# Our Bond, Inc. (OBAI) 10-Q SEC filing - Q1 FY2026
- Filed: May 15, 2026, 8:00 AM EDT
- Fiscal quarter: Q1 FY2026
- Calendar quarter: Q1 2026
- Accession: 0001493152-26-023347
- OpenCapital page: https://www.opencapital.sh/filings/0001493152-26-023347
- Markdown URL: https://www.opencapital.sh/filings/0001493152-26-023347.md
- Official SEC filing index: https://www.sec.gov/Archives/edgar/data/1756064/000149315226023347/0001493152-26-023347-index.htm
## Filing documents
- [10-Q (form10-q.htm)](https://www.sec.gov/Archives/edgar/data/1756064/000149315226023347/form10-q.htm)
---
## 10-Q
SEC source: [form10-q.htm](https://www.sec.gov/Archives/edgar/data/1756064/000149315226023347/form10-q.htm)
**UNITED
STATES**
**SECURITIES
AND EXCHANGE COMMISSION**
**Washington,
D.C. 20549**
**FORM10-Q**
(Mark
One)
☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**
For
the quarterly period ended March 31, 2026
or
☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**
For
the transition period from________ to ___________
Commission
File Number: **001-43087**
**Our
Bond Inc.**
(Exact
name of registrant as specified in its charter)
**Nevada** **83-1751618**
(State or other jurisdiction of
incorporation or organization) (I.R.S. Employer
Identification No.)
**85
Broad Street****, 17TH Floor****, New
York****, NY****10004**
(Address
of principal executive offices) (Zip Code)
**1-888-567-6234**
(Registrant’s
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Act:
**Title of each class** **Trading Symbol(s)** **Name of each exchange on which**
**registered**
Common Stock par value $0.0001 OBAI Nasdaq Capital Market
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
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 ☐ No ☒
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data
File required to be submitted and posted 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). Yes ☒ No ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
As
of May 14, 2026, the number of shares outstanding of the issuer’s common stock was 24,462,071.
**OUR
BOND INC.**
**INDEX
TO FORM 10-Q**
| | | **Page** |
| --- | --- | --- |
| **PART I - FINANCIAL INFORMATION** | | |
| **Item 1.** | **[Financial Statements](#a_002)** | 1 |
| | [Condensed Consolidated Balance Sheets as of March 31, 2026 (Unaudited) and December 31, 2025](#a_003) | 1 |
| | [Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2026 and 2025 (Unaudited)](#a_004) | 2 |
| | [Condensed Consolidated Statements of Comprehensive Loss for the Three Months Ended March 31, 2026 and 2025 (Unaudited)](#a_005) | 3 |
| | [Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 31, 2026 and 2025 (Unaudited)](#a_006) | 4 |
| | [Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026 and 2025 (Unaudited)](#a_007) | 5 |
| | [Notes to the Unaudited Condensed Consolidated Financial Statements](#a_008) | 6 |
| **Item 2.** | **[Management’s Discussion and Analysis of Financial Condition and Results of Operations](#a_009)** | 17 |
| **Item 3.** | **[Quantitative and Qualitative Disclosures About Market Risk](#a_010)** | 23 |
| **Item 4.** | **[Controls and Procedures](#a_011)** | 23 |
| **[PART II - OTHER INFORMATION](#a_012)** | | 24 |
| **Item 1.** | **[Legal Proceedings](#a_013)** | 24 |
| **Item 1A.** | **[Risk Factors](#a_014)** | 24 |
| **Item 2.** | **[Unregistered Sales of Equity Securities and Use of Proceeds](#a_015)** | 24 |
| **Item 3.** | **[Defaults Upon Senior Securities](#a_016)** | 24 |
| **Item 4.** | **[Mine Safety Disclosures](#a_017)** | 24 |
| **Item 5.** | **[Other Information](#a_018)** | 24 |
| **Item 6.** | **[Exhibits](#a_019)** | 25 |
| **[Signatures](#a_020)** | | 26 |
**PART
I. FINANCIAL INFORMATION**
**Item
1. Financial Statements**
**OUR BOND INC.**
### CONDENSED CONSOLIDATED BALANCE SHEETS
_(U.S. dollars in thousands, except per share and share amounts) · (Unaudited)_
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| ASSETS | | |
| Current assets: | | |
| Cash and cash equivalents | $3,758 | $599 |
| Accounts receivable | 1,704 | 1,592 |
| Prepaid expenses and other current assets | 342 | 224 |
| Total current assets | 5,804 | 2,415 |
| Property and equipment, net | 89 | 86 |
| Total assets | $5,893 | $2,501 |
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | | |
| Current liabilities: | | |
| Accounts payable | $3,196 | $2,588 |
| Promissory Note | 2,500 | — |
| Deferred revenue, current | 343 | 565 |
| Related party loan | 212 | 765 |
| Current portion of long-term debt | 1,555 | 1,555 |
| Accrued and other current liabilities | 2,443 | 2,645 |
| Total current liabilities | 10,249 | 8,118 |
| Long-term debt, net of current portion | 5,882 | 5,657 |
| Total liabilities | 16,131 | 13,775 |
| Commitments and contingencies (Note 11) | - | |
| Mezzanine Equity | | |
| Convertible Preferred Stock, $0.0001 par value; 879,122 shares and 1,561,892 shares authorized, at March 31, 2026 and December 31, 2025, respectively, 577,951 and 1,237,717 shares issued and outstanding as of March 31, 2025 and December 31, 2025, respectively | 4,735 | 11,389 |
| Stockholders’ deficit | | |
| Series preferred stock, $0.0001 par value; 149,120,878 shares and 148,438,108 shares authorized, at March 31, 2026 and December 31, 2025, respectively, 14,829,942 and 17,494,820 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively | 2 | 2 |
| Common stock, $0.0001 par value; 250,000,000 and 250,000,000 shares authorized at March 31, 2026 and December 31, 2025, respectively; 21,074,608 and 13,896,400 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively | 2 | 1 |
| Additional paid in capital | 131,196 | 116,556 |
| Accumulated other comprehensive income | (97) | (70 |
| Accumulated deficit | (146,076) | (139,152 |
| Total stockholders’ deficit | (14,973) | (22,663 |
| Total liabilities, redeemable convertible preferred stock, and stockholders’ deficit | $5,893 | $2,501 |
The
accompanying footnotes are an integral part of these condensed consolidated financial statements.
1
**OUR BOND INC.**
### CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
_(U.S. dollars in thousands, except per share and share amounts) · (Unaudited)_
| Line item | March 31, 2026 / Three Months Ended December 31, | March 31, 2025 / Three Months Ended December 31, |
| --- | --- | --- |
| Revenue | $2,347 | $2,249 |
| Cost of revenues | 2,300 | 2,176 |
| Gross profit | 47 | 73 |
| Operating expenses | | |
| Research and development | 691 | 555 |
| General and administrative | 2,441 | 1,026 |
| Sales and marketing | 3,290 | 277 |
| Total operating expenses | 6,422 | 1,858 |
| Loss from operations | (6,375) | (1,785) |
| Other income (expense), net: | | |
| Financial expense, net | (292) | (377) |
| Income before income taxes | (6,667) | (2,162) |
| Income tax expense | 36 | — |
| Net loss | $(6,703) | $(2,162) |
| Net loss per share – basic and diluted | $(0.41) | $(0.73) |
| Weighted average number of common shares outstanding – basic and diluted | 16,989 | 2,964 |
The
accompanying footnotes are an integral part of these condensed consolidated financial statements.
2
**OUR BOND INC.**
### CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
_(U.S. dollars in thousands) · (Unaudited)_
| Line item | March 31, 2026 / Three Months Ended | March 31, 2025 / Three Months Ended |
| --- | --- | --- |
| Net loss | $(6,703) | $(2,162) |
| Foreign currency translation adjustments, net of tax | (27) | (17) |
| Comprehensive loss | $(6,730) | $(2,179) |
The
accompanying footnotes are an integral part of these condensed consolidated financial statements.
3
**OUR
BOND INC.**
**CONDENSED
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY**
**FOR
THE THREE MONTHS ENDED MARCH 31, 2026 AND 2025**
(U.S.
