RPMT 10-K & 10-Q changes, risk factors and insider trading

We have experienced net losses in each fiscal year since our inception and as of December 31, 2024,2025, have an accumulated deficit of approximately $147.7$160.2 million. We incurred net losses attributable to common stockholders of approximately $12.4 million during the year ended December 31, 2025 and approximately $11.6 million during the year ended December 31, 2024 and approximately $18.9 million during the year ended December 31, 2023.2024. As of March 31, 2025 2026 we had a cash position of approximately $1.6$0.2 million. Depending on the speed at which we begin to generate revenue, and to the degree we continue to accelerate spending to take advantage of our market opportunity, we will need additional capital to execute our business plan. As a result of these conditions, the report of our independent accountants issued in connection with the audit of our financial statements as of and for our fiscal year ended December 31, 20242025 contained a qualification raising a substantial doubt about our ability to continue as a going concern.

Our ability to attract new users, and encourage users to purchase items through our website, and use our payment services in times where consumer spending is weak could materially and adversely affect our business, financial condition and results of operations.

We have patents and have made patent applications with the United States Patent and Trademark Office related to our Platform, which we rely on for protection to of our technology. We also rely on a combination of protections provided by contracts, including confidentiality and nondisclosure agreements, and common law rights, such as trade secrets, to protect our intellectual property. However, we cannot assure you that we will be able to adequately protect our technology or other intellectual property from misappropriation in the U.S. and abroad. This risk may be increased due to the lack of complete patent and/or copyright protection. Any patent issued to us could be challenged, invalidated invalidated or circumvented or rights granted thereunder may not provide a competitive advantage to us. Furthermore, patent applications that we file may not result in issuance of a patent or, if a patent is issued, the patent may not be issued in a form that is advantageous to us. Despite our efforts to protect our intellectual property rights, others may independently develop similar products, duplicate our products or design around our patents and other rights. In addition, it is difficult to monitor compliance with, and enforce, our intellectual property property rights on a worldwide basis in a cost-effective manner. In jurisdictions where foreign laws provide less intellectual property protection protection than afforded in the U.S. and abroad, our technology or other intellectual property may be compromised, and our business would be materially adversely affected. If any of our proprietary rights are misappropriated or we are forced to defend our intellectual property rights, rights, we will have to incur substantial costs. Such litigation could result in substantial costs and diversion of our resources, including diverting the time and effort of our senior management, and could disrupt our business, as well as have a material adverse effect on our business, prospects, financial condition and results of operations. We can provide no assurance that we will have the financial resources to oppose any actual or threatened infringement by any third party. Furthermore, any patents or copyrights that we may be granted may be held by a court to infringe on the intellectual property rights of others and subject us to the payment of damage awards.

Third parties may claim that we are infringing on their intellectual property rights. We may violate the rights of others without our knowledge. We may expose ourselves to additional liability if we agree to indemnify our clients against third party infringement claims. While we know of no basis for any claims of this type, the existence of and ownership of intellectual property can be difficult to verify, and we have not made an exhaustive search of all patent filings. Additionally, most patent applications are kept confidential for twelve to eighteen months, months, or longer, and we would not be aware of potentially conflicting claims that they make. We may become subject to legal proceedings and and claims from time to time relating to the intellectual property of others in the ordinary course of our business. If we are found to have have violated the intellectual property rights of others, we may be enjoined from using such intellectual property, and we may incur licensing fees or be forced to develop alternative technology or obtain other licenses. In addition, we may incur substantial expenses in defending against these third-party infringement claims and be diverted from devoting time to our business and operational issues, regardless of the merits of any such claim. In addition, in the event that we recruit employees from other technology companies, including certain potential competitors, and these employees are used in the development of portions of the Platform which are similar to the development in which they were involved at their former employers, we may become subject to claims that such employees have improperly used or disclosed trade secrets or other proprietary information. If any such claims were to arise in the future, litigation or other dispute resolution procedures might be necessary to retain our ability to offer our current and future services, which could result in substantial costs and diversion of our financial and management resources. Successful infringement or licensing claims against us may result in substantial monetary damages, which may materially disrupt the conduct of our business and have a material adverse effect on our reputation, business, financial condition and results of operations. Even if intellectual property claims brought against us are without merit, they could result in costly and time-consuming litigation,litigation and may divert our management and key personnel from operating our business.

