UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
For
the Quarterly Period Ended
OR
For the transition period from ______________ to ______________
Commission
File No.
(Exact name of the small business issuer as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices)
(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 | ||
| OTC Markets |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically 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 during the preceding 12 months (or for such shorter period
that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☐ | Smaller reporting company | ||
| Emerging growth company |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No
The number of shares of Common Stock, $ par value, of the registrant outstanding on August 13, 2025, was .
TABLE OF CONTENTS
| 2 |
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (“Form 10-Q”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue, or other financial items; any statements of the plans, strategies, and objectives of management for future operations; any statements concerning proposed new products or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties.
Forward-looking statements may include the words “may,” “could,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect,” “desire,” “goal,” “should,” “objective,” “seek,” “plan,” “strive” or “anticipate,” as well as variations of such words or similar expressions, or the negatives of these words. These forward-looking statements present our estimates and assumptions only as of the date of this Form 10-Q. Except for our ongoing obligation to disclose material information as required by the federal securities laws, we do not intend to and undertake no obligation to update any forward-looking statement. We caution readers not to place undue reliance on any such forward-looking statements. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes will likely vary materially from those indicated.
| 3 |
PART I.
| Item 1. | Financial Statements. |
FDCTECH, INC.
Index to Consolidated Financial Statements
| F-1 |
FDCTECH, INC.
CONSOLIDATED BALANCE SHEETS
| June 30, 2025 | December 31, 2024 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable, net of allowance for doubtful accounts of $ | ||||||||
| Prepaid expenses – current | ||||||||
| Subscription receivable | ||||||||
| Loan receivable | ||||||||
| Total Current assets | ||||||||
| Capitalized software, net | ||||||||
| Investment through a subsidiary | ||||||||
| Accrued income | ||||||||
| Acquired intangible assets | ||||||||
| Tax receivable | ||||||||
| Fair value of trading positions for the firm, profit | ||||||||
| Right of use (lease) | ||||||||
| Fixed assets, net | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Stockholders’ Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Line of credit | ||||||||
| Accrued expenses, related party | ||||||||
| Business acquisition loan | ||||||||
| Cares act- paycheck protection program advance | ||||||||
| Related party advances | ||||||||
| Customer funds | ||||||||
| Operating lease liability, current | ||||||||
| Other current liabilities | ||||||||
| Total Current liabilities | ||||||||
| Deferred tax liabilities | ||||||||
| SBA loan – non-current | ||||||||
| Operating lease liability, non-current | ||||||||
| Accrued interest – non-current | ||||||||
| Total liabilities | ||||||||
| Commitments and Contingencies (Note 9) | ||||||||
| Stockholders’ Deficit: | ||||||||
| Preferred stock, par value $, shares authorized, and issued and outstanding, as of June 30, 2025, and December 31, 2024 | ||||||||
| Series B Preferred Stock, par value $, shares authorized, and issued and outstanding, as of June 30, 2025, and December 31, 2024 | ||||||||
| Common stock, par value $, shares authorized; and shares issued and outstanding, as of June 30, 2025, and December 31, 2024 | ||||||||
| Additional paid-in capital, Common Series A, Series B | ||||||||
| Accumulated other comprehensive income | | ( | ) | |||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total FDCTech, Inc. stockholders’ equity (deficit) | ||||||||
| Noncontrolling interest | ||||||||
| Total liabilities and stockholders’ equity (deficit) | $ | $ | ||||||
See accompanying notes to the financial statements.
| F-2 |
FDCTECH, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| Revenues | ||||||||||||||||
| Technology & software | $ | $ | $ | $ | ||||||||||||
| Wealth management | ||||||||||||||||
| Brokerage (Trading) | ||||||||||||||||
| Total revenue | ||||||||||||||||
| Cost of sales | ||||||||||||||||
| Technology & software | ||||||||||||||||
| Wealth management | ||||||||||||||||
| Brokerage (Trading) | ||||||||||||||||
| Total cost of sales | ||||||||||||||||
| Gross Profit | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Sales and marketing | ||||||||||||||||
| Depreciation | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Operating income (loss) | ( | ) | ( | ) | ( | ) | ||||||||||
| Other income (expense): | ||||||||||||||||
| Other interest expense | ( | ) | ( | ) | ||||||||||||
| Other income (expense) | ( | ) | | ( | ) | |||||||||||
| Total other income (expense) | ( | ) | ( | ) | ||||||||||||
| Income (loss) before provision for income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Provision (benefit) for income taxes | ||||||||||||||||
| Net income (loss) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net income (loss) per common share, basic and diluted | ) | ) | ) | ) | ||||||||||||
| Weighted average number of common shares outstanding basic and diluted | ||||||||||||||||
| Other comprehensive income (loss): | ||||||||||||||||
| Change in foreign currency translation | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total other comprehensive income (loss) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total comprehensive income (loss) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Comprehensive income (loss) attributable to noncontrolling interests | ( | ) | ( | ) | ||||||||||||
| Comprehensive income (loss) attributable to FDCTech stockholders | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
See accompanying notes to the financial statements
| F-3 |
FDCTECH, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(Unaudited)
| Preferred stock | Common stock | Additional Paid-in | Accumulated other comprehensive | Accumulated | Total Stockholders’ | |||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | income (loss) | Deficit | Deficit | |||||||||||||||||||||||||
| Balance, March 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||
| Three months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
| Common stock issued for cash valued at $ | - | |||||||||||||||||||||||||||||||
| Increase in APIC due to shares issued at a discount | - | - | ||||||||||||||||||||||||||||||
| Change in APIC due to common control | - | - | ||||||||||||||||||||||||||||||
| FX gain (loss) | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Net (income) loss attributable to noncontrolling interest | - | - | ||||||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, June 30, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||
| Three months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||
| Three months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Change in APIC due to common control | - | - | ||||||||||||||||||||||||||||||
| FX gain (loss) | - | - | ||||||||||||||||||||||||||||||
| Net (income) loss attributable to noncontrolling interest | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||
| F-4 |
FDCTECH, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(Unaudited)
| Preferred stock | Common stock | Additional Paid-in | Accumulated other comprehensive | Accumulated | Total Stockholders’ | |||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | income (loss) | Deficit | Deficit | |||||||||||||||||||||||||
| Six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
| Balance, December 31, 2023 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||
| Six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
| Series A Preferred canceled | ( | ) | ( | ) | - | ( | ) | |||||||||||||||||||||||||
| Series B issuances at $ per share | - | |||||||||||||||||||||||||||||||
| Common stock issued for cash valued at $ | - | |||||||||||||||||||||||||||||||
| Increase in APIC due to shares issued at a discount | - | - | ||||||||||||||||||||||||||||||
| Change in APIC due to common control | - | - | ||||||||||||||||||||||||||||||
| FX gain (loss) | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Net (income) loss attributable to noncontrolling interest | - | - | ||||||||||||||||||||||||||||||
| Net income (loss) | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, June 30, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||
| Six months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||
| Three months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Common stock issued for services | - | |||||||||||||||||||||||||||||||
| Series B issuances at $ per share | - | |||||||||||||||||||||||||||||||
| Change in APIC due to common control | - | - | ||||||||||||||||||||||||||||||
| FX gain (loss) | - | - | ||||||||||||||||||||||||||||||
| Net (income) loss attributable to noncontrolling interest | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Net loss | - | - | ( | ) | ( | ) | ||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||||||||||
See accompanying notes to the financial statements
| F-5 |
FDCTECH, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Six Months Ended | ||||||||
June 30, 2025 | June 30, 2024 | |||||||
| Net income (loss) | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Software amortization | ||||||||
| Depreciation | ||||||||
| Common stock issued for services | ||||||||
| Series B Preferred issued for services | ||||||||
| Accounts receivable allowance | ||||||||
| Fixed assets, net | ( | ) | ( | ) | ||||
| Accrued expenses, non-related party | ||||||||
| Acquired intangible assets | ( | ) | ( | ) | ||||
| Change in assets and liabilities: | ||||||||
| Gross accounts receivable | ( | ) | ||||||
| Prepaid | ( | ) | ||||||
| Loan receivable | ( | ) | ( | ) | ||||
| Accounts payable | ||||||||
| Other current liabilities | ( | ) | ( | ) | ||||
| Accrued interest | ||||||||
| Customer funds | ( | ) | ||||||
| Fair value of trading position, net | ( | ) | ||||||
| Operating lease | ( | ) | ( | ) | ||||
| Deferred taxes | ( | ) | ||||||
| Related party guarantee | ||||||||
| Tax receivable by subsidiaries | ( | ) | ||||||
| Accrued income | ||||||||
| Right of use of assets (lease) | ||||||||
| Accrued expenses, related party | ( | ) | ||||||
| Net cash used in operating activities | $ | ( | ) | $ | ||||
| Investing Activities: | ||||||||
| Capitalized software | ( | ) | ||||||
| Effect of exchange rates | ( | ) | ||||||
| Business acquisition loan | ||||||||
| Changes in paid-in capital | ||||||||
| Net cash used in investing activities | $ | $ | ||||||
| Financing Activities: | ||||||||
| Borrowing from (payments to) line of credit | ( | ) | ||||||
| Promissory Note | ||||||||
| Net proceeds from cares act - paycheck protection program | ( | ) | ( | ) | ||||
| Net proceeds from SBA loan | ( | ) | ( | ) | ||||
| Related party advances | ( | ) | ||||||
| Common stock issued for cash | ||||||||
| Common stock issued for financing cost | ||||||||
| Series A Preferred cancelation | ( | ) | ||||||
| Noncontrolling interest | ( | ) | ( | ) | ||||
| Net cash provided by financing activities | $ | | $ | ( | ) | |||
| Net increase in cash | ||||||||
| Cash at beginning of the period | ||||||||
| Cash at end of the period | $ | $ | ||||||
| Cash paid for income taxes | $ | $ | ||||||
| Cash paid for interest | $ | $ | ||||||
| Non - cash investing and financing activities: | $ | - | $ | - | ||||
See accompanying notes to the financial statements
| F-6 |
NOTE 1. BUSINESS DESCRIPTION AND NATURE OF OPERATIONS
Under Delaware laws, the founders incorporated the Company as Forex Development Corporation on January 21, 2016. On February 27, 2018, the Company changed its name to FDCTech, Inc. The name change reflects the Company’s commitment to expanding its products and services in the FX and financial markets for OTC brokers. The Company provides innovative and cost-efficient financial technology (‘fintech’) and business solutions to online OTC brokerages (“customers”).
The Company is a financial technology company specializing in developing and delivering innovative software solutions and business services to the over-the-counter (OTC) brokerage and financial services industries. The company provides a range of proprietary and third-party technology solutions, including its flagship Condor Trading Technology, which supports multi-asset trading, risk management, and pricing for forex, equities, commodities, and digital assets.
FDCTech follows a strategic growth model centered on acquiring, integrating, and scaling legacy financial services firms. Through its recent acquisitions, the company has expanded its global footprint in wealth management, brokerage, and financial advisory services.
Key subsidiaries include:
| ● | AD Advisory Services Pty Ltd. (ADS) – An Australian-regulated wealth management firm managing over $530 million in client assets with a network of 28 financial advisors. | |
| ● | Alchemy Markets Ltd. (AML) – A Malta-based investment firm regulated by the Malta Financial Services Authority (MFSA), offering trading services across multiple asset classes in various European markets. | |
| ● | Alchemy Prime Limited (APL) – A UK-based investment firm regulated by the Financial Conduct Authority (FCA), providing investment advisory and brokerage services. | |
| ● | AlchemyTech Ltd. (ATECH) – A Cyprus-based technology, sales, and marketing service provider supporting the Company’s subsidiaries and affiliated companies. |
FDCTech continues to drive innovation by developing next-generation trading platforms, such as the Condor Pro Multi-Asset Trading Platform, and expanding its market reach. The company remains committed to leveraging proprietary technology and regulatory expertise to enhance operational efficiencies and client engagement across global financial markets.
Currently, we have three primary business segments: (1) Investment and Brokerage, (2) Wealth Management, and (3) Technology and Software Development.
The Company is building a diversified global financial services company driven by proprietary Condor trading technologies, complementary regulatory licenses, and a proven executive team. The Company plans to acquire, integrate, transform, and scale legacy financial service companies. The Company believes its proprietary technology and software development capabilities allow legacy financial services companies immediate exposure to forex, stocks, ETFs, commodities, social/copy trading, and other high-growth fintech markets.