dollars in thousands, except share amounts)
(Unaudited)
| (U.S. dollars in thousands) | Shares / Stockholders’ Deficit / Series Preferred Stock | Amount / Stockholders’ Deficit / Series Preferred Stock | Shares / Stockholders’ Deficit / Common Stock Voting | Amount / Stockholders’ Deficit / Common Stock Voting | Capital / Stockholders’ Deficit / Additional Paid-in | Income (Loss) / Stockholders’ Deficit / Accumulated Other Comprehensive | Deficit / Stockholders’ Deficit / Accumulated | Deficit / Stockholders’ Deficit / Total Stockholders’ | Shares / Mezzanine Equity / Series Preferred Stock | Amount / Mezzanine Equity / Series Preferred Stock |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Balance as of January 1, 2026 | 17,494,820 | $2 | 13,896,400 | $1 | $116,556 | $(70) | $(139,152) | $(22,663) | 1,237,717 | 11,389 |
| Stock based compensation related to options granted to employees and non-employees | — | — | — | — | 203 | — | — | 203 | — | — |
| Exercise of options and vesting of early exercise | — | — | 96 | *— | — | — | — | *— | — | — |
| Issuance of common shares for service | — | — | 161,963 | *— | 2,035 | — | — | 2,035 | — | — |
| Issuance of common shares related to direct listing | — | — | 418,219 | *— | *— | — | — | *— | — | — |
| Exercise of Common Warrants to Common Stock | — | — | 4,479 | *— | 20 | — | — | 20 | — | — |
| Issuance of Series D convertible preferred stock- net of issuance costs | — | — | — | — | — | — | — | — | 324,175 | 2,679 |
| Conversion of Series E Preferred Stock into Common Stock | — | — | 1,477,857 | 1 | 6,828 | — | — | 6,829 | (682,770) | (6,828) |
| Exercise of Series D Common Warrants into Common Stock - net of issuance costs | — | — | 8,098 | *— | 93 | — | — | 93 | — | — |
| Conversion of Series D Convertible Preferred Stock into Common Stock | — | — | 19,433 | *— | 196 | — | — | 196 | (24,000) | (196) |
| Exercise of Series C Common Warrants into Common Stock - net of issuance costs | — | — | 1,033,335 | *— | 3,121 | — | — | 3,121 | — | — |
| Conversion of Series C Convertible Preferred Stock into Common Stock | — | — | 1,367,742 | *— | 2,309 | — | — | 2,309 | (277,171) | (2,309) |
| Conversion of B-2 Preferred Stock into Common Stock | (607,775) | *— | 607,775 | *— | — | — | — | *— | — | — |
| Conversion of B-3 Preferred Stock into Common Stock | (2,057,103) | *— | 2,057,102 | *— | — | — | — | *— | — | — |
| Common Stock Dividend | — | — | 22,109 | *— | 85 | — | (85) | *— | — | — |
| Direct Listing Costs | — | — | — | — | (250) | — | — | (250) | — | — |
| Cash Dividend | — | — | — | — | — | — | (136) | (136) | — | — |
| Foreign currency translation adjustments, net of tax | — | — | — | — | — | (27) | — | (27) | — | — |
| Net loss | — | — | — | — | — | — | (6,703) | (6,703) | — | — |
| Balance as of March 31, 2026 | 14,829,942 | $2 | 21,074,608 | $2 | $131,196 | $(97) | $(146,076) | $(14,973) | 577,951 | 4,735 |
| Balance as of January 1, 2025 | 26,560,266 | $3 | 2,963,695 | $1 | $111,509 | $44 | $(128,070) | $(16,513) | — | — |
| Balance | 26,560,266 | $3 | 2,963,695 | $1 | $111,509 | $44 | $(128,070) | $(16,513) | — | — |
| Stock based compensation related to options granted to employees and non-employees | — | — | — | — | 82 | — | — | 82 | — | — |
| Exercise of options and vesting of early exercise | — | — | 609 | *— | *— | — | — | *— | | — |
| Issuance of Series CF preferred stock | 1,033,601 | *— | — | — | 2,476 | — | — | 2,476 | — | — |
| Foreign currency translation adjustments, net of tax | — | — | — | — | — | (17) | — | (17) | — | — |
| Net income | — | — | — | — | — | — | (2,162) | (2,162) | — | — |
| Net income (loss) | — | — | — | — | — | — | (2,162) | (2,162) | — | — |
| Balance as of March 31, 2025 | 27,593,867 | $3 | 2,964,304 | $1 | $114,067 | $27 | $(130,232) | $(16,134) | — | — |
| Balance | 27,593,867 | $3 | 2,964,304 | $1 | $114,067 | $27 | $(130,232) | $(16,134) | — | — |
*\** *)Represents less than $1*
The
accompanying footnotes are an integral part of these condensed consolidated financial statements.
4
**OUR BOND INC.**
### CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
_(U.S. dollars in thousands) · (Unaudited)_
| Line item | March 31, 2026 / Three Months Ended | March 31, 2025 / Three Months Ended |
| --- | --- | --- |
| CASH FLOWS FROM OPERATING ACTIVITIES | | |
| Net loss | $(6,703) | $(2,162) |
| Adjustments to reconcile net income (loss) to net cash flows used in operating activities: | | |
| Stock-based compensation | 203 | 82 |
| Depreciation | 10 | 12 |
| Common stock issued for legal and other services | 2,035 | — |
| Interest related to Convertible Promissory Notes and Loan Facility | 226 | 368 |
| Changes in operating assets and liabilities: | | |
| Accounts receivable | (112) | 850 |
| Prepaid expenses and other current assets | (119) | (29) |
| Accounts payable | 607 | (356) |
| Deferred revenue | (219) | 12 |
| Accrued and other current liabilities | (338) | (193) |
| Net cash flows used in operating activities | (4,410) | (1,416) |
| CASH FLOWS FROM INVESTING ACTIVITIES | | |
| Purchases and sell of property and equipment | (11) | — |
| Net cash flows used in by investing activities | (11) | — |
| CASH FLOWS FROM FINANCING ACTIVITIES | | |
| Payments as part of related party loans | (555) | (350) |
| Issuance of Series CF-1 Preferred Stock | — | 2,535 |
| Issuance of Series CF-1 Preferred Stock fundraising fees | — | (58) |
| Issuance of Series D convertible preferred stock | 2,950 | — |
| Issuance of Series D convertible preferred stock - issuance costs | (271) | — |
| Issuance of Promissory Note | 3,000 | — |
| Payment of Promissory Note | (500) | |
| Exercise of Series C Common Warrants | 3,356 | — |
| Exercise of Series C Common Warrants - issuance costs | (235) | |
| Exercise of Series D Common Warrants | 100 | — |
| Exercise of Series D Common Warrants - issuance costs | (7) | — |
| Exercise of Common Stock Warrants | 19 | — |
| Direct Listing Costs | (250) | — |
| Net cash flows provided by financing activities | 7,607 | 2,127 |
| Effect of exchange rate on cash | (27) | (17) |
| Change in cash, cash equivalents and restricted cash | 3,159 | 694 |
| Cash, cash equivalents, and restricted cash beginning of period | 599 | 726 |
| Cash, cash equivalents, and restricted cash end of period | $3,758 | $1,420 |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | | |
| Cash paid for income taxes, net | $37 | $28 |
| SUPPLEMENTAL DISCLOSURES OF NON-CASH FLOW INFORMATION: | | |
| Common Stock Dividend | $85 | — |
| Accounts payable associated with equity financing and unpaid dividends | $658 | — |
| Common stock issued in connection with a direct listing | $13,801 | — |
| Conversion of Preferred Stock into Common Stock | $9,333 | |
The
accompanying footnotes are an integral part of these condensed consolidated financial statements.
5
**OUR
BOND INC.**
**NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
### **NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
Basis
of Presentation
The
accompanying unaudited condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted
in the United States of America, or U.S. GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10
of Securities and Exchange Commission, or SEC, Regulation S-X.
The
December 31, 2025 consolidated balance sheet was derived from our audited consolidated financial statements included in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2025, as filed with the SEC, but does not include all disclosures required by U.S.
GAAP for annual financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments
considered necessary for a fair presentation of results of operations and financial position, have been included. The results for the
interim periods presented are not necessarily indicative of the results expected for any future period. The following information should
be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K
for the fiscal year ended December 31, 2025.
The
accompanying financial statements have been prepared on a going concern basis. However, the Company has incurred recurring losses and
negative operating cash flows, and its current liabilities exceed its current assets as of March 31, 2026. These conditions raise substantial
doubt about the Company’s ability to continue as a going concern.
Management
is pursuing several strategies to mitigate these conditions, including capital raising, and believes that these actions will provide
the necessary liquidity for at least the next twelve months. Nevertheless, there can be no assurance that such plans will be successfully
implemented or yield the intended financial benefits.
Accordingly,
there is a material uncertainty that may cast significant doubt on the Company’s ability to continue as a going concern, and therefore
it may be unable to realize its assets and discharge its liabilities in the normal course of business. The financial statements do not
include any adjustments that may be necessary if the Company is unable to continue as a going concern.
Significant
Accounting Policies
There
have been no material changes to the Company’s significant accounting policies disclosed in Note 4 - Significant Accounting Policies,
to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December
31, 2025.
Use
of Estimates
The
preparation of consolidated financial statements in conformity with U.S. 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.
On
an on-going basis, we evaluate our estimates, including those related to accounts receivable, cash equivalents and marketable securities,
income taxes, litigation, non-marketable equity securities, other contingencies, property, plant, and equipment, revenue recognition,
and stock-based compensation. The Company bases its estimates on historical experience, known trends, and other market-specific or other
relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates when
there are changes in circumstances, facts, and experience. Changes in estimates are recorded prospectively in the period in which they
become known. Actual results could significantly differ from those estimates.
Recently
Issued Accounting Pronouncements
Recent
Accounting Pronouncements Not Yet Adopted
In
December 2023, the FASB issued ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”).
ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information
on income taxes paid. The ASU is effective for public business entities for annual periods beginning after December 15, 2024. For all
other entities, the standard is effective for annual periods beginning after December 15, 2025. Early adoption is permitted. The Company
is currently evaluating the impact of this ASU on its consolidated financial statements.
6
In
November 2024, the FASB issued ASU No. 2024-03 Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic
220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”) a new accounting standard requiring disclosures of certain
additional expense information on an annual and interim basis, including, among other items, the amounts of purchases of inventory, employee
compensation, depreciation and intangible asset amortization included within each income statement expense caption, as applicable. We
expect to adopt this standard in our fiscal year 2027 annual report. We do not expect the adoption of this standard to have a material
impact on our Consolidated Financial Statements other than additional disclosures.
### **Note 2 – Revenue**
***Disaggregation
of Revenue***
The
Company recognizes revenue classified in services and other either at a point in time or over time. Revenue by point in time and over
time was as follows (in thousands):
Schedule
of Disaggregation of Revenue
| Line item | March 31, 2026 / Three Months Ended | March 31, 2025 / Three Months Ended |
| --- | --- | --- |
| SaaS revenue recognized over time | $363 | $330 |
| Services and other revenue recognized point in time | 1,984 | 1,919 |
| Total revenue | $2,347 | $2,249 |
The
deferred revenue balance represents payments received for performance obligations not yet satisfied. The following table shows the changes
in deferred revenue during the three months ended March 31, 2026, and 2025 respectively (in thousands):
Schedule
of Deferred Revenue
| Line item | March 31, 2026 / Three Months Ended | March 31, 2025 / Three Months Ended |
| --- | --- | --- |
| Balance at beginning of period | $562 | $776 |
| Deferred revenue additions during period | 223 | 262 |
| Revenue recognized during period | (442) | (271) |
| Balance at end of period | $343 | $767 |
Revenue
recognized during the three months ended March 31, 2026 that was included in deferred revenue as of December 31, 2025 was $299. Revenue
recognized during the three months ended March 31, 2025 that was included in deferred revenue as of December 31, 2024 was $260.
