CAPSTONE COMPANIES, INC.

Previous wording

This Form 10-Q contains forward-looking statements that are contained principally in the sections describing our business as well as in “Risk Factors, and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. These statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause our actual results, performance, or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. All statements other than statements of historical facts contained, or incorporated by reference, in this Form 10-Q, including, without limitation, those regarding our business strategy, business development efforts, financial position, funding prospects, results of operations, plans, prospects, actions taken or strategies being considered with respect to our liquidity position, valuation and appraisals of our assets and objectives of management for future operations, our ability to weather the impacts of the any pandemic or similar event, financing opportunities, and future cost mitigation and cash conservation efforts and efforts to reduce operating expenses and capital expenditures are forward-looking statements. These risks and uncertainties include, but are not limited to, the factors described in the section captioned “Risk Factors” in our 2025 Annual Report on Form 10-K. In some cases, you can identify forward-looking statements by terms such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “intends”, “may”, “plans”, “potential”, “predicts”, “projects”, “should”, “would”, “hope” and similar expressions (including the negative and variants of such words). Forward-looking statements reflect our current views with respect to future events and are based on assumptions and are subject to various risks and uncertainties. Given these uncertainties, a reader of this Form 10-Q should not rely upon forward-looking statements as predictions of future events or results or place undue reliance on forward-looking statements. The forward-looking statements contained in this Form 10-Q are made as of the date of filing this Form 10-Q. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law. Examples of these risks, uncertainties and other factors include, but are not limited, to the impact of:

Current wording

This Form 10-Q contains forward-looking statements that are contained principally in the sections describing our business as well as in “Risk Factors, and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. These statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause our actual results, performance, or achievements to be materially different from any future results, performances or achievements expressed or implied by the forward-looking statements. All statements other than statements of historical facts contained, or incorporated by reference, in this Form 10-Q, including, without limitation, those regarding our business strategy, business development efforts, financial position, funding prospects, results of operations, plans, prospects, actions taken or strategies being considered with respect to our liquidity position, valuation and appraisals of our assets and objectives of management for future operations, our ability to weather the impacts of the any pandemic or similar event, financing opportunities, and future cost mitigation and cash conservation efforts and efforts to reduce operating expenses and capital expenditures are forward-looking statements. The efforts of the Company to develop or acquire a new business line to generate sustained or sustainable revenues have failed as of the date of the filing of this Form 10-Q and may not succeed in the future. The effort to develop or acquire a new business line should not be construed as an indication of the prospects or likelihood of a new business line being developed or acquired. The Company may be unable to overcome its lack of working and expansion capital and revenue flow to fund the development or acquisition of a new business line. Further, any new business line may be unable to generate revenues sufficient to solve the Company’s current financial condition. These risks and uncertainties include, but are not limited to, the factors described in the section captioned “Risk Factors” in our 2025 Annual Report on Form 10-K. In some cases, you can identify forward-looking statements by terms such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “intends”, “may”, “plans”, “potential”, “predicts”, “projects”, “should”, “would”, “hope” and similar expressions (including the negative and variants of such words). Forward-looking statements reflect our current views with respect to future events and are based on assumptions and are subject to various risks and uncertainties. Given these uncertainties, a reader of this Form 10-Q should not rely upon forward-looking statements as predictions of future events or results or place undue reliance on forward-looking statements. The forward-looking statements contained in this Form 10-Q are made as of the date of filing this Form 10-Q. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as req…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

● Company may be unable to develop or acquire a new business line or operation that is able to fund the overhead necessary to maintain the Company as a public company into 2027.

Current wording

● Company may be unable to develop or acquire a new business line or operation that is able to fund the overhead necessary to maintain the Company as a public company into 2027. The Company’s efforts to develop or acquire a new business line have failed as of the date of the filing of this Form 10-Q and continued efforts to develop or acquire a new business line in 2026 may also be unsuccessful.

Previous wording

● The Company may be unable to restructure or resolve all or most of its debt obligations in any transaction for acquisition of a new business or business line, or to fund production and promotion of any new product or business line.

Current wording

● The Company may be unable to restructure or resolve all or most of its debt obligations in general or in any transaction for acquisition of a new business or business line, or to fund production and promotion of any new product or business line.

Previous wording

The challenge facing the Company is to acquire and fund a new business line, or to establish a new profitable product line or a services business, before the cost of marketing and establishing a revenue generating business impose unsustainable financial burdens and losses on the Company. Internal development of any new business line or product or services will require advance funding, which may be unattainable by the Company.

Current wording

The challenge facing the Company is to acquire and fund a new business line, or to establish a new profitable product line or a services business, before the cost of marketing and establishing a revenue generating business impose unsustainable financial burdens and losses on the Company. Internal development of any new business line or product or services will require advance funding, which has not been obtained as of the date of the filing of this Form 10-Q and may be unattainable by the Company.

Previous wording

The License Agreement for the Connected Chef was terminated by mutual agreement of the Company and Licensee during the first week of November 2025, as a result of the prospective Chinese OEM refusing to produce a product developed by an American company. Consequently, the Company and Licensee ended the License Agreement during the first week of November 2025. The Company is not considering further efforts to license the Connected Chef as of the date of the fling of this Form 10-Q, but the Company may reconsider efforts to license the Connected Chef if trade relations between the U.S. and China improve, or an OEM who does not require upfront money and located outside of China can be located by the Company.

Current wording

The License Agreement for the Connected Chef was terminated by mutual agreement of the Company and Licensee during the first week of November 2025, as a result of the prospective Chinese OEM refusing to produce a product developed by an American company. Consequently, the Company and Licensee ended the License Agreement during the first week of November 2025. The Company is not considering further efforts to license the Connected Chef as of the date of the filing of this Form 10-Q, but the Company may reconsider efforts to license the Connected Chef if trade relations between the U.S. and China improve, or an OEM who does not require upfront money and located outside of China can be located by the Company.

