AppTech Payments Corp. 10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-39158

AppTech Payments Corp.

(Exact Name of Registrant as Specified in its Charter)

Delaware

7389

65-0847995

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification No.)

5876 Owens Avenue

Suite 100

Carlsbad, California 92008

(760) 707-5959

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value per share	APCX	OTC Venture Market
Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $4.15	APCXW	OTC Venture Market

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The aggregate market value of common stock of the registrant held by non-affiliates as of June 30, 2025, was approximately $19.0 million. As of March 31, 2026, 40,503,934 shares of common stock, $0.001 par value were issued and outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Specified portions of the registrant’s proxy statement with respect to the registrant’s 2026 Annual Meeting of Stockholders, which is to be filed pursuant to Regulation 14A within 120 days after the end of the registrant’s fiscal year ended December 31, 2025, are incorporated by reference into Part III of this Annual Report on Form 10-K.

AppTech Payments Corp.

Form 10-K

Table of Contents

		Page
	Part I
	Special Note Regarding Forward-Looking Statements and Projections	1
Item 1.	Business	2
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	6
Item 1C.	Cybersecurity	6
Item 2.	Properties	8
Item 3.	Legal Proceedings	8
Item 4.	Mine Safety Disclosures	8

	Part II
Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities	9
Item 6.	[Reserved]	9
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	9
Item 7A.	Qualitative and Quantitative Disclosures about Market Risk	16
Item 8.	Financial Statements and Supplementary Data	17
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	17
Item 9A.	Controls and Procedures	17
Item 9B.	Other Information	18
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	18

	Part III
Item 10.	Directors, Executive Officers and Corporate Governance	19
Item 11.	Executive Compensation	19
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	19
Item 13.	Certain Relationships and Related Transactions and Director Independence
Item 14.	Principal Accountant Fees and Services	20

	Part IV
Item 15.	Exhibits and Financial Statements Schedules	21
Item 16.	Form 10-K Summary	21

Index to Financial Statements		22
Exhibit Index		45
Signatures		50

PART I

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND PROJECTIONS

Various statements in this report of AppTech Payments Corp. are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this report regarding our strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. These statements are subject to risks and uncertainties and are based on information currently available to our management. Words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “contemplates,” “predict,” “project,” “target,” “likely,” “potential,” “continue,” “ongoing,” “will,” “would,” “should,” “could,” or the negative of these terms and similar expressions or words, identify forward-looking statements. The events and circumstances reflected in our forward-looking statements may not occur and actual results could differ materially from those projected in our forward-looking statements.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this report identify important factors which you should consider in evaluating our forward-looking statements. These risks include, but are not limited to, the following:

	·	delays and uncertainty associated with the boarding of clients to our platform;

	·	substantial investment and costs associated with new potential revenue streams and their corresponding contractual obligations;

	·	a slowdown or reduction in our sales due to a reduction in end user demand, unanticipated competition, regulatory issues, or other unexpected circumstances;

	·	uncertainty regarding adverse macroeconomic conditions, including inflation, a recession, changes to fiscal and monetary policy, tighter credit, higher interest rates, consumer confidence and spending, and high unemployment;

	·	dependence on third-parties needed to facilitate our automated clearing house (“ACH”) and merchant service capabilities;

	·	delay in or failure to obtain regulatory approval for any future products in additional countries, and;

	·	current and future laws and regulations.

All written and oral forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. We caution investors not to rely too heavily on the forward-looking statements we make or that are made on our behalf. We undertake no obligation and specifically decline any obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Please see, however, any further disclosures we make on related subjects in any annual, quarterly or current reports that we may file with the Securities and Exchange Commission (SEC).

We encourage you to read the discussion and analysis of our financial condition and our consolidated financial statements contained both in our Form S-1 that was filed with the Securities and Exchange Commission on January 3, 2022, and in this Annual Report on Form 10-K. There can be no assurance that we will in fact achieve the actual results or developments we anticipate or, even if we do substantially realize them, that they will have the expected consequences to, or effects on, us. Therefore, we can give no assurances that we will achieve the outcomes stated in those forward-looking statements and estimates.

Unless the context otherwise requires, throughout this Annual Report on Form 10-K, the words “AppTech Payments,” “we,” “us,” the “registrant” or the “Company” refer to AppTech Payments Corp.

Item 1. Business

Business Overview

2025 was a defining year for AppTech Payments Corp. (“AppTech”). The Company entered the year with inherited structural, operational, and technological challenges that limited its ability to scale and compete effectively in the rapidly evolving financial services landscape. The legacy FinZeo acquisition, while strategically intended to position the Company in digital payments, required significant remediation. The inherited platform architecture was fragmented, the marketplace model was not commercially viable, and the product required substantial modernization to meet industry expectations. These issues constrained growth and created operational inefficiencies that needed to be addressed before the Company could pursue new opportunities.

Recognizing these challenges, the new management team undertook a comprehensive transformation of the Company. This included stabilizing operations, preserving existing revenue streams, restructuring internal processes, modernizing the technology stack, and repositioning the Company toward scalable, high-value financial technology infrastructure. The objective was not incremental improvement, but a fundamental repositioning of AppTech into a modern fintech infrastructure provider capable of supporting digital banking, embedded finance, and omnichannel payments at scale. By year-end, AppTech had rebuilt its foundation, aligned its teams, and established a clear strategic direction for long-term growth.

This transformation occurred during a period of rapid change in the financial services industry. Businesses, financial institutions, and technology platforms increasingly require modern, flexible, and compliant financial technology capable of supporting digital-first interactions, automated onboarding, and embedded financial services. The market is shifting toward unified platforms that reduce integration complexity, support multi-channel payment experiences, and deliver scalable financial services without requiring costly or disruptive changes to existing banking systems. Smaller and mid-sized banks, in particular, face mounting pressure to modernize their digital offerings but often lack the internal resources or infrastructure to do so effectively. These institutions represent a significant and underserved segment of the market.

To address these needs, AppTech deployed the AppTech Banking Platform, a modern financial services layer licensed and implemented in 2025. While architecturally similar to Banking-as-a-Service systems, AppTech positions this platform as a core Company technology rather than a traditional BaaS product. The platform enables digital banking capabilities, account-based processing, onboarding, compliance, and financial workflows through a unified, cloud-native architecture. It is designed as a multi-tenant, multi-bank system, allowing AppTech to support multiple financial institutions simultaneously and expand its banking partnerships over time. Importantly, the platform integrates alongside a bank’s existing core system rather than replacing it, enabling AppTech to deliver modern digital capabilities without requiring banks to undertake costly or disruptive system changes.

The Company’s first partner bank is now fully online and accepting clients through the AppTech Banking Platform. This relationship provides AppTech with a compliant and scalable foundation for delivering digital banking capabilities, account creation, payment services, and financial workflows. The close operational alignment between AppTech and its partner bank enhances the Company’s ability to deliver efficient onboarding, consistent compliance processes, and a streamlined path for clients to activate financial products, while maintaining the bank’s regulatory oversight and decision-making authority.

Building on this strengthened foundation, AppTech completed the acquisition of Infinitus Pay, Inc. (“IP”) in late 2025. IP brings a profitable business, a growing customer portfolio, and a robust cross-border payments and onboarding platform that integrates directly into the AppTech Banking Platform. Its technology expands AppTech’s capabilities in global payment acceptance, international payouts, multi-currency transactions, automated recipient onboarding, and compliance workflows. IP also contributes a sophisticated partner portal that provides detailed reporting, business metrics, and operational insights. This portal not only supports IP’s existing clients but also enhances AppTech’s broader sales channel by equipping partners with tools to identify opportunities, monitor client performance, and unlock client potential.

While the Company’s long-term strategy is centered on digital banking and embedded financial services, AppTech continues to operate and generate revenue from its FinZeo Payments-as-a-Service (“PaaS”) business. FinZeo remains an active and revenue-producing component of the Company’s operations, contributing approximately 10–15% of total revenue in 2025. Although the inherited marketplace structure required modernization and the original product did not meet commercial expectations, the underlying PaaS capabilities continue to serve merchants, ISOs, and technology partners. The Company stabilized this business, preserved its revenue, and repositioned it as a strategic channel for identifying future opportunities aligned with the Company’s broader financial technology strategy.

As a result of these efforts, AppTech emerges from 2025 as a fundamentally different company—one with a modern technology foundation, a scalable business model, a strengthened leadership team, and a clear strategic direction. The Company is now positioned to participate meaningfully in the next generation of digital financial services, with a platform capable of supporting financial institutions, technology companies, and SMEs with scalable, customizable financial solutions that reduce integration complexity and accelerate time-to-market.

Corporate Information

AppTech Corp. reincorporated in Delaware on December 23, 2021, and changed its name to AppTech Payments Corp. The Company’s principal executive offices are located at 5876 Owens Avenue, Suite 100, Carlsbad, California 92008. Its phone number is (760) 707-5959. Its website address is www.apptechcorp.com and www.finzeo.com. AppTech does not incorporate the information on or accessible through our website into this report. AppTech has included our website address in this report solely as an inactive textual reference.