Revenue
allocated to remaining performance obligations that are unsatisfied (or partially unsatisfied), which includes deferred revenue and amounts
that will be invoiced and recognized as revenue in future periods, will be recognized within one year or less.
### **Note 3 – Segment and Geographical Information**
The
Company’s security solutions are substantially similar in nature and as a result the Company operates as one operating and reportable
segment. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated
by the chief operating decision maker (“CODM”), which is the Company’s Chief Executive Officer, in deciding how to
allocate resources and assess performance. The Company’s CODM evaluates the financial information presented on a consolidated basis
for the purposes of making operating decisions, assessing financial performance and allocating resources. The CODM evaluates performance
based on income (loss) from operations, which is calculated as revenues less cost of sales and operating expenses. This measure excludes
interest income (expense), other income (expense) and income taxes. The CODM reviews income (loss) from operations on a monthly basis
to assess the Company’s ability to generate earnings from its core activities and to monitor operating efficiency. This analysis
includes comparisons of current results to budgeted amounts, prior periods and internal forecasts. Based on these evaluations, the CODM
determines whether to adjust operating plans, modify pricing strategies, implement cost-control initiatives or adjust resource levels
in specific functional areas. In addition, the CODM uses income (loss) from operations to make decisions about the allocation of resources,
including approving capital expenditures, prioritizing research and development initiatives, adjusting headcount in specific departments
and determining marketing spend. The CODM also considers this measure when evaluating the performance of the management team and establishing
annual incentive compensation targets. Income/loss from operations is the Company’s primary measure of profit or loss, and all
costs and expenses categories on the Company’s consolidated statement of operations, as well as stock-based compensation, depreciation
and amortization expenses, are significant. Refer to Note 9 for additional information about the Company’s stock-based compensation
expense.
7
Revenue
by geographic area is designated based upon the billing location of the customer as follows (in thousands):
Schedule of Revenue by Geographic Area
| Line item | March 31, 2026 / Three Months Ended | March 31, 2025 / Three Months Ended |
| --- | --- | --- |
| United States | $2,338 | $2,238 |
| Isreal | 9 | 11 |
| Total revenue | $2,347 | $2,249 |
Property
and equipment by geographic areas was as follows (in thousands):
Schedule
of Property
and Equipment by Geographic Area
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| United States | $15 | $18 |
| Israel | 70 | 68 |
| France | 4 | — |
| Total property and equipment | $89 | $86 |
### **Note 4 – Earnings Per Share**
Basic
net loss per share is computed by dividing reported net loss by the weighted-average number of common shares outstanding for the reported
period. In computing diluted earnings per share, common share equivalents are not considered in periods in which a net loss is reported,
as the inclusion of the common share equivalents would be antidilutive. Since the Company was in a net loss for all periods presented
in these consolidated financial statements, diluted net loss per share was the same as basic net loss per share.
Schedule
of Earnings Per Share Basic and Diluted
| Numerator: | March 31, 2026 / Three Months Ended / (in thousands, except per share data) | March 31, 2025 / Three Months Ended / (in thousands, except per share data) |
| --- | --- | --- |
| Net loss attributable to common stockholders | $(6,703) | $(2,162) |
| Less: preferred dividends | (221) | — |
| Net loss attributable to common shareholders | (6,924) | (2,162) |
| Denominator: | | |
| Weighted-average common shares outstanding | 16,989 | 2,964 |
| Net loss per common share | $(0.41) | $(0.73) |
The
following potential common share equivalents were excluded from the calculation of diluted net income per share because their effect
would have been anti-dilutive in the period presented (in thousands):
Schedule
of Antidilutive Securities Earnings Per Share
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| Convertible preferred stock | 15,514 | 20,782 |
| Common Stock Warrants | 25,376 | 26,421 |
| Preferred Stock Warrants | 247 | 247 |
| Stock options | 14,903 | 7,337 |
| Total potential common stock excluded from net loss per share | 56,040 | 54,787 |
8
### **Note 5 – Balance Sheet Detail**
Prepaid
expenses and other current assets consisted of the following (in thousands):
Schedule
of Prepaid Expenses and Other Current Assets
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| Prepaid expenses | $131 | $37 |
| Other current assets | 211 | 187 |
| Total prepaid expenses and other current assets | $342 | $224 |
Property
and equipment, net consisted of the following (in thousands):
Schedule
of Property and Equipment, Net
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| Computers and peripheral equipment | $423 | $411 |
| Office furniture and equipment | 46 | 46 |
| Electronic equipment | 290 | 290 |
| Leasehold improvements | 18 | 18 |
| Property plant and equipment gross | 777 | 765 |
| Less: accumulated depreciation | (688) | (679) |
| Total property and equipment, net | $89 | $86 |
Depreciation
expenses for the three months ended March 31, 2026 and 2025 amounted to $10 and $12, respectively.
Accrued
and other current liabilities was composed of the following (in thousands):
Schedule
of Accrued and Other Current Liabilities
| Line item | March 31, 2026 | December 31, 2025 |
| --- | --- | --- |
| Employee and related accruals | $693 | $822 |
| Accrued expenses | 1,528 | 1,686 |
| Dividends payable | 195 | 61 |
| Other | 27 | 76 |
| Total accrued and other current liabilities | $2,443 | $2,645 |
### **Note 6 – Loan and Promissory Note**
In
June 2019 the Company entered into Loan and Security agreement (the “Loan Facility”) in the amount of $9,999. The principal
amount outstanding under each Advance shall accrue at the following rate per annum rate equal to the greater of six and one-half percentage
points (6.50%) above the Prime Rate of 12.00%, which interest shall be payable monthly. Immediately upon the occurrence and during the
continuance of an event of default as defined in the contract, the Obligations shall bear interest at a rate per annum which is four
percentage points (4.0%) above the rate that is otherwise applicable thereto. Additionality, concurrently with the grant of the loan,
the Company issued warrants to 1,872,993 shares of preference Series A, per value 0.0001$ per share, and exercise price of 0.2803$ per
share. The Warrants expiration date was settled as the earlier of (1) the date that is ten (10) years after the original Issue Date,
(2) the Initial Public Offering and (3) a Liquid Acquisition.
Between
2021 and 2024, the Loan Facility was amended multiple times to defer and restructure principal and interest payments and extend the applicable
forbearance period through the earlier of December 31, 2025 or the closing of a qualifying equity financing.
In
November 2023, a total of $3,152 from the loan were converted into 6,466,194 Series B-1 Preferred Stock of $ 0.0001 par value as part
of Series B Preferred Stock Purchase Agreement. Additionally, the warrants mentioned above were cancelled and replaced by a new 741,435 Series B-1 warrant, per value 0.0001$ per share, and exercise price of 0.4875$ per share. The Series B-1 Warrants shall be convertible,
at the option of the holder, at any time after the date on which such warrant was issued by the Company, into such number of fully paid
and non-assessable Common Stock as is determined by dividing the value of the warrant.
9
On
August 6, 2025, the Company entered into a Securities Purchase and Conversion Agreement. Pursuant to the Agreement, the Company converted50% of its outstanding loan obligations, totaling approximately $6.8 million, into 682,770 shares of its Series E Convertible Preferred
Stock (“Series E Preferred”), stated value $10.00 per share. As the fair value of the Series E Preferred Stock issued approximated
the carrying value of the debt extinguished, no gain or loss was recognized. The Series E Preferred is convertible into shares of the
Company’s common stock and accrues dividends on the stated value thereof at the same rate as the original loan. Dividends are payable,
at the Company’s election, in cash or shares of common stock. The initial conversion price for the Series E Preferred is $4.62 per share. Upon the holder of the Company’s Series C Preferred Stock receiving a return of capital in the minimum amount of $8,000,000,
the conversion price for the Series E Preferred will adjust to $3.75 per share. Concurrently with the Securities Purchase and Conversion
Agreement, the Company entered into a Waiver and Twenty-seventh Amendment to Loan and Security Agreement (the “Amendment”)
with the holder of its senior secured debt. Under the Amendment, the remaining approximately $6.8 million in loan obligations are subject
to a modified repayment schedule. Upon the earlier of: (i) the Company closing one or more equity financings yielding an aggregate amount
of net cash proceeds of at least $20,000,000; or (ii) June 30, 2026, the Company shall make twenty-four (24) consecutive equal monthly
installments of principal and interest based on a thirty-six (36) month amortization period, with the balance of the obligation due and
payable on the 25th month.
The
total interest expenses and accrued interest for the three months ended March 31, 2026 were $226 and $610, respectively, and as for three
months ended March 31, 2025, were $350 and $3,158, respectively. Any unpaid interest was accrued as part of the loan.
On
March 1, 2026, the Company issued a Promissory Note in the principal amount of $2,500,000. The Promissory Note bears interest at a rate
of 10% per annum and matures on September 1, 2026. The Company is required to apply 25% of the net proceeds from any future offerings
or issuances of the Company’s securities toward repayment of the Promissory Note until it is paid in full. In the event of default,
the Promissory Note will bear interest at a rate of 24% per annum, and any late payments will be subject to a late fee equal to 10% of
the overdue amount.
The
total interest expenses and accrued interest for the three months ended March 31, 2026 were $21 and $0, respectively.
### **Note 7 – Related Party**
Since
the company’s establishment, the company’s founder and CEO has also been the largest investor who participated - either directly
or through entities under his control - in all funding rounds in a total amount of approximately $44.67 million.
In
2023, the Company entered into Unsecured Convertible Revolving Promissory Note (the “Note”) with its main shareholder in
the amount of up to $3,000. At any time, the Noteholder may, in its sole discretion, lend to the Company from time to time until the
first-year anniversary of the Effective Date such amounts as may be requested by the Company in accordance with the terms and conditions
of this Note. The principal amount outstanding under this Note from time to time shall bear interest at a rate per annum equal to the
Applicable Federal Rate.
During
the three months ended March 31, 2026 and 2025, the Company repaid $555 and $350, respectively, of the outstanding balance under the
Revolving Promissory Note. As of March 31, 2026 and December 31, 2025, the outstanding balance under the Revolving Promissory Note was
$212 and $765, respectively.