Previous wording

Even if a new business or operation is acquired or developed, there can be no assurance that it will produce revenues sufficient to sustain corporate operations. No assurances can be given that any new management members or additional funding by Coppermine or eBliss, which additional funding is not anticipated by the Company, will in fact result in a new business line or operation for the Company or cover all future operating expenses of the Company through 2026 or into 2027, or support any new business line or product or services. The Coppermine Note, as most recently amended on January 5, 2026, matures December 31, 2026, and Coppermine has committed to lending a total of $558,191 in working capital funding through December 31, 2026. In addition, on March 4, 2026, the Company issued the eBliss Note, a $250,000 unsecured working capital loan from eBliss Global, Inc. that includes a 90-day ‘no shop’ provision (with eBliss having exclusivity for the first 60 days). If Coppermine does not provide additional funding beyond its current commitment, the Note proceeds prove insufficient, no superior third-party proposal or definitive transaction with eBliss is consummated, a new source of funding is not found, or the Company does not develop revenue generating operations producing sufficient working capital prior to the end of fiscal 2026, the Company will need to obtain a new source of working capital funding to sustain operations and any efforts to develop or acquire a new business or business line in 2027. The Company does not have an alternative source of working capital funding to funding by Coppermine and eBliss as of the date of the filing of this Form 10-Q and is uncertain about whether it can obtain any alternative funding or receive any additional funding from Coppermine or eBliss. As of the date of the filing of this Form 10-Q, there is no indication of any additional funding from Coppermine or eBliss.

Current wording

If Coppermine does not provide additional funding beyond its current commitment, the eBliss Note proceeds prove insufficient, no superior third-party proposal or definitive transaction with eBliss is consummated, a new source of funding is not found, or the Company does not develop revenue generating operations producing sufficient working capital prior to the end of fiscal 2026, the Company will need to obtain a new source of working capital funding to sustain operations and any efforts to develop or acquire a new business or business line in 2027. The Company does not have an alternative source of working capital funding to funding by Coppermine and eBliss as of the date of the filing of this Form 10-Q and is uncertain about whether it can obtain any alternative funding or receive any additional funding from Coppermine. Due to eBliss terminating the Letter of Intent, the Company believes that any additional funding from eBliss or any restricting of the debt owed eBliss is highly unlikely. As of the date of the filing of this Form 10-Q, there is no indication of any additional funding from Coppermine or eBliss.

Previous wording

The Company is a “penny stock” company under Commission rules and the public stock market price for our common stock is impacted by the lack of significant institutional investor and any primary market maker support. Investment in our common stock is highly risky and should only be considered by investors who can afford to lose their investment and do not require on demand liquidity. Potential investors should carefully consider risk factors in our SEC filings. The Company’s common stock lacks the primary market maker and institutional investor support to protect the public market from being unpredictable and volatile. Investors may not have liquidity or desired liquidity in our common stock as an investment. With the lack of any revenues and revenue generating operations, and lack of any funding covering anticipated future overhead, and the doubt as a going concern, any investment in the Company’s common stock is highly risky in terms of liquidity and risk of loss of investment.

Current wording

The Company is a “penny stock” company under Commission rules and the public stock market price for our common stock is impacted by the lack of significant institutional investor and any primary market maker support. Investment in our common stock is highly risky and should only be considered by investors who can afford to lose their investment and do not require on demand liquidity. Potential investors should carefully consider risk factors in our SEC filings. The Company’s common stock lacks the primary market maker and institutional investor support to protect the public market from being unpredictable and volatile. Investors may not have liquidity or desired liquidity in our common stock as an investment. With the lack of any revenues and revenue generating operations, and lack of any funding covering anticipated future overhead, the inability of the Company to develop or acquire a new business line as of the date of the filing of this Form 10-Q, and the doubt as a going concern, any investment in the Company’s common stock is highly risky in terms of liquidity and risk of loss of investment.

Previous wording

2026 Business Development Efforts; eBliss Note. On March 3, 2026, the Company entered into a promissory note with eBliss Global, Inc. (“eBliss Note”), a private early-stage Delaware corporation engaged in the developing and production of e-mobility solutions (including and initially making e-bikes as transportation vehicles at a Utica, New York factory). The interest rate under the Note is seven percent simple annual interest. Principal and accrued interest are due in a single lump sum payment due on March 4, 2027. The Note is unsecured and does not provide for a conversion of debt-to-equity securities. The Loan is being made to supply working capital to the Company and as partial consideration for a 90-day ‘no shop’ provision in the Note. During the 90 days following the funding of the principal of the Note (“No Shop Period”), the Company will not entertain third party proposals for a merger, business combination, stock or asset acquisition, strategic alliance or joint venture for product development or similar transactions (collectively, “Transactions”) and will cease any third party discussions for any Transactions for the No Shop Period, except that the Company may entertain third party proposals during the last 30 days of the No Shop Period if the Company and eBliss have not signed a definitive agreement or letter of intent for a Transaction during the first 60 days of the No Shop Period and the third party proposal is deemed ‘superior’ to any existing proposal for a Transaction from eBliss, if any. The purpose of the ‘no shop’ provision is to afford the Company and eBliss an opportunity to discuss the possibility and feasibility of a mutually beneficial Transaction by eBliss and the Company and conduct any desired due diligence. The sixty day period of the No Shop Period has expired as of the first week of May 2026 and the No Shop Period expires as of June 2, 2026.