Industry Background

The financial technology and payment processing industries continue to evolve rapidly as technological innovation, shifting consumer expectations, and new business models reshape the global financial landscape. Digital transformation is accelerating across all sectors, driving demand for modern payment systems, digital banking capabilities, and embedded financial services. Automated Clearing House (“ACH”) payments, card processing, and mobile-first financial interactions have become foundational components of the digital economy.

ACH payments have experienced sustained growth in both volume and value. In 2022, the ACH network processed 30 billion payments valued at $76.7 trillion, reflecting increases in both transaction volume and dollar value, according to the Federal Reserve Payments Study (2022). By 2023, The Clearing House reported more than 19 billion ACH transactions totaling $52.4 trillion, representing continued year-over-year expansion. Between 2018 and 2021, the dollar value of ACH payments grew at an annual rate of 12.7%, the highest growth rate recorded by the Federal Reserve Payments Study (2023).

Card payments remain the dominant method of consumer and business transactions. The Federal Reserve Payments Study highlights the significant volume of card-based transactions, and demand continues to rise as consumers adopt contactless and instant payment methods. The global shift toward digital wallets, tokenized payments, and mobile-enabled commerce is expected to continue accelerating.

The broader fintech sector is also expanding rapidly. According to Statista’s Digital & Trends – Neobanking US Report (2023), the industry is projected to grow at a compound annual growth rate of approximately 16.5% between 2024 and 2032. The same report estimates that digital banking, including FDIC-insured neobanks offering modern financial services, will reach a value of approximately $2.6 trillion by 2027, with more than 78 million users. Neobanks and fintech platforms are reshaping traditional banking models by offering digital-first experiences, lower costs, and enhanced convenience.

Smaller financial institutions, including credit unions, are increasingly adopting digital payment solutions to remain competitive. According to CUInsight’s Credit Unions Adopting Open Banking Payments report (2024), approximately 11% of credit unions had incorporated open banking payment options as of mid-2024, reflecting a growing trend toward advanced digital capabilities. Digital transformation enables these institutions to attract and retain members by offering secure, convenient financial services. Many are partnering with fintech companies to accelerate modernization efforts, consistent with broader industry findings highlighted in PwC’s Global Consumer Insights Survey.

The digital payments ecosystem presents significant revenue opportunities. PwC estimates a $60 billion revenue opportunity across digital payment channels, driven by mobile wallets, ACH systems, and embedded financial services. As digital payments become more deeply integrated into everyday financial interactions, businesses and financial institutions are seeking partners capable of delivering modern, scalable, and compliant financial technology.

Our Competitive Strengths

AppTech believes that the transformation completed in 2025 provides the Company with several meaningful competitive strengths that differentiate it within the financial technology landscape. The most significant of these is the AppTech Banking Platform, which enables the Company to deliver modern financial services through a single, cohesive architecture that reduces integration complexity and accelerates time-to-market for clients. The platform’s multi-tenant, multi-bank design allows AppTech to support multiple financial institutions concurrently and expand its banking partnerships over time, creating a scalable foundation for long-term growth. Because the platform integrates alongside a bank’s existing core system rather than replacing it, AppTech can deliver modern digital capabilities without requiring banks to undertake costly or disruptive system changes.

The acquisition of IP further enhances AppTech’s competitive position. IP’s cross-border payments, multi-currency capabilities, automated onboarding workflows, and compliance infrastructure integrate directly into the AppTech Banking Platform, expanding the Company’s ability to support international commerce and embedded finance use cases. IP’s partner portal strengthens AppTech’s sales ecosystem by providing detailed reporting and business metrics that help identify opportunities, optimize performance, and accelerate adoption.

AppTech’s ability to serve as both a technology provider and a sales enablement partner for smaller and mid-sized banks further differentiates the Company. These institutions represent a large and underserved segment of the market, and AppTech’s platform allows them to expand their digital capabilities and reach new customers without replacing their existing systems. This positioning creates mutually beneficial opportunities for both AppTech and its banking partners and supports the Company’s long-term growth objectives.

Finally, the Company’s decision to preserve and stabilize its FinZeo PaaS business provides an additional competitive advantage. While the inherited marketplace model required significant remediation, the underlying PaaS capabilities continue to generate revenue and serve as a valuable channel for identifying new opportunities. This dual-engine model—digital banking infrastructure combined with a stabilized payments business—positions AppTech to grow revenue while expanding its presence across multiple segments of the financial services ecosystem.

Our Growth Strategy

AppTech’s growth strategy is centered on leveraging the foundation established in 2025 to expand its banking relationships, scale its unified financial technology platform, and capitalize on the increasing demand for modern digital financial services. The Company intends to build on the capabilities of the AppTech Banking Platform by onboarding additional financial institutions, thereby increasing distribution channels and broadening its reach across the banking sector. The platform’s multi-tenant architecture enables AppTech to support multiple banks concurrently, creating opportunities to serve diverse market segments and deepen its presence within the financial services ecosystem.

A key component of the Company’s strategy is the full integration and expansion of the IP platform. By combining IP’s cross-border payments, onboarding automation, and compliance workflows with the AppTech Banking Platform, the Company aims to deliver a comprehensive suite of financial services that support both domestic and international commerce. IP’s sales pipeline and partner portal will play an important role in this strategy by providing AppTech and its partners with actionable insights that can drive client acquisition, improve performance, and accelerate adoption.

AppTech also intends to focus on underserved market segments, particularly smaller and mid-sized banks that lack the internal resources to modernize their digital offerings. By providing these institutions with modern financial technology that integrates alongside their existing core systems, AppTech can serve as both a technology provider and a sales enablement partner, helping banks expand their digital capabilities and reach new customers. This approach creates mutually beneficial opportunities for both AppTech and its banking partners and supports the Company’s long-term growth objectives.

In addition, AppTech plans to continue enhancing its unified financial technology stack, which integrates digital banking, account-based processing, omnichannel payments, automated onboarding, compliance automation, and cross-border capabilities into a single architecture. The Company believes that delivering these capabilities through a modular, extensible platform will reduce integration friction for clients and enable AppTech to support a wide range of deployment models, including off-the-shelf solutions, white-label offerings, and fully embedded financial services.

By strengthening its banking partnerships, scaling the AppTech Banking Platform, fully leveraging the IP acquisition, and stabilizing and utilizing the FinZeo PaaS business as a strategic channel, AppTech believes it is well positioned to drive meaningful expansion in 2026 and beyond.

Our Products and Services

AppTech offers a suite of financial technology solutions designed to empower financial institutions, technology providers, and enterprise brands to deliver modern, digital-first financial experiences. The Company’s unified platform integrates digital banking, omnichannel payments, onboarding automation, compliance workflows, and embedded financial services into a single, extensible architecture.

Merchant Services

AppTech’s historical core business consists of merchant transaction services. The Company generates revenue by processing credit and debit card payments through point-of-sale equipment, eCommerce gateways, periodic ACH payments, and gift and loyalty programs. AppTech currently supports more than 150 merchants across a wide range of industries. Each merchant has unique processing needs, and AppTech leverages multiple processing partners to ensure optimal alignment based on risk, volume, customer service, integration capabilities, product features, and profitability.

FinZeo Payments-as-a-Service (PaaS)

FinZeo remains an active and revenue-producing component of AppTech’s operations, contributing approximately 10–15% of total revenue in 2025. The platform provides ACH processing, card acceptance, eCheck services, mobile payments, electronic billing, and text-to-pay capabilities to merchants and partners across a variety of industries. While the inherited marketplace structure required modernization and the original product did not meet commercial expectations, the Company stabilized the business, preserved its revenue, and repositioned it as a strategic channel for identifying new opportunities aligned with the Company’s broader financial technology strategy.

Digital Financial Technology Platform consisting of Omnichannel Payments and Digital Banking

AppTech’s digital financial technology platform incorporates two primary product pillars: omnichannel digital payments and digital banking capabilities. The omnichannel payments pillar includes hosted eCommerce checkout, a flexible payment gateway, patented payment technologies, alternative payment methods, and mobile and contactless payments. The digital banking pillar provides financial institutions with the technology required to offer modern financial services to businesses, professionals, and individuals.

The platform supports the development and deployment of customized financial experiences through open and private APIs, third-party integrations, white-label capabilities, and optional professional services. Clients may deploy AppTech’s solutions off-the-shelf or embed them directly into their own applications.

AppTech’s patented text-to-pay technology enables B2B, B2C, and P2P payments via SMS, mobile push, email, and embedded links. Combined with additional patents in mobile-to-computer messaging and lead generation, these capabilities allow AppTech to deliver innovative customer engagement and payment experiences.

The platform also supports personalization, marketing automation, and online-to-offline attribution, enabling businesses to tailor financial experiences to individual customer preferences. Automation capabilities allow clients to configure financial incentives, cashback programs, and savings features such as round-ups. The platform’s open architecture supports embedded payments and financial services through flexible APIs.

AppTech continues to enhance its platform through ongoing development, integration, testing, and certification. The Company expects to introduce additional features, capabilities, and improvements as it advances toward broader market readiness.

Employees

As of the date of this annual report, we have six full-time employees. In addition to our employees, we utilize various consultants and contractors for other services on an as-needed basis.

Item 1A. Risk Factors

As a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, we are not required to provide the information required by this Item.

Item 1B. Unresolved Staff Comments

Not applicable.