The
total interest expenses recorded in the three months ended March 31, 2026 and 2025 were $2 and $18, respectively.
### **Note 8 – Preferred Stock and Common Stock**
**Stock
reverse split**
On
September 19, 2025, the Company effected a 1-for-3 reverse stock split (the “Reverse Stock Split”), pursuant to which every
three shares of the Company’s issued and outstanding common stock were combined into one share of common stock. The par value per
share of the common stock remained unchanged at $0.0001. The total number of issued and outstanding shares of common stock was reduced
proportionately, and the number of issued preferred shares, warrants, and stock options were adjusted on the same basis. The Reverse
Stock Split did not affect the Company’s total stockholders’ deficit and the number of authorized shares remained unchanged.
All share amounts have been retroactively adjusted, as if the Reverse Stock Split had occurred at the beginning of all periods presented.
10
**Composition
of stock capital**
The
stock capital of the Company as of March 31, 2026 and December 31, 2025 is comprised of stock of $ 0.0001 par value each, as follows:
Schedule of Composition of
Stock Capital
| Line item | Authorized / March 31, 2026 | Issued and outstanding / March 31, 2026 | Authorized / December 31, 2025 | Issued and outstanding / December 31, 2025 |
| --- | --- | --- | --- | --- |
| Common stock | | | | |
| Common stock voting | 200,000,000 | 21,074,608 | 200,000,000 | 10,315,901 |
| Common stock non-voting | 50,000,000 | — | 50,000,000 | 3,580,499 |
| Total common stock | 250,000,000 | 21,074,608 | 250,000,000 | 13,896,400 |
| Preferred stock | | | | |
| Series B-1 preferred stock | 25,356,256 | 8,204,944 | 25,356,256 | 8,204,944 |
| Series B-2 preferred stock | 27,463,149 | 1,520,962 | 27,463,149 | 2,128,737 |
| Series B-3 preferred stock | 21,453,390 | 5,094,036 | 21,453,390 | 7,151,139 |
| Series CF-1 preferred stock | — | — | 14,128,084 | — |
| Series CF-2 preferred stock | — | — | 2,900,000 | — |
| Series F preferred stock | 10,000 | 10,000 | 10,000 | 10,000 |
| Non-designated preferred stock | 74,838,083 | — | 57,127,229 | — |
| Total preferred stock | 149,120,878 | 14,829,942 | 148,438,108 | 17,494,820 |
**Common
Stock**
Common
Stock confer upon their holders the right, among others, to participate and vote in the Company’s stockholders meeting, participation
in the Company’s distributable earnings and participation in the distribution of the Company’s assets upon its liquidation.
The stockholders’ liability is limited to the redemption of the par value of their stock.
**Preferred
Stock**
Preferred
stock has been designated into several classes, consisting of Series B-1 Preferred Stock, Series B-2 Preferred Stock, Series B-3 Preferred
Stock, Series CF-1 Preferred Stock, Series CF-2 Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series E Preferred
Stock and Series F Preferred Stock.
The
Series C Preferred Stock and the Series D Preferred Stock are not mandatorily redeemable; however, they are contingently redeemable upon
the occurrence of certain events that are not solely within the control of the Company. Accordingly, they are classified as temporary
equity (mezzanine equity) in the Company’s consolidated balance sheets.
All
issued and outstanding shares of the Series CF-1 Preferred Stock, Series CF-2 Preferred Stock and Series E Preferred Stock were converted
into shares of the Company’s common stock. As a result, no shares of such series remained issued or outstanding as of March 31,
2026, and the Company withdrew the related Certificates of Designation.
Series
B-1, B-2, and B-3 Preferred Stock
*Voting
rights:*
The
holders of Series B Preferred Stock are entitled to one vote for each share of Common stock on an as-converted basis and shall vote together,
along with holders of other Preferred Stock entitled to vote thereon with the holders of Common Stock as a single class. The holders
of the Series B Preferred stock shall be entitled to vote on all matters on which holders of Common stock are entitled to vote.
*Conversion:*
Each
share of Series B Preferred Stock shall be convertible, at the option of the holder, at any time after the date on which such stock was
issued by the Company, into such number of fully paid and non-assessable Common Stock as is determined by dividing the applicable original
issuance price by the applicable conversion price in effect at the time of conversion. Each share of Series B Preferred Stock shall automatically
be converted into Common Stock immediately upon the earlier of (i) the closing of a Qualified IPO (as such term is defined in the applicable
certificate of designation), as such or (ii) written consent or agreement of the majority of the outstanding shares of Preferred Stock
voting together on an as-converted to Common Stock basis that are entitled to vote on such matter. In the event that the Company issues
any new securities, for a consideration per share lower than the applicable conversion price of the applicable Series B Preferred Stock,
the applicable conversion price for the applicable Series B Preferred Stock shall be readjusted to reflect the lower consideration paid
for the applicable Series B Preferred Stock as set forth in the applicable certificate of designation.
11
*Liquidation
preference:*
The
Company’s Series B Preferred Stock is entitled to a non-participating liquidation preference. In the event of any liquidation,
dissolution or winding up of the Company, assets or proceeds shall be distributed as follows: (i) the holders of Series B-1 Preferred
Stock and Series B-2 Preferred Stock (along with holders of Series CF Preferred Stock on a pari passu basis) shall be paid before any
payment is paid to the remaining stockholders (other than holders of Series C Preferred Stock), of an amount per share equal to two (2)
times their original issue price and any unpaid dividend and subsequently (ii) the holders of Series B-3 Preferred Stock shall be paid
before any payment is paid to holders of Common Stock and Series F Preferred Stock, of an amount per share equal to two (2) times their
original issue price and any unpaid dividend.
Series
C Preferred Stock
*Voting
rights:*
The
holders of Series C Preferred Stock shall have no voting rights, except as required by law and as expressly provided in the certificate
of designation.
*Conversion:*
Shares
of Series C Preferred Stock have a stated value of $10.00 per shares and are convertible to the common stock at a price of $2.0265 per
share of common stock. Conversions of Series C Preferred Stock are limited such that no conversion will be allowed to the extent that,
immediately following the conversion, the holder, its affiliates or any other person acting as a group, would beneficially own in excess
of 9.99% of the Company’s issued and outstanding common stock
*Liquidation
preference:*
The
holders of Series C Preferred Stock are entitled to a non-participating liquidation preference. In the event of any liquidation, dissolution
or winding up of the Company, assets or proceeds shall be distributed to the holders of Series C Preferred Stock first who shall be paid
before any payment is paid to the remaining stockholders, of an amount per share equal to the greater of (i) 200% of stated value (as
defined therein) or (ii) the amount the holder would receive if such holder converted such Series C Preferred Stock into Common Stock
immediately prior to the date of such payment.
*Dividends:*
Holders
of Series C Preferred Stock are entitled to dividends payable on the stated value thereof, commencing from on the issuance date, at an
annual rate of 8%, payable monthly in arrears on the stated value.
Series
D Preferred Stock
*Voting
rights:*
The
holders of Series D Preferred Stock shall have no voting rights, except as required by law and as expressly provided in the certificate
of designation.
*Conversion:*
Shares
of Series D Preferred Stock have a stated value of $10.00 per shares and are convertible to the common stock at a price of $12.35 per
share of common stock. Conversions of Series C Preferred Stock are limited such that no conversion will be allowed to the extent that,
immediately following the conversion, the holder, its affiliates or any other person acting as a group, would beneficially own in excess
of 9.99% of the Company’s issued and outstanding common stock. See also note 12.
*Liquidation
preference:*
The
holders of Series D Preferred Stock are entitled to a non-participating liquidation preference. In the event of any liquidation, dissolution
or winding up of the Company, assets or proceeds shall be distributed to the holders of Series D Preferred Stock first who shall be paid
before any payment is paid to the remaining stockholders, of an amount per share equal to the greater of (i) 200% of stated value (as
defined therein) or (ii) the amount the holder would receive if such holder converted such Series D Preferred Stock into Common Stock
immediately prior to the date of such payment.
12
*Dividends:*
Holders
of Series D Preferred Stock are entitled to dividends payable on the stated value thereof, commencing from on the issuance date, at an
annual rate of 8%, payable monthly in arrears on the stated value.
Series
F Preferred Stock
*Voting
rights:*
The
holders of Series F Preferred Stock are entitled to cast 40,000 votes for each one (1) share of Series F Preferred Stock and shall vote
together, along with holders of other Preferred Stock entitled to vote thereon, with the holders of Common Stock as a single class. The
holders of the Series F Preferred stock shall be entitled to vote on all matters on which holders of Common stock are entitled to vote.
*Conversion:*
Each
share of Series F Preferred Stock shall be convertible, at the option of the holder, at any time after the date on which such stock was
issued by the Company, into one (1) share of fully paid and non-assessable Common Stock.
*Liquidation
preference:*
The
Company’s Series F Preferred Stock are entitled to participate in any distribution out of the assets of the Company on an equal
basis per share with the holders of the Common Stock. For the purposes of such distribution, holders of Series F Preferred Stock shall
be treated as if all shares of Series F Preferred Stock had been converted to Common Stock immediately prior to the distribution.
**Dividends**
During
the three months ended March 31, 2026, the Company recorded total dividends of $136. As of March 31, 2026, accrued dividends payable
were $197.
**Issuance
of Preferred Stock and Warrants**
On
June 2025, the Company designated a new class of Series F Preferred Stock consisting of 10,000 authorized shares (the “Series F
Preferred Stock”). The Series F Preferred Stock were issued through the conversion of an equivalent number of shares of the Company’s
founder and CEO Common Stock on a pre–reverse stock split basis (was not affected by the subsequent reverse stock split) and is
entirely held by him. Each share of Series F Preferred Stock entitles the holder to cast 40,000 votes on all matters submitted to the
Company’s shareholders or acted upon by written consent. In addition, each three shares is convertible, at the option of the holder,
into one share of the Company’s Common Stock. The conversion of the founder and CEO’s Common Stock into Series F Preferred
Stock was accounted for as an equity reclassification, as it did not result in a change in control or economic ownership. Accordingly,
no gain or loss was recognized.