Current wording

2026 Business Development Efforts; eBliss Note. On March 3, 2026, the Company entered into a promissory note with eBliss Global, Inc. (“eBliss Note”), a private early-stage Delaware corporation engaged in the developing and production of e-mobility solutions (including and initially making e-bikes as transportation vehicles at a Utica, New York factory). The interest rate under the eBliss Note is seven percent simple annual interest. Principal and accrued interest are due in a single lump sum payment due on March 4, 2027. The eBliss Note is unsecured and does not provide for a conversion of debt-to-equity securities. The Loan is being made to supply working capital to the Company and as partial consideration for a 90-day ‘no shop’ provision in the eBliss Note. During the 90 days following the funding of the principal of the eBliss Note (“No Shop Period”), the Company could not entertain third party proposals for a merger, business combination, stock or asset acquisition, strategic alliance or joint venture for product development or similar transactions (collectively, “Transactions”) and had to cease any third party discussions for any Transactions for the No Shop Period, except that the Company could entertain third party proposals during the last 30 days of the No Shop Period if the Company and eBliss have not signed a definitive agreement or letter of intent for a Transaction during the first 60 days of the No Shop Period and the third party proposal is deemed ‘superior’ to any existing proposal for a Transaction from eBliss, if any. The purpose of the ‘no shop’ provision was to afford the Company and eBliss an opportunity to discuss the possibility and feasibility of a mutually beneficial Transaction by eBliss and the Company and conduct any desired due diligence. On May 14, 2026, the Company and eBliss entered into a non-binding Letter of Intent (the “LOI”) with the intent to explore the possibility of a merger, other business combination or similar corporate transaction between the two companies. The LOI contained a mutual ‘no shop’ provision that supersedes the ‘no shop’ provision in the eBliss Note. The ‘no shop’ provision in the eBliss Note was to expire on or about June 3, 2026. On July 8, 2026, the Company and eBliss entered into Amendment Number One to the LOI, extending the ‘no shop’ provision and the LOI’s expiration date from July 31, 2026 to August 31, 2026. eBliss notified the Company on August 1, 2026, that it was terminating the LOI, which terminates 35 days after the written notice. See Note 1 and Note 2 for further information.

Previous wording

The Company and eBliss have held preliminary discussions on a possible Transaction, but these discussions have not resulted in any agreement on the terms and conditions of a Transaction. The Company and eBliss may be unable to reach any agreement for any Transactions and, as such, may not consummate or pursue any Transactions.

Current wording

The Company and eBliss held preliminary discussions on a possible Transaction, but these discussions did not result in any agreement on the terms and conditions of a Transaction as of August 1, 2026, the date of eBliss termination notice for the LOI. The Company and eBliss were unable to reach any agreement for any Transactions and, as such, the two companies will not seek to consummate or pursue any Transactions as of the date of the filing of this Form 10-Q.

Previous wording

2025 Product Development Efforts. The following discusses efforts by the Company to develop a new product line in 2025 and in 2023 and 2024. The Company has been unable to successfully launch a new product line with the maturation of its former traditional business line in LED Lighting Products.

Current wording

Product Development Efforts. The following discusses efforts by the Company to develop a new product line in over the last few years. The Company has been unable to successfully launch a new product line with the maturation of its former traditional business line in LED Lighting Products.

Previous wording

HFS Business Development Efforts. The following section discusses Company’s efforts to develop a business line in the HFS industry in 2025, which efforts did not produce a new business line or operation in fiscal year 2025 or in the first fiscal quarter of 2026. These efforts have been suspended in March 2026 for the 90-day ‘no shop’ period as described in “eBliss Note” above.

Current wording

HFS Business Development Efforts. The following section discusses Company’s efforts to develop a business line in the HFS industry in 2025, which efforts did not produce a new business line or operation in fiscal year 2025 or in the first fiscal quarter of 2026. These efforts were suspended in March 2026 for the 90-day ‘no shop’ period as described in “eBliss Note” above and further suspended under the subsequent ‘no shop’ restrictions in the LOI. Upon expiration or earlier termination of the ‘no shop’ provision in the LOI, the Company will no longer be restricted from soliciting or pursuing third-party transactions with respect to the HFS business and may resume its HFS business development efforts. There can be no assurance that the Company will resume such efforts, or that any resumed efforts will be successful.

Previous wording

E-Mobility Business Development. In parallel with its HFS efforts, the Company is evaluating opportunities in the e-mobility industry, including the e-bike business, principally through the discussions with eBliss Global, Inc. during the 90-day ‘No Shop’ Period under the eBliss Note. eBliss is a private Delaware corporation that is gearing up for production of e-bikes for personal transportation in Utica, New York in 2026. There is no legally binding agreement or other non-binding agreement between the Company and eBliss to consummate any merger, business combination, strategic relationship, joint venture or similar transaction as of the date of the filing of this Form 10-Q. There can be no assurance that any discussions between the Company and eBliss will result in any agreement or commitment for or consummation of any Transactions. As of the date of the filing of this Form 10-Q, there is no agreement, commitment or consent to terms and conditions for any Transactions between the Company and eBliss and no agreement, commitment or consent may be reached by the Company and eBliss for any Transactions.

Current wording

E-Mobility Business Development. In parallel with its HFS efforts, the Company was evaluating opportunities in the e-mobility industry, including the e-bike business, principally through the discussions with eBliss. eBliss is a private Delaware corporation that commenced production of e-bikes for personal transportation in Utica, New York in July 2026. The Company and eBliss are parties to a non-binding Letter of Intent dated May 14, 2026, as amended July 8, 2026 (see Note 1), to negotiate a possible merger, other business combination or similar corporate transaction between eBliss and the Company. There is no legally binding agreement, agreement in principle, or understanding between the Company and eBliss on the essential terms of any Transaction as of August 1, 2026, the date on which eBliss notified the Company that eBliss was terminating the LOI. The discussions between the Company and eBliss did not result in any agreement or commitment for or consummation of any Transactions.

