10-K: SUPA Consolidated Faces Going Concern Doubt Amidst Food Tech Pivot

SUPA Consolidated Inc. reports a significant working capital deficit and no revenue in its 2025 annual filing, raising substantial doubt about its ability to continue as a going concern despite a strategic pivot to food technology.

Summary

• SUPA Consolidated Inc. completed its strategic transition from ridesharing technology by selling its intellectual property to Boumarang Inc. for $5 million in Boumarang common stock on December 31, 2024.
• The company is now focused on the food technology sector, acquiring 1,157 commercial ice/water vending machines from related party SUPA Food Services LLC for 250 million shares of common stock (valued at $125,000) and assuming a $121,200 related party loan on June 30, 2025.
• For the fiscal year ended December 31, 2025, the company reported no revenue, a net loss of $293,069, and an accumulated deficit of $3,092,223.
• Current liabilities of $1,112,845 significantly exceed current assets of $25,775, resulting in a working capital deficit of $1,087,070.
• Management has identified substantial doubt about the company's ability to continue as a going concern, citing insufficient liquidity to fund operations for the next twelve months.
• The company plans to address liquidity issues by raising additional capital, generating revenue from its Boumarang investment and vending operations, seeking continued related party support, and implementing cost reduction measures.
• Several management changes occurred throughout 2025, including the appointment of Yessenia Hernandez as Chief Executive Officer and Executive Director on November 5, 2025.
• The company is involved in a legal proceeding with Igala Commonwealth Limited, which seeks an additional 12.8 million shares (valued at $3,072,000) for alleged liquidated damages from a 2023 consulting agreement.
• Material weaknesses in internal control over financial reporting were identified, including a lack of segregation of duties, inadequate governance, and insufficient documentation.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this filing with a very negative sentiment due to severe liquidity issues, lack of revenue, significant accumulated deficit, and explicit 'going concern' doubt. The strategic pivot is nascent and unproven, overshadowed by financial instability and ongoing legal challenges.

Positives

• Successfully divested historical ridesharing technology intellectual property to Boumarang Inc. for $5,000,000 in Boumarang common stock, providing a strategic non-core asset.
• Completed a strategic pivot to the food technology sector, acquiring 1,157 commercial ice/water vending machines, establishing a new business direction.
• Cash balance increased from $0 at December 31, 2024, to $17,675 at December 31, 2025.
• FINRA approved the corporate name change to SUPA Consolidated Inc. and ticker symbol change to SFCX, effective January 30, 2026, streamlining market identity.

Negatives

• Reported no revenue for both fiscal years ended December 31, 2025, and 2024, indicating a lack of operational income.
• Incurred a net loss of $293,069 for the year ended December 31, 2025, a significant decline from a net income of $52,842 in 2024 (which was primarily due to non-cash gains).
• Experienced a substantial increase in total operating expenses to $406,982 in 2025 from $88,196 in 2024, driven by higher legal, professional, accounting, and rental expenses.
• Working capital deficit worsened to $1,087,070 at December 31, 2025, from $797,001 at December 31, 2024, highlighting severe liquidity constraints.
• Current liabilities of $1,112,845 significantly exceed current assets of $25,775, indicating an inability to meet short-term obligations.
• Accumulated deficit increased to $3,092,223 at December 31, 2025, from $2,799,154 at December 31, 2024.
• Reliance on related party advances for liquidity, with $238,200 owed to Spark Capital Investments LLC and an additional $180,000 accrued for management and consulting services from the same related party.
• The company is currently in the development stage with no current operating revenues, making future operations dependent on external capital or successful product launches.
• Identified material weaknesses in internal control over financial reporting, including lack of segregation of duties, inadequate governance, and insufficient documentation, which could affect financial reporting reliability.