Our payment system is susceptible to potentially illegal use. Use of our payment system for illegal or improper purposes could subject us to claims, such as individual and class action lawsuits, and government and regulatory investigations, inquiries or requests that could result in potential liability. liability. Increased penalties for intermediaries providing payment services for certain illegal activities have become more prevalent. Any Any threatened or resulting claims could result in a material adverse effect on our business.

Access to worldwide markets depends depends in part on the strength of our intellectual property portfolio. There can be no assurance that, as our business expands into new areas, areas, we will be able to independently develop the technology, software or know-how necessary to conduct our business or that we can do so without infringing the intellectual property rights of others. To the extent that we have to rely on licensed technology from others, there can be no assurance that we will be able to obtain licenses at all or on terms we consider reasonable. The lack of a necessary license could could expose us to claims for damages and/or injunction from third parties, as well as claims for indemnification by our customers in instances instances where we have a contractual or other legal obligation to indemnify them against damages resulting from infringement claims. Regarding Regarding our own intellectual property, we intend to actively enforce and protect our rights to the extent practicable. However, there can be no assurance that our efforts will be adequate to prevent the misappropriation or improper use of our protected technology in international markets.

Our Board of Directors is continually exploring our strategic alternatives. Any process of exploring strategic alternatives includes market risk and other uncertainties. There can be no assurance that an exploration of strategic alternatives will result in the successful consummation of a liquidity event, capital raise or other corporate transaction, on a basis that will provide any specific level of value to our common stockholders or other security holders, or at all. On September 22, 2022 the Company engaged an investment banking firm to explore a potential sale of the Company. The Company and this investment banking firm mutually agreed to terminate their agreement on February 22, 2024 and a merchant bank was simultaneously engaged in a consultative capacity to advise on capital funding and strategic initiatives. We terminated our agreement with the merchant bank in March 2025 due to the incapacity of the principal and are assessing the retention ofengaged a replacement advisor.investment banking firm on May 7, 2025. We remain committed to the exploration and assessment of our strategic alternatives.

A material percentage of the currently outstanding shares of our common stock were issued as “restricted securities” within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted securities, these shares may be resold only pursuant to an effective registration statement, under the requirements of Rule 144, or other applicable exemptions from registration under the Securities Act and applicable state securities laws. Generally, Rule 144 provides that a person who has held restricted securities for a prescribed period may, under certain conditions, publicly resell such shares. Under Rule 144, a non-affiliate (i.e., a stockholder who has not been an officer, director or control person for at least 90 consecutive days) may freely resell restricted securities issued by a reporting company so long as such securities have been held by the owner for a period of at least one year, or under certain circumstances six months. The availability of a large number of shares for sale to the public under Rule 144 and the sale of such shares in public markets could have an adverse effect on the market price of our common stock.

Upon the Company’s formation, formation, and through subsequent approval, our shareholders authorized and approved 230,000,000 shares of common stock. Currently, only approximately 9.8 11.7 million of such shares remain available for issuance. To finance and continue to grow our business, we will require additional capital and have historically relied upon the issuance of common stock, or securities convertible into common stock, for such financing. financing. Should our shareholders be unwilling to approve a sufficient increase in the number of our authorized shares of common stock, we would be required to finance our business with debt or other instruments, which may be difficult or impossible to secure on terms acceptable to us. If that were to occur, we may not be able to (a) pay our costs and expenses as they are incurred, (b) execute our business plan, (c) take advantage of future opportunities, or (d) respond to competitive pressures or unanticipated requirements, which may, in the extreme case, require us to liquidate the Company.

Youth Financial Literacy: Partners can expand their brand story around empowerment and education of youth financial literacy while engaging their ‘future customers’ with Gen Z,Z and Gen Alpha, a digital native population of post-millennial youth.

We have not generated significant revenue since our inception. For the years ended December 31, 20242025 and 2023,2024, we generated revenues of $2,250 and $0. Our historical revenue was generated from transactional sources with customers. Commencing in 2025, revenues will be generated primarily from business-to-business, SaaS subscriptions.

Our net loss attributable to common stockholders decreasedincreased $7.3$0.8 million to $11.6$12.4 million for the year ended December 31, 20242025 when compared to $18.9$11.6 million for the year ended December 31, 2023.2024. This was primarilydue ato resultincreases of a decrease into general and administrative costs ($7.1$0.9 million), andinterest a decrease in sales and marketing costs ($1.2 million). These decreases were partially offset by increases in product development costs ($0.3 million), transaction expensesexpense ($0.1 million), and accrued preferred dividends ($0.6$0.1 million) partially offset by decreases in transaction expense ($0.1 million) and sales and marketing expense ($0.2 million) for the year ended December 31, 2025 when compared to the year ended December 31, 2024.