Previous wording

Corporate Status. The Company’s business activities were limited to business development efforts during the first quarter of fiscal 2026. The Company has no revenue generating business and no products in active commercialization as of the date of the filing of this Form 10-Q.

Current wording

Corporate Status. The Company’s business activities were limited to business development efforts during the first half of fiscal 2026. The Company has no revenue generating business and no products in active commercialization as of the date of the filing of this Form 10-Q.

Previous wording

Working Capital Funding. In 2025 and into 2026, the Company sought working capital funding for basic working capital for essential corporate operations and regulatory compliance costs necessary as a reporting company under the Exchange Act and a company with its common stock quoted on the OTC Market Group QB Venture Market. During 2024, the Company was successful in securing a new funding source for operating working capital from Coppermine Ventures LLC (“Coppermine”). The Company received capital advances beginning in 2024 and into 2026, totaling $530,163 under an unsecured promissory note, most recently amended on January 5, 2026, (“Note”) issued by Coppermine. The Note accrues simple interest at 7% and matures December 31, 2026, and Coppermine has committed to lending a total of $558,191 in working capital funding through December 31, 2026. In addition, on March 4, 2026, the Company issued the Note to eBliss Global, Inc. (“eBliss”), a $250,000 unsecured working capital promissory note that includes a 90-day ‘no shop’ provision (with eBliss having exclusivity for the first 60 days) during which the Company and eBliss will discuss a potential merger, business combination, strategic relationship, joint venture or similar transaction. There is no legally binding agreement between the Company and eBliss to consummate any such transaction as of the date of the filing of this Form 10-Q. See Note 3 — Notes Payable for further information regarding the Coppermine Note and the eBliss Note. There is no assurance that funding from Coppermine or eBliss will extend beyond the second half of 2026.

Current wording

Working Capital Funding. In 2025 and into 2026, the Company sought working capital funding for basic working capital for essential corporate operations and regulatory compliance costs necessary as a reporting company under the Exchange Act and a company with its common stock quoted on the OTC Market Group QB Venture Market. During 2024, the Company was successful in securing a new funding source for operating working capital from Coppermine Ventures LLC (“Coppermine”). The Company received capital advances beginning in 2024 and into 2026, totaling $530,163 under an unsecured promissory note, most recently amended on January 5, 2026, (“Note”) issued by Coppermine. The Note accrues simple interest at 7% and matures December 31, 2026, and Coppermine has committed to lending a total of $558,191 in working capital funding through December 31, 2026. In addition, on March 4, 2026, the Company issued the eBliss Note to eBliss Global, Inc. (“eBliss”), a $250,000 unsecured working capital promissory note that includes a 90-day ‘no shop’ provision (with eBliss having exclusivity for the first 60 days) during which the Company and eBliss will discuss a potential merger, business combination, strategic relationship, joint venture or similar transaction. See Note 2 — Notes Payable for further information regarding the Coppermine Note and the eBliss Note and the LOI between the Company and eBliss. There is no assurance that funding from Coppermine or eBliss will extend beyond the second half of 2026 or that either company will restructure its current loans to the Company.

Previous wording

Finding affordable, timely and adequate funding from third party sources in 2026 will be essential to sustaining Company basic corporate operations and business development efforts. The funding from the Note is estimated to provide adequate funding of basic corporate compliance and operational overhead into the latter half of 2026.

Current wording

Finding affordable, timely and adequate funding from third party sources in 2026 will be essential to sustaining Company basic corporate operations and business development efforts. The funding from the eBliss Note is estimated to provide adequate funding of basic corporate compliance and operational overhead into the latter half of 2026.

Previous wording

The Company does not currently have an operating product line. The net loss for the three months ended March 31, 2026 was $92,269 as compared to $111,079 in 2025. During the three months ended March 31, 2026 and 2025 the Company used cash in operating activities of approximately $77,082 in 2026 and $98,989 in 2025. The decrease in net cash used in operations primarily relates to a decrease in professional fees and other general and administrative expenses compared to the prior year period, in an effort to operate as efficiently as possible under a low cost strategy while the Company explores strategic business opportunities.

Current wording

The Company does not currently have an operating product line. The net loss for the six months ended June 30, 2026 was $177,193 as compared to $187,612 in 2025. During the six months ended June 30, 2026 and 2025 the Company used cash in operating activities of approximately $139,526 in 2026 and $156,611 in 2025. The decrease in net cash used in operations primarily relates to a decrease in professional fees and other general and administrative expenses compared to the prior year period, in an effort to operate as efficiently as possible under a low cost strategy while the Company explores strategic business opportunities.

Previous wording

As of March 31, 2026, the Company has negative working capital of $551,338 and an accumulated deficit of $12,772,037. The Company’s cash balance increased by approximately $218,000 from $39,000 as of December 31, 2025 to approximately $257,000 as of March 31, 2026. The increase was due to the working capital note proceeds from both eBliss and Coppermine in the first quarter of 2026. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

Current wording

As of June 30, 2026, the Company has negative working capital of $636,262 and an accumulated deficit of $12,856,961. The Company’s cash balance increased by approximately $156,000 from $39,000 as of December 31, 2025 to approximately $195,000 as of June 30, 2026. The increase was due to the working capital note proceeds from both eBliss and Coppermine in the first quarter of 2026. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

Previous wording

Besides the efforts to license the Connected Chef kitchen appliance product, which effort has not successfully commercialized the Connected Chef product or resulted in any production of that product as of the date of the filing of this Form 10-Q, the Company is seeking to establish revenue generating operations in the HFS business by internal development of HFS operations or acquiring or being acquired by an existing, operating HFS company, and is also evaluating opportunities in the e-mobility industry, including the e-bike business, principally through the discussions with eBliss Global, Inc. during the 90-day ‘no shop’ period under the eBliss Note. Management is closely monitoring its operations, liquidity, and capital resources and is actively working to minimize the current and future impact of this unprecedented situation.