Item 1C. Cybersecurity

Risk Management and Strategy

AppTech recognizes the critical importance of cybersecurity in protecting its operations, customer information, and proprietary data. The Company is committed to implementing robust security measures designed to mitigate the risk of cyber incidents that could disrupt business operations or compromise data integrity.

Engage Third-parties on Risk Management

Due to the difficulties and evolving nature of cybersecurity threats, AppTech engages with external experts, including cybersecurity consultants and auditors to evaluate and test its risk management systems. These relationships allow us to utilize specialized knowledge and insights, ensuring our strategies and processes remain in-line with current best practices. These third-parties provide the Company with regular audits, threat assessments, and consultations on security enhancements. Also, during onboarding and periodically thereafter, we conduct trainings for the Company’s employees, contractors, and temporary workers about cybersecurity risks, including sending test phishing emails for training purposes to all users of the Company’s email system.

Our cybersecurity strategy encompasses a comprehensive suite of measures designed to protect our systems and data from unauthorized access, use, alteration, or destruction. These measures include, but are not limited to:

· Implementation of advanced cybersecurity technologies, including firewalls, intrusion detection systems, and encryption protocols, to safeguard our network and data.

· Regular security assessments and penetration testing conducted by external experts to identify and remediate potential vulnerabilities.

· Establishing and maintaining incident response and recovery plans to ensure timely and effective responses to any cybersecurity incidents.

Oversee Third-party Risk

To manage the risks associated with third-party service providers, AppTech conducts weekly calls with its providers to monitor compliance on an ongoing basis. Issues that arise are addressed immediately with mitigating measures added to avoid future problems.

Risks from Cybersecurity Threats

Like other companies in our industry, we face several cybersecurity risks in connection with our business. Although such risks have not materially affected us or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition, to date, we have, from time to time, experienced threats to and security incidents related to our data and systems, including denial of service and phishing attacks.

Risk Management Personnel

Primary responsibility for assessing, monitoring and managing our cybersecurity risks rests with our third-party provider, the Company's Director of Information Technology and Director of Software Engineering (referred to as “IT”). Their knowledge, experience and relationship with our third-party vendor are instrumental in developing and executing our cybersecurity strategies.

Risk Management Reporting

The IT Team provides updates to upper Management on a routine basis or as potentially critical risks from cybersecurity threats or incidents arise. In addition, the audit committee is notified of any material cybersecurity concerns that may impact internal controls, data storage, or the integrity of our financial reporting.

Governance

Our board of directors has ultimate oversight responsibility for our strategic and business risk management and delegates cybersecurity risk management oversight to its audit committee.

Risk Management

Despite our diligent efforts to secure our systems and data, we acknowledge that no cybersecurity measures can completely eliminate the risk of cyber incidents. The evolving nature of cyber threats means that we must continually adapt our cybersecurity strategies to address new and emerging risks.

In recognition of these risks, we have implemented a comprehensive risk management framework that includes:

	·	Continuous monitoring of our networks and systems for signs of unauthorized activity.
	·	Regular updates to our cybersecurity measures to address new vulnerabilities and threats.
	·	Collaboration with industry partners and government agencies to share information on threats and best practices for cybersecurity.
	·	Maintaining cyber insurance to mitigate the financial impact of potential cybersecurity incidents.

Potential Impact of Cybersecurity Incidents

We recognize that a significant cybersecurity incident could have material adverse effects on our business, including operational disruptions, financial losses, legal liabilities, and damage to our reputation. Such incidents could also result in the loss of proprietary information or the exposure of sensitive customer data, leading to further financial and reputational harm.

In conclusion, while AppTech Payment Corp is committed to employing comprehensive cybersecurity measures to protect against cyber threats, there are inherent risks associated with cybersecurity that could impact our business. We continue to monitor our cybersecurity landscape actively and adapt our defenses to mitigate these risks as much as possible.

Item 2. Properties

Corporate headquarters is located at 5876 Owens Avenue, Suite 100, Carlsbad, CA 92008, consisting of approximately 3,000 square feet of leased office space. The Company does not own any real property.

Item 3. Legal Proceedings

Finzeo Seller Suit

On October 30, 2025, AppTech Payments Corp. filed a lawsuit in the United States District Court, Southern District of California, against Seller with claims for trade secret misappropriation, fraud, misrepresentation, conversion, unfair business practices, violation of California Penal Code section 502, and breach of contract. The litigation relates to AppTech’s acquisition of membership interests in a company and the company’s related product. The defendant has made claims of an offset based on alleged outstanding payments as part of the acquisition. On November 4, 2025, the Court entered an order approving the parties Stipulation/Joint re AppTech’s Motion for Temporary Restraining Order and Order. The case is currently in the discovery stage with the final pretrial conference scheduled for March 18, 2027.

On March 13, 2025, Moses & Singer LLP filed a case against AppTech Payments Corp. for unpaid fees of approximately $445 thousand with the American Arbitration Association. AppTech has brought a counterclaim of legal malpractice for $800 thousand. Arbitration is confidential and ongoing; resolution is expected before or by April 2026. Invoices for fees and costs to date are reflected in accounts payable.

Infinios Financial Services Litigation

On October 1, 2020, the Company entered into a strategic partnership with NEC PAYMENTS B.S.C., which subsequently became Infinios Financial Services B.S.C. (“Infinios”); on May 4, 2023, the Company notified Infinios of its intent to terminate the relationship and commenced good-faith negotiations, and in October 2023, the parties entered arbitration.

As of December 31, 2024, the parties settled the lawsuit under a confidential Settlement Confirmation letter whereby the terms of the Settlement Agreement and Mutual Release were fulfilled. Under the settlement, no payments were exchanged between the parties, and both the anti-dilution liability and the payable owed to Infinios of $72 thousand and $249 thousand, respectively, were fully extinguished. The matter is closed.

Litigation with Former Employees

On May 3, 2024, the Company was sued by three former employees over severance payments. In March 2025, the Company settled its lawsuit for $172 thousand. As of December 31, 2025, all monies owed have been paid.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities

The Company was delisted to the middle tier of the Over-The-Counter Venture Market (“OTCQB”) on May 20, 2025. AppTech trades under the symbol “APCX” and its warrants trade under the symbol “APCXW”.

Stockholder Data

As of December 31, 2025, 40,488,934 shares of our common stock were outstanding and held of record by more than 4,000 stockholders, and 14 shares of preferred stock held by 11 shareholders were outstanding.

Dividends

We have not declared or paid any cash dividends on our common stock since our inception.

Equity Compensation Plan

For information regarding securities authorized under the equity compensation plan, see Item 12.

Recent Sales of Unregistered Securities

In 2025, we did not sell any shares of stock that were not registered under the Securities Act of 1933, as amended, other than those sales previously reported in a Current Report on Form 8-K.

Recent Purchases of Equity Securities

We made no repurchases of our equity securities during the fourth quarter of the fiscal year ended December 31, 2025.

Item 6. RESERVED

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read together with the audited consolidated financial statements and related notes included elsewhere in this report. Certain statements contained in this report, including statements regarding the anticipated development and expansion of our business, our intent, belief or current expectations, primarily with respect to the future operating performance of our company and the products and services we expect to offer and other statements contained herein regarding matters that are not historical facts, are “forward-looking” statements. Our Management’s Discussion and Analysis contains not only statements that are historical facts, but also forward-looking statements which involve risks, uncertainties, and assumptions. Because forward-looking statements are inherently subject to risks and uncertainties, our actual results may differ materially from the results discussed in the forward-looking statements.

Business Overview

Building on this strengthened foundation, AppTech completed the acquisition of IP in late 2025. IP brings a profitable business, a growing customer portfolio, and a robust cross-border payments and onboarding platform that integrates directly into the AppTech Banking Platform. Its technology expands AppTech’s capabilities in global payment acceptance, international payouts, multi-currency transactions, automated recipient onboarding, and compliance workflows. IP also contributes a sophisticated partner portal that provides detailed reporting, business metrics, and operational insights. This portal not only supports IP’s existing clients but also enhances AppTech’s broader sales channel by equipping partners with tools to identify opportunities, monitor client performance, and unlock client potential.

Financial Operations Overview

The following discussion sets forth certain components of our statements of operations as well as factors that impact those items (in thousands, except per share data).

Revenues

Our Revenues. We derive our revenue by providing financial services to businesses.

Set up Fees

The Company provides one-time customer setup services that include gathering and validating required compliance documentation for its banking partners and performing the technical integration necessary to establish an operational merchant profile on the Company’s platform. As part of the setup, customers receive stand-alone value by receiving a named bank account with our banking partner that they can use independent of us. Setup services are satisfied at a point in time when the customer or subaccount is fully configured and enabled to transact on the platform. Revenue is recognized upon completion of setup, which generally coincides with month-end billing.

Monthly Platform and Transaction-Based Fees

Monthly recurring platform access fees and transaction-based fees represent consideration for continuous platform access and payment processing services and are recognized monthly as the services are performed. Transaction-based fees, which represent variable consideration, are recognized in the period in which the underlying transactions occur. Subaccount setup fees are recognized when the subaccount is established and made available for use.

Customers are invoiced in arrears at month-end, and amounts billed but not yet collected are recorded as accounts receivable.

