On July 1, 2026, Sentient Brands Holdings Inc. (the “Company”) entered into two separate confidential pre-filing settlement and cooperation agreements (collectively, the “Agreements”), each with a former member of the Company’s management, in furtherance of the “Compliance and Restitution” initiative described in the Company’s Current Report on Form 8-K filed June 23, 2026, under which the Board of Directors (the “Board”) authorized the Company to pursue, among other things, the recovery and cancellation of equity the Board has identified as having been improperly issued and the recovery of assets for the Company’s. The Company executed each of the Agreements solely through independent authority, acting through disinterested members of the Board and not through any person whose conduct is subject to the Board’s ongoing review of historical corporate actions. In each case, the Company is coordinating on a unified basis with a group of 25 investors and other parties (collectively, the “Plaintiff Parties”) under a previously disclosed Joint Representation and Confidentiality Agreement.
Under the Agreements, the former members of management
have agreed to provide full, truthful and continuing cooperation to the Plaintiff Parties in connection with contemplated legal actions
arising out of the historical transactions, billing records, debt and share issuances under the Board’s review — including
by executing sworn declarations, preserving and producing documents, and providing truthful testimony — and to make restitution
to the Company through the surrender and cancellation of shares. In the aggregate, the Agreements provide for the surrender and cancellation
to the Company of restricted shares of the Company’s common stock (
In consideration of that cooperation and restitution, the Plaintiff Parties have agreed to conditional releases and covenants not to sue (and, as applicable, forbearance from prosecuting and the dismissal or holding in abeyance of claims), in each case conditioned on the continued, complete and truthful cooperation of the applicable party and subject to revocation upon a material breach. The Agreements contain no monetary settlement consideration paid to the Plaintiff Parties, and no party will pay any fee, bonus or settlement payment in exchange for testimony or cooperation; reimbursement is limited to reasonable, documented out-of-pocket expenses. Each Agreement provides that the applicable party’s sole obligation is to provide complete and truthful information and testimony, that no party may request that the party adopt any particular version of facts, and that the party retains the right to communicate directly with the U.S. Securities and Exchange Commission and other governmental authorities without prior notice to or approval from any party. The Company believes the Agreements advance the objectives of its Compliance and Restitution initiative by securing the cooperation of two former members of management and the return and cancellation of a substantial number of shares to the Company.
Each of the Agreements is governed by the laws of the State of New York, except that matters of the Company’s corporate authority, the share surrender and cancellation, and related matters are governed by Nevada law. Each Agreement is a confidential settlement communication. The foregoing descriptions of the Agreements are summaries only, do not purport to be complete, and the Company has not filed either Agreement as an exhibit to this Current Report on Form 10-Q.
As of the date of this filing, the contemplated legal actions referenced in the Agreements have not been filed, and the Company can provide no assurance as to the timing, outcome, or amount of any recovery, restitution, or cancellation of securities that may result from the matters described above, beyond the cancellation of the shares surrendered under the Agreements. The Company has provided the foregoing disclosure on a voluntary basis, does not undertake to disclose its litigation strategy, and undertakes to make such further disclosures regarding these matters as may be required by the federal securities laws.
The Company is not aware of any other material subsequent events requiring disclosure.
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the unaudited condensed consolidated interim financial statements and related notes included in Item 1 of this report, and with the audited financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2025.
Forward-Looking Statements
All statements other than statements of historical fact included in this Form 10-Q including, without limitation, statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding our financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. When used in this Form 10-Q, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to us or our management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of a number of factors, including those set forth under the risk factors and business sections in this Form 10-Q
Overview
Sentient Brands is a next-generation brand platform focused on the acquisition, development, and commercialization of premium and functional consumer packaged goods (CPG) with an emphasis on wellness, sustainability, and emergency preparedness. The Company has implemented a product innovation and acquisition-driven growth strategy through its operating subsidiaries, focusing on consumer categories that offer long-term secular growth potential.