Transaction expense for the year ended December 31, 20242025 was $0.3$0.2 million compared to $0.2$0.3 million for year ended December 31, 2023.2024. These are transactional charges charges primarily for the operation of the Mazoola® app,app. andThe decrease is attributed to the Choreshift Checkaway app.from business-to-consumer initiatives to more of a business-to-business focus.

Sales and marketing expenses decreased by $1.2 $0.2 million for the year ended December 31. 20242025 to $0.6$0.4 million compared to $1.8$0.6 million for the year ended December 31, 2023.2024. The decrease was isdue attributed to thelower eliminationmarketing consulting and replacement of certain marketing consultantsevent withexpenses, moreoffset cost-effectiveslightly serviceby providersan along with a decreaseincrease in marketing options expense in 2024 2025 as compared to 2023.2024.

Product Development DevelopmentExpenses

Interest Expense, Expensenet

Net cash used in operating activities activities decreased $0.2$0.9 million to $6.1 million for the year ended December 31, 2025 compared to $7.0 million for the year ended December 31, 2024 compared to $7.2 million for the year ended December 31, 2023.2024. The decrease in 20242025 resulted primarily from increased accounts payable and the change in share-based compensation, offset by the fairchange value of options andin the fair value of common stock issued in exchange for services offset by an increase in prepaid expenses and a decrease in accounts payable-accrued expenses as compared to 2023.2024.

Net cash used in investing activities activities wasincreased $0.001$0.011 million andto $0.01$0.012 million for the yearsyear ended December 31, 2025 compared to $0.001 million for the year ended December 31, 2024 andas 2023.a result of an increase in expenditures related to investments in patents. The Company maintained its current patents in 2024.2025.

Net cash provided by financing activities decreased by $3.8$0.4 million to $3.7$3.3 million for the year ended December 31, 20242025 compared to $7.5$3.7 million for the year ended December 31, 2023. Proceeds2024. The Company did not receive any proceeds from the sale of Series B Preferred Stock andin 2025. However, the exerciseCompany did receive $3.3 million in proceeds from the sale of options10% secured convertible notes payable to stockholders in 20242025. decreasedThis whenwas compared$0.4 tomillion less 2023.than the $3.7 million in proceeds received from the sale of Series B Preferred Stock in 2024.

On March 13, 2023, Company entered entered into an Investor Private Line of Credit agreement (the “LOC Agreement”) with James Davison (the “Lender”). The The Lender is an existing shareholder of the Company. Pursuant to the LOC Agreement, the Lender may extend unsecured loans to the Company in the amount of up to twenty million dollars ($20,000,000) which may be drawn upon by the Company for a period of one year in order to provide additional capital to facilitate the Company’s operations. Drawings may be made by the Company as long as there has not been any material change in the operations of the Company. Loans under the LOC Agreement bear interest at the rate of 7% per annum. Drawings under the LOC Agreement must be repaid in full: (i) upon the execution and completion of a sale, merger or other transaction of the Company whereby the Company transfers its ownership and/or its assets to a third party within thirty (30) days of the completion of the transaction (a “Change of Control”) or (ii) if a Change of Control does not occur within one year from the date of the LOC Agreement, the Company will repay any amounts outstanding within sixty (60) days. This LOC Agreement was extended for one year on March 13, 20242024, and then again on March 13, 2025 for an additional year. There have beenwere no draws on this LOC Agreement as of December 31, 2024.2025. The LOC Agreement expired on March 13, 2026.

As of March 31, 2025, 2026, the Company has a cash position of approximately $1.6$0.2 million. Based upon the current cash position and the Company’s planned expense run run rate, management believes the Company will be able to finance its operations through JuneApril 2025.2026.

REGO Payment Architectures, Inc. is a provider of consumer software that delivers a mobile payment platform— Mazoola® - a family focused mobile banking solution. Headquartered in Blue Bell, Pennsylvania, theThe Company maintains a portfolio of trade secrets and four US patent awards. REGO offers an all-digital financial payments platform to enable minors, particularly under 13 years old, to transact, complete chores and learn in a secure online environment guided by parental permission, oversight, and control, while remaining COPPA and GDPR compliant.