Merchant Processing Services

The Company provides merchant processing solutions for credit card and ACH transactions. We act as an intermediary between merchants, who initiate transactions and banks that process them. We collect either a flat fee, a fee for each transaction, and or a fee calculated as a percentage of its value, from both credit cards and ACHs. Revenue is recognized when transactions are processed by banks or at month-end based on the processing activity. Payments to channel partners are deducted from revenue.

Accrued Residuals

The Company pays commissions to independent agents who refer merchant accounts. The amounts payable to these independent agents is based upon a percentage of the amounts processed by these merchant accounts.

Expenses

Cost of Revenue. Includes costs directly attributable to processing and other services the Company provides. These also include related costs such as residual payments to our business development partners, which are based on a percentage of the net revenue generated from client referrals.

General and administrative. Include salaries, professional services, software costs, regulatory expenses, stock-based compensation, rent and utilities, and other operating costs.

Research and development. Includes the internal and outsourced services costs incurred to maintain and further develop the FinZeo and IP platforms, and the development of additional technology needed to pursue new product offerings.

Other income (expenses). Consists of interest on outstanding indebtedness and the gain/loss on debt extinguishment.

Results of Operations

This section includes a summary of our historical results of operations, followed by detailed comparisons of our results for the years ended December 31, 2025 and 2024, respectively. We have derived this data from our annual consolidated financial statements included elsewhere in this report.

The following table presents our historical results of operations for the periods indicated:

	Years ended December 31						Change
($ in thousands)	2025			2024			Amount			%

Revenue	$	1,395		$	276		$	1,119			405.4%
Cost of revenue		624			52			572			1,100.0%
Gross profit		771			224			547			244.2%

Operating expenses
General and administrative		6,003			7,794			(1,791	)		(23.0%	)
Research and development		2,347			1,977			370			18.7%
Total operating expenses		8,350			9,771			(1,421	)		(14.5%	)

Loss from operations		(7,579	)		(9,547	)		1,968			(20.6%	)

Other income (expenses)
Interest expense, net		(121	)		(67	)		(54	)		80.6%
Gain on debt extinguishment		13			1,245			(1,232	)		(99.0%	)
Loss on change in fair value of contingent consideration		(174	)		–			(174	)		–
Debt discount amortization		(104	)		(579	)		475			(82.0%	)
Other income (expense)		45			15			30			200.0
Total other income (expenses)		(341	)		614			(955	)		(155.5%	)

Loss before income taxes		(7,920	)		(8,933	)		1,013			(11.3%	)

Provision for income taxes		–			–			–			–

Net loss	$	(7,920	)	$	(8,933	)	$	1,013			(11.3%	)

Revenue

Revenue was approximately $1,395 thousand for the year ended December 31, 2025, compared to $276 thousand for the year ended December 31, 2024, representing an increase of $1,119 thousand or 405.4%. The increase was principally driven by the launch of our lending revenue vertical and the revenue generated from the IP platform.

Cost of Revenue

Cost of revenue was approximately $624 thousand for the year ended December 31, 2025, compared to $52 thousand for the year ended December 31, 2024, representing an increase of $572 thousand. The increase was principally driven by bank fees charged by our banking partner for our lending revenue vertical and an increase to referral partner payouts related to the IP acquisition.

General and Administrative Expenses

General and administrative expenses decreased 23.0% to approximately $6,003 thousand for the year ended December 31, 2025, from $7,794 thousand in 2024. The reduction was mainly due to lower salaries following the Company’s restructuring plan, lower professional fees, and less stock-based compensation.

Research and Development Expenses

Research and development expenses were approximately $2,347 thousand for the year ended December 31, 2025, compared to $1,977 thousand for the year ended December 31, 2024, representing an increase of 18.7%. The increase was solely driven by the Company’s decision to expand the development team to launch its lending vertical and the additional costs related to managing IP’s platform.

Other Income (Expenses)

Interest Expense

Interest expense was approximately $121 thousand and $67 thousand for the years ended December 31, 2025 and December 31, 2024, respectively, representing an increase of $54 thousand. The increase was due to the interest expense related to the convertible notes and liability assumption from our banking partner.

Gain on debt extinguishment

The gain on debt extinguishment was approximately $13 thousand for the year ended December 31, 2025 compared to $1,245 thousand for the year ended December 31, 2024. The decrease was due to the Company extinguishing less of its past debt.

Loss on change in fair value of contingent consideration

The loss was approximately $174 thousand for the year ended December 31, 2025 compared to $0 for the year ended December 31, 2024. The change was due to the Company adjusting the earnout owed to the Sellers of IP.

Debt discount amortization

The debt discount amortization was approximately $104 thousand for the year ended December 31, 2025, compared to $579 thousand for the year ended December 31, 2024. The change was due to the amount of convertible debt incurred in FY 2025 versus the prior year.

Other income (expenses)

Other expense was approximately $45 thousand for the year ended December 31, 2025, compared to other income of approximately $15 thousand for the year ended December 31, 2024, representing an increase of $30 thousand. The increase was primarily driven by interest income earned on the note receivable related to our banking parter relationship.

Liquidity and Capital Resources

The Company routinely evaluates its immediate working capital needs and liquidity sources. For the years ended December 31, 2025 and 2024, the Company maintained its liquidity sources primarily through cash and cash equivalents, convertible notes, and proceeds received from equity and equity-linked instruments to pay for services and compensation.

Cash and cash equivalents at December 31, 2025 and 2024 were $244 thousand and $868 thousand, respectively.

See Note 9 – Stockholders’ Equity.

Management's Plan to Address Going Concern Considerations

The Company has experienced recurring operating losses, primarily due to limited revenues and net cash used in operations. The Company's current financial conditions and recurring losses raise substantial doubt about its ability to continue as a going concern.

Management is actively pursuing additional funding options and is confident that its revenue streams will begin generating revenue in the following twelve months from the issuance date of these financial statements.

Management intends to maintain adequate working capital and adhere to prudent financial forecasting. In December 2025, Management began implementing comprehensive expense reduction strategies across the Company’s operations to enhance financial stability.

Cash Flows

The following table presents a summary of cash flows from operating, investing and financing activities ($ in thousands):


	2025			2024

Net cash used in operating activities	$	(4,889	)	$	(7,457	)
Net cash used in investing activities	$	(1,884	)	$	(1,159	)
Net cash provided by financing activities	$	6,149		$	8,203

Cash Flow from Operating Activities

Net cash used in operating activities during the year ended December 31, 2025 was approximately $4,889 thousand, which is comprised of (i) our net loss of $7,920 thousand, adjusted for non-cash expenses totaling $2,716 thousand (which includes adjustments for equity-based compensation, depreciation and amortization), and (ii) is decreased by changes in operating assets and liabilities of approximately $315 thousand.

Net cash used in operating activities during the year ended December 31, 2024 was approximately $7,457 thousand, which is comprised of (i) our net loss of $8,933 thousand, adjusted for non-cash expenses totaling $2,175 thousand (which includes adjustments for equity-based compensation, depreciation and amortization), and (ii) is decreased by changes in operating assets and liabilities of approximately $699 thousand.

Cash Flow from Investing Activities

Net cash used by investing activities during the year ended December 31, 2025 was approximately $1,884 thousand. This expenditure was primarily attributable to the acquisition of IP.

Net cash used by investing activities during the year ended December 31, 2024 was approximately $1,159 thousand. This expenditure was primarily attributable to capitalized software costs.

Cash Flow from Financing Activities

Net cash provided by financing activities during the year ended December 31, 2025 was approximately $6,149 thousand, driven by net proceeds received of $3,550 thousand through the issuance of common shares and warrants, and $2,599 thousand proceeds received from notes payables, net of repayments.

Net cash provided by financing activities during the year ended December 31, 2024 was approximately $8,203 thousand, driven by net proceeds received of $6,288 thousand through the issuance of common shares and warrants in our public offerings, $1,010 thousand proceeds received from exercise of warrants, and $910 thousand net proceeds received from convertible notes payable.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. Significant estimates include those related to the valuation of intangible assets acquired as part of the business combination and related contingent consideration. These estimates are based on historical experience and assumptions believed to be reasonable under current conditions. It's important to note that actual results could differ from these estimates.

Critical accounting policies are those that we consider the most critical to understanding our financial condition and results of operations. The accounting policies we believe to be most critical to understanding our financial condition and results of operations are discussed below. As of December 31, 2025, there have been no significant changes to our critical accounting estimates nor to our recently issued accounting pronouncements, except as described in Note 2 to our consolidated financial statements.

Business Combination

Recognition and Measurement: Companies must recognize the assets acquired, liabilities assumed, and any non-controlling interest in the acquiree at their fair value on the acquisition date.

Goodwill: Arises when the consideration transferred in a business combination exceeds the fair value of the net identifiable assets acquired. It represents future economic benefits arising from assets that are not individually identified and separately recognized.

Intangible Assets: Identifiable intangible assets, distinguishable either by separability from the acquired entity or through contractual or other legal rights, are valued and reported independently from goodwill. These assets include, but are not limited to, trademarks, customer relationships, proprietary technology, and patents. The fair value of these intangible assets is determined at the time of acquisition and is subject to subsequent impairment tests.