On
June 2025, the Company entered into a Series C Preferred Stock Purchase Agreement (the “Series C SPA”) with a new investor.
According to the Series C SPA, Company issued an aggregate of 329,671 shares of Series C Preferred Stock, par value $0.0001 per share,
together with warrants to purchase 4,000,000 shares of common stock, for an aggregate consideration of $3,000. Series C Preferred Stock
features a stated value of $10.00 per share and is convertible to common stock at a price of $2.0265 per share. The warrants are exercisable
at a price of $3.2475 per share, with expiration dates as follows: 1,000,000 warrants have an expiration date of eight (8) months, 1,000,000
warrants have an expiration date of sixteen (16) months, and 2,000,000 warrants have an expiration date of two (2) years from the issuance
date. See also note 12.
On
July 2025, the Company entered into a listing agreement, under regulation Crowdfunding (also known as Reg CF), whereby the Company agrees
to sell securities to eligible investors through the funding portal through special purpose vehicle. On September 2025 the Company closed
the financing round, raising a total of $819 and issued 212,033 Series CF-2 Preferred Stock with par value of $0.0001 each, at a price
per stock of $2.1234; The total fundraising fees recorded were $56.
13
On
August 6, 2025, the Company entered into a Securities Purchase and Conversion Agreement. Pursuant to the Agreement, the Company
converted 50%
of its outstanding loan obligations, totaling approximately $6.8 million, into 682,770 shares of its Series E Convertible Preferred Stock (“Series E Preferred”), stated value $10.00 per share. The Series E Preferred is convertible into shares of the Company’s common stock and accrues dividends on the stated
value thereof at the same rate as the original loan. Dividends are payable, at the Company’s election, in cash or shares of
common stock. The initial conversion price for the Series E Preferred is $4.62 per share. During the three months ended March 31, 2026, the Company issued 22,109 shares of its common stock as stock dividends, and as of March 31, 2026, an aggregate of 121,457 shares of common
stock had been issued as stock dividends. See also note 6.
On
October 15, 2025, all outstanding shares of the Company’s Series CF-1 Preferred Stock and Series CF-2 Preferred Stock were converted
into shares of non-voting common stock. Subsequently, on February 2, 2026, all outstanding shares of non-voting common stock were converted
into shares of the Company’s voting common stock.
On
October 27, 2025, the Company entered into a Securities Purchase Agreement (the “SPA”) for the issuance and sale of a total
of 549,451 shares of Series D Preferred Stock and warrants to the purchase a total of 25,000,000 shares of common stock. At the initial
closing under the SPA on October 27, 2025, the Company issued 109,891 shares of Series D Preferred Stock for consideration of $1,000,
together with warrants to purchase a total of 25,000,000 shares of common stock exercisable at a price of $12.35 per share (the “Warrants”),
with expiration dates as follows: 16,000,000 warrants have an expiration date of nine (9) months, 3,000,000 warrants have an expiration
date of sixteen (16) months, and 6,000,000 warrants have an expiration date of two (2) years from the issuance date. The Warrants may
not be exercised on a cashless basis unless, upon the listing of the Company’s common stock on any recognized stock exchange pursuant
to an effective registration statement, there is no effective registration statement covering, or no current prospectus available for,
the free resale of the warrant exercise shares by the holder. On December 2025, the Company completed three additional closings under
the SPA for an aggregate consideration of $1,050, pursuant to which the Company issued an additional 115,385 shares of Series D Preferred
Stock. On January 12, 2026, at a fifth closing under the SPA, the Company issued 93,407 additional shares of Series D Preferred Stock
for additional consideration of $850. On January 30, 2026, at a sixth closing under the SPA, we issued 131,867 additional shares of Series
D Preferred Stock for consideration of $1,200. On February 4, at a final closing under the SPA, the Company issued 98,902 additional
shares of Series D Preferred Stock for consideration of $900. Total issuance costs related to the Series D Preferred Stock were $506.
See also note 12.
On
November 3, 2025, an aggregate of 7,025,651 shares of Series B-2 Preferred Stock were converted into common stock. On November 3, 2025, an aggregate of 7,025,651 shares of Series B-2 Preferred Stock were converted into common stock. In addition, on February 4, 2026, an additional 607,775 shares of Series B-2 Preferred Stock were converted into common stock. All such conversions were completed in accordance with the original terms of the applicable agreements, and accordingly,
no gain or loss was recognized upon conversion.
On
February 4, 2026, the Company issued 161,963 shares of common stock to certain service providers in exchange
for services rendered, for aggregate non-cash consideration of $2,035,000,
based on the market value of the common stock at the time of the agreement.
On
February 4, 2026, pursuant to the terms of an engagement agreement entered into in connection with the Company’s direct listing,
upon (i) the successful consummation of the direct listing and (ii) the closing of financings with aggregate gross proceeds of at least
$5.0 million, the Company issued 418,219 shares of common stock to certain designees, representing 0.5% of the Company’s outstanding
common stock on a fully diluted basis. The shares were issued as consideration for investment banking and advisory services and had an
aggregate value of approximately $33,801,000, based on an implied value of $33.00 per share. The fair value of the shares issued was
recorded as an increase to additional paid-in capital, with an offsetting reduction to additional paid-in capital as equity issuance
costs related to the direct listing.
On
February 5, 2026, all 682,770 outstanding shares of the Company’s Series E Convertible Preferred Stock were converted into 1,477,857 shares of the Company’s common stock in accordance with the terms of the Series E Preferred. Following the conversion, no shares
of Series E Preferred remained outstanding.
On
March 1, 2026, the Company entered into Amendment No. 1 (the “Amendment”) to a Warrant to Purchase Shares of Common Stock
originally issued on October 27, 2025 (the “Warrant”). The Warrant provides for the purchase of up to 16,000,000 shares of
the Company’s common stock at an exercise price of $12.35 per share and expires on July 27, 2026. Pursuant to the Amendment, the
exercise price for 12,000,000 shares underlying the Warrant was temporarily reduced as follows: (i) $2.25 per share for 4,500,000 shares
for a period of 60 days; (ii) $2.75 per share for 3,750,000 shares for a period of 60 days; and (iii) $3.25 per share for 3,750,000 shares
for a period of 75 days. Upon expiration of the reduced exercise price periods, the exercise price for the applicable warrants will revert
to the original exercise price of $12.35 per share. All other terms and conditions of the Warrant remain unchanged,
and the Amendment was effected in accordance with the terms of the applicable agreements; accordingly, no gain or loss was recognized
in connection with the transaction. See also note 12.
On March 3, 2026 and March 17, 2026, an aggregate of 2,057,102 shares
of Series B-3 Preferred Stock were converted into common stock.
During
the three months ended March 31, 2026, holders of Series D preferred stock converted an aggregate of 24,000 shares of Series D preferred
stock with a stated value of $10.00 per share into 19,433 shares of common stock at a conversion price of $12.35 per share. In addition,
holders of Series C preferred stock converted an aggregate of 277,171 shares of Series C preferred stock with a stated value of $10.00 per share into 1,367,742 shares of common stock at a conversion price of $2.0265 per share.
During
the three months ended March 31, 2026, the Company issued 8,098 shares of common stock upon the exercise of warrants from the Series
D financing, resulting in aggregate proceeds of approximately $100,010. In addition, the Company issued 1,033,335 shares of common stock
upon the exercise of Series C warrants at an exercise price of $3.2475 per share, resulting in aggregate proceeds of approximately $3.35 million. The Company incurred issuance costs of approximately $242,000 related to the warrant exercises.
### **Note 9 – Stock-Based Compensation**
The
Equity Incentive Plan provides for the Company to grant ISOs, and NSOs to employees, advisers, and directors. As of March 31, 2026 there
were 15,111,193 equity awards authorized including 208,135 awards that were exercised to common stock.
***Stock
Options***
Stock
options represent the right to purchase shares of common stock on the date of exercise at a stated exercise price. The exercise price
of a stock option generally must be at least equal to the fair market value of the common stock on the date of grant. Options vest over
a period of time not to exceed 10 years from the grant date. For the three months ended March 31, 2026 and 2025, the Company recorded
stock-based compensation expense of $203 and $82, respectively.
14
The
terms of the plan permit certain option holders to exercise options before their options are vested, subject to certain limitations.
Upon early exercise, the awards become subject to a restricted stock agreement. The shares of restricted stock granted upon early exercise
of the options are subject to the same vesting provisions in the original stock option awards. Shares issued as a result of early exercise
that have not been vested are subject to repurchase by the Company upon termination of the purchaser’s employment, at the price
paid by the purchaser. Such shares are not deemed to be issued for accounting purposes until they vest.
The
following table summarizes the Company’s stock option activity and related information:
Schedule of Stock Option Activity
| Line item | Number of Shares | Weighted Average Exercise Price | Aggregate Intrinsic Value (in thousands) | Weighted Average Remaining Life |
| --- | --- | --- | --- | --- |
| Outstanding as of December 31, 2025 | 7,336,803 | $0.76 | $3,716,928 | 8.71 |
| Granted | 7,589,660 | $1.31 | - | - |
| Exercised during period | - | - | - | - |
| Forfeited | 631 | $0.95 | - | - |
| Expired | 12,870 | $1.15 | - | - |
| Outstanding as of March 31, 2026 | 14,912,962 | $1.04 | $3,716,511 | 9.20 |
The
aggregate intrinsic value of options is calculated as the difference between the exercise price of the stock options and the fair value
of the Company’s shares of common stock for those options that had exercise prices lower than the fair value of the Company’s
shares of common stock.
The
weighted-average grant date fair value of options granted was $1.04 and $0.42 for the years ended March 31, 2026 and 2025, respectively.
As
of March 31, 2026 and 2025, the total remaining unrecognized compensation expense related to non-vested stock options was $4,672 and
$308, respectively, which will be amortized over the weighted-average period of 3.37 years and 0.94 years, respectively.