Completed Acquisitions
On December 22, 2021, the Company entered into a Share Exchange Agreement (the “Agreement”) with AD Financial Services Pty Ltd, ACN 628 331 117, of Level 38, 71 Eagle Street, Brisbane, Queensland, Australia 4000 (“ADFP” or “Target”). According to the Agreement, the Company acquired % of ADFP’s issued and outstanding shares of capital stock in exchange for (the “Consideration”) newly issued “restricted” common shares. The operating and licensed entity of ADFP is AD Advisory Services Pty Ltd. ADFP owns one hundred percent (%) equity interest in AD Advisory Services Pty Ltd (“ADS”). As a result, the Company is % the owner of ADS. The Company closed the acquisition on December 22, 2021, and combined the financial statements of ADS in its annual report, 10-K, filed with the SEC on March 28, 2022.
On
December 31, 2022, the Company announced the sales purchase agreement (“Agreement”) under which the Company acquired a
The
Company will assume a business acquisition loan liability of $
The
Company completed the acquisition of the remaining
The
Company completed the acquisition of
Mr.
Gope S. Kundnani (“Kundnani”) is the sole controlling shareholder, holding one hundred percent (
| F-7 |
NOTE 1. BUSINESS DESCRIPTION AND NATURE OF OPERATIONS (continued)
Bank Acquisition Termination
In
April 2024, the Company terminated the letter of intent to acquire a community bank in Iowa. As part of the termination, the Company
shall pay the community bank a sum of $
AlchemyTech Ltd.
On March 19, 2024, the Company established Alchemytech Ltd. (ATECH), a Cypriot company. ATECH provides the Company’s subsidiaries and affiliate companies with information technology, sales, and marketing services.
| (1) | Investment and Brokerage |
Margin Brokerage (Europe) – Alchemy Markets Ltd.
AML is an investment firm regulated by the Malta Financial Services Authority (MFSA). The MFSA authorizes AML to deal with its account (market maker) as a Category 3 licensed entity by the MFSA, receive and transmit orders for retail and professional clients, and hold and control clients’ money and assets. AML trading platform services in the English, French, German, Italian, and Arabic-speaking markets, whereby customers can trade in currency, commodity, equity, and digital assets-linked derivatives in real time. AML is authorized countries to do business include Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Liechtenstein, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.
During
the third quarter of the fiscal year ending December 31, 2024, AML acquired approximately 2,631 clients from Next Markets, transferring
€
AML
acquired 35 clients from a Cypriot-based brokerage, transferring over $
AML has also secured authorization in terms of Article 6 of the Investment Services Act, Chapter 370 of the Laws of Malta, to offer equities and money market securities, enabling the Company to provide stocks and interest-yielding products. This authorization positions the Company to grow its asset base on deposits and expand its product portfolio.
Margin Brokerage (UK) – Alchemy Prime Ltd.
APL is an investment firm regulated by the Financial Conduct Authority (FCA). It provides investment advice, acts as an agent and principal, safeguards and administers assets in forex, equity, commodities, spread bets, and other financial assets, and is authorized to do business in several countries, including England, Scotland, Wales, and Northern Ireland.
Margin Brokerage (Mauritius) – Prime Intermarket Group Eurasia
On May 27, 2025, FDCTech, Inc. (the “Company”) formed a new wholly owned subsidiary, Prime Intermarket Group Eurasia (“PIG Eurasia”), incorporated in the Republic of Mauritius. PIG Eurasia is structured as a Private Company limited by shares and is regulated by the Financial Services Commission of Mauritius under the Companies Act. The subsidiary will operate under a SEC-2.1B Investment Dealer License (Full-Service Dealer, excluding Underwriting). At present, there PIG Eurasia has no operations.
Investment
and Brokerage consolidated revenues for the six months ended June 30, 2025, and 2024 were $
| F-8 |
NOTE 1. BUSINESS DESCRIPTION AND NATURE OF OPERATIONS (continued)
| (2) | Wealth Management – AD Advisory Services Pty Ltd. |
On December 22, 2021, the Company entered into a Share Exchange Agreement (the “Agreement”) with AD Financial Services Pty Ltd ACN 628 331 117 of Level 38/71 Eagle St, Brisbane, Queensland, Australia, 4000 (“ADFP” or “Target”). According to the Agreement, the Company acquired a controlling interest of fifty-one percent (%) of ADFP’s issued and outstanding shares of capital stock in exchange for (the “Consideration”) newly issued “restricted” common shares. The operating and licensed entity of ADFP is AD Advisory Services Pty Ltd. (“ADS”). ADFP owns one hundred percent (%) equity interest in ADS. As a result, the Company owns % of ADS. The Company closed the acquisition on December 22, 2021, and combined the financial statements of ADS in its annual report, 10-K, filed with the SEC on March 28, 2022.
AD Advisory Services Pty Ltd. (ADS) is an Australian-regulated wealth management company with 28 financial advisors and $530+ million in funds under advice. ADS provides licensing solutions for financial advisers and accountants in Australia and offers financial planners different licensing, compliance, and education solutions to meet their practice’s specific needs.
Wealth
Management consolidated revenues for the six months ended June 30, 2025, and 2024 were $
| (3) | Technology & Software Development – Condor Trading Technology |
The Company provides technology and software development for digital assets. In the retail foreign exchange trading space, where individuals speculate on the exchange rate between different currencies, our customers are forex brokerages, prime of prime brokers, prime brokers, and banks. The Company generates revenues by licensing its trading technology infrastructure, including but not limited to trading platforms (desktop, web, mobile), back office, and CRM and banking integration technology.
The Company has three sources of revenue.
| ● | Technology Solutions – The Company licenses its proprietary and sometimes resells third-party technologies to customers. Our proprietary technology includes but is not limited to Condor Risk Management Back Office (“Condor Risk Management”), Condor Pro Multi-Asset Trading Platform (previously known as Condor FX Pro Trading Terminal), Condor Pricing Engine, Digital Assets Web Trader Platform, and other digital assets-related solutions. | |
| ● | Customized Software Development – The Company develops software for Customers with unique requirements outlined in the Software Development Agreement (“Agreement”). | |
| ● | Consulting Services—The Company’s turnkey business solutions include Start-Your-Own brokerage (“SYOB”), Start-Your-Own Prime Brokerage (“SYOPB”), and FX/OTC liquidity solutions. |
The Company’s Condor Pro Multi-Asset Trading Platform is a regulatory-grade trading platform targeted at day traders and retail investors. The industry characterized such platforms by their ease of use and helpful features, such as the simplified front-end (user interface/user experience), back-end (reporting system), news feeds, and charting system. The Condor Pro Multi-Asset Trading Platform includes risk management (dealing desk, alert system, margin calls, etc.), a pricing engine (best bid/ask), and connectivity to multiple liquidity providers or market makers. We have tailored the Condor Pro Multi-Asset Trading Platform to markets such as forex, stocks, commodities, digital assets, and other financial products.
The Company released, marketed, and distributed its Condor Pro Multi-Asset Trading Platform in the second quarter of the fiscal year ending December 31, 2019. The Company has also developed the Condor Back Office API to integrate third-party CRM and banking systems into Condor Back Office. The Company’s upgraded Condor Back Office (Risk Management) meets the regulatory requirements of various jurisdictions. Condor Back Office complies with the directives under the Markets in Financial Instruments Directive (MiFID II/MiFIR), legislation implemented by the European Securities and Markets Authority (ESMA) across the European Union as of January 3, 2018.
The Company is developing the Condor Investing & Trading App, a simplified trading platform for traders with varied experiences in trading stocks, ETFs, and other financial markets from their mobile phones. The Company expects to commercialize the Condor Investing & Trading App by the end of the fourth quarter of the fiscal year ending December 31, 2025.
| F-9 |
NOTE 1. BUSINESS DESCRIPTION AND NATURE OF OPERATIONS (continued)
The Company does not hold any patents or trademarks on its proprietary technology solutions.
The Company acts as an adviser/strategic consultant and reseller of its proprietary technologies in the digital assets and blockchain space. The Company expects to generate additional revenue from its digital asset-related solutions. Such solutions include revenues from the development of a custom digital assets exchange platform for customers, the sale of the non-exclusive source code of the digital assets exchange platform to third parties, white-label fees of digital assets exchange platforms, and the sale of aggregated digital assets data price feed from various digital assets exchanges to OTC brokers. The Company initially plans to develop the technology architecture of the digital assets exchange platform for its customers. The initial capital required to produce such technologies is provided by our customers, as the Company undertakes design-build software development projects for them. The Company develops these projects to meet the customer’s design criteria and performance requirements.
The Company does not mine any digital assets, trade, or act as a counterparty in digital assets within the United States. Consequently, the Company does not intend to register as a custodian with state or federal regulators, including, but not limited to, obtaining a money service business or money transmitter license from the Financial Crimes Enforcement Network (FinCEN) and respective states’ money transmission laws. The Company also does not need to register under the Securities Exchange Act of 1934, as amended, as a national securities exchange, an alternative trading system, or a broker-dealer, since the Company is not a broker-dealer and does not intend to become one. Customers sometimes compensate us in Bitcoin through our custodian, Gemini Trust Company, LLC (“Gemini”). Gemini is a licensed New York trust company that undergoes regular bank exams and is subject to cybersecurity audits conducted by the New York Department of Financial Services.
The Company secures and earns revenues by signing an agreement with its customers. The Company considers a signed agreement with its customers a binding contract with the customer or other similar documentation reflecting the terms and conditions under which the Company will provide products or services as persuasive evidence of an arrangement. Each agreement is tailored to the customer and clearly defines the fee schedule, duties, responsibilities, renewal and termination terms, confidentiality agreement, dispute resolution, and other clauses necessary for a contract of this nature. The material terms of customer contracts depend on the nature of services and solutions. Each contract is tailored to the customer and clearly defines the fee schedule, duties, responsibilities, renewal and termination terms, confidentiality agreement, dispute resolution, and other clauses necessary for such a contract.
The Company has seven licensing agreements for its Condor Pro Multi-Asset Trading Platform as of the fiscal year ending June 30, 2025. The Company continuously negotiates additional licensing agreements with several retail online brokers to use the Condor Pro Multi-Asset Trading Platform. Condor Pro Multi-Asset Trading Platform is available in desktop, web, and mobile versions.
The
consolidated revenues for Technology and Software Development for the six months ended June 30, 2025, and 2024, were $
Settlement of the FRH Group Note
Between
February 22, 2016, and April 24, 2017, the Company borrowed $
2021-2022 Equity Line of Credit
On
October 04, 2021, the Company filed a prospectus that relates to the resale of up to shares of our Common Stock issued or
issuable to selling shareholders for up to $
| F-10 |
From
January 2021 to February 2022, the Company executed five “Purchase Notice Rights” under an Investment Agreement with White
Lion and received a net of $
The
Company also received a net amount of $
2022 Promissory Note
On
January 27, 2022, the Company issued a $
Related Party Investments from 2022 to 2024
On
January 25, 2023, the Company issued restricted common shares for cash valued at $
On
March 28, 2023, the Company issued restricted common shares for cash valued at $
On
July 31, 2023, the Company sent the notice of termination of the purchase agreement to CIM Securities, as future events may result in
a change of ownership in the CMA application. The Company terminated the escrow agreement and released $
On
November 30, 2023, Kundnani, a related party, purchased shares of Series A Preferred stock of the Company for $
In
December 2023, Susan Eaglstein, mother of Mitchel Eaglstein, the Company’s CEO, provided $
On January 30, 2024, the Company issued Series B preferred stock to Gope S. Kundnani for cash valued at $ per share.
Governmental Regulation
FDCTech is a publicly traded company subject to SEC and FINRA’s rules and regulations regarding public disclosure, financial reporting, internal controls, and corporate governance.
Our wealth management business, AD Advisory Services (ADS), is subject to enhanced regulatory scrutiny and is regulated by multiple regulators in Australia. The Australian Securities and Investments Commission (ASIC) administers a licensing regime for ‘financial services’ providers where ADS holds an Australian Financial Services License (AFSL) and meets various compliance, conduct, and disclosure obligations.
AML is an investment firm regulated by the Malta Financial Services Authority (MFSA).
APL is an investment firm regulated by the Financial Conduct Authority (FCA).
| F-11 |
NOTE 1. BUSINESS DESCRIPTION AND NATURE OF OPERATIONS (continued)
Board of Directors
At present, the Company has four members of the Board of Directors. Mitchell M. Eaglstein is the acting Chairman of the Company. Mitchell M. Eaglstein and Imran Firoz are the company’s executive directors and officers. Gope S. Kundnani is considered an executive director by owning at least 10% of the Company’s stock. Jonathan Baumgart is an independent director under the NYSE and NASDAQ listing standards.
Mitchell M. Eaglstein and Imran Firoz have been Executive Directors of the Company since January 21, 2016.
On June 15, 2021, the Company appointed Jonathan Baumgart as the Director of the Company.
On September 30, 2022, the Company appointed Gope S. Kundnani as the Director of the Company.