Risks

• Substantial doubt exists about the company's ability to continue as a going concern due to significant working capital deficit, accumulated deficit, and lack of revenue.
• Inability to raise sufficient additional capital through equity or debt financing on acceptable terms, if at all, could force the company to cease operations.
• Failure to generate revenue and positive cash flows from the Boumarang Inc. equity investment and commercial vending operations could exacerbate liquidity issues.
• Reliance on continued financial support from related parties, such as Spark Capital Investments LLC and SUPA Food Services LLC, which is not formally committed and due on demand.
• Exposure to significant legal and financial liabilities from the Igala Commonwealth Limited litigation, which seeks 12.8 million additional shares (4.22% dilution) or $3,072,000 in monetary damages.
• Potential transactional exposure from the Forza 2 LLC pre-litigation demand for at least $655,000, related to vending machines and XNDA shares, which the company is monitoring.
• Cybersecurity risks, including potential unauthorized access, disruption, or damage to systems and data, could materially affect business strategy, operations, or financial condition.
• The company's common stock is considered a penny stock, which decreases broker-dealer willingness to make a market, reduces liquidity, and increases transaction costs.
• Material weaknesses in internal control over financial reporting could lead to undetected misstatements in financial statements.

Future Outlook

The company intends to realign its corporate strategy and resources to identify, develop, and acquire food technology businesses and assets, believing the industry presents significant opportunities. Future operations are dependent on its ability to raise additional capital, complete acquisitions, and successfully launch products or services in the food tech space. Management plans to address liquidity needs by seeking equity or debt financing, generating revenue from its Boumarang Inc. investment and vending operations, obtaining continued related party support, and implementing cost reduction measures. There is no assurance these plans will be successful.

Management Comments

• "We intend to realign our corporate strategy and resources toward identifying, developing, and acquiring food technology businesses and assets."
• "We believe the food tech industry presents significant opportunities driven by global demand for healthier, more sustainable, and technology-enabled food solutions."
• "Our future operations will depend on our ability to raise additional capital, complete acquisitions, and successfully launch products or services in the food tech space."
• "The Company believes the claims asserted in the [Igala] complaint are without merit and intends to defend the lawsuit vigorously."
• "We are committed to maintaining a strong internal control environment, and we believe that these remediation efforts will represent significant improvements in our controls."

Industry Context

StockSavvy.ai notes that SUPA Consolidated's pivot to the food technology sector aligns with broader industry trends emphasizing healthier, sustainable, and technology-enabled food solutions. However, the company is currently in a development stage with no revenue, indicating it is far from capitalizing on these trends. The acquisition of ice/water vending machines represents a very nascent entry into a highly competitive and capital-intensive market, contrasting sharply with the high-growth, software-driven nature of its previous ridesharing technology focus. The reliance on related-party financing and the 'going concern' warning suggest significant challenges in establishing a competitive foothold in this new industry without substantial external capital.

Comparison to Industry Standards

• The company's lack of revenue and significant accumulated deficit are far below industry standards for established food tech companies, which typically demonstrate revenue growth and clear paths to profitability.
• The acquisition of 1,157 vending machines for $40,809 (approximately $35 per machine) suggests a low-value asset base compared to major players in the automated retail or food service equipment sectors, where individual units can cost thousands of dollars and generate substantial recurring revenue.
• The working capital deficit of over $1 million and the 'going concern' warning are critical indicators of financial distress, placing the company significantly below the liquidity and solvency benchmarks of healthy public companies in any sector, let alone a growth-oriented one like food tech.
• The reliance on related-party loans and the absence of formal commitments for continued support are not indicative of robust, independent financing typical for companies seeking to scale in competitive markets.