Current wording

Besides the efforts to license the Connected Chef kitchen appliance product, which effort has not successfully commercialized the Connected Chef product or resulted in any production of that product as of the date of the filing of this Form 10-Q, the Company is seeking to establish revenue generating operations in the HFS business by internal development of HFS operations or acquiring or being acquired by an existing, operating HFS company, and is also evaluating opportunities in the e-mobility industry, including the e-bike business, principally through the discussions with eBliss Global, Inc. Management is closely monitoring its operations, liquidity, and capital resources and is actively working to minimize the current and future impact of this unprecedented situation.

Previous wording

The lack of adequate working capital significantly hinders and may undermine ongoing or future business development efforts. There is also substantial uncertainty about the Company as a going concern and its ability to operate beyond fiscal 2026.

Current wording

The lack of adequate working capital and lack of tangible assets to attain asset based funding significantly hinder and may undermine ongoing or future business development efforts. There is also substantial uncertainty about the Company as a going concern and its ability to operate beyond fiscal 2026.

Previous wording

The Company’s business operations in 2024 and 2025 were the HFS business development efforts and third-party licensing of the Connected Chef. The long-term business strategy of the Company in 2025 was focused on the HFS business development with the third-party licensing of the Connected Chef as a secondary business. The implementation of the long-term business strategy depends on having adequate working capital until revenue flow from new business operations or revenues from Connected Chef product replaces third party funding as the principal means of funding overhead. The failure of the licensing effort for the Connected Chef in late 2025 has left only business development efforts. We have third party funding for basic operational overhead, through the Note and the Coppermine Note (as amended), into the latter half of fiscal 2026. We may be unable to achieve sufficient working capital, when and in the amounts required, to meet operational overhead beyond fiscal 2026. We have not achieved adequate funding for all anticipated working capital needs for fiscal year 2026 as of the date of the filing of this Form 10-Q. We were not able to secure adequate funding for internal development and launch of a new business line.

Current wording

The Company’s business operations in 2024 and 2025 consisted of the HFS business development efforts and third-party licensing of the Connected Chef. The Company’s long-term business strategy in 2025 was focused on HFS business development, with third-party licensing of the Connected Chef as a secondary business. Implementation of this long-term strategy depends on having adequate working capital until revenue from new business operations, or revenue from Connected Chef products, replaces third-party funding as the Company’s principal source of funding for overhead. The failure of the Connected Chef licensing effort in late 2025 left the Company with only its business development efforts. The Company has funded basic operational overhead through the eBliss Note and the Coppermine Note (as amended) for fiscal 2026. The Company may be unable to achieve sufficient working capital, when and in the amounts required, to meet operational overhead beyond December 31, 2026. As of the date of the filing of this Form 10-Q, the Company has not achieved adequate funding for all anticipated working capital needs for fiscal year 2027 and has not been able to secure adequate funding for the internal development or launch of a new business line.

Previous wording

In terms of HFS business, the Company sought in 2025 to penetrate an industry that was and continues to enjoy rapid expansion nationwide with many existing and new companies that have established operations and brand recognition. The Company’s strategy for any developed or acquired HFS operation was to provide offerings and facilities that appeal to a broad demographic group (children, families and adults) as opposed to offerings that are primarily aimed at appealing to adults seeking pickle ball courts with a sport bar or social activities environment. This model is based on Coppermine’s business approach. The inability of the Company to secure adequate business development funding hampered efforts in 2025 to either acquire or internally develop a new HFS industry business line. The Company believes that identification of a suitable acquisition target or a strategic alliance with an established HFS industry business may potentially enhance the ability of the Company to attract funding for acquiring or establishing a new HFS business (either internally or through an acquisition). Due to the ‘no shop’ provision in the eBliss Note, the HFS industry business development efforts, which have not succeeded to date, are suspended for the 90-day ‘no shop’ period.

Current wording

In terms of HFS business, the Company sought in 2025 to penetrate an industry that was and continues to enjoy rapid expansion nationwide with many existing and new companies that have established operations and brand recognition. The Company’s strategy for any developed or acquired HFS operation was to provide offerings and facilities that appeal to a broad demographic group (children, families and adults) as opposed to offerings that are primarily aimed at appealing to adults seeking pickle ball courts with a sport bar or social activities environment. This model is based on Coppermine’s business approach. The Company’s inability to secure adequate business development funding hampered efforts in 2025 to either acquire or internally develop a new HFS industry business line. he Company believes that identifying a suitable acquisition target or a strategic alliance with an established HFS industry business may enhance its ability to attract funding for acquiring or establishing a new HFS business, whether internally or through an acquisition. As described in Note 1, on May 14, 2026 the Company and eBliss entered into a non-binding Letter of Intent containing a mutual ‘no shop’ provision that supersedes the ‘no shop’ provision in the eBliss Note; that provision, as extended, runs through August 31, 2026. On August 1, 2026, eBliss notified the Company that it was terminating the LOI under the 35-days’ prior written notice termination provision. The Company’s HFS industry business development efforts, which have not succeeded to date, remain suspended during this period. Upon expiration or earlier termination of the exclusivity period, the Company will no longer be restricted from soliciting or pursuing third-party proposals with respect to the HFS business and may resume its HFS business development efforts. There can be no assurance that the Company will resume, pursue, or successfully complete any HFS-related business opportunity, or that adequate financing will be available to do so.