Going Concern
The accompanying condensed consolidated interim financial statements have been prepared assuming the Company will continue as a going concern. The Company has incurred losses since inception and has an accumulated deficit of $6,472,806 as of June 30, 2026, a total stockholders’ deficit of $2,212,931, and a working capital deficit of $4,001,813. Included in the working capital deficit for the three and six months ended June30, 2026 and the year ended December 31, 2025 is $2,640,712 in Acquisition Credits as a contingent liability which is solely settleable in equity to be issued for acquiring the subsidiaries AIGFB & AE NV, in the amount of $2,500,712, with an additional issuance of $140,000 to a vendor in settlement of an accounts payable. Although the Company generated income from operations of $42,322 for the three months ended June 30, 2026, it incurred net losses of $46,836 and $139,912 for the three and six months then ended. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.
To address these challenges, management is executing a strategic plan focused on the following areas:
| ● | Operational Efficiency: The Company has implemented strict cost-control measures, including a policy requiring detailed activity reporting on all professional service invoices and the suspension of board fees, to reduce general and administrative (G&A) overhead. | |
| ● | Revenue Scaling: We are prioritizing the growth of our existing CPG subsidiaries, AIG-F&B, Inc. and Aqua Emergency, Inc., by leveraging product innovation and expanding distribution channels within our core wellness and emergency preparedness markets. | |
| ● | Liquidity and Capital Access: We are actively pursuing additional working capital through potential strategic partnerships and equity financing opportunities. | |
| ● | Balance Sheet Restructuring: We are in discussions with the convertible note holder to restructure terms and conditions including conversion pricing, equity conversion and interest rate reductions. |
There can be no assurance that these initiatives will be successful or that the Company will achieve sustainable profitability. If we are unable to secure additional financing on satisfactory terms, our business and financial condition could be materially and adversely affected.
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Results of Operations – Three and Six Months Ended June 30, 2026 vs. June 30, 2025
Revenue
Total condensed consolidated revenues were $462,461 for the three months ended June 30, 2026, compared to $110,600 for the comparable 2025 period, an increase of $351,861, and for the six months ended June 30, 2026 and 2025, respectively, were $693,172 and $110,600, reflecting the ramp-up of revenue-generating operations across both operating subsidiaries.
Cost of Revenues and Gross Profit
Cost of revenues was $289,147 for the three months ended June 30, 2026, compared to $115,712 for the three months ended June 30, 2025. Cost of revenues for the six months ended June 30, 2026 was $455,648 compared to $116,312 for the six months ended June 30, 2025.
Gross profit was $173,314 compared to a gross loss of ($5,112) for the three months ended June 30, 2026 and 2025, respectively. For the six months ended June 30, 2026 gross profit was $237,524 compared to a gross loss of ($5,712) for the six months ended June 30, 2025.
Operating Expenses
For the three and six months ended June 30, 2026 and 2025, operating expenses consisted of the following:
| For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Unaudited | Restated | Unaudited | Restated | |||||||||||||
| General and Administrative | $ | 7,513 | $ | 4,564 | $ | 12,806 | $ | 7,685 | ||||||||
| Legal and Professional | 54,479 | 255,548 | 120,566 | 467,832 | ||||||||||||
| Management Fees | 69,000 | 99,545 | 116,500 | 250,645 | ||||||||||||
| TOTAL OPERATING EXPENSES | $ | 130,992 | $ | 359,657 | $ | 249,872 | $ | 726,162 | ||||||||
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Total operating expenses were $130,992 and $359,657 for the three months ended June 30, 2026 and 2025, respectively and $249,872 and $726,162 for the six months ended June 30, 2026 and 2025, respectively. The decrease in operating expenses was due to legal and professional and management fees expenses.