Management Changes

Corporate Governance

Legal Proceedings

• Igala Commonwealth Limited Litigation: Igala filed a complaint on January 20, 2026, seeking an order for the company to issue an additional 12,800,000 shares of common stock (valued at $3,072,000) based on liquidated damages provisions in a March 2, 2023, consulting agreement. The company believes the claims are without merit and filed a motion to dismiss on February 23, 2026. If Igala prevails, it could result in approximately 4.22% dilution to existing shareholders or a monetary judgment of $3,072,000 plus potential attorney fees.
• Forza 2 LLC Pre-Litigation Demand: On October 28, 2025, a demand letter was issued against Snacks Co., LLC, and individuals, asserting claims for not less than approximately $655,000 related to an alleged transaction involving vending machines and XNDA shares. The company is not a named party but is monitoring the matter due to ongoing acquisition due-diligence activities.

Related Party Transactions

• Sale of intellectual property: On December 31, 2024, the company sold substantially all of its IP to Boumarang Inc. for 2,906,977 shares of Boumarang common stock, valued at $5,000,000.
• Acquisition of vending machines: On June 30, 2025, the company acquired 1,157 commercial ice/water vending machines from SUPA Food Services LLC (a related party) for 250,000,000 shares of its common stock (fair value $125,000) and assumed a related party loan obligation of $121,200.
• Spark Capital Investments LLC advances and services: Spark Capital Investments LLC, controlled by the company's majority shareholder Imran Firoz, provided $238,200 in loan advances in 2025. Additionally, $180,000 in management and consulting services from Spark Capital were accrued in 2025.
• Settlement with previous management: In February 2025, the company entered into a Release and Settlement Agreement with former CEO Joseph Grimes, Sanjay Prasad, and Steven Ritacco, mutually releasing claims and waiving outstanding balances valued at $174,350.
• Loan from SUPA Food Services LLC: The company assumed a $121,200 related party loan from SUPA Food Services LLC as part of the vending machine acquisition, with terms and conditions (interest rate, maturity, repayment) still under negotiation and recorded as demand-repayable.

Stakeholder Impact

• Shareholders: Face significant dilution risk from potential future capital raises and the Igala litigation. The 'going concern' warning indicates a high risk of capital loss. The stock is a penny stock, limiting liquidity and increasing transaction costs.
• Employees (Directors/Officers/Consultants): Current activities are conducted through directors, officers, and third-party consultants, with no full-time employees, indicating a lean operational structure but also potential reliance on a small group.
• Creditors: Face risk due to the company's severe liquidity constraints, working capital deficit, and reliance on uncommitted related-party support. Notes payable and related party loans are significant liabilities.
• Customers (future): The success of the new food tech venture, particularly the vending machine operations, will determine future customer acquisition and satisfaction. Currently, there are no operating revenues.
• Regulatory Authorities: The company is subject to ongoing SEC filing requirements and has had auditor changes and internal control weaknesses, which could draw regulatory scrutiny.

Next Steps

• Raise additional capital through equity or debt financing from third-party investors or lenders.
• Generate revenue and positive cash flows from the Boumarang Inc. equity investment and related business operations (vending machines).
• Obtain continued financial support from related parties, including SUPA Food Services LLC.
• Implement cost reduction measures to reduce operating expenses and extend the company's cash runway.
• Vigorously defend against the Igala Commonwealth Limited litigation, with a status hearing scheduled for April 22, 2026.
• Develop and implement a remediation plan to strengthen internal control over financial reporting, including creating a formal policy manual for financial controls.

Key Dates

Recommendation

The filing presents a dire financial picture with a 'going concern' warning, no revenue, a worsening working capital deficit, and significant accumulated losses. The strategic pivot to food tech is in its infancy, marked by a low-value asset acquisition and heavy reliance on related-party financing without formal commitments. Ongoing litigation poses a material financial or dilutive threat. Material weaknesses in internal controls further undermine confidence. For a seasoned investor, these factors collectively indicate extremely high risk and a strong likelihood of further value erosion, warranting a strong sell recommendation.

Keywords

Food Technology, Vending Machines, SEC Filing, 10-K, Going Concern, Liquidity, Capital Raise, Related Party Transactions, Corporate Governance, Legal Proceedings, SFCX, Boumarang Inc., Spark Capital Investments