Previous wording

The success of Mr. Jacobs at another company is a not an indication of and should not be deemed to be an indication or projection or guarantee of the potential performance of any Company HFS operation. The Company cannot fully implement its HFS business without sufficient working capital for internal development of an HFS operation or acquisition of an existing HFS company or operation, and such working capital has not been obtained as of the date of the filing of this Form 10-Q report. Even with adequate funding, the Company will face significant competition in the growing HFS industry and may, as a new entrant in the industry, be unable to successfully compete in that industry. As noted, the HFS business development effort is suspended for the 90-day No Shop Period under the eBliss Note.

Current wording

The success of Mr. Jacobs at another company is a not an indication of and should not be deemed to be an indication or projection or guarantee of the potential performance of any Company HFS operation or the likelihood of the Company developing or acquiring a business in the HFS industry. The Company cannot fully implement its HFS business without sufficient working capital for internal development of an HFS operation or acquisition of an existing HFS company or operation, and such working capital has not been obtained as of the date of the filing of this Form 10-Q report. Even with adequate funding, the Company will face significant competition in the growing HFS industry and may, as a new entrant in the industry, be unable to successfully compete in that industry. As noted, the HFS business development effort was suspended for the 90-day No Shop Period under the eBliss Note until June 3, 2026, and then further suspended under the ‘no shop’ provision of the LOI until August 31, 2026, the expiration date of the LOI and ‘no shop’ provision. Otherwise, the August 1, 2026, termination notice from eBliss terminates the ‘no shop’ provision and the LOI as of September 4, 2026. The Company intends to pursue opportunities in HFS Industry upon expiration of the LOI ‘no shop’ period.

Previous wording

Connected Chef Product. With respect to 2025 efforts to develop the Connected Chef product into a new product line, the Company regards the following as potential strategic strengths in the consumer product business. In North America, the Company has been recognized for more than a decade as an innovator and highly efficient, low-cost manufacturer in several product niches. Company believes that its insight into the needs of retail programming and its proven execution track record is a potential strength if the Company decides and is able to launch a new product or services business.

Current wording

Connected Chef Product. With respect to 2025 efforts to develop the Connected Chef product into a new product line, the Company regards the following as potential strategic strengths in the consumer product business. In North America, the Company has been recognized for more than a decade as an innovator and highly efficient, low-cost manufacturer in several product niches. Company believes that its insight into the needs of retail programming and its proven execution track record is a potential strength if the Company decides and is able to launch a new product or services business as part of any new business line, including an HFS business line. Selling branded merchandise is a common part of HFS operations.

Previous wording

In the past, the operating management’s experience in hardline product manufacturing has prepared the Company for successful entries into various consumer product markets, especially its experience in using foreign OEMs to provide capabilities not possessed internally by our company.

Current wording

The Company’s former chief executive officer, and current Chairman of the Board, Stewart Wallach, has over three decades of consumer product experience and has successfully built and managed other consumer product companies. In the past, the operating management’s experience in hardline product manufacturing has prepared the Company for successful entries into various consumer product markets, especially its experience in using foreign OEMs to provide capabilities not possessed internally by our company.

Previous wording

Consumer Product Quality: With prior product lines, the Company demonstrated a high quality in product’s design and utility through a combination of sourcing quality components, stringent manufacturing quality control and conducting rigorous third-party testing. The Company’s history of developing cost-competitive products without compromising quality standards is a competitive strength of the Company’s consumer products.

Current wording

Consumer Product Quality: With prior product lines, the Company demonstrated a high quality in product’s design and utility through a combination of sourcing quality components, stringent manufacturing quality control and conducting rigorous third-party testing. The Company’s history of developing cost-competitive products without compromising quality standards could be a competitive strength of the Company if product development, promotion and sales are part of any new business line.

Previous wording

As of the date of the filing of this Form 10-Q report, the Company’s working capital constraints hinder full implementation of the HFS business development and hindered a more expansive promotion of the Connected Chef product licensing program in 2025. The lack of adequate working capital prevents any sustained, effective development effort for product development as of the date of the filing of this Form 10-Q report and caused the Company to pursue the licensing program in 2025.

Current wording

As of the date of the filing of this Form 10-Q Report, the Company’s working capital constraints hinder full implementation of the HFS business development and hindered a more expansive promotion of the Connected Chef product licensing program in 2025. The lack of adequate working capital prevents any sustained, effective development effort for product development as of the date of the filing of this Form 10-Q Report.

Previous wording

With respect to the Connected Chef, and in the past with any new product line, the Company’s consumer products face the risk of new technologies or functionalities shifting consumer demand away from the products produced by the Company. The Company lacks and may lack the financial resources or ability to license, develop or acquire new technologies or functionalities in demand by consumers, which failure may undermine the commercial viability of Connected Chef. Further, the Company’s business model in consumer products was to focus on bulk sales to ‘Big Box’ retailers. While this strategy worked well for the Company in the past, with a small number of employees and reliance on competent foreign OEMs for product production, the strategy was dependent on meeting the purchasing preferences and predicting consumer preferences for products that the Company could economically, efficiently produce. Without bulk orders from traditional retailers, the Company did not have alternative, at-hand distribution channels to replace the sales to ‘Big Box’ retailers. The development of alternative distribution channels takes prolonged sustained effort, adequate working capital and sustained investment and adequate, experienced personnel. These alternative distribution channels were beyond the available capabilities and resources of the Company to develop in 2025 or 2024.

Current wording

With respect to the Connected Chef, and in the past with any new product line, the Company’s consumer products face the risk of new technologies or functionalities shifting consumer demand away from the products produced by the Company. The Company lacks and may continue to lack the financial resources or ability to license, develop or acquire new technologies or functionalities in demand by consumers, which failure may undermine the commercial viability of Connected Chef. Further, the Company’s business model in consumer products was to focus on bulk sales to ‘Big Box’ retailers. While this strategy worked well for the Company in the past, with a small number of employees and reliance on competent foreign OEMs for product production, the strategy was dependent on meeting the purchasing preferences and predicting consumer preferences for products that the Company could economically, efficiently produce. Without bulk orders from traditional retailers, the Company did not have alternative, at-hand distribution channels to replace the sales to ‘Big Box’ retailers. The development of alternative distribution channels takes prolonged sustained effort, adequate working capital and sustained investment and adequate, experienced personnel. These alternative distribution channels are currently beyond the available capabilities and resources of the Company.