Changes in Registrant’s Certifying Accountant
On July 2, 2021, the Board of Directors of FDCTech, Inc. (the “Company”) approved the dismissal of Farber Hass Hurley LLP (“FHH”) as the Company’s independent registered public accounting firm. The reports of FHH on the Company’s consolidated financial statements for the fiscal years ended December 31, 2020, and 2019 did not contain an adverse opinion or a disclaimer of opinion. It was not qualified or modified for the uncertainty audit scope or accounting principles.
On July 2, 2021, the Company appointed BF Borgers CPA PC (“BFB”) as the Company’s new independent registered public accounting firm, effective immediately, to perform independent audit services for the fiscal year ending December 31, 2021. BFB has been the Company’s auditor since July 2021. On April 18, 2023, the board of directors of FDCTech, Inc. (the “Company”) terminated its relationship with its independent registered public accounting firm, BF Borgers CPA PC, Lakewood, Colorado (“BF Borgers”), effective as of April 18, 2023. The reports of BF Borgers on the Company’s financial statements for the two years ended December 31, 2022, and 2021 did not contain an adverse opinion or disclaimer of opinion. They were not qualified or modified as to uncertainty, audit scope, or accounting principles, except for providing a qualification for the Company’s ability to continue as a going concern. During the year ended December 31, 2022, and in the subsequent period through March 31, 2023, there were no disagreements with BF Borgers on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to the satisfaction of BF Borgers, would have caused BF Borgers to refer to the matter in its reports on the Company’s financial statements for such periods.
On April 18, 2023, the Company, based on the decision of its board of directors, approved the engagement of Bolko & Company, Boca Raton, Florida (“Bolko”) to serve as the Company’s independent registered public accounting firm, commencing April 18, 2023. On March 4, 2024, the board of directors of the “Company terminated its relationship with its independent registered public accounting firm, Bolko & Company, Boca Raton, Florida (“Bolko”), effective as of March 4, 2024.
The Company retained Bolko for less than a year, and we did not file any Form 10K reports with the SEC. During the period that Bolko was the Company’s auditor through March 4, 2024, there were no disagreements with Bolko on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which, if not resolved to the satisfaction of Bolko, would have caused Bolko to refer to the matter in its reports on the Company’s financial statements for such periods.
On March 4, 2024, the Company, based on the decision of its board of directors, approved the engagement of Fortune CPA Inc., Orange, California (“FCPA”) to serve as the Company’s independent registered public accounting firm, commencing March 4, 2024.
On July 2, 2024, the Company, based on the decision of its board of directors, approved the engagement of Olayinka Oyebola & Co (“Olayinka”) to serve as the Company’s independent registered public accounting firm, commencing July 2, 2024. Olayinka is a member of the Public Company Accounting Oversight Board (PCAOB) in the United States and a member of the Canadian Public Accountability Board (CPAB) in Canada.
Description of Company’s Securities to be Registered
Effective September 03, 2021, the Company’s description of its common stock, par value $ per share, to be registered hereunder contained under the heading “Description of Securities” in the Company’s Registration Statement on Form S-1 (File No. 333- 221726), as initially filed with the Securities and Exchange Commission (the “Commission”) on November 22, 2017, as subsequently amended (the “Registration Statement”). Since the Registration Statement filing, the Company has made all required filings pursuant to Section 15(d) and has continued to file all reports voluntarily.
Ukraine-Russia Conflict
The geopolitical situation in Eastern Europe intensified on February 24, 2022, with Russia’s invasion of Ukraine. The war between the two countries continues to evolve as military activity continues. The United States and certain European countries have imposed additional sanctions on Russia and specific individuals. By the end of August 2022, the Company closed its technical support and development office in Russia. We relocated our personnel to Turkey, currently considered a neutral zone. No individual associated with the Company is banned or under Special Designated Nationals and Blocked Person list. If the military activities worsen and expand in Europe, we may relocate our office from Turkey to other neutral zones in Asia. If we cannot relocate our technical and development operations to a safer zone, it may impact our software development capabilities and negatively impact the Company’s business plans.
As of the date of this report, there has been no disruption in our operations.
| F-12 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation
The accompanying consolidated financial statements include the accounts of FDCTech, Inc. and its wholly-owned subsidiary. We have eliminated all intercompany balances and transactions. The Company has prepared the consolidated financial statements consistent with the accounting policies adopted by the Company in its financial statements. The Company has measured and presented its consolidated financial statements in US Dollars, the currency of the primary economic environment in which it operates (also known as its functional currency).
Financial Statement Preparation and Use of Estimates
The Company prepared consolidated financial statements according to accounting principles generally accepted in the United States of America (“GAAP”). The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates, judgments, and assumptions. This could impact the reported amounts of assets and liabilities, as well as the related disclosures, at the date of the consolidated financial statements, and the reported amounts of revenue and expenses for the periods presented. Estimates include revenue recognition, the allowance for doubtful accounts, website and internal-use software development costs, recoverability of intangible assets with finite lives, and other long-lived assets. Actual results could materially differ from these estimates. Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties, including uncertainty in the current economic environment due to the coronavirus (“COVID-19”).
Cash and Cash Equivalents
Cash
and cash equivalents include cash on hand, bank deposits, and other short-term, highly liquid investments with three months or less of
original maturities. The Company maintains its cash balances at multiple financial institutions, both domestic and foreign. For US financial
institutions, the balances do not exceed Federal Deposit Insurance Corporation (FDIC) limits as of June 30, 2025. However, as of December
31, 2024, the majority of the cash balance was held with non-FDIC financial institutions in Malta, the UK, and other countries. As of
June 30, 2025, and December 31, 2024, the Company had $
| F-13 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Accounts Receivable
Accounts Receivable primarily represent the amount from four (4) technology customers. In some cases, customer receivables are due immediately upon demand; however, in most cases, the Company offers net 30 terms, where payment is due in full 30 days after the invoice date. The Company has based the allowance for doubtful accounts on its assessment of the collectability of customer accounts. The Company regularly reviews the allowance by considering historical experience, credit quality, the accounts receivable balances’ age, and economic conditions that may affect a customer’s ability to pay and expected default frequency rates. Trade receivables are written off at the point when they are considered uncollectible.
At
June 30, 2025, and December 31, 2024, the Management determined that the allowance for doubtful accounts was $
Sales, Marketing, and Advertising
The Company recognizes sales, marketing, and advertising expenses when incurred.
The
Company incurred $
The
sales, marketing, and advertising expenses represented
Revenue Recognition
On January 1, 2019, the Company adopted ASU 2014-09 Revenue from Contracts with Customers. The majority of the Company’s revenues come from two contracts – IT support and maintenance (‘IT Agreement’) and software development (‘Second Amendment’) that fall within the scope of ASC 606.
The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services as per the contract with the customer. As a result, the Company accounts for revenue contracts with customers by applying the requirements of Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (Topic 606), which includes the following steps:
| ● | Identify the contract or contracts and subsequent amendments with the customer. | |
| ● | Identify all the performance obligations in the contract and subsequent amendments. | |
| ● | Determine the transaction price for completing performance obligations. | |
| ● | Allocate the transaction price to the performance obligations in the contract. | |
| ● | Recognize the revenue when, or as, the Company satisfies a performance obligation. |
| F-14 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The Company adopted ASC 606 using the modified retrospective method applied to all contracts not completed as of January 1, 2019. The Company presents results for reporting periods beginning after January 1, 2019, under ASC 606, while prior period amounts are reported following legacy GAAP. In addition to the above guidelines, the Company also considers implementing guidance on warranties, customer options, licensing, and other topics. The Company considers revenue collectability, methods for measuring progress toward complete satisfaction of a performance obligation, warranties, customer options for additional goods or services, non-refundable upfront fees, licensing, customer acceptance, and other relevant categories.
The Company accounts for a contract when the Company and the customer (‘parties’) have approved of the contract and are committed to performing their respective obligations. Each party can identify its rights, obligations, and payment terms; the contract has commercial substance. The Company will collect all of the considerations. Revenue is recognized when performance obligations are satisfied by transferring control of the promised service to a customer. The Company fixes the transaction price for goods and services at contract inception. The Company’s standard payment terms are net 30 days and, in some cases, due upon receipt of the invoice.
The Company considers the change in scope, price, or both as contract modifications. The parties describe contract modification as a change order, a variation, or an amendment. A contract modification exists when the parties approve a modification that either creates new or changes existing enforceable rights and obligations. The Company assumes a contract modification by oral agreement or implied by the customer’s customary business practice when agreed in writing. If the parties to the contract have not approved a contract modification, the Company continues to apply the existing contract’s guidance until the contract modification is approved. The Company recognizes contract modification in various forms –partial termination, an extension of the contract term with a corresponding price increase, adding new goods or services to the contract, with or without a corresponding price change, and reducing the contract price without a change in goods/services promised.
At contract inception, the Company assesses the solutions or services, or bundles of solutions and services, obligated in the contract with a customer to identify each performance obligation within the contract and then evaluate whether the performance obligations are capable of being distinct and distinct within the context of the agreement. Solutions and services that are not capable of being distinct and distinct within the contract context are combined and treated as a single performance obligation in determining the allocation and recognition of revenue. For multi-element transactions, the Company allocates the transaction price to each performance obligation on a relative stand-alone selling price basis. The Company determines the stand-alone selling price for each item at the transaction’s inception involving these multiple elements.
Since January 21, 2016 (‘Inception’), the Company has derived its revenues mainly from consulting services, technology solutions, and customized software development. The Company recognizes revenue when it has satisfied a performance obligation by transferring control over a product or delivering a service to a customer. We measure revenue based upon the consideration outlined in an arrangement or contract with a customer.
| F-15 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The Company’s standard performance obligations include the following:
| Performance Obligation | Types of Deliverables | When Performance Obligation is Typically Satisfied | ||
| Consulting Services | Consulting related to Start-Your-Own-Brokerage (“SYOB”), Start-Your-Own-Prime Brokerage (“SYOPB”), Start-Your-Own-Crypto Exchange (“SYOC”), FX/OTC liquidity solutions and lead generations. | The Company recognizes the consulting revenues when the customer receives services over the contract length. If the customer pays the Company in advance for these services, the Company records such payment as deferred revenue until the Company completes the services. | ||
| Technology Services | Licensing of Condor Risk Management Back Office (“Condor Risk Management”), Condor FX Pro Trading Terminal, Condor Pricing Engine, Crypto Trading Platform (“Crypto Web Trader Platform”), and other cryptocurrency-related solutions. | The Company recognizes ratably over the contractual period that the services are delivered, beginning on the date such service is made available to the customer. Licensing agreements are typically one year in length with an option to cancel by giving notice; customers have the right to terminate their agreements if the Company materially breaches its obligations under the agreement. Licensing agreements do not provide customers the right to take possession of the software. The Company charges the customers a set-up fee for installing the platform, and implementation activities are insignificant and not subject to a separate fee. | ||
| Software Development | Design and build development software projects for customers, where the Company develops the project to meet the design criteria and performance requirements as specified in the contract. | The Company recognizes the software development revenues when the Customer obtains control of the deliverables as stated in the Statement-of-Work contract. |
The Company assumes that the goods or services promised in the existing contract will be transferred to the customer to determine the transaction price. The Company believes that the contract will not be canceled, renewed, or modified; therefore, the transaction price includes only those amounts to which the Company has rights under the present contract. For example, suppose the Company enters a contract with a customer with an original term of one year and expects the customer to renew it for a second year. In that case, the Company will determine the transaction price based on the initial one-year period. When choosing the transaction price, the company first identifies the fixed consideration, including non-refundable upfront payment amounts.
To allocate the transaction price, the Company gives the amount that best represents the consideration that the entity expects to receive for transferring each promised good or service to the customer. The Company allocates the transaction price to each performance obligation identified in the contract on a relatively standalone selling price basis to meet the allocation objective. In determining the standalone selling price, the Company uses the best evidence of the stand-alone selling price that the Company charges to similar customers in similar circumstances. The Company sometimes uses the adjusted market assessment approach to determine the standalone selling price. It evaluates the market in which it sells the goods or services and estimates the price that customers in that market would pay for those goods or services when sold separately.
The Company recognizes revenue when or as it transfers the promised goods or services into the contract. The Company considers the “transfers” of the promised goods or services when the customer obtains control of the goods or services. The Company believes a customer “obtains control” of an asset when it can directly use and substantially obtain all the remaining benefits from an asset. The Company recognizes deferred revenue related to services it will deliver within one year as a current liability. The Company presents deferred revenue related to services that the Company will provide more than one year into the future as a non-current liability.