The Company instituted a policy requiring all officers and directors to present detailed activity on an approved invoice basis rather than through fixed consulting agreements. In addition, the board of directors agreed to suspend their board fees until further notice. Both of these initiatives resulted in a significant reduction in management fees. During the six months ended June 30, 2026, there was a reduction of $134,145 in management fees compared to the six months ended June 30, 2025. There were 118,007 shares of common stock issued for bonuses related to the acquisitions of subsidiaries valued at $141,600 for the six months ended June 30, 2025. No such bonuses were awarded in 2026. The recipient of 66,667 of these bonus shares has agreed to surrender those shares to the Company as part of the Settlement Agreements (see Note 14).
Legal and Professional fees include legal fees, auditing and accounting services, investor relations and other professional fees. There was a reduction of legal fees costs of $212,253 compared to the six months ended June 30, 2025. There were 66,667 shares of common stock issued for bonuses for legal services related to the acquisitions of subsidiaries valued at $176,000 for the three and six months ended June 30, 2025. There were no such bonuses awarded in 2026.
Other advisory services decreased $101,088 due to reduced Investor Relations expenses incurred and required between June 2026 and 2025. Investor relations expenses were settled through the issuance of 100,000 shares of common stock in the six months ended June 30, 2025.
Accounting and Auditing fees for the three and six months ended June 30, 2025 included a bonus of 33,334 shares of common stock valued at $40,000 at the time of issuance paid to the former contracted accountant. There were no such bonuses rendered in 2026.
Income (Loss) from Operations
The Company’s income (loss) from operations during the three months ended June 30, 2026 and 2025 was $42,322 and ($364,769), respectively. The loss from operations during the six months ended June 30, 2026 and 2025, respectively, was ($12,348) and ($731,874).
Other Income (Expense)
Net other expenses were ($89,158) and ($108,351) for the three months ended June 30, 2026 and 2025 and for the six months ended for June 30, 2026 and 2025, respectively, was ($127,564) and ($213,471).
The loss on the embedded derivatives for the three months ended June 30, 2026 and 2025 was ($4,251) and ($35,863) and the gain for the six months ended June 30, 2026 was $38,141 and loss for the six months ended June 30, 2025 was ($72,329).
Interest expense for the three and six months ended June 30, 2026 was $84,907 and $165,705. For the three and six months ended June 30, 2025, interest expense was $72,488 and $151,142.
Net Loss
Net loss was ($46,836) for the three months ended June 30, 2026, compared to a net loss of ($473,120) for the three months ended June 30, 2025. The improvement of $426,284 reflects the commencement of substantial revenue-generating operations across both subsidiaries, reduced holding company costs and the gain on embedded derivative calculations. Net loss for the six months ended June 30, 2026 and 2025, respectively, was ($139,912) and ($945,345), resulting in an improvement of $805,433.
Liquidity and Capital Resources
Cash was $143,799 on June 30, 2026 compared to $29,011 on December 31, 2025. The net increase of $114,788 reflects net cash provided by operating activities of $45,917 and net proceeds from short-term related-party loans of $68,871.
Net cash provided by operating activities for the six months ended June 30, 2026, reflecting net loss of ($139,912) adjusted for non-cash items of depreciation and amortization of $8,569, embedded derivative calculation loss of ($38,141), and interest expense of $165,705 plus working capital changes including collections of accounts receivable of $9,368, a decrease in prepaid fulfilment fees of $122,737 and an increase in accounts payable of $167,017.
Financing activities provided $68,871 and $0 from net short-term loan proceeds from related parties for the six months ended June 30, 2026 and 2025, respectively. Management is actively pursuing additional working capital financing through equity raises, strategic partnerships, and operating cash flow improvements.
The Company’s working capital deficit was $4,001,813 on June 30, 2026, and $3,902,970 on December 31, 2025. Included in the working capital deficit for the six months ended June 30, 2026 and year ended December 31, 2025 is $2,640,712 in Acquisition Credits as a contingent liability which is solely settleable in equity to be issued for acquiring the subsidiaries AIGFB & AE NV, in the amount of $2,500,712, with an additional issuance of $140,000 for a reduction in accounts payable.
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Contractual Obligations and Off-Balance Sheet Arrangements
None
Contractual Obligations
We presently do not have any contractual obligations.