Previous wording

As a smaller reporting company, Company lacks the staff, money, internal capabilities and resources and operational experience to significantly or timely respond to significant challenges and adverse changes in business and financial requirements. It also lacked and lacks the financial, marketing and technical resources to compete against competitors with greater financial, distribution, marketing, and technical resources, including greater brand recognition with consumers.

Current wording

As a smaller reporting company, Company lacks the staff, money, internal capabilities and resources and operational experience to significantly or timely respond to significant challenges and adverse changes in business and financial requirements. It also lacks the financial, marketing and technical resources to compete against competitors with greater financial, distribution, marketing, and technical resources, including greater brand recognition with consumers.

Previous wording

Strategic Reviews. Like many companies, the Company conducts periodic strategic reviews where the feasibility of significant corporate transactions is considered, including mergers, asset purchases or sales and diversification or change in business lines. The Company lacks the financial resources of larger companies to withstand adverse, significant and sustained changes in business and financial condition. This vulnerability necessitates an ongoing consideration of alternatives to current operations. Due to the decline in financial performance of the Company since 2021, with no current product line, as well as the Company having its shares of Common Stock quoted on The OTC Markets Group, Inc. QB Venture Market and being a “penny stock”, the Company may be unable to fully implement any HFS business or e-mobility development efforts or, if the Company elected to revise its licensing efforts, aggressively pursue Connected Chef licensing.

Current wording

Strategic Reviews. Like many companies, the Company conducts periodic strategic reviews where the feasibility of significant corporate transactions is considered, including mergers, asset purchases or sales and diversification or change in business lines. The Company lacks the financial resources of larger companies to withstand adverse, significant and sustained changes in business and financial condition. This vulnerability necessitates an ongoing consideration of alternatives to current operations. Due to the decline in financial performance of the Company since 2021, with no current product line or source of sustained revenues, as well as the Company having its shares of Common Stock quoted on The OTC Markets Group, Inc. QB Venture Market and being a “penny stock”, the Company may be unable to fully implement any HFS business or other business development efforts or, if the Company elected to revise its licensing efforts, aggressively pursue Connected Chef licensing.

Previous wording

Connected Chef, a purpose-built kitchen appliance tablet, which is a unique form factor with Google GMS operating system, with an integrated platform for cooking accessories, i.e.: cutting board. The development effort for the Connected Chef has been suspended in the first fiscal quarter of 2026 due to failure of 2025 licensing arrangement and focus on business development efforts under the Note and its ‘no shop’ provision.

Current wording

Connected Chef, a purpose-built kitchen appliance tablet, which is a unique form factor with Google GMS operating system, with an integrated platform for cooking accessories, i.e.: cutting board. The development effort for the Connected Chef has been suspended indefinitely due to failure of 2025 licensing arrangement.

Previous wording

2025 Tariffs. President Trump imposed aggregate tariffs of 20% on Chinese imports. These tariffs produced retaliatory tariffs from China on certain U.S. imports. This trade dispute adversely impacted the Connected Chef product licensing business by hindering possible Chinese contract manufacturers from producing products for licensees or licensors, or those products being competitively priced after the seller or distributor adds any costs from tariffs. The Company may be able to find other contract manufacturers to replace Chinese contract manufacturers, The Company’s experience in consumer product development and production has primarily been with Chinese contract or OEM manufacturers. The Company lacks sufficient operational history as of the filing of this Form 10-Q report to estimate or project the impact of the current trade dispute and tariff hikes on the Connected Chef licensing business.

Current wording

Tariffs. President Trump imposed aggregate tariffs of 20% on Chinese imports. These tariffs produced retaliatory tariffs from China on certain U.S. imports. This trade dispute adversely impacted the Connected Chef product licensing business by hindering possible Chinese contract manufacturers from producing products for licensees or licensors, or those products being competitively priced after the seller or distributor adds any costs from tariffs. The Company may be able to find other contract manufacturers to replace Chinese contract manufacturers, The Company’s experience in consumer product development and production has primarily been with Chinese contract or OEM manufacturers. The Company lacks sufficient operational history as of the filing of this Form 10-Q Report to estimate or project the impact of the current trade dispute and tariff hikes on the Connected Chef licensing business.

Previous wording

We used social media platforms and online advertising campaigns to further grow the Company’s online presence. In addition to Facebook, Instagram, Pinterest and LinkedIn, The Company has launched a YouTube channel to host videos and established a X (formerly, Twitter) account. Our Social Media marketing has not resulted in any significant sales of products. We have not been and may not be able to effectively compete in e-commerce and Social Media marketing and sales. The Company has a Social Media presence on the following Social Media platforms, (however the Company did not emphasize or actively utilize Social Media marketing in 2025 or into 2026:

Current wording

We used social media platforms and online advertising campaigns to further grow the Company’s online presence. In addition to Facebook, Instagram, Pinterest and LinkedIn, The Company has launched a YouTube channel to host videos and established a X (formerly, Twitter) account. Our Social Media marketing has not resulted in any significant sales of products. We have not been and may not be able to effectively compete in e-commerce and Social Media marketing and sales. The Company has a Social Media presence on the following Social Media platforms , but the Company has not actively pursued promotion or use of Social Media in 2026 due to the lack of a product or service suitable for Social Media promotion.