The fair value of identifiable intangible assets is estimated using income, market, or cost approach methods. The income approach, often applied through the discounted cash flow (DCF) method, involves projecting future cash flows attributable to the asset and discounting them to present value using a discount rate that reflects the risk associated with those cash flows. The estimation of fair value is inherently uncertain due to the assumptions and judgments involved in projecting future cash flows, determining appropriate discount rates, and estimating the useful life of each asset.

Over the reporting period, changes in market conditions, technological advancements, or strategic shifts in the business may necessitate revisions to the assumptions used in the valuation of identifiable intangible assets. Management closely monitors these factors and will adjust the valuation of intangible assets as appropriate, reflecting the impact of any such changes in our financial statements.

Contingent Consideration: Any contingent consideration, such as earn-outs, is measured at fair value at the acquisition date and can be adjusted in subsequent periods if the fair value changes.

Smaller Reporting Company

As a smaller reporting company, as defined in Item(f)(1) of Regulation S-K, we may choose to prepare our disclosures relying on scaled disclosure requirements for smaller reporting companies in Regulation S-K and in Article 8 of Regulation S-X.

The scaled disclosure requirements for smaller reporting companies permit us (i) to include less extensive narrative disclosure than required of other reporting companies, particularly in the description of executive compensation and (ii) to provide audited consolidated financial statements for two fiscal years, in contrast to other reporting companies, which must provide audited consolidated financial statements for three years.

We may lose our status as a smaller reporting company on the last day of the fiscal year in which (i) our public float exceeds $250 million or (ii) if we have more than $100 million in annual revenues and (a) have no public float or (b) have a public float or more than $700 million.

Recent Accounting Pronouncements

As of December 31, 2025, there was no significant changes to our recently issued accounting pronouncements, except as described in Note 2 to our consolidated financial statements.

Off-Balance Sheet Arrangements

We do not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, that would have been established to facilitate off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulation S-K) or other contractually narrow or limited purposes. As such, we are not exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in those types of relationships. We enter into guarantees in the ordinary course of business related to the guarantee of our own performance.

Equity-based Compensation

The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at the fair market value on the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair market value of stock options and other equity-based compensation issued to employees and non-employees.

During the years ended December 31, 2025, and 2024, 10,000 shares and 260,000 shares of common stock were issued to consultants and employees in connection with business development, professional, and employment services with a value of $5 thousand and $267 thousand, respectively.

Related Parties

See Item 13 for a full discussion of related parties.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Because we are allowed to comply with the disclosure obligations applicable to a “smaller reporting company,” as defined by Rule 12b-2 of the Exchange Act, with respect to this Annual Report on Form 10-K, we are not required to provide the information required by this Item.

Item 8. Financial Statements and Supplementary Data

The consolidated financial statements and related financial statement schedules required to be filed are indexed on page 24 and are incorporated herein.

Item 9. Changes in and Disagreements with Accounts on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including the Chief Executive Officer and the Chief Financial Officer, we evaluated the effectiveness of the design and operation of our “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2025 due to the material weaknesses in our internal control over financial reporting as described below.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

Our management is also responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for us. Our management, including our Chief Executive Officer and Chief Financial Officer, evaluated, as of December 31, 2025, the effectiveness of our internal control over financial reporting using the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, our management concluded that our internal control over financial reporting was not effective as of December 31, 2025.

The management has identified a material weakness in our internal control over financial reporting, primarily due to insufficient formal financial reporting policies and procedures resulting in material post-close adjustments.

Policies and procedures should be implemented to ensure that any significant events requiring disclosure are identified, accounted for, disclosed and reviewed by the management.

Changes in Internal Control over Financial Reporting

There have been no material changes in our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the fourth quarter of 2025 that materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Limitations on the Effectiveness of Controls

Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Because of the inherent limitations in any control system, misstatements due to error or fraud may occur and not be detected.

Item 9B. Other Information

For the quarter ended December 31, 2025, there was no information required to be disclosed in a report on Form 8-K which was not disclosed in a report on Form 8-K.

During the quarter ended December 31, 2025, no director or officer adopted or terminated any “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The information required by this item regarding our executive officers will be presented under the caption “Executive Officers” in our Proxy Statement for the 2026 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission within 120 days of the fiscal year ended December 31, 2025 (the 2026 Proxy Statement) and is incorporated herein by reference.

The information required by this item regarding our compliance with Section 16 of the Exchange Act of 1934, as amended, will be presented under the caption “Security Ownership of Certain Beneficial Owners and Management - Delinquent Section 16(a) Reports” in our 2026 Proxy Statement and is incorporated herein by reference.

The information required by this item regarding our audit committee will be presented under the caption “Corporate Governance - Board Committee - Audit Committee” in our 2026 Proxy Statement and is incorporated herein by reference.

We have adopted a written code of business ethics and conduct, known as the “Code of Business Conduct,” which applies to all our directors, officers, and employees, including our Chief Executive Officer and Chief Financial Officer. The full text is available on our website. The information required by this item regarding our code of ethics will be presented under the caption “Corporate Governance - Code of Business Conduct” in our 2026 Proxy Statement and is incorporated herein by reference. There is no material change.

The information required by this item regarding our insider trading policy will be presented under the caption “Insider Trading Policy” in our 2026 Proxy Statement and is incorporated herein by reference.

Item 11. Executive Compensation

The information required by this item regarding executive compensation will be presented under the caption “Executive Compensation” in our 2026 Proxy Statement and is incorporated herein by reference.

The information required by this item regarding director compensation will be presented under the caption “Corporate Governance - Director Compensation” in our 2026 Proxy Statement and is incorporated herein by reference.

The information required by this item regarding our compensation committee will be presented under the caption “Corporate Governance - Compensation Committee Interlocks and Insider Participation” in our 2026 Proxy Statement and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item regarding security ownership and certain beneficial owners and management will be presented under the caption “Security Ownership of Certain Beneficial Owners and Management” in our 2026 Proxy Statement and is incorporated herein by reference.

Equity Compensation Plan

The following table provides information, as of December 31, 2025, with respect to shares of our common stock that may be issued, subject to certain vesting requirements, under existing or future awards under our 2025 Equity Incentive Plan (“2025 Plan”). The 2025 Plan was approved by our Board of Directors and ratified by our shareholders at our 2025 Annual Shareholder Meeting.

Plan Category

Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights

Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights

Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (A))

Equity compensation plans approved by security holders

811,312

1.47

⁷

2,788,009

Equity compensation plans not approved by security holders

–

Total

811,312

1.47

2,788,009

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this item regarding certain relationships and related persons transactions will be presented under the caption “Certain Relationships and Related Persons Transactions” in our 2026 Proxy Statement and is incorporated herein by reference.

The information required by this item regarding director independence will be presented under the caption “Corporate Governance - Independent Directors” in our 2026 Proxy Statement and is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

The information required by this item regarding aggregate fees billed to us by our independent registered public accounting firm’s fees will be presented in our 2026 Proxy Statement and is incorporated herein by reference.

The information required by this item regarding our audit committee’s pre-approval policies and procedures will be presented in our 2026 Proxy Statement and is incorporated herein by reference.

____________________

⁷ The weighted-average exercise price does not take into account restricted stock units, which do not have an exercise price.

PART IV

Item 15. Exhibits and Financial Statements Schedules

(a) The following documents are filed as part of, or incorporated by reference into, this Annual Report on Form 10-K:

	1.	Financial Statements. See Index to Financial Statements under Item 8 of this Annual Report on Form 10-K.

	2.	Financial Statement Schedules. All schedules have been omitted because the information required to be presented in them is not applicable or is shown in the financial statements or related notes.

	3.	Exhibits. We have filed, or incorporated into this Annual Report on Form 10-K by reference, the exhibits listed on the accompanying Exhibit Index immediately following the financial statements contained in this Annual Report on Form 10-K.

(b) Exhibits. See Item 15(a)(3) above.

Item 16. Form 10-K Summary

Not applicable.

APPTECH PAYMENTS CORP. CONSOLIDATED FINANCIAL STATEMENTS

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Pages

Report of Independent Registered Public Accounting Firm (PCAOB ID 3501)	23

Consolidated Balance Sheets	25

Consolidated Statements of Operations	26

Consolidated Statements of Stockholders’ Equity	27

Consolidated Statements of Cash Flows	28

Notes to the Consolidated Financial Statements	29

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of AppTech Payments Corp.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of AppTech Payments Corp. (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders’ equity, and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has suffered recurring losses from operations and cash used in operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter, or on the accounts or disclosures to which they relate.

Business Combination

As described in Note 1, the Company completed the acquisition of Infinitus Pay, Inc. for consideration transferred which included cash, equity, and contingent consideration. The acquisition resulted in the recognition of goodwill and identifiable intangible assets. The Company engaged a third-party valuation specialist to assist in valuing the identifiable intangible assets as well as the contingent consideration.

How the Critical Audit Matter was Addressed in the Audit

Auditing the Company’s accounting for the acquisition required significant auditor judgment due to the complexity of estimating the fair value of the acquired intangible assets and contingent consideration. These estimates involved significant assumptions and judgements with respect to forecasted revenue growth rates, profit margins, royalty rates, and discount rates.