Total
stock-based compensation expense for the three months ended March 31, 2026 and 2025 was as follows (in thousands):
Schedule
of Stock Based Compensation Expenses
| Line item | March 31, 2026 / Three Months Years Ended | March 31, 2025 / Three Months Years Ended |
| --- | --- | --- |
| Cost of sales | 15 | 4 |
| Research and development | 33 | 36 |
| Sales and marketing | 7 | 16 |
| General and administrative | 148 | 26 |
| Total stock-based compensation expense | 203 | 82 |
### **Note 10 – Income Taxes**
The
Company’s quarterly tax provision and estimate of its annual effective tax rate is subject to variation due to several factors,
including variability in pre-tax income (or loss), the mix of jurisdictions to which such income (or loss) relates, changes in how the
Company does business, and tax law developments. The Company’s estimated effective tax rate for the year differs from the U.S.
statutory rate of 21% primarily as a result of not benefiting U.S. losses as those losses are not more likely than not to be realized,
as well as its foreign operations, which are subject to tax rates that differ from those in the United States.
The
Company recorded an income tax expense of $36 and $0 for the three months ended March 31, 2026 and 2025, respectively.
### **Note 11 – Commitments and Contingencies**
In
August 2018, The Israeli subsidiary entered into a lease agreement for a 60-month period beginning January 1, 2019. The subsidiary may
terminate the lease agreement on December 31 of each year with 6-month advance written notice to the lessor. If the subsidiary to terminate
the lease agreement at the first 48-month period, then an exit penalty of $241 will apply.
15
In
May 2021, the lease agreement was amended where Subsidiary and lessor agreed to convert fifty percent from February-December 2021 monthly
rent payments into fully vested warrants to purchase 56,325 shares of the Company’s common stock issuable upon exercise of this
warrant and exercise price of 0.0001$ per share. The warrants will expire on April 30, 2026.
In
August 2021, the lease agreement was further amended where the Subsidiary and lessor agreed to convert fifty percent from 2022 monthly
rent payments into a warrants to purchase 63,015 shares of the Company’s common stock issuable upon exercise of this warrant and
exercise price of 0.0001$ per share. The warrants will expire on September 30, 2026.
On
August 22, 2024 the warrants were exercised by the lessor and accordingly, 119,340 common Stock were issued.
In
July 2022, the Israeli Subsidiary gave the lessor advanced notice of its intention to exercise the exit point on December 31, 2022, while
negotiating the fifth-year terms. The parties were unable to reach agreements and in July 2023 the subsidiary vacated the leased premises.
In February 2025 a lawsuit was filed against the Company for a total of $1,600. Given the preliminary stage in which the lawsuit is at,
the Israeli Subsidiary lawyers cannot reasonably assess the likelihood of the claims to be accepted. The company accounted for $1,600 and the amount is included in Accrued and other current liabilities.
### **Note 12 – Subsequent Events**
On
April 9, 2026, the Securities and Exchange Commission declared effective the registration statement covering the resale of shares issuable
under the Company’s equity line financing arrangement originally entered into on October 27, 2025 pursuant to a Securities Purchase
Agreement. The facility provides the Company with the right, but not the obligation, to direct the purchaser to purchase shares of the
Company’s common stock from time to time, subject to specified pricing, volume and other customary conditions, for aggregate gross
proceeds of up to $300.0 million. Following the effectiveness of the registration statement, the Company became eligible to access the
facility in accordance with its terms. In April and May 2026, the Company entered into amendments to the equity line financing arrangement
that modified certain operational, pricing and settlement provisions and reduced the maximum aggregate purchase commitment under the
facility from $300.0 million to $50.0 million.
On
May 4, 2026, the Company issued a Second Promissory Note in the principal amount of $1,000,000. The Second Promissory Note bears interest
at a rate of 10% per annum and matures on September 1, 2026. The Company is required to apply a cumulative total 25% of the net proceeds
from any future offerings or issuances of the Company’s securities toward repayment of the Second Promissory Note and/or the Promissory
Note issued March 1, 2026 until both notes are paid in full. In the event of default, the Second Promissory Note will bear interest at
a rate of 24% per annum, and any late payments will be subject to a late fee equal to 10% of the overdue amount.
Also
on May 4, 2026, the Company entered into amendments to certain warrants originally issued in connection with the Company’s October
27, 2025 Series D financing transactions. Pursuant to the amendments, warrants to purchase an aggregate of 9,000,000 shares of common
stock were repriced, including (i) three tranches of 1,000,000 warrants each expiring February 27, 2027 repriced to exercise prices of
$1.25, $1.75 and $2.25 per share, respectively, and (ii) three tranches of 2,000,000 warrants each expiring October 27, 2027 repriced
to exercise prices of $3.50, $4.00 and $4.50 per share, respectively. In addition, all remaining 15,991,902 Series D warrants, as well
as 300,000 Series C warrants, were cancelled.
Further,
on May 4, 2026, the Company agreed to amend the Certificates of Designation relating to its Series C Preferred Stock and Series D Preferred
Stock. Pursuant to the amendments, the conversion price of the Series D Preferred Stock was adjusted to $2.0265 per share. In addition,
a “leak-out” provision was added to both the Series C Preferred Stock and Series D Preferred Stock, pursuant to which holders
collectively may not sell, on any trading day, a number of conversion shares exceeding 10% of the total daily trading volume of the Company’s
common stock, unless such sales are made at a price equal to or greater than 115% of the closing price of the Company’s common
stock on the immediately preceding trading day.
The
Company has evaluated all transactions through May, 15, 2026, the date these consolidated financial statements were available to be issued
and has determined that there are no other events, other than the following, that would require disclosure in or adjustment to these
financial statements.
16
**Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.**
**Overview**
Our
Bond Inc. (“***Bond***,” “***we***,” “***us***,” “***our***”
or the “***Company***”) was formed under the laws of the State of Delaware on April 11, 2017. We provide preventative
personal security (the “***Bond Preventative Personal Security Platform***”) powered by artificial intelligence (“***AI***”).
Once activated, the cloud-based Bond Preventative Personal Security Platform provides users with remote protective services via phone
app (using its Bond Preventative Personal Security Platform) and with 24/7 support from our Personal Security Agents, who are in Bond
Command Centers and can respond rapidly.
We
use third party AI tools like ChatGPT internally across the spectrum of our operations. Additionally, we have developed and continue
to develop Bond AI capabilities. Bond’s AI (which is currently in production) consists largely of proprietary rule-based systems
that assist us in identification of potential anomalies for further review by our agents.
Bond’s
vision is to leverage AI to enable personal security services to be more scalable, effective and ultimately affordable for more people.
The Bond Preventative Personal Security Platform is designed with that vision, allowing us to incorporate increasing amounts of AI over
time as technology advances. The chart below shows some of the key areas where we have incorporated AI, their current state and future
plans:
**Task** **AI currently in use by Bond** **AI in R&D**
Anomaly detection Bond-developed rule-based systems based on past data and expert input Bond-developed machine learning models trained on past anomaly data
Supporting agent decision-making Third-party AI tools for agent decision support Implementing a RAG incorporating Bond processes and content with third-party data
Automated translation Third-party AI tools for translation of services and content Third-party tools for automated live translation of calls
Automating quality assurance Automated test suites for code Automated assessment of live agent performance
AI interviewing, hiring, and training agents Video interviews and third-party AI assessment to accelerate hiring funnel Increased use of automation and virtual agents in agent training and onboarding processes
Creation of content that facilitates informing end users about the Bond service and platform Third-party AI tools for generating and optimizing marketing content, including videos and images None
Automating of agent administrative tasks None Automated transcription, translation, and summarization of cases
Automatically triaging active calls to identify “hot” cases None Automated analysis of active calls to flag high-risk cases for supervisor attention
Automatically triaging incoming calls in overload situations None Virtual agents that gather information about situations and prioritize cases for human agents
Facial recognition for “bad actors” None Integrating third-party facial recognition technology with Bond’s platform
Automating and optimizing customer messaging None Automated CRM suites that use AI to customize messaging for each customer
Automating drone response to reported incidents None Patented techniques for autonomous drone navigation and collision avoidance
We
offer 14 distinct services through our phone app (the “***Bond App***”) and fully automated Bond Command Centers
located around the world, that allow Bond members to choose when and how Bond will keep them secure while preserving their privacy.
The
Bond Preventative Personal Security Platform is a multilayered, multifaceted technology platform that incorporates numerous technologies,
inputs and outputs to other systems, and third-party information. It allows us to perform a large number of multi-functional activities
relative to a large number of end-users/members, with a high level of precision, speed and reliability, as well as affordably, in a manner
that is automated. The core functionality includes: (1) “look after” a massively scalable number of members/end-users simultaneously;
at their or their guardians request, monitor them, collect data from multiple sources – on the phone of the member, from what Bond
historically knows about the member; from what Bond knows about the area/location of the member, from what the member has shared with
Bond – in order to detect anomalies in real time; (2) communicate with the member in order to verify their status, potentially
engage Bond Personal Security Agents in order to calm, guide, deter or orchestrate help for the member; (3) record and analyze all activities
in the Bond sphere, which included on the phones of the end-users, in the Command Centers and through our technology.
17
**Corporate
Organization**
We
conduct our operations through eight wholly owned subsidiaries, organized as follows:
- TG- 17 (Israel) Ltd. was incorporated in 2017 and provides R&D services to Our Bond, Inc. Since 2023 the subsidiary operates also as Command Center for Israel and global users (members).
- Bond Bodyguard New York, Inc., a New York corporation, was incorporated in 2020 for the sole purpose of obtaining bodyguard licenses in the US. Services are given under Our Bond, Inc. Currently, we are licensed in 11 states and submitted application for additional states.
- TG-17 (UK) Ltd. was incorporated in 2023 to provide services to UK citizens and global members.
- TG-17 France, was incorporated in 2024 to provide services to French citizens and global members.
- TG-17 Belgium, a société à responsabilité limitée, was incorporated in 2025 to provide services to Belgian citizens and global members.