Previous wording

Consumer Products. In terms of the consumer product industry, the Company operated in a highly competitive environment, both in the United States and internationally, in the former LED lighting product segment and in the Connected Chef internet of things product segments. The Company’s previous consumer products competed with products made by large multinationals with global operations as well as numerous other smaller, specialized national or regional competitors who generally focus on narrower markets, products, or particular categories. Competitors included Gentex Corporation, Seura Solutions, Inc., Magna International, Inc, Amazon and Samsung Electronics Co. Ltd.

Current wording

Consumer Products. The Company’s former LED lighting and Connected Chef product lines operated in a highly competitive environment, both in the United States and internationally, competing with large multinationals with global operations as well as numerous smaller, specialized national or regional competitors, including Gentex Corporation, Seura Solutions, Inc., Magna International, Inc., Amazon, and Samsung Electronics Co. Ltd. The Company discontinued these product lines in 2025 and currently has no operating product line. See the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 for further information regarding these discontinued product lines.

Previous wording

With respect to past production of consumer products, the Company’s research and development operations based in Florida and Thailand have designed and engineered many of the Company’s consumer products, with collaboration from its third-party manufacturing partners, software developers and Capstone U.S. engineering advisers. The Company outsources the manufacture and assembly of our products to a select group of OEM manufacturers overseas.

Current wording

The Company’s former research and development operations, based in Florida and Thailand, designed and engineered many of the Company’s discontinued consumer products, in collaboration with third-party manufacturing partners, software developers, and Capstone U.S. engineering advisers, and outsourced manufacturing and assembly to a select group of OEM manufacturers overseas. The Company discontinued these product lines in 2025 and currently has no active product research, development, or manufacturing operations.

Previous wording

The Company did not experience any cybersecurity incidents for the three months ended March 31, 2026.

Current wording

The Company did not experience any cybersecurity incidents for the six months ended June 30, 2026.

Previous wording

The Company was not engaged in production or manufacturing activities in 2025. We believe that the Company is in compliance with environmental protection regulations and will not have a material impact on our financial position and results of operations. The Company is not aware of any national, state or local environmental laws or regulations that will materially affect our earnings or competitive position or result in material capital expenditures. However, the Company cannot predict the effect on our operations due to possible future environmental legislation or regulations. During 2025, there were no capital expenditures for environmental control facilities and no such material expenditures are anticipated.

Current wording

The Company has not engaged in production or manufacturing activities since 2023. We believe that the Company is in compliance with environmental protection regulations and will not have a material impact on our financial position and results of operations. The Company is not aware of any national, state or local environmental laws or regulations that will materially affect our earnings or competitive position or result in material capital expenditures. However, the Company cannot predict the effect on our operations due to possible future environmental legislation or regulations.

Previous wording

Climate Change. With no product line in 2025, the Company did not experience any direct, material impact on business and financial condition in 2025 from pending or existing climate-change related legislation, regulations, and international accords in the U.S., the physical impacts of climate change, or perceived indirect material impact from business trends. On March 27, 2025, the Commission voted to end its defense of its climate related risk and greenhouse gas emissions rule (The Enhancement and Standardization of Climate-Related Disclosures for Investors, SEC Release Nos. 33-11275; 34-99678). On April 4, 2024, the SEC had imposed an administrative stay on enforcement of the rule due to pending challenges in federal courts. The Eighth Circuit ordered that the litigation would be held in abeyance until such time as the SEC reconsider or renews it defense of the Rules. In its order, the Eighth Circuit emphasized that the SEC has the “responsibility to determine whether its Final Rules will be rescinded, repealed, modified, or defended in litigation.” On May 4, 2026, the SEC reportedly sentto the White House’s Office of Management and Budget for review a prop osal to formally terminate theclimate related risk and greenhouse gas emissions rule.

Current wording

Climate Change. With no current product line, the Company has not experience any direct, material impact on business and financial conditions from pending or existing climate-change related legislation, regulations, and international accords in the U.S., the physical impacts of climate change, or perceived indirect material impact from business trends. On March 27, 2025, the Commission voted to end its defense of its climate related risk and greenhouse gas emissions rule (The Enhancement and Standardization of Climate-Related Disclosures for Investors, SEC Release Nos. 33-11275; 34-99678). On April 4, 2024, the SEC had imposed an administrative stay on enforcement of the rule due to pending challenges in federal courts. The Eighth Circuit ordered that the litigation would be held in abeyance until such time as the SEC reconsider or renews it defense of the Rules. In its order, the Eighth Circuit emphasized that the SEC has the “responsibility to determine whether its Final Rules will be rescinded, repealed, modified, or defended in litigation.”On June 3, 2026, the U.S. Securities and Exchange Commission (SEC or Commission) published a proposed withdrawal of its climate-related disclosure rule that required registrants and public companies to provide standardized, detailed information about climate-related risks, governance, and certain greenhouse gas emissions in SEC filings. This action would eliminate the pending disclosure framework rather than replacing it with an alternative set of climate-specific reporting requirements, reverting issuers to existing, principles-based disclosure obligations.

Previous wording

We believe that there have been no significant changes to our critical accounting policies during the three months ended March 31, 2026, as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Annual Report.

Current wording

We believe that there have been no significant changes to our critical accounting policies during the six months ended June 30, 2026, as compared to those we disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Annual Report.

Previous wording

Operating expenses include sales and marketing expenses, advertising expense and costs related to consultant fees. In addition, operating expense include charges relating to office expenses, accounting, legal, and insurance.

Current wording

Operating expenses include professional fees and compliance and regulatory expenses. In addition, operating expense include charges relating to office expenses, accounting, and insurance.

Previous wording

Company did not have an operating product line during the three month period ended March 31, 2026 or 2025.

Current wording

Company did not have an operating product line during the three and six month periods ended June 30, 2026 or 2025.