COPPA applies not only to websites and mobile apps. Itapps.It can apply to a growing list of connected devices that is included in the Internet of Things. SomeThings.Some of these include toys and products that could collect personal information, such as voice recordings or geolocation information. Non-compliance with COPPA has meant substantial fines for many violators.

Management believes that by building on its COPPA compliance advantage, the future of REGO Payment Architectures, Inc. will be based on the foundational architecture of its software platform (the “Platform”) that will allow its use across multiple financial markets where secure controlled payments are needed. Theneeded.The Company intends to license in each alternative field of use the ability for its partners, distributors and/or value-added resellers to private label each of the alternative markets. Thesemarkets.These partners would deploy, customize and support each implementation under their own label, but with acknowledgement of the Company’s proprietary intellectual property assets as the base technology. Managementtechnology.Management believes this approach will enable the Company to reduce marketing expenses while broadening its reach.

Revenues are generated from the Platform from multiple sources depending on the level of service and facilities requested. Thererequested.There are levels of subscription revenue paid monthly, service fees, transaction fees and in some cases, revenue sharing and licensing with banking and distribution partners.

Safety & Security: Partners can safely engage a younger consumer segment and their families with a new family friendly peer-to-peer-payment approach. Vendorsapproach.Vendors will be explicitly protected from non-compliant transactions and the underlying technology protects the privacy of the user.

Youth Financial Literacy: Partners can expand their brand story around empowerment and education of youth financial literacy while engaging their ‘future customers’ with Gen Z and Gen Alpha,Z, a digital native population of post-millennial youth.

We believe that our near-term success will depend particularly on our ability to develop customer awareness and confidence in our service. Sinceservice.Since we have extremely limited capital resources, we will need to closely manage our expenses and conserve our cash by continually monitoring any increase in expenses and reducing or eliminating unnecessary expenditures. Our prospects must be considered in light of the risks, expenses and difficulties encountered by companies at an early stage of development, particularly given that we operate in new and rapidly evolving markets, that we have limited financial resources, and face an uncertain economic environment. We may not be successful in addressing such risks and difficulties.

Comparison of the Three Months Ended MarchJune 31,30, 2026 and 2025

The following discussion analyzes our results of operations for the three months ended MarchJune 31,30, 2026 and 2025. The following information should be considered together with our condensed financial statements for such period and the accompanying notes thereto.

For the three months ended MarchJune 31,30, 2026 and 2025, we generated revenues of $11,750$31,850 and $0. Revenues for the three months ended March,June 31,30, 2026 were generated from business-to-business, SaaS subscriptions associated with the rollout of the Platform.

For the three months ended MarchJune 31,30, 2026 and 2025, we had a net loss of $1,937,521$2,121,007 and $2,743,488.$2,113,343.

Transaction expense for the three months ended MarchJune 31,30, 2026 was $46,967$0 compared to $64,875$57,593 for the three months ended MarchJune 31,30, 2025. These are transactional charges primarily for the operation of the Mazoola® app. The decrease is attributed to a diminished focus on the business-to-consumer marketspace for the three months ended MarchJune 31,30, 2026 when compared to the three months ended MarchJune 31,30, 2025.

Sales and marketing expenses for the three months ended March 31,June 30, 2026 were $101,296$88,735 compared to $118,733$110,408 for the three months ended MarchJune 31,30, 2025, a decrease of $17,437.$21,673. The decrease was due to lower marketing event and marketing options expense that was partially offset by increased event expendituresexpenses for the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025.

Product development expenses were $876,081$787,052 and $558,541 for the three months ended March 31, 2026 and 2025, an increase of $317,540. The increase was due to higher integration, payroll, and security/compliance costs associated with the rollout of the Platform to subscribing financial institutions$863,441 for the three months ended March 31,June 30, 2026 and 2025, a decrease of $76,389. Aggregate outside product development consultant costs for the three months ended June 30, 2026 were lower when compared to the three months ended MarchJune 31,30, 2025.

General and administrative expenses decreasedincreased $1,221,659$90,278 to $593,015 $916,742 for the three months ended MarchJune 31,30, 2026 from $1,814,674$826,464 for the three months ended MarchJune 31,30, 2025. The decreaseincrease is attributed to lowerhigher consultingprofessional fees and lowerhigher consulting options expensesexpense for the three months ended MarchJune 31,30, 2026 when compared to the three months ended MarchJune 31,30, 2025.