Off-balance Sheet Arrangements
We presently do not have off-balance sheet arrangements.
Inflation
The effect of inflation on our revenue and operating results was not significant.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information required by this Item.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We conducted an evaluation, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended, or the Exchange Act as of June 30, 2026, to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission’s rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of June 30, 2026, our disclosure controls and procedures are not effective at the reasonable assurance level due to the material weaknesses identified and described below.
Our principal executive officers do not expect that our disclosure controls or internal controls will prevent all error and all fraud. Although our disclosure controls and procedures were designed to provide reasonable assurance of achieving their objectives, a control system, no matter how well conceived and operated, can provide only reasonable, not absolute assurance that the objectives of the 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. Because of 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, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented if there exists in an individual a desire to do so. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
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Remediation Plan to Address the Material Weaknesses in Internal Control over Financial Reporting
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. Management identified the following three material weaknesses that have caused management to conclude that, as of June 30, 2026, our internal control over financial reporting, was not effective at the reasonable assurance level:
| 1. | We do not have sufficient written documentation of our internal control policies and procedures. Written documentation of key internal controls over financial reporting is a requirement of Section 404 of the Sarbanes-Oxley Act as of the period ending June 30, 2026. Management evaluated the impact of our failure to have written documentation of our internal controls and procedures on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness. | |
| 2. | We do not have sufficient segregation of duties within accounting functions, which is a basic internal control. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. However, to the extent possible, the initiation of transactions, the custody of assets and the recording of transactions should be performed by separate individuals. Management evaluated the impact of our failure to have segregation of duties on our assessment of our disclosure controls and procedures and has concluded that the control deficiency that resulted represented a material weakness. | |
| 3. | Effective controls over the control environment were not maintained. Specifically, a formally adopted written code of business conduct and ethics that governs our employees, officers, and directors was not in place. Additionally, management has not developed and effectively communicated to employees its accounting policies and procedures. This has resulted in inconsistent practices. Further, our Board of Directors currently has two independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness. |
To address these material weaknesses, management performed additional analyses and other procedures to ensure that the condensed consolidated financial statements included herein fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented. Accordingly, we believe that the condensed consolidated interim financial statements included in this report are fairly presented, in all material respects, our financial condition, results of operations and cash flows for the periods presented.
To remediate the material weakness in our documentation, evaluation and testing of internal controls we plan to engage a third-party firm to assist us in remedying this material weakness once resources become available.
We intend to remedy our material weakness with regard to insufficient segregation of duties by hiring additional employees in order to segregate duties in a manner that establishes effective internal controls once resources become available.
Changes in Internal Controls
Other than the commencement of the Compliance and Restitution initiative described above, there were no changes in our internal control over financial reporting during the six months ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, we are subject to ordinary routine litigation incidental to our normal business operations. On February 6, 2026, Gregg Templeton filed a Statement of Claim with the American Arbitration Association claiming Failure to Pay Wage, Failure to Reimburse Expenses; Statutory Wage Violation under New York Law; Fraud and Unjust Enrichment. The AAA rejected the claim due to the procedural process and improper venue election. After rejection by AAA, Templeton’s legal counsel advised the Company of his intention to petition a New York Court to accept the complaint under an arbitration demand. The petition was filed on March 25, 2026. The claim related to an Employment Agreement dated on or about February 28, 2019. On May 30, 2025, the Company received a demand letter from an attorney representing the contractor in the amount of $286,010 including wages, expenses and interest. Mr. Templeton asserts interest has continued to accrue and the current claim now exceeds $300,000. Templeton was terminated by the Company on February 3, 2020 after an unauthorized diversion of $40,000 in Company funds to Templeton’s personal accounts was discovered by the Company, as well as his being barred by FINRA from certain aspects of any securities business, for similar conduct on multiple prior occasions. The Company disputes the claim in its entirety but has maintained an accrual of $54,525 related to the dispute. This amount was recorded on March 31, 2022 as an account payable for services in that quarter. The Company has not made any change to its accrual as of this time. The Company will defend itself vigorously and assert claims of misconduct against the former contractor.