Our audit procedures related to the Company’s valuation of identifiable intangible assets and the contingent consideration for the businesses combination included the following, among others:

We gained an understanding of the methods used by management to account for the business combination, including the use of a third-party valuation specialist. We evaluated the purchase price allocation performed by the third-party valuation specialist engaged by management. Our procedures included evaluating the professional qualifications and objectivity of the specialist, assessing the appropriateness of the valuation methodologies used, and testing the completeness and accuracy of the underlying data provided to the specialist. We evaluated the reasonableness of key assumptions, including forecasted revenue growth rates, profit margins, royalty rates, and discount rates by comparing them to relevant industry benchmarks, market data, and the Company's historical performance. Additionally, we assessed the consistency of these assumptions with the Company's strategic plans and other information obtained during our audit as well as for indications of management bias.

/s/ dbbmckennon

We have served as the Company’s auditor since 2014

San Diego, California

March 31, 2026

APPTECH PAYMENTS CORP.

CONSOLIDATED BALANCE SHEETS

($ in thousands, except per share data)


	December 31, 2025			December 31, 2024
ASSETS
Current assets
Cash and cash equivalents	$	244		$	868
Accounts receivable		350			43
Prepaid expenses		25			159
Interest receivable		46			–
Other current assets		250			1,350
Total current assets		915			2,420
Right of use asset		18			86
Security deposit		32			86
Intangible assets, net of accumulated amortization		4,151			3,410
Goodwill		2,956			1,161
Capitalized software development, net of accumulated amortization		1,321			1,823
TOTAL ASSETS	$	9,393		$	8,986

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	2,566		$	1,853
Accrued liabilities		1,321			1,519
Notes payable		250			–
Notes payable – related party		1,000			–
Convertible notes payable, net of discount of $66		717			–
Deferred revenue		5			–
Contingent consideration		564			–
Right of use liability		18			68
Total current liabilities		6,441			3,440
Long-term liabilities
Right of use liability, net of current portion		–			18
Notes payable – related party, net of current portion		1,000			–
Notes payable, net of current portion		59			61
Total long-term liabilities		1,059			79
TOTAL LIABILITIES		7,500			3,519

Commitments and contingencies (Note 8)		–			–

Stockholders’ equity
Series A preferred stock; $0.001 par value; 100,000 shares authorized; 14 shares issued and outstanding at December 31, 2025 and 2024		–			–
Common stock, $0.001 par value; 105,263,158 shares authorized; 40,488,934 and 33,278,934 issued and outstanding at December 31, 2025 and 2024, respectively		40			33
Additional paid-in capital		178,470			174,131
Accumulated deficit		(176,617	)		(168,697	)
Total stockholders’ equity		1,893			5,467
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	9,393		$	8,986

See accompanying notes to the consolidated financial statements

APPTECH PAYMENTS CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in thousands, except per share data)


	December 31, 2025			December 31, 2024

Revenues	$	1,395		$	276
Cost of revenues		624			52
Gross profit		771			224

Operating expenses:
General and administrative, including stock-based compensation of $981 thousand and $1,254 thousand, for the years ended December 31, 2025 and 2024, respectively		6,003			7,794
Research and development, including stock-based compensation of $0 thousand and $138 thousand, for the years ended December 31, 2025 and 2024, respectively		2,347			1,977
Total operating expenses		8,350			9,771

Loss from operations		(7,579	)		(9,547	)

Other income (expenses)
Interest expense		(121	)		(67	)
Gain on debt extinguishment		13			1,245
Loss on change in fair value of contingent consideration		(174	)		–
Debt discount amortization		(104	)		(579	)
Other income		45			15
Total other expenses		(341	)		614

Loss before provision for income taxes		(7,920	)		(8,933	)

Provision for income taxes		–			–

Net loss		(7,920	)		(8,933	)
Deemed dividend related to warrant resets		–			(15	)
Net loss attributable to common stockholders	$	(7,920	)	$	(8,948	)

Basic and diluted net loss per common share	$	(0.23	)	$	(0.35	)
Weighted-average number of shares used basic and diluted per share amounts		34,872,578			25,305,837

See accompanying notes to the consolidated financial statements.

APPTECH PAYMENTS CORP.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

($ in thousands, except per share data)


	Series A Preferred				Common Stock				Additional Paid-in			Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Capital			Deficit			Equity

Balance December 31, 2023		14	$	–		22,251,742	$	22	$	163,921		$	(159,749	)	$	4,194
Net loss		–		–		–		–		–			(8,933	)		(8,933	)
Stock-based compensation		–		–		260,000		–		1,392			–			1,392
Net proceeds from sale of common stock		–		–		6,473,180		7		6,281			–			6,288
Offering costs		–		–		–		–		(68	)		–			(68	)
Repricing of warrants		–		–		–		–		15			(15	)		–
Shares issued for debt conversion		–		–		1,975,606		2		1,124			–			1,126
Warrants issued		–		–		–		–		334			–			334
Warrants exercised, net		–		–		1,666,667		2		1,008			–			1,010
Warrants exercised – cashless		–		–		521,739		–		–			–			–
Shares issued with notes payable		–		–		130,000		–		124			–			124
Balance December 31, 2024		14	$	–		33,278,934	$	33	$	174,131		$	(168,697	)	$	5,467
Net loss		–		–		–		–		–			(7,920	)		(7,920	)
Stock-based compensation		–		–		10,000		–		981			–			981
Net proceeds from sale of common stock		–		–		2,200,000		2		2,198			–			2,200
Warrants issued for acquisition		–		–		–		–		365			–			365
Common stock issued for Infinitus Pay, Inc acquisition		–		–		5,000,000		5		795			–			800
Balance December 31, 2025		14	$	–		40,488,934	$	40	$	178,470		$	(176,617	)	$	1,893

See accompanying notes to the consolidated financial statements.

APPTECH PAYMENTS CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in thousands, except per share data)


	December 31, 2025			December 31, 2024
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(7,920	)	$	(8,933	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation		981			1,392
Gain on debt extinguishment		(13	)		(1,245	)
Loss on change in fair value of contingent consideration		174			–
Amortization of debt discount		104			579
Amortization of intangible assets and software		1,470			1,423
Write-off of note receivable		–			26
Changes in operating assets and liabilities:
Accounts receivable		(308	)		(12	)
Prepaid expenses		134			46
Other current assets		(46	)		(1,350	)
Accounts payable		726			1,150
Accrued liabilities		(196	)		(413	)
Deferred revenue		5			(94	)
Right of use asset and liability, net		–			(26	)
Net cash used in operating activities		(4,889	)		(7,457	)
CASH FLOWS FROM INVESTING ACTIVITIES
Capitalized software development		–			(1,081	)
Other assets		55			(78	)
Cash paid for Infinitus Pay, Inc. acquisition		(2,000	)		–
Cash acquired, acquisition of Infinitus Pay, Inc.		61			–
Net cash used in investing activities		(1,884	)		(1,159	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common stock		2,200			6,288
Proceeds from notes payable - related party		2,000			–
Proceeds from notes payable		–			200
Repayments of note payable		(250	)		(205	)
Proceeds from convertible note payable		849			910
Proceeds from equity receivable		1,350			–
Proceeds received from exercise of stock options and warrants		–			1,010
Net cash provided by financing activities		6,149			8,203
Changes in cash and cash equivalents		(624	)		(413	)
Cash and cash equivalents, beginning of year		868			1,281
Cash and cash equivalents, end of year	$	244		$	868
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for interest	$	66		$	67
Cash paid for income taxes	$	–		$	–
NON-CASH INVESTING AND FINANCING ACTIVITIES
Goodwill from acquisition	$	1,795		$	–
Intangible assets from acquisition	$	1,709		$	–
Non-cash discount on issuance	$	170		$	–
Assumption of notes payable, through the issuance of note receivable	$	250		$	–
ROU assets and lease liabilities recognized from the new lease	$	–		$	86
Shares issued for debt conversion	$	–		$	1,126
Shares issued for prepaid services	$	–		$	68
Shares issued with notes payable	$	–		$	124
Warrants issued with convertible notes payable	$	–		$	334

See accompanying notes to the consolidated financial statements.

APPTECH PAYMENTS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

($ in thousands, except per share data)

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

AppTech Payments Corp. (“AppTech” or the “Company”), a Delaware corporation, is a Fintech Company headquartered in Carlsbad, California. AppTech utilizes innovative payment processing and digital banking technologies to complement its core merchant services capabilities. The Company’s proprietary software will provide progressive and adaptable products that are available through a suite of synergistic offerings directly to merchants, banking institutions, and business enterprises.

AppTech has a highly secure digital payments platform that we acquired and are further developing digital banking products to power commerce experiences for clients and their customers. Based upon industry standards for payment and banking protocols, we will offer standalone products and fully integrated solutions that deliver innovative, unparalleled payments, banking, and financial services experiences. Our processing technologies can be taken off-the-shelf or tapped into via our RESTful APIs to build fully branded and customizable experiences while supporting tokenized, multi-channel, and multi-method transactions.

In June 2023, the Company entered into licensing agreements with InstaCash and PayToMe.co. The licensing arrangement with InstaCash was terminated in December 2024.

Purchase of Infinitus Pay, Inc.