Interest ExpenseExpense, net

During the three months ended MarchJune 31,30, 2026, the Company incurred interest expenseexpense, net of $332,041interest income of $360,328 compared to $246,841$255,437 for the three months ended MarchJune 31,30, 2025, an increase of $85,200.$104,891. The increase in interest expense relates to increased levels of outstanding debt for the three months ended MarchJune 31,30, 2026 when compared to the three months ended March 31,June 30, 2025.

Accrued preferred dividend expense decreased by $32,650$1,828 to $671,950 for the three months ended March 31, 2026 compared to $704,600$702,771 for the three months ended MarchJune 31,30, 2026 compared to $704,599 for the three months ended June 30, 2025. The expense decreased dueas to thea reversalresult of athe priorconversions periodof over-accrualSeries B Preferred Stock into common shares that was adjustedoccurred during the three months ended MarchJune 31,30, 2026.2025.

As of MayAugust 20,14, 2026 we had cash on hand of approximately $105,000. $250,000.

Net cash used in operating activities decreased $600,561$844,122 to $793,437 $2,261,695 for the threesix months ended MarchJune 31,30, 2026 as compared to $1,393,998$3,105,817 for the threesix months ended MarchJune 31,30, 2025. The decrease resulted primarily from the change in the fair value of options issued in exchange for services which was partially offset by an increase in accounts payable and accrued expenses compared to that of the same period in the prior year.

Net cash provided by financing activities increased byto $720,000 $2,198,022 for the threesix months ended MarchJune 31,30, 2026 asfrom compared to $0$2,000,000 for the threesix months ended MarchJune 31,30, 2025. This increase was due to the proceeds received from the sale of notes payable-other andwhich was partially offset by a decrease in the proceeds received from the sale of 10% secured convertible notes payable-stockholder which occurred during the three months ended March 31, 2026 but not during the three months ended March 31, 2025.payable-stockholder.

As we have not realized significant revenues since our inception, we have financed our operations through offerings of debt and equity securities. Onsecurities.On March 13, 2023, the Company entered into a $20 million Investor Private Line of Credit agreement (the “LOC”) with an existing shareholder of the Company. This LOC Agreement was extended for one year on March 13, 2024, and then again on March 13, 2025 for an additional year. There were no draws on this LOC Agreement and it expired on March 13, 2026.

Since our inception, we have focused on developing and implementing our business plan. Weplan.We believe that our existing cash resources will not be sufficient to sustain our operations during the next twelve months. Wemonths.We currently need to generate sufficient revenues to support our cost structure to enable us to pay ongoing costs and expenses as they are incurred, finance enhancements to our Platform, and execute the business plan.plan.If If we cannot generate sufficient revenue to fund our business plan, we intend to seek to raise such financing through the sale of debt and/or equity securities. Such financing may include both traditional notes and notes issued along with stock options. The issuance of additional equity would result in dilution to existing shareholders. The issuance of convertible debt may also result in dilution to existing stockholders. If we are unable to obtain additional funds when they are needed or if such funds cannot be obtained on terms acceptable to us, we will be unable to execute upon the business plan or pay costs and expenses as they are incurred, which would have a material, adverse effect on our business, financial condition and results of operations. See Note 2 to our consolidated financial statements included in this Form 10-Q.

Even if we are successful in generating sufficient revenue or in raising sufficient capital in order to commercialize the Platform, our ability to continue in business as a viable going concern can only be achieved when our revenues reach a level that sustains our business operations. Weoperations.We do not project that significant revenue will be developed at the earliest until thelate third quarter of 2026. There can be no assurance that we will raise sufficient proceeds, or any proceeds, for us to implement fully our proposed business plan. Moreover,plan.Moreover, there can be no assurance that even if the Platform is fully developed and successfully commercialized, that we will generate revenues sufficient to fund our operations.operations.In In either such situation, we may not be able to continue our operations and our business might fail.

Based upon the current cash position and the Company’s planned expense run rate, management believes the Company will not be able to finance its operations beyond May September 2026.

As of MarchJune 31,30, 2026, we do not have any off-balance sheet arrangements.

All issuances of stock options or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the equity instruments issued. Non-employeeissued.Non-employee equity based payments that do not vest immediately upon grant are recorded as an expense over the vesting period.