According to the contract’s terms and conditions, the Company invoices the customer at the beginning of the month for the month’s services. The invoice amount is due upon receipt. The Company recognizes the revenue at the end of each month, equal to the invoice amount.
| F-16 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Wealth Management
AD Advisory Services Pty (ADS), the Company’s wealth management revenue, primarily consists of advisory revenue, commission revenue from insurance products, fees to prepare the statement of advice, rebalancing portfolio, and other financial planning activities. ADS is authorized and regulated by the Australian Securities & Investments Commission (ASIC) to conduct licensing activities in Australia.
ASC 606 establishes a five-step model for revenue recognition aimed at enhancing comparability and transparency across entities, industries, and capital markets. The Company only recognizes revenue that reflects the transfer of promised goods or services to customers in exchange for the consideration to which the entity expects to be entitled.
For ADS, a contract is an agreement between ADS and a client that creates enforceable rights and obligations, encompassing advisory services, insurance product commissions, and other financial planning activities. Contracts may be written, oral, or implied by customary business practices and are identified when both parties approve the agreement; each party can identify rights regarding the goods or services to be transferred, establish payment terms, the contract has commercial substance, and collection of payment is probable.
A performance obligation is a promise in a contract to transfer a distinct good or service to the Customer. For ADS, performance obligations may include:
| ● | Providing ongoing financial advisory services, | |
| ● | Preparing statements of advice, | |
| ● | Executing portfolio rebalancing, | |
| ● | Facilitating the purchase of insurance products, and | |
| ● | Offering other specialized financial and estate planning services. |
We evaluate these services to determine if they are distinct, considering whether the Customer can benefit from the service on its own or with other readily available resources, and if the promise to transfer the service is separately identifiable from other promises in the contract.
The transaction price is the amount of consideration ADS expects to receive in exchange for transferring the promised goods or services to the Customer. These services include fixed fees, commissions from insurance products, and variable consideration for performance-based fees. ADS estimates the amount of variable consideration to which it will be entitled in a manner that reflects the likelihood and magnitude of a revenue reversal.
If a contract includes more than one performance obligation, ADS allocates the transaction price to each performance obligation based on its standalone selling price. When standalone selling prices are not directly observable, ADS estimates them using methods that may include cost-plus margin, market assessment, or residual approach, considering the Customer’s perceived value of each service.
ADS recognizes revenue when (or as) a performance obligation is satisfied, i.e., when the control of the promised good or service is transferred to the Customer. For ongoing services, revenue is recognized over time, reflecting the continuous transfer of services. For services performed at a specific point in time, revenue is recognized upon completion of the service. The pattern of revenue recognition is determined based on when the Customer obtains control of the promised good or service, which for advisory services is typically throughout the contract, and for transaction-based services (like insurance commissions or fees for specific planning activities), is at the point in time when the transaction is executed, or the service is rendered. If we receive payments before services, we defer and recognize them as revenue when we are satisfied with our performance obligation. Advisory revenue includes fees charged to clients in advisory accounts for which we are the licensed investment advisor. We bill advisory fees weekly.
| F-17 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Investment and Margin Brokerage Business
Alchemy Markets Ltd (Alchemy Malta) and Alchemy Prime Ltd (Alchemy UK) are providers of trading services and solutions specializing in over-the-counter (“OTC”) and exchange-traded markets for European markets. Malta Financial Services Authority (MFSA) regulates Alchemy Malta with authorized countries, including Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Liechtenstein, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden. The Financial Conduct Authority (FCA) regulates Alchemy UK in authorized countries, including England, Scotland, Wales, and Northern Ireland.
The Company operates its brokerage business in two segments: retail and institutional (“clients” or “customers”). Through its retail and institutional segment, the Company provides its customers (individuals) around the world with access to a diverse range of global financial markets, including spot forex, precious metals, spread bets, and contracts for difference (“CFDs”) on currencies, commodities, indices, individual equities, cryptocurrencies, bonds, and interest rate products, as well as OTC options. The FCA defines a retail customer as a client who is not a professional or an eligible counterparty. A professional client is an entity that must be authorized or regulated to operate in the financial markets. According to the MFSA, a retail client is a client who is not a professional client or an eligible counterparty. A professional client possesses the knowledge, experience, and expertise to assess risks and make informed investment decisions.
We recognize Brokerage (Trading) revenue through the principal model following the guidance outlined in ASC 606, Revenues from Contracts with Customers. The Company primarily generates revenue through market-making and trading execution services for its clients, known as Brokerage (Trading) Revenues. The Brokerage (Trading) revenue is the Company’s largest source of revenue. Brokerage (Trading) revenue comprises revenue from the retail OTC business and the advisory business. OTC trading includes forex trading (“forex”), precious metals trading, CFDs, and spread betting (in markets that do not prohibit such transactions), as well as other financial products.
We realize gains or losses when we liquidate customer transactions. We revalue unrealized gains or losses on trading positions at prevailing market rates at the date of the balance sheet. We include them in Receivables from brokers, Payables to customers, and Payables to brokers on the Consolidated Balance Sheets. We record changes in net unrealized gains or losses in Brokerage (Trading) revenue on the Consolidated Statements of Operations and Comprehensive (Loss)/Income. We record Brokerage (Trading) revenue on a trade date basis.
We also generate business through an agency model by earning commissions and spreads for executing customer trades. We book these revenues on a trade-date basis. The Company acts as an agent concerning clearing trades, but is the principal on fees paid to introducing brokers. The Company does not assume any market-making risk related to customer trades in this business.
Net interest revenue consists primarily of the revenue generated by the Company’s cash and customer cash held at banks, as well as funds on deposit as collateral with the Company’s liquidity providers, less interest paid to the Company’s customers.
We record interest revenue and interest expense when earned and incurred, respectively.
| F-18 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Concentrations of Credit Risk
Cash
Cash
and cash equivalents include cash on hand, bank deposits, and other short-term, highly liquid investments with a maturity of three months
or less. The Company maintains its cash balances at multiple financial institutions, both domestic and foreign. For US financial institutions,
the balances do not exceed Federal Deposit Insurance Corporation (FDIC) limits as of June 30, 2025. However, as of December 31, 2024,
the majority of the cash balance was held with non-FDIC financial institutions in Malta, the UK, and other countries. On June 30, 2025,
and December 31, 2024, the Company had $
Revenues
For
the six months ended June 30, 2025 and 2024, the Company generated $
Accounts Receivable
Accounts Receivable primarily represent the amount from four (4) technology customers. In some cases, customer receivables are due immediately upon demand; however, in most cases, the Company offers net 30 terms, where payment is due in full 30 days after the invoice date. The Company has based the allowance for doubtful accounts on its assessment of the collectability of customer accounts. The Company regularly reviews the allowance by considering historical experience, credit quality, the age of accounts receivable balances, and economic conditions that may affect a customer’s ability to pay, and the expected default frequency rates. Trade receivables are written off when they are considered uncollectible.
As
of June 30, 2025, and December 31, 2024, management determined that the allowance for doubtful accounts was $
Research and Development (R and D) Cost
The
Company acknowledges that future benefits from research and development (R and D) are uncertain; therefore, we cannot capitalize on R
and D expenditures. The GAAP accounting standards require us to expense all research and development expenditures as incurred. For the
Three Months ended June 30, 2025, and 2024, the Company incurred R and D costs of $
Legal Proceedings
The Company discloses a loss contingency if there is at least a reasonable possibility that a material loss has been incurred. The Company records its best estimate of loss related to pending legal proceedings when the loss is probable, and the amount can be reasonably estimated. The Company can reasonably estimate a range of losses with no best estimate in the range; the Company records the minimum estimated liability. As additional information becomes available, the Company assesses the potential liability related to pending legal proceedings, revises its estimates, and updates its disclosures accordingly. The Company’s legal costs associated with defending itself are recorded as expenses when incurred.
On December 23, 2023, the Company received legal correspondence and supporting documents addressed to APSI Holdings Limited (formerly Alchemy Prime Holdings Limited) and FDCTech, Inc. The nature of the legal claims or disputes has not been fully specified in the received correspondence. The Company is assessing the situation and will respond appropriately. While management cannot predict the outcome of these matters, any adverse resolution could potentially have a material impact on the Company’s business, financial condition, and results of operations. The Company intends to defend its interests vigorously and will provide further updates as material developments arise.
The Company is currently not involved in any other litigation.
| F-19 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Impairment of Long-Lived Assets
The
Company reviews long-lived assets for impairment in accordance with FASB ASC 360, Property, Plant, and Equipment. Under the standard,
long-lived assets are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may
not be recoverable. An impairment charge is recognized when the asset’s carrying value exceeds the fair value. There were
Provision for Income Taxes
The provision for income taxes is determined using the asset and liability method. This method calculates deferred tax assets and liabilities based on the temporary differences between the consolidated financial statement and income tax bases of assets and liabilities using the enacted tax rates applicable each year.
The Company utilizes a two-step approach to recognizing and measuring uncertain tax positions (“tax contingencies”). The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount, exceeding 50%, that is likely to be realized upon ultimate settlement. The Company considers various factors when evaluating and estimating its tax positions and benefits, which necessitate periodic adjustments that may not accurately predict actual outcomes. The Company includes interest and penalties related to tax contingencies in the provision for income taxes in the consolidated statements of its operations. The Company’s management does not expect the total amount of unrecognized tax benefits to change significantly in the next twelve (12) months.
| F-20 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Software Development Costs
According to ASC 985-20, Software development costs, including expenses incurred to develop software sold, leased, or otherwise marketed, are capitalized after establishing technological feasibility, if significant. The Company amortizes the capitalized software development costs using the straight-line method over the estimated useful life of the application software. By the end of February 2016, the Company completed the technical feasibility of the Condor FX Back Office, Condor Pro Multi-Asset Trading Platform Version, and Condor Pricing Engine. The Company established the technical feasibility of the Digital Assets Web Trader Platform in February 2018. The Company completed the technical feasibility of the Condor Investing and Trading App in January 2021.
The
Company estimates the useful life of the software to be three (
The Company is developing the Condor Investing and Trading App. The Company is currently capitalizing on the costs associated with the development. The R and D costs in the period ending September 30, 2022, were incurred in evaluating the technological feasibility of the Robo Advice Platform. The R and D costs in the period ending December 31, 2022, were incurred while evaluating the technological feasibility of the Condor Investing and Trading App. There were no R and D costs for the three months ending June 30, 2025, and 2024.
The Company capitalizes major costs incurred during the application development stage for internal-use software.
Convertible Debentures
The cash conversion guidance in ASC 470-20, Debt with Conversion and Other Options, is considered when evaluating the accounting for convertible debt instruments, including certain convertible preferred stock classified as a liability, to determine whether the conversion feature should be recognized as a separate component of equity. The cash conversion guidance applies to all convertible debt instruments that, upon conversion, may be settled entirely or partially in cash or other assets where the conversion option is not bifurcated and separately accounted for pursuant to ASC 815.
If the conversion features of conventional convertible debt provide a conversion rate below market value, this feature is characterized as a beneficial conversion feature (“BCF”). The Company records BCF as a debt discount in accordance with ASC Topic 470-20, Debt with Conversion and Other Options. In such circumstances, the convertible debt is recorded net of the discount related to the Black-Scholes formula. The Company amortizes the discount to interest expense over the life of the debt using the effective interest method.
| F-21 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Foreign Currency Translation and Re-measurement
The Company translates its foreign operations into US dollars in accordance with ASC 830, “Foreign Currency Matters.” Gains or losses resulting from translating the foreign currency financial statements are accumulated as a separate component of accumulated other comprehensive income (“AOCI”) in the Company’s stockholders’ equity and noncontrolling interests. Transaction gains and losses resulting from exchange rate changes on transactions denominated in currencies other than the functional currency of the applicable subsidiary are included in the Consolidated Statements of Income, within “Other (income) expense, net”, in the year in which the change occurs.
We have translated the local currency of ADS and AML in the Australian Dollar (AUD), Euro Dollar (EUR), and British Pound (GBP), respectively, into US$1.00 at the following exchange rates for the respective dates:
The exchange rate at the reporting end date:
| June 30, 2025 | December 31, 2024 | |||||||
| USD: AUD | $ | $ | ||||||
| USD: EUR | $ | |||||||
| USD: GBP | $ | |||||||
Average exchange rate for the period:
Average exchange rate for the period:
| Q1 2025 | Q2 2025 | |||||||
| USD: AUD | $ | |||||||
| USD:EUR | $ | |||||||
| USD: GBP | $ | |||||||
ADS’ functional currency is AUD, and the reporting currency is the US dollar. AML’s functional currency is the EUR, and its reporting currency is the US dollar. APL’s functional currency is GBP, and its reporting currency is US dollars.