- TG-17 (Canada) Inc., a corporation subject to the Business Corporations Act (Ontario), was incorporated in 2025 to provide services to Canadian citizens and global members.
- TG-17 Brazil Ltda., was incorporated in 2025 to provide services to Brazilian citizens and global members.
- TG-17 Mexico., was incorporated in 2025 to provide services to Mexican citizens and global members.
All
subsidiaries are 100% controlled/owned by Our Bond, Inc.
**Components
of Results of Operations**
*Net
Revenues.*
The
Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, which provides a five-step framework through
which revenue is recognized when control of promised goods or services is transferred to a customer at an amount that reflects the consideration
to which the Company expects to be entitled in exchange for those goods or services. To determine revenue recognition for arrangements
that the Company concludes are within the scope of ASC 606, management performs the following five steps: (i) identifies the contract(s)
with a customer; (ii) identifies the performance obligations in the contract(s); (iii) determines the transaction price, including whether
there are any constraints on variable consideration; (iv) allocates the transaction price to the performance obligations; and (v) recognizes
revenue when (or as) the Company satisfies a performance obligation.
The
Company provides comprehensive security solutions. The company’s flagship offering is a cloud-based Software-as-a-Service (“***SaaS***”)
that delivers a preventative personal security solution platform. Additionally, the Company offers comprehensive and customized services
designed to protect its clients. These services include, but are not limited to, on/off premise guards, assets protection, threat assessment
and monitoring and other tailored-made security services. Revenue is recognized either over time or at a point in time, depending on
the nature of each customer’s agreement. For its subscription-based SaaS solution delivered through the Company’s platform,
revenue is typically recognized over time as services are made available on an on-going basis. In contrast, for performance obligations
of services described above other than the SaaS solution, we generally satisfy our obligations *vis-à-vis* each deliverable
as it occurs and is provided to the customer. The customers simultaneously receives and avails the benefits of our services, at which
point these performance obligations are deemed to be satisfied.
18
We
group the above services offerings into one broad category which generates all of Company’s revenue through, primarily, the following
sales:
- B2B (or B2G): selling to private or public institutions who use the services in order to protect their people (employees, students, residents, etc.).
- B2B2C: selling to or through corporations so they can sell/subsidize/gift Bond services to their own consumers.
- DTC: selling directly to consumers.
The
Company combines and accounts for multiple contracts as a single contract when they are negotiated together with the same customer at
or near the same time in order to achieve a single commercial objective, or when the contracts are related in other ways.
Transaction
price may be comprised of fixed consideration and variable consideration. The Company’s contracts are typically for fixed consideration.
For
all contracts with customers that have more than one performance obligation, the Company allocates the transaction price to each separate
performance obligation based on the relative SSP of each performance obligation. The SSP is typically the price at which the Company
sells service separately to a customer. The best evidence of an SSP, if available, is the observable price charged in similar circumstances
and to similar customers. If an SSP is not directly observable, the Company estimates SSP using various observable inputs including historical
internal pricing data and cost-plus expected margin analysis due to the limited standalone sales history.
For
the three months ended March 31, 2026, the Company demonstrated annual recurring revenue (“ARR”) of approximately $10 million
and total bookings of $10.5 million. For the three months ended March 31, 2025, the Company demonstrated ARR of approximately $9.74 million
and total bookings of $10.6 million. The Company use ARR as a metric to measure customer demand and growth, and use booking values act
as an indicator of customer engagement, including new sales and renewals. These figures highlight consistent growth and increasing customer
demand.
Total
bookings represent the aggregate dollar value of all customer contracts executed during a given period, inclusive of both recurring subscription
and service commitments and any associated one-time fees (e.g., implementation, setup or training). Bookings are expressed based on the
total committed contract value, regardless of the timing of invoicing or revenue recognition under U.S. GAAP. We calculate ARR using
a trailing actuals method to provide a conservative measure of recurring revenue. Specifically, we determine average Monthly Recurring
Revenue (“***MRR***”) based on actual recurring revenue recognized over the prior 12 months and multiply that amount
by 12 to derive ARR. This method smooths short-term fluctuations and reflects actual earned recurring revenue rather than forward-looking
projections. ARR excludes one-time fees, usage-based overages, and non-recurring revenues. No adjustments are made for potential future
churn, upgrades, or downgrades beyond the actual results in the trailing period.
*Cost
of Services Sold.*
Cost
of Services sold primarily consists of our Command Center operations and other rendered services that we outsource to third-party for
particular security services offering. As a subscription-based business, our model emphasizes scalability so that most costs do not increase
linearly with revenue growth.
*Operating
Expenses*.
Operating
expenses consist of general and administrative expenses, which are primarily salaries, professional fees, and expenses related to the
administrative functions of the Company, research and development expenses, which consist primarily of product development costs and
salaries, and sales and marketing expenses, which represent advertising and direct marketing costs, as well as the associated personnel
costs.
19
**Results
of Operations**
***Comparison
of the three months ended March 31, 2026 to the three months ended March 31, 2025***
*Net
Revenues*
The
majority of our net revenues for the three months ended March 31, 2026 and 2025, were generated from our B2B services. For the three
months ended March 31, 2026, 15.47% of our revenue was generated from cloud-based SaaS services, while 84.53% came from our physical
service offerings. This compares to 14.67% and 85.33%, respectively, for the three months ended March 31, 2025.
Total
revenue increased by $98,000 or approximately 4.36% to $2,347,000 for the three months ended March 31, 2026, compared to approximately
$2,249 for the three months ended March 31, 2025. This increase reflects continued demand for our security services and modest growth
in our customer base during the three months ended March 31, 2026 compared to the same period in 2025
*Cost
of Services Sold.*
Our
cost of services sold increased slightly by $124,000 or approximately 5.7% to $2,300,000 for the three months ended March 31, 2026 compared
to $2,176,000 for the three months ended March 31, 2025. This modest change is not considered significant and primarily reflects the
Company’s continued global expansion and the use of outsourced services to support its growth initiatives.
_($ in thousands)_
| Line item | Three Months Ended / March 31, 2026 | Three Months Ended / March 31, 2025 |
| --- | --- | --- |
| Command Center Operations | $853 | $581 |
| Security Services | 1,447 | 1,595 |
| | $2,300 | $2,176 |
*Operating
Expenses.*
Our
operating expenses for the three months ended March31, 2026 and 2025 were as follows:
_($ in thousands)_
| Line item | Three Months Ended / March 31, 2026 | Three Months Ended / March 31, 2025 |
| --- | --- | --- |
| General and Administrative | $2,441 | $1,026 |
| Research and Development | 691 | 555 |
| Sales and Marketing | 3,290 | 277 |
| | $6,422 | $1,858 |
Our
operating expenses for the three months ended March 31, 2026, were approximately $6,422,000 compared to approximately $1,858,000 for
the three months ended March 31, 2025, an increase of approximately $4,564,000.
The
increase in operating expenses for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, was primarily
attributable to non-recurring costs associated with the Company’s transition to and operation as a public company following the
completion of its public listing on February 4, 2026. Such costs included approximately $1.2 million of one-time expenses related to
the public listing transaction, a $2.0 million strategic marketing investment related to 2026 (TV ads that will be aired in the second
half of 2026), approximately $0.8 million of investor relations expenses, and approximately $0.4 million of incremental public company
operating costs, primarily consisting of increased directors and officers insurance premiums and accounting-related expenses.
*Net
Profit/Loss*
As
a result of the foregoing, the Company suffered a net loss of approximately $6,703,000 for the three months ended March 31, 2026, compared
to a net loss of approximately $2,162,000 for the three months ended March 31, 2025.
**Liquidity
and Capital Resources**
*Overview*
Since
inception, we have funded our operations primarily through proceeds from sales of our capital stock and, to a lesser extent, cash flow
generated from operating activities. Based on our current operating plan, we believe that our existing cash and cash equivalents, together
with anticipated cash generated from operations, will support our working capital and capital expenditure requirements for the near term.
20
Our
future capital requirements will depend on many factors, including the pace of growth in our customer base, the timing and extent of
investments in our platform and services, expansion of our sales and marketing activities, and general economic conditions. To support
our operations and growth initiatives, the Company expects to obtain additional capital through equity financing and other financing
instruments that have been arranged or are available to the Company.
In
alignment with Bond’s business plan and operating model, management projects that as sales and the number of end-users increase,
utilization of the overall Bond platform will improve, driving the company toward profitability.
When
referring to the Bond platform, we include the full ecosystem that enables and supports the service globally, including: command centers
around the world; security agents; engineering resources responsible for developing, maintaining, and enhancing the technology that powers
the app, command centers, and cloud infrastructure; as well as the company’s relationships with third parties, first responders,
and other key partners.
At
this stage, the Bond platform has been built to scale and support a significant global end-user base. We continue to gradually onboard
additional end-users as we secure new customers and as existing corporate customers expand the population of employees offered the Bond
service. At the same time, we are steadily increasing our investments in marketing and sales in order to accelerate growth and advance
the company toward profitability.
*Summary
of Cash Flows*
The
following table summarizes our cash flows for the three months ended March 31, 2026 and 2025.
_($ in thousands)_
| Line item | Three Months Ended / March 31, 2026 | Three Months Ended / March 31, 2025 |
| --- | --- | --- |
| Net cash (used in) operating activities | $(4,410) | $(1,416) |
| Net cash (used in) investing activities | (11) | - |
| Net cash provided by financing activities | 7,607 | 2,127 |
| Effect of exchange rate changes on cash | (27) | (17) |
| Cash and cash equivalents at end of period | $3,758 | $1,420 |
*Operating
Activities.*
We
continue to experience negative cash flow from operating activities as we expand our business. Cash flows from operating activities are
significantly affected by investments to support the growth of our business, including expenditures related to product and service development,
engineering resources required to maintain and enhance our technology platform, Command Center operations, and selling, general and administrative
functions. In addition, operating cash flows during the three months ended March 31, 2026 were adversely affected by non-recurring costs
associated with the Company’s transition to and operation as a public company following the completion of its public listing on
February 4, 2026. Such costs included approximately $1.2 million of one-time expenses related to the public listing transaction, a $2.0
million strategic marketing investment related to 2026 (TV ads that will be aired in the second half of 2026), approximately $0.8 million
of investor relations expenses, and approximately $0.4 million of incremental public company operating costs, primarily consisting of
increased directors and officers insurance premiums and accounting-related expenses. Operating cash flow also continue to be impacted
by working capital requirements associated with supporting our growth, including fluctuations in personnel-related expenditures, accounts
payable, and other current assets and liabilities.