Compliance and Restitution Initiative; Settlement Agreements
On July 1, 2026, Sentient Brands Holdings Inc. (the “Company”) entered into two separate confidential pre-filing settlement and cooperation agreements (collectively, the “Agreements”), each with a former member of the Company’s management, in furtherance of the “Compliance and Restitution” initiative described in the Company’s Current Report on Form 8-K filed June 23, 2026, under which the Board of Directors (the “Board”) authorized the Company to pursue, among other things, the recovery and cancellation of equity the Board has identified as having been improperly issued and the recovery of assets for the Company’s. The Company executed each of the Agreements solely through independent authority, acting through disinterested members of the Board and not through any person whose conduct is subject to the Board’s ongoing review of historical corporate actions. In each case, the Company is coordinating on a unified basis with a group of 25 investors and other parties (collectively, the “Plaintiff Parties”) under a previously disclosed Joint Representation and Confidentiality Agreement.
Under the Agreements, the former members of management have agreed to provide full, truthful and continuing cooperation to the Plaintiff Parties in connection with contemplated legal actions arising out of the historical transactions, billing records, debt and share issuances under the Board’s review — including by executing sworn declarations, preserving and producing documents, and providing truthful testimony — and to make restitution to the Company through the surrender and cancellation of shares. In the aggregate, the Agreements provide for the surrender and cancellation to the Company of 455,496 restricted shares of the Company’s common stock (13,664,747 shares on a pre-reverse-split basis, prior to the Company’s 1-for-30 reverse stock split effected January 2, 2026), in each case without any monetary payment by the Company for such shares. The surrendered shares will be cancelled and retired and restored to the status of authorized but unissued shares of the Company in accordance with Nevada law, and will not be held as treasury shares. The Agreements characterize the surrender and cancellation as restitution and the rescission and disgorgement of improperly issued shares to the Company, and not as monetary settlement consideration; the surrenders are effective immediately upon execution, are irrevocable, and will remain effective even if the related releases are later revoked.
In consideration of that cooperation and restitution, the Plaintiff Parties have agreed to conditional releases and covenants not to sue (and, as applicable, forbearance from prosecuting and the dismissal or holding in abeyance of claims), in each case conditioned on the continued, complete and truthful cooperation of the applicable party and subject to revocation upon a material breach. The Agreements contain no monetary settlement consideration paid to the Plaintiff Parties, and no party will pay any fee, bonus or settlement payment in exchange for testimony or cooperation; reimbursement is limited to reasonable, documented out-of-pocket expenses. Each Agreement provides that the applicable party’s sole obligation is to provide complete and truthful information and testimony, that no party may request that the party adopt any particular version of facts, and that the party retains the right to communicate directly with the U.S. Securities and Exchange Commission and other governmental authorities without prior notice to or approval from any party. The Company believes the Agreements advance the objectives of its Compliance and Restitution initiative by securing the cooperation of two former members of management and the return and cancellation of a substantial number of shares to the Company.
Each of the Agreements is governed by the laws of the State of New York, except that matters of the Company’s corporate authority, the share surrender and cancellation, and related matters are governed by Nevada law. Each Agreement is a confidential settlement communication. The foregoing descriptions of the Agreements are summaries only, do not purport to be complete, and the Company has not filed either Agreement as an exhibit.
As of the date of this filing, the contemplated legal actions referenced in the Agreements have not been filed, and the Company can provide no assurance as to the timing, outcome, or amount of any recovery, restitution, or cancellation of securities that may result from the matters described above, beyond the cancellation of the shares surrendered under the Agreements. The Company has provided the foregoing disclosure on a voluntary basis, does not undertake to disclose its litigation strategy, and undertakes to make such further disclosures regarding these matters as may be required by the federal securities laws.