The Company translates its records into USD as follows:
| ● | Assets and liabilities at the rate of exchange in effect at the balance sheet date | |
| ● | Equities at the historical rate | |
| ● | Revenue and expense items at the average rate of exchange prevailing during the period |
| F-22 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Fair Value
The Company uses current market values to recognize certain assets and liabilities at a fair value. The fair value is the estimated price at which the Company can sell the asset or settle a liability in an orderly transaction to a third party under current market conditions. The Company uses the following methods and valuation techniques for deriving fair values:
Market Approach – The market approach uses the prices associated with actual market transactions for similar or identical assets and liabilities to derive a fair value.
Income Approach – The income approach utilizes estimated future cash flows or earnings, adjusted by a discount rate that reflects the time value of money and the risk of not achieving the cash flows, to derive a discounted present value.
Cost Approach – The cost approach uses the estimated cost to replace an asset, adjusted for the obsolescence of the existing asset.
The Company ranks the fair value hierarchy of information sources from Level 1 (the best) to Level 3 (the worst). The Company uses these three levels to select inputs for valuation techniques:
| Level I | Level 2 | Level 3 | ||
| Level 1 is a quoted price for an identical item in an active market on the measurement date. Level 1 is the most reliable evidence of fair value and is used whenever this information is available. | Level 2 is directly or indirectly observable inputs other than quoted prices. An example of a Level 2 input is a valuation multiple for a business unit, based on the sales, EBITDA, or net income of comparable companies. | Level 3 is an unobservable input. It may include the company’s data, adjusted for other reasonably available information. Examples of a Level 3 input are an internally generated financial forecast. |
The Company follows ASC 260, Earnings Per Share, to account for earnings per share. Basic earnings per share (“EPS”) calculations are determined by dividing net loss by the weighted average number of shares of common stock outstanding during the year. Diluted earnings per share calculations are determined by dividing net income by the weighted average number of common shares and dilutive common share equivalents outstanding. As of June 30, 2025, and 2024, the Company had weighted and basic and dilutive shares issued and outstanding.
During the period ended June 30, 2025, common stock equivalents were dilutive due to net income. Hence, they were considered in the computation.
During the period ended June 30, 2024, common stock equivalents were dilutive due to net income. Hence, they were considered in the computation.
Reclassifications
We have reclassified certain amounts from the prior period to conform to the current year’s presentation. None of these classifications impacted reported operating or net loss for any presented period.
| F-23 |
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Recent Accounting Pronouncements
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, including most industry-specific requirements. ASU 2014-09 establishes a five-step revenue recognition process; an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. ASU 2014-09 also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from customers’ contracts. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of ASU 2014-09 by one (1) year. The Company adopted ASC 606 using the modified retrospective method, applying it to all contracts not completed as of January 1, 2019. The Company presents results for reporting periods beginning after January 1, 2019, under ASC 606, while prior period amounts are reported in accordance with legacy GAAP. Refer to Note 2, Revenue from Major Contracts with Customers, for further discussion on the Company’s accounting policies for revenue sources within the scope of ASC 606.
NOTE 3. MANAGEMENT’S PLANS
The
Company has prepared consolidated financial statements on a going concern basis, which assumes the realization of assets and the settlement
of liabilities and commitments in the ordinary course of business. At June 30, 2025, and December 31, 2024, the accumulated deficit was
$
Since
its inception, the Company has sustained recurring losses and negative cash flows from operations. During the six months ended June 30,
2025, and 2024, the Company incurred net loss of $
As
of June 30, 2025, the Company had a cash balance of $
While the Company has adequate liquidity to sustain its existing business activities, its strategic growth initiatives, particularly in the development of financial technologies, may require additional capital investment. To accelerate expansion and enhance its technological offerings, the Company may seek external financing through private equity, public markets, or credit facilities. However, the availability and terms of such financing cannot be guaranteed.
Management remains focused on strengthening the company’s financial position by expanding its global customer base, increasing revenue from its diversified portfolio of technological solutions, and working toward achieving a positive cash flow. To support long-term growth, the Company also plans to invest in long-lived assets that will drive economic benefits beyond the fiscal year 2025. Additionally, Management may explore revolving loan agreements with financial institutions or other funding options, as needed, to complement its organic growth strategy.
The Management intends to continue its efforts to enhance its revenue from its diversified portfolio of technological solutions, become cash flow positive, and raise funds through private placement offerings and debt financing. See Note 8 for Notes Payable. As the Company increases its global customer base, it intends to acquire long-lived assets that will provide future economic benefits beyond fiscal year 2025.
| F-24 |
NOTE 4. CAPITALIZED SOFTWARE COSTS
During
the three months ended June 30, 2025, and 2024, the estimated remaining weighted-average useful life of the Company’s capitalized
software was three (
At
June 30, 2025, and December 31, 2024, the unamortized balance of capitalized software for the Company, including software of subsidiaries,
was $
The Company has estimated aggregate amortization expenses for each of the five succeeding fiscal years, based on the estimated lifespan of the software asset of three years.
NOTE 5. RELATED PARTY TRANSACTIONS
Between
February 22, 2016, and April 24, 2017, the Company borrowed $
Between
March 15 and 21, 2017, subject to the terms and conditions of the Stock Purchase Agreement, the Company issued shares to Susan
Eaglstein and shares to Brent Eaglstein at $ per share, a cumulative cash amount of $
On
February 22, 2021, the Company entered into an Assignment of Debt Agreement (the “Agreement”) with FRH and FRH Group Corporation.
The Company eliminated all four FRH Group convertible notes, including interest, of $
| F-25 |
NOTE 5. RELATED PARTY TRANSACTIONS (continued)
In
September 2022, the Company issued common stock for cash consideration of $
In
January 2023, the Company issued common stock for a cash consideration of $
In January 2023, Eaglstein and Firoz transferred and shares to Kundnani, the Company’s director. As of September 30, 2023, the Company had preferred shares issued and outstanding, with Eaglstein, Kundnani, and Hong holding , , and shares, respectively.
On
September 30, 2023, the Company signed a definitive agreement with Alchemy Group, pursuant to which the Company acquired
On
November 30, 2023, the Company purchased shares of Alchemy Markets Holdings Ltd. (Alchemy BVI) from Alchemy Prime Holdings Ltd. (APHL)
in exchange for shares of Series B Preferred Stock. The Company did not exchange cash in the transaction. The Company has issued
the Series B Preferred stock to APHL. Kundnani, a related party, is the sole shareholder of APHL, a related party. As a result, the Company
now owns one hundred percent (
On
November 30, 2023, the Company purchased one hundred percent (
Kundnani,
a related party, purchased Series A Preferred stock of FDCTech for $
Kundnani,
a related party, purchased shares of the Company’s common stock for $
In
December 2023, Susan Eaglstein, mother of Mitchel Eaglstein, the Company’s CEO, provided $
On
January 4, 2024, the Company issued
On January 4, 2024, the Company issued Series B preferred stock to Mitchell M. Eaglstein, CEO and Director, for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Imran Firoz, CFO and Director, for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to FRH Group for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to William B. Barnett, Esq., for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Susan E. Eaglstein for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Gope S. Kundnani for services valued at $ per share.
On January 30, 2024, the Company’s board of directors adopted and approved the rescission and cancellation of (i) shares of Series A Preferred Stock of the Company issued to Mitchell M. Eaglstein and (ii) shares of Series A Preferred Stock of the Company issued to Felix R Hong.
On February 07, 2025, the Company issued Series B preferred stock to Nick G. Kundnani for services valued at $ per share.
| F-26 |
NOTE 6. LINE OF CREDIT
Since
June 2016, the Company has obtained an unsecured revolving line of credit of $
As
of June 30, 2025, the Company is in compliance with the credit line’s terms and conditions. As of June 30, 2025, and December 31,
2024, the outstanding balances were $
NOTE 7. NOTES PAYABLE
Cares Act – Paycheck Protection Program (PPP Note)
On
May 01, 2020, the Company received proceeds of Fifty-Thousand Six Hundred and Thirty-Two ($
SBA Loan
On
May 22, 2020, the Company received $
AJB Note
On
January 27, 2022, the Company signed a promissory note (‘AJB Note’) with AJB Capital Investments, LLC (‘AJB Capital’),
a Delaware limited liability company, for the principal amount of $
On December 27, 2023, the Company redeemed the Warrants on the following terms:
| i) | The
Company shall pay $ |
| ii) | The
Company shall pay $ |
the Company issued to the Purchaser restricted shares of the Company’s Common Stock (the “Shares”) on December 27, 2023 (the “Share Issuance”).
Economic Injury Disaster Loan (EIDL)
The
Small Business Administration offers the Economic Injury Disaster Loan program. The CARES Act modified the program to offer an emergency
grant of up to $
| F-27 |
NOTE 8. COMMITMENTS AND CONTINGENCIES
Office Facility and Other Operating Leases
Irvine, California, USA (Company’s Headquarters)
Effective
October 29, 2019, to the present, the Company leased office space at 200 Spectrum Center Drive, Suite 300, Irvine, CA 92618. As per the
Commitment Term of the lease (“Agreement”), this Agreement shall continue on a month-to-month basis (any term after the Commitment
Term, also known as “Renewal Term”). The Commitment Term and all subsequent Renewal Terms shall constitute the “Term.”
The Company may terminate this Agreement by delivering to the lessor Form (“Exit Form”) at least one (1) whole calendar month
before the month in which the Company intends to terminate this Agreement (“Termination Effective Month”). The Company is
entitled to use the office and conference space if needed. The new rent payment or membership fee for the Irvine Office is $
Brisbane, Australia (ADS Office)
Effective
January 1, 2024, to the present, the Company has leased office space at Level 38, 71 Eagle Street, Brisbane City, QLD 4000, Australia.
This lease will continue on a month-to-month basis. ADS may terminate this Agreement by delivering to the lessor at least one (1) whole
calendar month before the month in which ADS intends to terminate the lease. ADS is entitled to use the office and conference space if
needed. The new rent payment or membership fee for the ADS Office is approximately $
Limassol, Cyprus Lease (Company’s Executive Rental)
From
February 2019 to July 2023, the Company leased office space in Limassol District, Cyprus, from an unrelated party for a year. The office’s
monthly rent payment is $
Limassol, Cyprus Lease, Europe (ATECH Office)
Effective
August 26, 2024, ATECH has entered into a Sublease Agreement for office premises located on the ground floor at 10A-10C Eleftheriou Venizelou
Street, Limassol, Cyprus. The sublease is between Aldeon Property Partners Ltd (the “Sublessor”) and AlchemyTech Ltd (the
“Sublessee”), with FDCTech, Inc. acting as the Guarantor. The leased premises are designated strictly for office use, and
any other usage is explicitly prohibited under the terms of the agreement.
St. Julian, Malta (AML Office)
Effective
July 11, 2024, to the present, AML leased office space with Regus Malta at Portomaso Business Centre, Portomaso, St. Julian, PTM01, Malta.
As per the lease, this agreement shall continue on a month-to-month basis (any term after the term, also known as “Renewal Term”).
The term and all subsequent renewal terms shall constitute the “Term.” AML may terminate this agreement by delivering to
Regus Malta at least one (1) whole calendar month before the month in which AML intends to terminate this lease. AML is entitled to use
the office and conference space if needed. The rent payment or membership fee for the AML Office is €
| F-28 |
NOTE 8. COMMITMENTS AND CONTINGENCIES (continued)
Tel Aviv, Israel (AML Sales Office)
Effective
July 1, 2023, AML has entered into a service agreement with Mindspace Ltd. for the use of office space and related services at Menachem
Begin 11, Ramat Gan, Israel. The agreement provides access to designated office space, common areas, and various business services, including
internet connectivity, printing, and access to conference rooms. The agreement operates on a monthly, automatically renewing basis with
a total monthly fee of $
London, United Kingdom (APL Office)
Effective
December 20, 2024, APL entered into a lease agreement for office space located on the fifth floor at 142 Central Street, Clerkenwell,
London, EC1V BAR. The lease is held by Agop Tanielian and Hourig Mercedes Tanielian as landlords, and the Company, through its subsidiary
Alchemy Prime Limited, is the tenant. The lease has a fixed term of
Employment Agreement
Accrued Interest
At
June 30, 2025, and December 31, 2024, the cumulative accrued interest for SBA and other loans defined as an accrued non-current was $
Pending Litigation
On December 23, 2023, the Company received legal correspondence and supporting documents addressed to APSI Holdings Limited (formerly Alchemy Prime Holdings Limited) and FDCTech, Inc. The nature of the legal claims or disputes has not been fully specified in the received correspondence. The Company is assessing the situation and will respond appropriately. While management cannot predict the outcome of these matters, any adverse resolution could potentially have a material impact on the Company’s business, financial condition, and results of operations. The Company intends to defend its interests vigorously and will provide further updates as material developments arise.
Management is unaware of any other actions, suits, investigations, or proceedings (public or private) pending or threatened against or affecting any of the assets or any affiliate of the Company.