On October 31, 2025 (the “Acquisition Date”), the Company acquired 100% of the outstanding equity interests of Infinitus Pay Inc., a provider of payment platform solutions, pursuant to a Stock Purchase and Share Exchange Agreement dated October 30, 2025. The acquisition was accounted for as a business combination in accordance with ASC 805, Business Combinations. The acquisition enhances the Company’s Banking-as-a-Service (BaaS) and digital commerce offerings by integrating IP’s technology platform and customer relationships.

The fair value of consideration transferred as of the Acquisition Date was as follows:


Consideration Transferred	Fair Value ($)
Cash paid at closing		2,000
Common stock issued (5,000,000 shares at $0.16 per share)		800
Warrants issued		365
Contingent consideration		390
Total consideration transferred		3,555

The fair value of the common stock was determined using the Company’s closing market price on the Acquisition Date.

The warrants were classified as equity and recorded within additional paid-in capital at their estimated fair value on the Acquisition Date. Fair value was determined using an option-pricing model incorporating assumptions for expected volatility, expected term, and risk-free interest rate. Because the warrants are equity-classified, they are not subject to subsequent remeasurement.

The contingent consideration represents a revenue-based earnout of up to $1,000 thousand payable in cash upon achievement of specified post-acquisition performance targets. The earnout was measured at fair value using a Monte Carlo simulation approach. The contingent consideration liability will be remeasured at fair value at each reporting date, with changes recognized in earnings.

Allocation of Purchase Price

The purchase price was allocated to the identifiable assets acquired and liabilities assumed based on their estimated fair values as of the Acquisition Date as follows. Net identifiable assets acquired totaled $1,760 thousand. Goodwill of $1,795 thousand was recognized as the excess of total consideration transferred over the fair value of net identifiable assets acquired. Goodwill primarily represents expected synergies from combining operations, the value of the assembled workforce, and anticipated future growth opportunities. Of the total intangible assets acquired of $3,504 thousand, $1,387 thousand related to software development which will be depreciated on a straight-line basis over a 5-year period.

The following unaudited pro-forma combined financial information is based on the financial statements of the Company and Infinitus Pay, Inc. There were no material proforma adjustments to record.


	December 31, 2024
$ in thousands	AppTech Payments Corp.			Infinitus Pay, Inc.		Pro-Forma Combined
Revenues	$	276		$	12	$	288
Net income (loss)	$	(8,933	)	$	5	$	(8,928	)


	December 31, 2025
$ in thousands	AppTech Payments Corp.			Infinitus Pay, Inc.		Pro-Forma Combined
Revenues	$	1,395		$	268	$	1,663
Net income (loss)	$	(7,920	)	$	13	$	(7,907	)

This contingent consideration liability is classified as a Level 3 fair value measurement; it is remeasured at each reporting date with changes in fair value recognized in earnings. The following table presents a rollforward of the liability for the period:


$ in thousands	December 31, 2025
Beginning balance	$	–
Contingent consideration at acquisition date		390
Loss on change in fair value of contingent consideration		174
Total contingent consideration	$	564

Liquidity and Going Concern Considerations

In late 2024, we reorganized senior leadership and initiated actions to reduce indebtedness to improve the current financial condition. In addition, we are actively pursuing additional funding options and are confident that our revenue streams will begin generating cash, although no assurances can be made.

Management continues to maintain adequate working capital and adhere to prudent financial forecasting.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated audited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Certain prior period amounts have been reclassified to conform to the current period’s presentation.

Basis of Consolidation

The consolidated audited financial statements include the accounts of AppTech Payments Corp. and its wholly owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation.

Use of Estimates

The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The Company makes critical estimates and assumptions in valuing identifiable intangible assets from the IP acquisition, and its related contingent considerations. Actual results could differ from those estimates.

Concentration of Credit Risk

Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits of $250,000 per institution that pays Federal Deposit Insurance Corporation (“FDIC”) insurance premiums. The Company has never experienced any losses related to these balances.

As of December 31, 2025, one customer accounted for 16% of the accounts receivable balance compared to three customers accounting for 85% in 2024.

For the year ended December 31, 2025, two customers accounted for 31% and 15% of our revenues compared to 34%, 22% and 15% for the top three customers for the year ended December 31, 2024. The loss of the customers would have a significant impact on the Company's financials

Cash and Cash Equivalents

The Company's cash consists of cash on deposit at its bank. Cash equivalents, if applicable, represents highly liquid investments with maturities of three months or less at the date of purchase. Management determines the appropriate classification.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable are recorded at the invoiced amount and presented net of an allowance for credit losses, when applicable. The Company estimates the allowance for credit losses using relevant available information, from both internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. Historical loss experience is generally the starting point for estimating expected credit losses, which is then adjusted for current conditions and reasonable and supportable forecasts of future economic conditions, as applicable. The Company regularly monitors receivables for collectability and updates its estimate of expected credit losses at each reporting date.

Historically, the Company has not experienced significant credit losses on its accounts receivable and, as a result, maintains an allowance for credit losses of $0 as of December 31, 2025 and December 31, 2024, respectively. The Company has not written off any material accounts receivable balances in the periods presented.

Loan Receivables and Interest Income

Loan receivable represents amounts due to the Company under contractual lending arrangements. Loans are recorded at their outstanding principal balance, net of any allowance for expected credit losses, when applicable. The Company evaluates loan receivables for collectability on a regular basis and considers relevant factors such as payment history, financial condition of the borrower, and current economic conditions.

Interest income is recognized over the term of the loan using the effective interest method, based on the principal amount outstanding. Accrual of interest is discontinued when, in management’s opinion, the collectability of principal or interest becomes uncertain. Payments received on nonaccrual loans are applied to principal unless otherwise determined by management.

Convertible Notes

Convertible notes represent debt instruments that may be converted into the Company’s equity securities upon the occurrence of certain events or at the option of the holder, in accordance with the terms of the agreement. Convertible notes are recorded at their principal amount, net of any unamortized debt discount and issuance costs.

The Company evaluates the terms of each convertible note to determine whether any embedded features, including conversion options, should be accounted for separately or as a component of the note. Debt discounts, including those arising from embedded derivative liabilities or other embedded elements, are amortized to interest expense over the term of the notes using the effective interest method.

Upon conversion, the carrying value of the convertible note, including any unamortized discount, is reclassified to equity.

Revenue Recognition

The Company accounts for revenue under Accounting Standards Codification (“ASC”) 606 Revenue from Contracts with Customers, which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers.

Setup Fees

Monthly Platform and Transaction-Based Fees

Customers are invoiced in arrears at month-end, and amounts billed but not yet collected are recorded as accounts receivable.

Merchant Processing Services

Accrued Residuals

The Company pays commissions to independent agents who refer merchant accounts. The amounts payable to these independent agents are based upon a percentage of the amounts processed by these merchant accounts.

Business Combination

ASC 805, Business Combinations (“ASC 805”), applies the acquisition method of accounting for business combinations to all acquisitions where the acquirer gains a controlling interest, regardless of whether consideration was exchanged. ASC 805 establishes principles and requirements for how the acquirer: a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree; b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. Accounting for acquisitions requires the Company to recognize, separately from goodwill, the assets acquired, and the liabilities assumed at their acquisition-date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred and the net of the acquisition-date fair values of the assets acquired and the liabilities assumed. While the Company provided its best estimates and assumptions when accurately valuing assets acquired and liabilities assumed at the acquisition date, the estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

Intangible Assets and Intellectual Property

Intellectual Property

The Company amortizes intellectual property based on the estimated period over which the economic benefits of the intangible assets are expected to be consumed. Typically, the Company amortizes its intellectual property, including patents and other identifiable intangible assets, on a straight-line basis. The amortization periods generally range from three years to fifteen years, depending on the nature of the asset and its expected useful life.

Capitalized Software Development Cost

The Company capitalizes certain costs related to the development of its digital payment and banking platform, including employee compensation and consulting fees for third-party developers, only when it is probable that the development will result in new or additional functionality. Costs incurred during the preliminary project planning phase and post-implementation phase are expensed as incurred. The capitalized software development costs are amortized on a straight-line basis over the estimated useful life of the asset.

Goodwill

The Company accounts for goodwill in accordance with ASC 350, Intangibles – Goodwill and Other (“ASC 350”). ASC 350 requires that goodwill and other intangibles with indefinite lives should be tested for impairment annually or on an interim basis if events or circumstances indicate that the fair value of an asset has decreased below its carrying value. Goodwill represents the excess of the purchase price over the estimated fair values of the net tangible and intangible assets of acquired entities. The Company performs a goodwill impairment test annually and more frequently if an event or circumstance indicates that impairment may have occurred. Triggering events that may indicate a potential impairment include, but are not limited to, significant adverse changes in customer demand or business climate and related competitive considerations. The Company first performs a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs a goodwill impairment test to calculate the fair value of the applicable reporting unit(s) and compares it to its carrying amount. We recognize an impairment on any amount of the carrying value over the fair value. If the Company determines that the implied fair value of a reporting unit is greater than its carrying amount, the goodwill impairment test is not required. Management performed the analysis and no impairment was deemed necessary.