Net
cash used in operating activities for the three months ended March 31, 2026 was approximately $4,410,000 which reflects our net loss
of approximately $6,703,000. Net cash used in operating activities for the three months ended March 31, 2025 was approximately $1,416,000
which reflects our net loss of approximately $2,162,000.
*Investing
Activities*
Our
investing activities have consisted primarily of the purchases of assets and equipment. We have invested in assets and equipment to support
our Command Center growth.
21
Net
cash used in investing activities for the three months ended March 31, 2026 was approximately $11,000 which was entirely attributable
to purchases of IT and other Electronic equipment.
*Financing
Activities*
Net
cash provided by financing activities was $7.6 million during the three months ended March 31, 2026, consisting primarily of $2.95 million
in proceeds from the issuance of Series D convertible preferred stock, $2.5 million in proceeds from the issuance of a promissory note,
and $3.5 million from the exercise of common warrants, partially offset by repayments of related party loans, promissory note and stock issuance costs.
**Issuance
of Series D Preferred Stock**
On
October 27, 2025, the Company entered into a Securities Purchase Agreement (the “SPA”) for the issuance and sale of up to
549,451 shares of Series D Preferred Stock. During 2025, the Company completed four closings under the SPA and issued an aggregate of
225,275 shares of Series D Preferred Stock for gross proceeds of approximately $2.1 million. During the three months ended March 31,
2026, the Company completed the remaining closings under the SPA and issued an additional 324,176 shares of Series D Preferred Stock
for aggregate gross proceeds of approximately $2.95 million. Issuance costs incurred during the three months ended March 31, 2026 were
approximately $0.2 million.
**Exercise
of Series C and Series D Common Warrants**
During
February 2026, holders of the Company’s Series C and Series D warrants exercised warrants to purchase an aggregate of 1,041,433
shares of the Company’s common stock. The Series C warrants were exercised at an exercise price of $3.2475 per share, and the Series
D warrants were exercised at an exercise price of $12.35 per share. As a result of these exercises, the Company received aggregate gross
proceeds of approximately $3.46 million.
**Promissory
Note**
On
March 1, 2026, the Company issued a Promissory Note in the principal amount of $2,500,000. The Promissory Note bears interest at a rate
of 10% per annum and matures on September 1, 2026. The Company is required to apply 25% of the net proceeds from any future offerings
or issuances of the Company’s securities toward repayment of the Promissory Note until it is paid in full. In the event of default,
the Promissory Note will bear interest at a rate of 24% per annum, and any late payments will be subject to a late fee equal to 10% of
the overdue amount.
The
following table summarizes our financing activities for the three months ended March 31, 2026 and 2025.
_($ in thousands)_
| Line item | Three Months Ended / March 31, 2026 | Three Months Ended / March 31, 2025 |
| --- | --- | --- |
| Payments as part of Related Party Loans | $(555) | $(350) |
| Issuance of Series CF Preferred Stock | - | 2,535 |
| Issuance of Series CF Preferred Stock fundraising fees | - | (58) |
| Issuance of Series D convertible preferred stock | 2,950 | - |
| Issuance of Series D convertible preferred stock - issuance costs | (271) | - |
| Issuance of Promissory Note | 3,000 | - |
| Payment of Promissory Note | (500) | - |
| Exercise of Series C Common Warrants | 3,356 | - |
| Exercise of Series C Common Warrants - issuance costs | (235) | - |
| Exercise of Series D Common Warrants | 100 | - |
| Exercise of Series D Common Warrants - - issuance costs | (7) | - |
| Exercise of Common Stock Warrants | 19 | - |
| Direct Listing Costs | (250) | - |
| | $7,607 | $2,127 |
**Off-Balance
Sheet Arrangements**
We
did not have during the periods presented, and we do not currently have, any off-balance sheet financing arrangements or any relationships
with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose
entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited
purposes.
22
**Critical
Accounting Policies and Estimates**
Management’s
discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements
and the related notes thereto, which have been prepared in accordance with accounting principles generally accepted in the United States
(“U.S. GAAP”). In preparing the condensed consolidated financial statements, we apply accounting policies and estimates that
affect the reported amounts and related disclosures. Inherent in such policies are certain key assumptions and estimates made by management,
which we believe best reflect our underlying business and economic conditions. Our estimates are based on historical experience and various
other factors and assumptions that we believe are reasonable under the circumstances. We regularly re-evaluate our estimates used in
the preparation of the condensed consolidated financial statements based on our latest assessment of the current and projected business
and economic environment. By their nature, these estimates and judgments are subject to an inherent degree of uncertainty and actual
results could differ materially from the amounts reported based on these estimates. There have been no material changes to our critical
accounting policies and estimates as described in Item 7 of Part II, “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” of our 2025 Annual Report on Form 10-K.
**Recently
Accounting Pronouncements and SEC Rules**
See
Note 1 to our Consolidated Financial Statements included elsewhere in this Form 10-Q for recently adopted accounting pronouncements and
SEC rules and recently issued accounting pronouncements not yet adopted as of the date of this report.
**Contractual
Obligations and Commitments**
In
addition to ongoing capital expenditures and working capital needs to fund operations over the next twelve (12) months, our contractual
obligations to make future payments primarily relate to our operating lease obligations and insurance obligations, all of which are governed
by agreements with month-to-month terms, and which are generally terminable after a notice period at any time. We purchase equipment
and software necessary to conduct our operations on an as-needed basis.
**Known
Trends, Events and Uncertainties**
We
are not currently aware of any trends, events, or uncertainties that are reasonably likely to have a material effect on our financial
condition. For a further discussion of factors that may affect future operating results, see the section entitled “Risk Factors”
in our most recent annual report on Form 10-K.
**Item
3. Quantitative and Qualitative Disclosures About Market Risk.**
We
are a smaller reporting company as defined by Rule 229.10(f)(1) and are not required to provide information under this item.
**Item
4. Controls and Procedures.**
**Evaluation
of Disclosure Controls and Procedures**
The
Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, have evaluated
the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) as of March 31,2026. Based on that evaluation, the Company’s
Chief Executive Officer and the Company’s Chief Financial Officer have concluded that as of the period ended March 31, 2026, the
Company’s disclosure controls and procedures were effective.
As
described in our Annual Report on Form 10-K for the year ended December 31, 2025, under the supervision and with the participation of
management, including the Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our
internal control over financial reporting based on the framework in “Internal Control — Integrated Framework (2013)”
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the results of this evaluation, our senior
management has concluded that the Company’s internal controls over financial reporting were effective for the period ended December
31, 2025.
23
**Changes
in Internal Control Over Financial Reporting**
There
were no changes in our internal control over financial reporting identified in management’s evaluation pursuant to Rules 13a-15(d)
or 15d-15(d) of the Exchange Act during the quarter ended March 31, 2026, that materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.
**Limitations
on Effectiveness of Controls and Procedures**
In
designing and evaluating the disclosure controls and procedures and internal control over financial reporting, management recognizes
that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired
control objectives. In addition, the design of disclosure controls and procedures and internal control over financial reporting must
reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of
possible controls and procedures relative to their costs.
**PART
II - OTHER INFORMATION**
**Item
1. Legal Proceedings.**
In
July 2022, the Israeli Subsidiary gave the lessor advanced notice of its intention to exercise the exit point on December 31, 2022, while
negotiating the fifth-year terms. The parties were unable to reach agreements and in July 2023 the subsidiary vacated the leased premises.
In February 2025 a lawsuit was filed against the Company for a total of $1,600. Given the preliminary stage in which the lawsuit is at,
the Israeli Subsidiary’s lawyers cannot reasonably assess the likelihood of the claims to be accepted by court. Given that Company’s
plan to litigate the case, and given the dynamics of such trials in Israel, a decision by a court is not anticipated until 2027.
From
time to time, we may be party to litigation arising in the ordinary course of business. Except as described above, as of the date of
this prospectus, we are not subject to any material legal proceedings nor, to the best of our knowledge, are any material legal proceedings
pending or threatened against us.
**Item
1A. Risk Factors.**
Our
business, financial condition, operating results, and cash flows may be impacted by a number of factors, many of which are beyond our
control, including those set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities
and Exchange Commission (the “SEC”) on March 31, 2026, the occurrence of any one of which could have a material adverse effect
on our actual results.
There
have been no material changes to our risk factors previously disclosed in Item 1A. of Part I, “Risk Factors” of our 2025
Annual Report on Form 10-K, filed March 31, 2026.
**Item
2. Unregistered Sales of Equity Securities and Use of Proceeds.**
There
were no sales of equity securities during the period covered by this Quarterly Report that were not registered under the Securities Act
or were not previously reported in a Current Report on Form 8-K filed by the Company.
**Item
3. Defaults Upon Senior Securities.**
None.
**Item
4. Mine Safety Disclosures.**
Not
applicable.
**Item
5. Other Information.**
None.
24
**Item
6. Exhibits.**
| Exhibit No. | Description |
| --- | --- |
| 31.1+ | Certification of Principal Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| 32.1* | Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
| 31.2** | Certification of Principal Financial and Accounting Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
| 32.2** | Certification of Principal Financial and Accounting 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 |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
\* Filed herewith.
\*\* Furnished herewith.
25
**SIGNATURES**
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this Report to be signed
on its behalf by the undersigned, thereunto duly authorized.
DATE: May 15, 2026 **Our Bond, Inc.**
By: */s/ Doron Kempel*
Doron Kempel
Chief Executive Officer
(Principal Executive Officer)
By: */s/ Amit Hod*
Amit Hod
Chief Financial Officer
(Principal Financial Officer
Principal Accounting Officer)
26