Tax Compliance Matters
From its inception to the present, the Company’s officers have been paid as independent contractors. As of June 30, 2025, the Company believes its payroll tax liabilities are not yet estimated. The Company’s federal taxes are acceptable to the Internal Revenue Service.
| F-29 |
NOTE 9. STOCKHOLDERS’ EQUITY (DEFICIT)
Authorized Shares
On
February 12, 2021, the Company filed the Certificate of Amendment with the Secretary of State of Delaware to change the authorized shares.
As per the Amendment, the Company shall have the authority to issue
On February 17, 2022, the Company filed the Information Statement pursuant to Section 14C of the Securities Exchange Act of 1934 and informed all holders of record on February 10, 2022 (the “Record Date”) of the common stock, $ par value per share (the “Common Stock”), of the Company, in connection with the approval of the following actions taken by the Board of Directors of the Company (the “Board”) and by written consent of the holders of a majority of the voting power of Company’s issued and outstanding capital stock (the “Approving Stockholders”):
| 1. | To amend our certificate of incorporation, as amended (the “Certificate”), to increase the number of authorized shares of common stock from to (the “Authorized Share Increase” and together with the 2022 Equity Plan, the “Corporate Action”), and |
| 2. | To approve the Company’s 2022 Equity Plan (the “2022 Equity Plan”) |
On
February 10, 2022, the Board approved the Corporate Actions. To implement the actions, the Company opted to obtain written consent from
a majority of its voting power, as per Sections 228 and 242 of the Delaware General Corporation Law (DGCL) and our bylaws. On February
10, 2022, the Approving Stockholders gave their approval. On February 10, 2022, the Approving Stockholders approved the Corporate Actions
by written consent. The Approving Stockholders (common stock only) own shares, representing
As of December 31, 2022, the Company had no equity compensation plans.
On
February 21, 2024, our Board unanimously approved the Corporate Actions. In order to eliminate the costs and management time involved
in holding a special meeting and in order to effect the actions disclosed herein as quickly as possible in order to accomplish the purposes
of our Company, we chose to obtain the written consent of a majority of the Company’s voting power to approve the actions described
in this Information Statement in accordance with Sections 228 and 242 of the Delaware General Corporation Law (the “DGCL”)
and our bylaws. On February 21, 2024, the Approving Stockholders approved, by written consent, the Corporate Actions. The Approving Stockholders
(common stock only) own shares, representing
On March 12, 2024, the Company filed the Information Statement pursuant to Section 14C of the Securities Exchange Act of 1934 and informed all holders of record on February 21, 2024 (the “Record Date”) of the common stock, $ par value per share (the “Common Stock”), of the Company, in connection with the approval of the following actions taken by the Board of Directors of the Company (the “Board”) and by written consent of the holders of a majority of the voting power of Company’s issued and outstanding capital stock (the “Approving Stockholders”):
| 1. | To amend our certificate of incorporation, as amended (the “Certificate”), to increase the number of authorized shares of common stock from to (the “Authorized Share Increase”), and | |
| 2. | To
authorize our Board of Directors, in its discretion, to amend our articles of incorporation not later than June 30, 2024, to effect
a Reverse Stock Split of all outstanding shares of our common stock in a ratio of | |
| 3. | To approve the Company’s 2023 Stock Incentive Plan (the “2023 Stock Incentive Plan”). |
As both the Board and the majority of shareholders have voted in favor, all necessary steps to authorize the Corporate Actions have been completed. We expect that each of the Corporate Actions will become effective on or about the 20th calendar day after the date on which this Information Statement and the accompanying notice are mailed to our stockholders. Our Board may abandon either or both Corporate Actions for any reason before their effective date.
As of December 31, 2024, and 2023, the Company’s authorized capital stock consists of shares of preferred stock, a par value of $ per share, and shares of common stock, a par value of $ per share.
As of June 30, 2025, and December 31, 2024, the Company had and common shares issued and outstanding, respectively.
As of June 30, 2025, and December 31, 2024, the Company had and Series A Preferred stock issued and outstanding.
As of June 30, 2025, and December 31, 2024, the Company had and Series B Preferred Stock issued and outstanding.
| F-30 |
NOTE 9. STOCKHOLDERS’ EQUITY (DEFICIT) (continued)
Series A Preferred Stock
The percentages below are calculated based on 4,500,000 shares of our Series A Preferred Stock issued and outstanding for the fiscal year ending December 31, 2024.
| Name and Address(1) | Title of Class (4) | Number of Shares Beneficially Owned | Percent of Class | |||||||
| Mitch Eaglstein | % | |||||||||
| Gope S. Kundnani (5) | % | |||||||||
| Officers and Directors as a group (2 persons) | % | |||||||||
| (4) | ||
| (5) |
On
November 30, 2023, the Company issued Series A Preferred Stock to Kundnani, valued at $
On January 30, 2024, the Company’s board of directors adopted and approved the rescission and cancellation of (i) shares of Series A Preferred Stock of the Company issued to Mitchell M. Eaglstein and (ii) shares of Series A Preferred Stock of the Company issued to Felix R Hong.
Series B Preferred Stock
The percentages below are calculated based on 2,371,844 shares of our Series B Preferred Stock issued and outstanding for the fiscal year ending June 30, 2025.
| Name and Address(1) | Title of Class (6) | Number of Shares Beneficially Owned | Percent of Class | |||||||
| Alchemy Prime Holdings Ltd. | % | |||||||||
| Gope S. Kundnani | % | |||||||||
| Mitchell M. Eaglstein | % | |||||||||
| Imran Firoz | % | |||||||||
| FRH Group | % | |||||||||
| William B. Barnett | % | |||||||||
| Susan E. Eaglstein | % | |||||||||
| Nick G. Kundnani | % | |||||||||
| Officers and Directors as a group (3 persons) | % | |||||||||
| (6) |
| F-31 |
NOTE 9. STOCKHOLDERS’ EQUITY (DEFICIT) (continued)
On
November 30, 2023, the Company issued Series B Preferred Stock to Kundnani, valued at $
On January 4, 2024, the Company issued Series B preferred stock to Mitchell M. Eaglstein, CEO and Director, for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Imran Firoz, CFO and Director, for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to FRH Group for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to William B. Barnett, Esq., for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Susan E. Eaglstein for services valued at $ per share.
On January 4, 2024, the Company issued Series B preferred stock to Gope S. Kundnani for services valued at $ per share.
On January 30, 2024, the Company issued Series B preferred stock to Gope S. Kundnani for cash valued at $ per share.
On February 07, 2025, the Company issued Series B preferred stock to Nick G. Kundnani for cash valued at $ per share.
Common Stock
On January 21, 2016, the Company collectively issued and common shares at par value to Mitchell Eaglstein and Imran Firoz, respectively, as the founders, in consideration of services rendered to the Company.
On December 12, 2016, the Company issued common shares to the remaining two (2) founding members.
On
March 15, 2017, the Company issued restricted common shares for platform development valued at $
On
March 15, 2017, the Company issued restricted common shares for professional services to three (3) individuals valued at $
On
March 17, 2017, subject to the terms and conditions of the Stock Purchase Agreement, the Company issued shares to Susan Eaglstein
for a cash amount of $
On
March 21, 2017, subject to the terms and conditions of the Stock Purchase Agreement, the Company issued shares to Bret Eaglstein
for a cash amount of $
Ms. Eaglstein and Mr. Eaglstein are the mother and brother of Mitchell Eaglstein, the CEO and director of the Company.
From July 1, 2017, to October 03, 2017, the Company has issued units for a cash amount of $ under its offering Memorandum, where the unit consists of one (1) share of common stock and one Class A warrant (See Note 11).
On
October 31, 2017, the Company issued restricted common shares to management consultants valued at $
On
January 15, 2019, the Company issued restricted common shares for professional services to eight (8) consultants valued at $
From
January 29, 2019, to February 15, 2019, the Company issued registered shares under the Securities Act of 1933 for a cash amount
of $
| F-32 |
NOTE 9. STOCKHOLDERS’ EQUITY (DEFICIT) (continued)
Effective
June 3, 2020, the Company issued shares of common stock to Benchmark Investments, Inc. (“Broker-Dealer” or “Kingswood
Capital Markets”) at $ per share for a total value of $
On
October 1, 2020, the Company issued restricted common shares to a digital marketing consultant valued at $
On
January 31, 2021, the Company issued restricted common shares in exchange for professional services to two consultants, valued
at $
On
February 22, 2021, the Company entered into an Assignment of Debt Agreement (the “Agreement”) with FRH and FRH Group Corporation.
The Company eliminated all four FRH Group convertible notes, including interest, of $
On
May 19, 2021, the Company issued restricted common shares in exchange for professional services to a consultant, valued at
$
On
June 2, 2021, the Company issued restricted common shares under the Genesis Agreement to a consultant, valued at $
On
June 15, 2021, the Company issued restricted common shares to a board member for services to a consultant valued at $
On
July 6, 2021, the Company issued restricted common shares to a board member in exchange for services rendered by a consultant,
valued at $
On
July 20, 2021, the Company issued restricted common shares in exchange for professional services to a consultant, valued at $
On
October 04, 2021, the Company filed a prospectus related to the resale of shares to White Lion and AD Securities America, LLC. The Company
issued shares to AD Securities America, LLC for $
On
October 5, 2021, the Company issued restricted common shares in exchange for professional services to a consultant, valued
at $
In
November 2021, the Company issued registered shares to White Lion for a gross cash amount of $
On
December 22, 2021, the Company issued restricted common shares to ADFP to acquire a
In
December 2021, the Company issued restricted common shares to two board members, a consultant, and two officers for services
and software development valued at $
On
January 4, 2022, the Company issued restricted common shares in exchange for professional services to a consultant, valued
at $
| F-33 |
NOTE 9. STOCKHOLDERS’ EQUITY (DEFICIT) (continued)
From
January 4, 2022, to February 10, 2022, the Company issued registered shares to White Lion for a gross cash amount of $
On
January 27, 2022, the Company signed a promissory note (‘AJB Note’) with AJB Capital Investments, LLC (‘AJB Capital’).
The Company issued common stock valued at $
On
July 31, 2022, the Company issued restricted common shares in exchange for professional services to a consultant, valued at $
On
September 30, 2022, the Company issued restricted common shares for cash valued at $
On
September 30, 2022, the Company issued restricted common shares to Gope S. Kundnani for services valued at $
On
December 12, 2022, the Company issued restricted common shares to two officers for services valued at $
On
December 15, 2022, the Company issued restricted common shares to two officers for services valued at $
On
January 25, 2023, the Company issued restricted common shares to AJB as compensation for consideration shares related to the
AJB Note, valued at $
On
January 25, 2023, the Company issued restricted common shares for cash valued at $
On
March 28, 2023, the Company issued restricted common shares for cash valued at $
On
November 30, 2023, the Company issued restricted shares for cash valued at $
On
December 27, 2023, the Company issued restricted common shares to AJB in exchange for redeeming warrants valued at $
On
May 9, 2024, the Company issued shares for a cash value of $
On
January 1, 2025, the Company issued shares to various employees of its subsidiaries valued at
| F-34 |
NOTE 10. WARRANTS
The
Company issued common stock valued at $
NOTE 11. COMPREHENSIVE INCOME
The Company’s other comprehensive income (OCI) comprises foreign currency translation adjustments from subsidiaries that do not use the U.S. dollar as their functional currency.
The following table shows the changes in AOCI by component for the three months ending June 30, 2025, and 2024:
| Accumulated Comprehensive Income: | Cumulative Foreign Currency Translation | |||
| Balance as of March 31, 2024 | $ | ( | ) | |
| Other comprehensive income/(loss), ADS | ||||
| Other comprehensive income/(loss), AML | ( | ) | ||
| Other comprehensive income/(loss), APL | ||||
| Other comprehensive income/(loss), ATECH | ||||
| Total other comprehensive income/(loss) | ( | ) | ||
| Balance as of June 30, 2024 | $ | ( | ) | |
| Balance as of March 31, 2025 | $ | |||
| Other comprehensive income/(loss), ADS | ( | ) | ||
| Other comprehensive income/(loss), AML | ( | ) | ||
| Other comprehensive income/(loss), APL | ||||
| Other comprehensive income/(loss), ATECH | ||||
| Total other comprehensive income/(loss) | ( | ) | ||
| Balance as of June 30, 2024 | $ | ( | ) | |
The following table shows the changes in AOCI by component for the six months ending June 30, 2025, and 2024:
| Accumulated Comprehensive Income: | Cumulative Foreign Currency Translation | |||
| Balance as of December 31, 2023 | $ | |||
| Other comprehensive income/(loss), ADS | ||||
| Other comprehensive income/(loss), AML | ( | ) | ||
| Other comprehensive income/(loss), APL | ( | ) | ||
| Other comprehensive income/(loss), ATECH | ||||
| Total other comprehensive income/(loss) | ( | ) | ||
| Balance as of June 30, 2024 | $ | ( | ) | |
| Balance as of December 31, 2024 | $ | |||
| Other comprehensive income/(loss), ADS | ( | ) | ||
| Other comprehensive income/(loss), AML | ( | ) | ||
| Other comprehensive income/(loss), APL | ||||
| Other comprehensive income/(loss), ATECH | ||||
| Total other comprehensive income/(loss) | ( | ) | ||
| Balance as of June 30, 2025 | $ | ( | ) | |
NOTE 12. OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements affecting our liquidity, capital resources, market risk support, credit risk support, or other benefits.