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ITEM 1A. RISK FACTORS
As a smaller reporting company, we are not required to provide information required by this Item. Reference is made to the risk factors contained in our Annual Report on Form 10-K for the year ended December 31, 2025, which are incorporated herein by reference.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
On April 28, 2025 the Company sold 600,000 shares of its common stock to an investor for $30,000. The shares were issued on January 2, 2026 and subject to the 1-for-30 reverse split. The total shares issued post reverse was 20,000.
On April 23, 2026, the Company issued 300,000 shares from its 2026 Employee Benefit Plan.
On June 25, 2026, the Company issued 25,000 shares from its 2026 Employee Benefit Plan.
The offers, sales, and issuances of the securities described above were deemed to be exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended and/or Rule 506 as promulgated under Regulation D as transactions by an issuer not involving a public offering. The recipients of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions was an accredited or sophisticated person and had adequate access, through employment, business or other relationships, to information about us.
The Company claims an exemption from the registration requirements of the Securities Act of 1933 (the “Securities Act”) for the issuances of the above securities pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D promulgated under the Securities Act. The investors in these securities are accredited investors as defined in Rule 501 of Regulation D promulgated under the Securities Act.
Shares issued under the 2026 Employee Benefit Plan are registered with the SEC through filing a Form S-8 on February 2, 2026. The 2026 Employee Benefit Plan as filed authorizes 1,000,000 shares of common stock to be issued.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
The Company’s convertible notes payable to GA3 Consortium with a principal of $715,789 and $876,309 of accrued interest are currently in default upon the maturity date of each which occurred on April 28, 2022 for the first note in the amount of $315,789 and November 19, 2022 for the second note in the amount of $400,000. The default interest rate is 22%. These convertible notes were in default upon the maturity date of each which occurred on April 28, 2022 for the first note in the amount of $315,789 and November 19, 2022 in the amount of $400,000. The default interest rate is 22%. Under the terms of the note documents, no notice of default was required by the holder. The Company has not received a notice of waiver or forbearance, although the holder and the Company are in discussions to amend the terms of the notes. No change has been agreed upon as of the date of this filing.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
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ITEM 5. OTHER INFORMATION
On May 1, 2026, the Board of Directors accepted the resignation of George Furlan from his positions as Director and Chief Executive Officer, effective May 1, 2026, and simultaneously approved the appointment of Serge Knazev as Interim Chief Executive Officer. Mr. Knazev previously served and continues to serve as President and Chief Operating Officer of the Company. The Company is conducting a search for a permanent Chief Executive Officer.
On June 16, 2026, the Company accepted the resignation of Dionne Pendleton as Director, Treasurer and Secretary. Ms. Pendleton’s resignation following her decision to transition from these roles and was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Ms. Pendleton has agreed to serve on committees in an advisory capacity as her time permits.
On June 16, 2026, the Board of Directors appointed Derek Wyman and Serge Knazev as directors of the Company. In addition, Mr. Wyman was appointed Treasurer and Mr. Knazev was appointed Secretary of the Company.
On June 23, 2026, the Company disclosed on Form 8-K (Item 8.01) the commencement of its Compliance and Restitution initiative, and on July 10, 2026 the Company disclosed on Form 8-K (Item 8.01) the settlement agreements and the aggregate share surrenders and cancellations under the Jones and Furlan Agreements. See Note 14 to the condensed consolidated interim financial statements.
No
director or officer
ITEM 6. EXHIBITS
| Exhibit No. | Exhibit Description | |
| 31.1* | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32.1* | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 32.2* | Certification of 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* | Inline XBRL Document Set for the condensed consolidated interim financial statements and accompanying notes in Part I, Item 1 of this Quarterly Report on Form 10-Q. | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* Filed herewith.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
SENTIENT BRANDS HOLDINGS INC.
| Dated: August 11, 2026 | /s/ Serge Knazev |
| Serge Knazev | |
| Interim Chief Executive Officer | |
| (Principal Executive Officer) |
| Dated: August 11, 2026 | /s/ Jeanene Morgan |
| Jeanene Morgan | |
| Chief Financial Officer | |
| (Principal Financial and Accounting Officer) |
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