Impairment of Long-Lived Assets

Long-lived assets are reviewed for impairment when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability of assets to be held and used is measured by comparing the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset or asset group exceeds the estimated fair value of the asset or asset group. Long-lived assets to be disposed of by sale are reported at the lower of their carrying amounts or their estimated fair values less costs to sell and are not depreciated. During the years ended December 31, 2025 and 2024, there was $0 in asset impairments.

Leases

The Company recognizes right-of-use assets and lease liabilities at the commencement date of the lease based on the present value of remaining fixed and determinable lease payments over the lease term. The Company calculates the present value of future payments by using an estimated incremental borrowing rate, which approximates the rate at which the Company would borrow on a secured basis and over a similar term, and recognizes lease expense for operating leases on a straight-line basis over the lease term. Right-of-use assets represent the Company’s right to control the use of an identified asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The Company uses the incremental borrowing rate on the commencement date in determining the present value of the lease payments.

The Company has lease agreements which include lease and non-lease components, which the Company has elected to account for as a single lease component for all classes of underlying assets. Lease expense for variable lease components are recognized when the obligation is probable.

The lease term for all of the Company’s leases includes the non-cancellable period of the lease plus any additional periods covered by either a Company option to extend (or not to terminate) the lease that the Company is reasonably certain to exercise, or an option to extend (or not to terminate) the lease controlled by the lessor. Options for lease renewals have been excluded from the lease term (and lease liability) for the majority of the Company’s leases as the reasonably certain threshold is not met.

Lease payments included in the measurement of the lease liability are comprised of fixed payments, variable payments that depend on index or rate, and amounts probable to be payable under the exercise of the Company option to purchase the underlying asset if reasonably certain. Variable lease payments are presented as operating expenses in the Company’s statement of operations in the same line as expense arising from fixed lease payments. As of December 31, 2025 and 2024, management determined that there were no variable lease costs.

Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date.

The Company’s income tax returns are based on calculations and assumptions that are subject to examination by the Internal Revenue Service and other tax authorities. In addition, the calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. While the Company believes it has appropriate support for the positions taken on its tax returns, the Company regularly assesses the potential outcomes of examinations by tax authorities in determining the adequacy of its provision for income taxes. The Company continually assesses the likelihood and amount of potential adjustments and adjusts the income tax provision, income taxes payable and deferred taxes in the period in which the facts that give rise to a revision become known. As of December 31, 2025 and 2024, the Company does not believe any provisions are required in connection with uncertain tax positions.

Research and Development

Research and Development (R&D) expenses include internal and outsourced service costs incurred to maintain the FinZeo and Infintus Pay, Inc platforms. Per ASC 730, R&D costs are expensed as incurred. Total R&D expenses for the years ended December 31, 2025 and December 31, 2024, were approximately $2,347 thousand and $1,977 thousand, respectively.

Per Share Information

Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the year. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the year, increased by the potentially dilutive common shares that were outstanding during the year. Dilutive securities include stock options, warrants granted, convertible debt and convertible preferred stock.

The number of common stock equivalents not included in diluted income per share for the years ended December 31, 2025 and 2024, respectively are presented below. The weighted average number of common stock equivalents is not included in diluted income (loss) per share, because the effects are anti-dilutive.


	December 31, 2025		December 31, 2024
Series A preferred stock		1,148		1,148
Warrants		28,781,627		15,906,627
Options		5,402,354		5,446,785
Total		34,185,129		21,354,560

Stock-based compensation

Stock options are valued using the estimated grant-date fair value method of accounting in accordance with ASC Topic 718, Compensation – Stock Compensation. Fair value is determined based on the Black-Scholes Model using inputs reflecting our estimates of expected volatility, term and future dividends. We recognize forfeitures as they occur. The Company has several consulting agreements that have share-based payment awards based on performance. These agreements typically require the Company to issue common stock to the consultants on a monthly basis. The Company records the fair market value of the common stock issuable at each month end when the performance is complete based upon the closing market price of the Company’s common stock.

Segment Reporting

In accordance with ASC 280, Segment Reporting (“ASC 280”), we identify our operating segments according to how our business activities are managed and evaluated. ASC 280 establishes standards for companies to report financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision makers (“CODMs”) in deciding how to allocate resources and assess performance.

The CODMs have been identified as the Chief Executive Officer and Chief Financial Officer, who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that the Company only has one operating and reportable segment.

The key measures of segment profit or loss reviewed by our CODMs are revenue and operating expenses. Revenue is monitored by the CODMs to understand the performance of its verticals. Operating expenses are reviewed and monitored by the CODMs to manage and forecast cash. The CODMs also reviews operating costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and internal budgets.

Fair Value Measurements

The Company measures certain assets and liabilities at fair value in accordance with applicable accounting guidance. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.

The Company categorizes fair value measurements within a three-level hierarchy based on the nature of the inputs used in the valuation, as follows:

	·	Level 1 — Inputs are quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
	·	Level 2 — Inputs are observable for the asset or liability, either directly or indirectly, but do not include quoted prices for identical instruments in active markets. These inputs may include quoted prices for similar assets or liabilities in active markets, quoted prices in markets that are not active, and other observable inputs such as interest rates and yield curves.
	·	Level 3 — Inputs are unobservable and reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the asset or liability. These inputs are developed based on the best information available in the circumstances.

The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of the asset or liability within the fair value hierarchy.

New Accounting Pronouncements

The Financial Accounting Standards Board (“FASB”) issues Accounting Standards Updates (“ASUs”) to amend the authoritative accounting guidance in the Accounting Standards Codification (“ASC”).

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances the transparency and decision-usefulness of income tax disclosures. The standard requires, among other items, enhanced rate reconciliation disclosures (including disaggregation of significant reconciling items by nature and jurisdiction) and expanded disclosures of income taxes paid, net of refunds, by jurisdiction. The Company adopted ASU 2023-09 effective January 1, 2025. The adoption did not impact the Company’s consolidated financial position, results of operations, or cash flows, as the guidance is disclosure-only in nature.

On November 4, 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures. This ASU provides guidance to public companies regarding footnote disclosures of natural expense components (such as employee compensation, depreciation, and amortization) included within each relevant income statement expense caption. The guidance is effective for public companies for fiscal years beginning after December 15, 2026. The Company is currently assessing the impact of the new guidance on its financial statement disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software (the “internal-use software update”). This ASU modernizes the accounting for internal-use software costs to better reflect agile development methods. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures. Per the guidance, the effective date of the ASU is for annual reporting periods after December 15, 2027.

Except as noted above, the Company believes that recent ASUs issued by the FASB either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company, or (iv) are not expected to have a material impact on the Company’s consolidated financial statements or related disclosures.

NOTE 3 – OTHER CURRENT ASSETS

On December 13, 2024, the Company entered into an agreement with AFIOS Partners (“AFIOS”) for a $5,000 thousand direct investment, including an overage of $1,000 thousand. As part of the arrangement, AFIOS received 6,050,000 shares at an average price of $0.99 per share, 6,250,000 warrants to purchase our common stock at $0.90 per share and 7,970,000 warrants to purchase common stock at $1.20 per share. As of December 31, 2024, $1,350 thousand was receivable related to this agreement, which was fully collected in the first quarter of 2025.

See Note 9 – Notes Payable – Stock Issued as part of an Investment.

On April 11, 2025, the Company entered a three-party agreement with one of its banking partners and software providers. Under the terms of the arrangement, AppTech agreed to pay a $103 thousand licensing fee to the software provider. In addition, the banking partner held a $250 thousand note receivable bearing 8% interest with the software provider, while the software provider held an offsetting liability to the banking partner. As part of this arrangement, AppTech assumed the note receivable and offsetting note payable to the software provider and banking partner, respectively. AppTech further paid the accumulated interest to the bank and established an interest receivable from the software provider. The note receivable matures on June 2026, and may be converted early if a financing event occurs. As of December 31, 2025, the accrued interest on the note receivable was $46 thousand.

NOTE 4 – INTANGIBLE ASSETS

Intellectual Property

The Company has two patent portfolios. As of December 31, 2025 and 2024, we have gross value of patents at $407 thousand. As of December 31, 2025 and 2024, accumulated amortization is approximately $407 thousand and $368 thousand, respectively.

As part of the Infintitus Pay, Inc transaction, the Company acquired intangible assets valued at $3,504 thousand, which includes $1,795 thousand of goodwill. $322 thousand in trademarks will not be depreciated, however, the remaining $1,387 thousand in acquired technology will be amortized on a straight-line basis over 60 months.

As of December 31, 2025 and 2024, we have gross value of acquired technology of $6,108 thousand and $4,400 thousand, respectively. For the same periods, the accumulated amortization is approximately $1,957, thousand and $1,029 thousand, respectively.


Intellectual Property	December 31, 2025			December 31, 2024
Beginning balance	$	3,410		$	4,428
Acquisition of intangible assets		1,709			–
Amortization expenses		(968	)		(1,018	)
Ending balance	$	4,151		$	3,410

Capitalized Software Development Cost

The Company capitalizes certain costs related to the development of its digital payment and banking platform.

As of December 31, 2025 and 2024, the Company has gross value of capitalized software development cost at $2,647 thousand and accumulated amortization is approximately $1,326 thousand and $824 thousand, respectively.


Capitalized Software Development Cost	December 31, 2025	December 31, 2024

SEC Form 10-K filed by AppTech Payments Corp.