NOTE 13. SUBSEQUENT EVENTS
The Company has evaluated subsequent events through the filing of this Form 10-Q and determined that no events would require adjustments to our disclosures in the consolidated financial statements.
| F-35 |
| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
This Quarterly Report Form 10-Q contains forward-looking statements. Our actual results could differ materially from those set forth as a result of general economic conditions and changes in the assumptions used in making such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “predict,” “potential,” “continue,” “expect,” “anticipate,” “future,” “intend,” “plan,” “believe,” “estimate,” “forecast” and similar expressions (or the negative of such expressions). Forward looking statements include, but are not limited to, financial and operational information, the volatility of our stock price, current competitive conditions and the impact of U.S. tariffs, trade barriers and restrictions . The following discussion and analysis of our financial condition and results of operations should be read together with the unaudited condensed financial statements and accompanying notes and the other financial information appearing elsewhere in this report. The analysis set forth below is provided pursuant to applicable Securities and Exchange Commission regulations and is not intended to serve as a basis for projections of future events.
The Company is building a diversified global financial services company driven by proprietary Condor trading technologies, complementary regulatory licenses, and a proven executive team. The Company plans to acquire, integrate, transform, and scale legacy financial service companies. The Company believes its proprietary technology and software development capabilities allow legacy financial services companies immediate exposure to forex, stocks, ETFs, commodities, digital assets, social/copy trading, and other high-growth fintech markets.
From December 2021 onwards, the Company has been growing through its acquisition strategy, specializing in the purchase and integration of small to mid-sized legacy financial services companies. The Company intends to build a diversified global software-driven financial services company. The Company continues to acquire, integrate, transform, and scale legacy financial service companies. The Company replaces conventional legacy software infrastructure of target companies with its proprietary, regulatory-grade Condor trading technologies, aiming to enhance the end-user experience, increase client retention, and achieve cost synergies.
The Company is a financial technology company specializing in developing and delivering innovative software solutions and business services to the over-the-counter (OTC) brokerage and financial services industries. The company provides a range of proprietary and third-party technology solutions, including its flagship Condor Trading Technology, which supports multi-asset trading, risk management, and pricing for forex, equities, commodities, and digital assets.
FDCTech follows a strategic growth model centered on acquiring, integrating, and scaling legacy financial services firms. Through its recent acquisitions, the company has expanded its global footprint in wealth management, brokerage, and financial advisory services.
Key subsidiaries include:
| ● | AD Advisory Services Pty Ltd. (ADS) – An Australian-regulated wealth management firm managing over $530 million in client assets with a network of 28 financial advisors. | |
| ● | Alchemy Markets Ltd. (AML) – A Malta-based investment firm regulated by the Malta Financial Services Authority (MFSA), offering trading services across multiple asset classes in various European markets. | |
| ● | Alchemy Prime Limited (APL) – A UK-based investment firm regulated by the Financial Conduct Authority (FCA), providing investment advisory and brokerage services. | |
| ● | AlchemyTech Ltd. (ATECH) – A Cyprus-based technology, sales, and marketing service provider supporting the Company’s subsidiaries and affiliated companies. |
FDCTech continues to drive innovation by developing next-generation trading platforms, such as the Condor Pro Multi-Asset Trading Platform, and expanding its market reach. The company remains committed to leveraging proprietary technology and regulatory expertise to enhance operational efficiencies and client engagement across global financial markets.
Currently, we have three primary business segments: (1) Investment and Brokerage, (2) Wealth Management, and (3) Technology and Software Development.
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Investment and Brokerage (Europe and UK)
AML is authorized to deal with its account (market maker) as a Category 3 licensed entity by the Malta Financial Services Authority (MFSA), receive and transmit orders for retail and professional clients, hold and control clients’ money and assets. AML trading platform services in the English, French, German, Italian, and Arabic-speaking markets, whereby customers can trade in currency, commodity, equity, and digital assets-linked derivatives in real time. AML is authorized countries to do business include Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Liechtenstein, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden. In May 2024, Mitchell M. Eaglstein, CEO, was appointed as the CEO and COO of Alchemy Markets Ltd. (AML) to oversee operations in Malta.
APL is an investment firm regulated by the Financial Conduct Authority (FCA). It provides investment advice, acts as an agent and principal, and safeguards and administers assets in forex, equity, commodities, spread bets, and other financial assets. It is authorized to do business in several countries, including England, Scotland, Wales, and Northern Ireland.
Margin Brokerage (Mauritius) – Prime Intermarket Group Eurasia
On May 27, 2025, FDCTech, Inc. (the “Company”) formed a new wholly owned subsidiary, Prime Intermarket Group Eurasia (“PIG Eurasia”), incorporated in the Republic of Mauritius. PIG Eurasia is structured as a Private Company limited by shares and is regulated by the Financial Services Commission of Mauritius under the Companies Act. The subsidiary will operate under a SEC-2.1B Investment Dealer License (Full-Service Dealer, excluding Underwriting). At present, there PIG Eurasia has no operations.
Investment and Brokerage (Trading Revenues) & Gross Margins*:
Six months ended June 30, 2025 (Unaudited) | Six months ended June 30, 2024 (Unaudited) | |||||||
| Revenue | $ | 6,216,255 | 8,698,221 | |||||
| Cost of sales | $ | 2,902,716 | 4,972,853 | |||||
| Gross Profit (loss) | $ | 3,313,539 | 3,725,368 | |||||
| Gross Margins | 53.30 | % | 42.83 | % | ||||
Wealth Management Business
On December 22, 2021, the Company entered into a Share Exchange Agreement (the “Agreement”) with AD Financial Services Pty Ltd, ACN 628 331 117, of Level 38, 71 Eagle Street, Brisbane, Queensland, Australia 4000 (“ADFP” or “Target”). According to the Agreement, the Company acquired 51% of ADFP’s issued and outstanding shares of capital stock in exchange for 45,000,000 (the “Consideration”) newly issued “restricted” common shares. The operating and licensed entity of ADFP is AD Advisory Services Pty Ltd. ADFP owns one hundred percent (100%) equity interest in AD Advisory Services Pty Ltd (“ADS”). As a result, the Company is a 51% owner of ADS. Our wealth management business, AD Advisory Services (ADS), is subject to enhanced regulatory scrutiny and is regulated by multiple Australian regulators. The Australian Securities and Investments Commission (ASIC) administers a licensing regime for financial services providers. ADS holds an Australian Financial Services License (AFSL) and meets various compliance, conduct, and disclosure obligations.
AD Advisory Services Pty Ltd. (ADS) is an Australian-regulated wealth management company with 28 advisors and $530+ million in funds under advice. ADS provides licensing solutions for financial advisers & accountants in Australia. ADS offers financial planners various licensing, compliance, and education solutions to meet the specific needs of their practice.
Wealth Management Revenue & Gross Margins:
Six months ended June 30, 2025 (Unaudited) | Six months ended June 30, 2024 (Unaudited) | |||||||
| Revenue | $ | 3,188,522 | 3,252,876 | |||||
| Cost of sales | $ | 2,833,598 | 2,933,363 | |||||
| Gross profit (loss) | $ | 354,924 | 319,513 | |||||
| Gross margins | 11.13 | % | 9.82 | % | ||||
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Technology & Software Development Business
For the three months ended June 30, 2025, and 2024, the Company had seven and nine licensing agreements, respectively, for its Condor Pro Multi-Asset Trading Platform. The Company continuously negotiates additional licensing agreements with several retail online brokers to use the Condor Pro Multi-Asset Trading Platform. Condor Pro Multi-Asset Trading Platform is available in desktop, web, and mobile versions.
The Company is developing the Condor Investing & Trading App, a simplified trading platform designed for traders with varying levels of experience in trading stocks, ETFs, and other financial markets, accessible from their mobile phones. The Company expects to commercialize the Condor Investing & Trading App by the end of the 2025 fiscal year.
IT, Sales & Marketing Service Provider (Cyprus)
On March 19, 2024, the Company established Alchemytech Ltd. (ATECH), a Cypriot company. ATECH provides the Company’s subsidiaries and affiliate companies with information technology, sales, and marketing services. The Company has mandated ATECH to develop, market, and distribute the Condor Pro Multi-Asset Trading Platform to qualified market participants, including brokers, professional traders, hedge funds, and other financial institutions.
Technology & Software Development Revenue & Gross Margins:
Six months ended June 30, 2025 (Unaudited) | Six months ended June 30, 2024 (Unaudited) | |||||||
| Revenue | $ | 2,007,574 | 554,759 | |||||
| Cost of sales | $ | 495,168 | 26,167 | |||||
| Gross profit (loss) | $ | 1,512,406 | 528,592 | |||||
| Gross Margins | 75.34 | % | 95.28 | % | ||||
CIM Acquisition Termination
On July 31, 2023, the Company sent the notice of termination of the purchase agreement to CIM Securities, as future events may result in a change of ownership in the CMA application. The Company believed that this would cause further delays in the approval process. Our board has mandated that the management team focus on expanding and developing our core non-US foreign exchange business to maximize shareholder value.
Bank Acquisition Termination
In April 2024, the Company terminated the letter of intent to acquire a community bank in Iowa. As part of the termination, the Company paid the community bank a sum of $100,000 in six equal installments of $15,000, plus one final payment of $10,000, from April 2024 to November 2024.
Consolidated Financial Summary
The Company has prepared consolidated financial statements on a going concern basis, which assumes the realization of assets and the settlement of liabilities and commitments in the ordinary course of business. For the three months ended June 30, 2025, and 2024, the Company generated $11,412,351 and $12,505,856 in revenues.
At June 30, 2025, the Company had a cash balance of $26,195,817 and an accumulated deficit of $2,916,646.
At December 31, 2024, the Company had a cash balance of $24,781,389 and an accumulated deficit of $2,563,620.
Financial Condition as of June 30, 2025
On June 30, 2025, the accumulated deficit, cash balance, and working capital surplus were $2,916,646, $26,195,817, and $12,202,035, respectively.
Financial Condition at December 31, 2024
As of December 31, 2024, the accumulated deficit, cash balance, and working capital surplus were $2,563,620, $24,781,389, and $9,097,591, respectively.
Although we believe our cash balance is sufficient to fund our operations and growth, the Company plans to raise additional capital, as disclosed in Subsequent Events. The Company intends to continue its efforts to enhance its revenue from its diversified portfolio of technological solutions, become cash flow positive, and raise funds through private placement offerings and debt financing. As the Company increases its global customer base, it intends to acquire long-lived assets that will provide future economic benefits beyond fiscal 2025.
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RESULTS OF OPERATIONS
Three Months Ended June 30, 2025, compared with Three Months Ended June 30, 2024
The consolidated revenues for the three months ended June 30, 2025, and 2024 were $5,435,403 and $6,129,521, respectively. During the three months ended June 30, 2025, and 2024, the Company reported net loss of $423,797 and $1,045,275, respectively.
The total revenue breakdown for the three months ended June 30, 2025, and 2024 is below:
| Three Months Ended | June 30, 2025 | June 30, 2024 | ||||||
| Revenue Description | % of Total | % of Total | ||||||
| Technology Solutions | 21.96 | % | 4.88 | % | ||||
| Wealth Management | 30.42 | % | 28.38 | % | ||||
| Brokerage | 47.61 | % | 66.75 | % | ||||
| Total | 100.00 | % | 100.00 | % | ||||
During the three months ended June 30, 2025, and 2024, the Company incurred general and administrative costs (“G&A”) of $2,144,328 and $2,522,394 (excluding amortization expenses), respectively. The G&A costs were 39.45% and 41.15% of the revenue for the three months ended June 30, 2025, and 2024, respectively. Amortization expenses were $310,884 and $26,167 for the three months ended June 30, 2025, and 2024, respectively, included in the Cost of sales.
The rental expense was $61,150 and $11,106 for the three months ended June 30, 2025, and 2024, respectively.
The Company incurred $298,592 and $781,022 in sales, marketing, and advertising costs (“sales and marketing”) for the three months ended June 30, 2025, and 2024. The sales and marketing costs mainly included travel costs for tradeshows, customer meetings, online marketing on industry websites, press releases, and public relations activities. The sales, marketing, and advertising expenses represented 5.49% and 12.74% of the sales for the fiscal year ending June 30, 2025, and 2024, respectively.
Six Months Ended June 30, 2025, compared with Six Months Ended June 30, 2024
The consolidated revenues for the six months ended June 30, 2025, and 2024 were $11,412,351 and $12,505,856, respectively. During the three months ended June 30, 2025, and 2024, the Company reported net loss of $319,249 and $211,830, respectively.
The total revenue breakdown for the three months ended June 30, 2025, and 2024 is below:
| Six Months Ended | June 30, 2025 | June 30, 2024 | ||||||
| Revenue Description | % of Total | % of Total | ||||||
| Technology Solutions | 17.59 | % | 4.44 | % | ||||
| Wealth Management | 27.94 | % | 26.01 | % | ||||
| Brokerage | 54.47 | % | 69.55 | % | ||||
| Total | 100.00 | % | 100.00 | % | ||||
During the six months ended June 30, 2025, and 2024, the Company incurred general and administrative costs (“G&A”) of $4,284,598 and $4,821,528 (excluding amortization expenses), respectively. The increase in G&A for the six months ended June 30, 2024, is due to the inclusion of G&A costs of all subsidiaries. The G&A costs were 37.54% and 38.55% of the revenue for the six months ended June 30, 2025, and 2024, respectively. Amortization expenses were $495,168 and $26,167 for the six months ended June 30, 2025, and 2024, respectively, included in the Cost of sales.
The rental expense was $122,300 and $38,056 for the six months ended June 30, 2025, and 2024, respectively.
The Company incurred $574,796 and $827,947 in sales, marketing, and advertising costs (“sales and marketing”) for the six months ended June 30, 2025, and 2024. The sales and marketing costs mainly included travel costs for tradeshows, customer meetings, online marketing on industry websites, press releases, and public relations activities. The sales, marketing, and advertising expenses represented 5.04% and 6.62% of the sales for the fiscal year ending June 30, 2024, and 2023, respectively.
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LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 2025, and December 31, 2024, we had cash balances of $26,195,817 and $24,781,389, respectively. At June 30, 2025, and December 31, 2024, the working capital surplus was $12,202,035 and $9,097,591, respectively. The increase in working capital surplus was primarily due to the acquisition of AML and APL, resulting in an increase in current assets over current liabilities as of June 30, 2025.
We generate a substantial portion of our operating income outside the United States, which is indefinitely reinvested in foreign jurisdictions. Consequently, as outlined under “Cash and Cash Equivalent,” the majority of our cash and short-term investments are held by our foreign subsidiaries. At present, we do not intend to repatriate these funds and do not foresee a need to do so.
The company maintains multiple sources of liquidity, including cash flow from operations, potential capital raises, and strategic financing arrangements. FDCTech is actively managing its working capital to support ongoing business expansion, including the development of its Condor Trading Technology, regulatory compliance initiatives, and integration of newly acquired entities.
Key liquidity factors include:
| ● | Operating Cash Flow: The company continues to invest in technology infrastructure and operational efficiency to drive sustainable revenue growth. | |
| ● | Capital Expenditures: Investment in proprietary trading platforms and software development remains a priority. | |
| ● | Financing Activities: FDCTech has historically relied on equity offerings, debt instruments, and related-party financing to support its expansion. Future capital-raising efforts may be necessary to fund acquisitions and market expansion. |
Management believes that existing cash reserves, combined with expected revenue growth and potential financing opportunities, will provide sufficient liquidity to meet both operational and strategic needs. However, external market conditions, regulatory changes, and acquisition-related expenditures could impact future liquidity requirements.
We anticipate that our existing domestic cash, short-term investments, and cash flows from operations will be sufficient to fund our domestic operating activities and fulfill our cash commitments for investing and financing activities, such as regular quarterly dividends, debt repayments, and capital expenditures, for at least the next 12 months and for the foreseeable future.
Should we require additional capital in the United States beyond what our domestic operations generate—for instance, to fund significant discretionary activities such as business acquisitions or share repurchases—we could choose to repatriate future earnings from foreign jurisdictions or raise capital within the United States through debt or equity issuances. These alternatives may result in higher effective tax rates, increased interest expenses, or dilution of our earnings. We have previously borrowed funds domestically and believe that we can continue to do so at reasonable interest rates.
Over the next 12 months, the Company will continue investing in sales, marketing, product development, and technology solutions to enhance customer service and expand its market presence. Capital expenditures are anticipated to rise to $1.000,000. This allocation will encompass working capital, software development, sales and marketing initiatives, as well as infrastructure enhancements, including the procurement of computers and servers.
The company expects that its existing cash reserves, cash equivalents, operational cash flows, and access to private equity and capital markets will be sufficient to fund operations for at least the next 12 months. These resources will support continued business operations, including debt obligations and significant capital expenditures. However, achieving sustainable revenue growth may require additional funding, and there is no guarantee that financing will be available on favorable terms.
If additional capital is required, the company may consider restructuring or refinancing existing debt, securing financing from financial institutions, or raising funds through private equity or debt issuance. FDCTech remains committed to expanding its operations while exploring strategic funding opportunities to support long-term growth.
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PPP and SBA Funding in 2020
On May 01, 2020, the Company received proceeds of Fifty-Thousand Six Hundred and Thirty-Two ($50,632) from the Promissory Note (“PPP Note”) under the Paycheck Protection Program under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The outstanding balance of the PPP loan, including accrued interest at 1.00%, is approximately $890 as of June 30, 2025.
On May 22, 2020, the Company received proceeds of $144,900. The outstanding balance of the SBA loan, including accrued interest, is $109,931 as of June 30, 2025.
Related Party Investments and Acquisitions in 2023
On January 25, 2023, the Company issued 5,309,179 restricted common shares to AJB as compensation for consideration shares related to the AJB Note, valued at $60,525.
On January 25, 2023, the Company issued 115,000,000 restricted common shares for cash valued at $550,000 to Kundnani, considered a related party.
On March 28, 2023, the Company issued 2,000,000 restricted common shares for cash valued at $20,000.
On July 31, 2023, the Company sent the notice of termination of the purchase agreement to CIM Securities, as future events may result in a change of ownership in the CMA application. The Company terminated the escrow agreement and released $180,000 to increase cash on hand.
On November 30, 2023, Kundnani, a related party, purchased 2,500,000 shares of the Company’s Series A Preferred stock for $2.5 million. The Company has issued the Series A Preferred stock to Kundnani. On November 30, 2023, Kundnani purchased 50,000,000 shares of the Company’s common stock for $5.5 million. The Company has issued the Common stock to Kundnani. The Company expects to receive funds by the end of June 2025.
GOING CONCERN CONSIDERATION
We generated revenues of $11,412,351 and $12,505,856 for the six months ended June 30, 2025, and 2024, respectively. As of June 30, 2025, and December 31, 2024, the accumulated deficit was $2,916,646 and $2,563,620. Our independent auditors included an explanatory paragraph in their reports on the audited financial statements for the fiscal years ending December 31, 2024, and 2023, regarding concerns about our ability to continue as a going concern. Our financial statements include additional note disclosures that describe the circumstances leading to this disclosure by our independent auditors. Our financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classifications of liabilities that may result in the Company being unable to continue as a going concern.
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Critical Accounting Policies and Significant Judgments and Estimates
We have based our management’s discussion and analysis of our financial condition and results of operations on our financial statements, which we have prepared in accordance with U.S. generally accepted accounting principles. In preparing our financial statements, we must make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses for the reporting periods.
In more detail, we have described significant accounting policies in Note 2 of our annual financial statements included in our 10-K for the fiscal year ended December 31, 2023, filed with the SEC on October 15, 2024. We continually evaluate our critical accounting estimates and judgments, as required by our policies, and update them as necessary based on changing conditions.
JOBS Act Accounting Election
We are an “emerging growth company,” as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued after the enactment of the JOBS Act until those standards apply to private companies. As an emerging growth company, we have applied for an exemption; as a result, the Company may delay the adoption of certain accounting standards until the standards apply to private companies.
Off-Balance Sheet Arrangements and Contractual Obligations
We have not engaged in any off-balance sheet arrangements as defined in Item 303(c) of the SEC’s Regulation S-B. We had no relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that would have been established to facilitate off-balance sheet arrangements or other contractually narrow or limited purposes.
Recent Accounting Pronouncements
The Company evaluates all Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”) for applicability and impact on its consolidated financial statements.
We have adopted ASC 606, Revenue from Contracts with Customers, and ASC 842 (formerly ASU 2016-02, Leases) as of March 31, 2020. The amendments in these ASUs are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption was permitted and consistent with SEC guidance; we implemented these standards as required. The adoption of these standards did not have a material impact on our consolidated financial statements.
The Company has reviewed recently issued ASUs that are not yet effective and expects no significant impact on its financial statements or disclosures upon adoption. As a smaller reporting company, we have elected to take advantage of the extended transition period for complying with new or revised accounting standards, as permitted by the JOBS Act and SEC rules applicable to emerging growth companies.
For a more detailed description of our significant and critical accounting policies, please refer to Note 2 in the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on June 30, 2025.
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| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS. |
Not Applicable.
| ITEM 4. | CONTROLS AND PROCEDURES. |
Evaluation of Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer (together, the “Certifying Officers”), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this Report.
Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Certifying Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.
Management’s Report on Internal Controls over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Securities Exchange Act, as amended. Management, with the participation of the Chief Executive Officer, evaluated the effectiveness of the Company’s internal control over financial reporting as of June 30, 2024. In making this assessment, management utilized the criteria established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in its 2013 Framework for Internal Control. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our consolidated financial statements for external reporting purposes in accordance with Generally Accepted Accounting Principles (GAAP). Our internal control over financial reporting includes those policies and procedures that:
(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and
(3) provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the consolidated financial statements.
Due to its inherent limitations, internal control over financial reporting may not be effective in preventing or detecting errors or misstatements in our consolidated financial statements. Additionally, projections of any evaluation of effectiveness in future periods are subject to the risk that controls may become inadequate due to changes in conditions or that the degree of compliance with policies or procedures may deteriorate. Management assessed the effectiveness of our internal control over financial reporting as of June 30, 2025. Based on our assessments, management determined that we did not maintain effective internal control over financial reporting as of June 30, 2024, due to the material weakness in our internal controls due to inadequate segregation of duties within account processes due to limited personnel and insufficient written policies and procedures for accounting, IT, and financial reporting and record keeping.
Management intends to implement remediation steps to enhance our internal controls, addressing inadequate segregation of duties within account processes, limited personnel resources, and insufficient written policies and procedures for accounting, IT, financial reporting, and record-keeping. We plan to further improve this process by enhancing the size and composition of our board upon the closing of the business identifying third-party professionals with whom to consult regarding complex accounting applications, and consideration of additional staff with the requisite experience and training to supplement existing accounting professionals and implemented additional layers of reviews in the internal controls and financial reporting process.
This Report does not include an attestation report from our independent registered public accounting firm, as we are an emerging growth company under the JOBS Act.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Rule 13a-15 or Rule 15d-15 under the Exchange Act that occurred during the three months Ended June 30, 2025, and 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II.
| ITEM 1. | LEGAL PROCEEDINGS. |
On December 23, 2023, the Company received legal correspondence and supporting documents addressed to APSI Holdings Limited (formerly Alchemy Prime Holdings Limited) and FDCTech, Inc. The nature of the legal claims or disputes has not been fully specified in the received correspondence. The Company is assessing the situation and will respond appropriately. While management cannot predict the outcome of these matters, any adverse resolution could potentially have a material impact on the Company’s business, financial condition, and results of operations. The Company intends to defend its interests vigorously and will provide further updates as material developments arise.
Management is unaware of any other actions, suits, investigations, or proceedings (public or private) pending or threatened against or affecting any of the assets or any affiliate of the Company.
| Item 1A. | Risk Factors. |
In accordance with the requirements of Form 10-Q, the Company, as a smaller reporting company, is not required to disclose this item.
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds. |
None.
| Item 3. | Defaults Upon Senior Securities. |
None
| Item 4. | Mine Safety Disclosures. |
None
| Item 5. | Other Information. |
None
| Item 6. | Exhibits. |
(a) Exhibits.
| Exhibit | Item | |
| 31.1 | Certification of Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 | |
| 31.2 | Certification of Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002 | |
| 32.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 32.2 | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
| 101.INS | Inline XBRL Instance Document | |
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| FDCTECH, INC. | |
| Date: August 13, 2025 | /s/ Mitchell Eaglstein |
| Mitchell Eaglstein, President and CEO | |
|
(Principal Executive Officer) |
| Date: August 13, 2025 | /s/ Imran Firoz |
Imran Firoz, CFO | |
| (Principal Accounting Officer) |
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