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Business Combinations

12 Months Ended

Dec. 31, 2024

Business Combinations [Abstract]

Business Combinations

Note 5 - Business Combinations

Acquisition of Naamche Inc. and Naamche Inc. Pvt Ltd.

On May 6, 2024, we completed our acquisitions of Naamche, Inc. (“U.S. Naamche”) and Naamche, Inc. Pvt Ltd. (“Nepal Naamche,” and together with U.S. Naamche, “Naamche”). As a result, we own 100% of the issued and outstanding shares of capital stock of Naamche, and both entities are wholly-owned subsidiaries of the Company. We acquired Naamche to assist the Company with the research and development of its proprietary AI algorithms and other technologies.

The purchase price consisted of (i) a $50,000 cash payment, (ii) 225,000 restricted shares of common stock to be issued within 9 months from the closing date of the acquisitions subject to terms and conditions specified herein, and (iii) $450,000 in cash, payable over a 3-year period following the closing date of the acquisitions based on the achievement by Naamche of specified revenue-based targets.

The table below represents the final purchase price allocation to total assets acquired and liabilities assumed and the associated estimated useful lives as of the acquisition date.

		Initial Amounts Recognized as of the acquisition date				Measurement Period Adjustment				Final Purchase Price Allocation

Cash & Cash Equivalents		$	50,786			$	-			$	50,786
Accounts Receivable			15,745				(15,745	)			-
Other Current Assets			2,050				-				2,050
Net Property Plant & Equipment			76,350				-				76,350
Goodwill⁽¹⁾			549,494				(459,517	)			89,977
Intangible assets			-				26,000				26,000
Accounts Payable			(46,506	)			46,506				-
Accrued Expenses			(36,480	)			-				(36,480	)
Dividend Payable			(31,381	)			-				(31,381	)
Long Term Loans			(54,662	)			-				(54,662	)
Net assets acquired		$	525,396			$	(402,756	)		$	122,640

(1)

During the measurement period, the Company recorded a measurement period adjustment to the preliminary purchase price allocation (“PPA”). This adjustment reduced goodwill due to eliminating intercompany transactions affecting the PPA and removed previously recognized contingent consideration, which was recorded as compensation expense under ASC 805.

The determination of the fair value for the acquired business employed the income approach, specifically the discounted cash flow (“DCF”) method. This method involves assessing the present value of anticipated future cash flows from the acquired business. These cash flows are discounted at the weighted average cost of capital (“WACC”), which represents the necessary return on the combined entity’s equity and debt. The WACC is weighted by the respective proportions of equity and debt in the overall capital structure.

For the fair valuation of trademarks and trade names, the relief from royalty method was applied. Customer and other relationships were valued through the multi-period excess earnings model (“MPEEM”), which calculates the present value of excess earnings attributed to these relationships over their estimated remaining useful life. Assembled workforce is not recognized separately from goodwill, as it lacks separability and contractual nature.

The final purchase price allocation includes $26,000 of acquired identifiable intangible assets, all of which have finite lives. The intangible assets are being amortized over their estimated useful lives on a straight-line basis. The determination of useful lives is based upon various industry studies, historical acquisition experience, and economic factors.

The purchase price allocation to identifiable intangible assets acquired subject to amortization consists of the following:

		Estimated Useful Life (in years)				Gross Value				Accumulated Amortization				Net Book Value
Definite Lived Intangible Assets:
Trademarks and trade names			5			$	8,500			$	1,118			$	7,382
Customer and other relationships			6				17,500				1,918				15,582
Balance, December 31, 2024						$	26,000			$	3,036			$	22,964

We estimate amortization expense for the next five years and beyond will be as follows:

Years Ending December 31:		Amount
2025			4,617
2026			4,617
2027			4,617
2028			4,617
2029			3,499
Thereafter			999
Total		$	22,966

Acquisition of AiChat Pte. Ltd.

On July 12, 2024, we entered into a Business Acquisition and Financing Agreement (the “Business Acquisition Agreement”) with AiChat Pte. Ltd. (“AiChat”), AiChat10X Pte. Ltd., and Kester Poh Kah Yong, pursuant to which we acquired 85% of AiChat’s ordinary shares, with the remaining 15% to be acquired by June 30, 2025. AiChat is an AI-powered company offering conversational customer experience solutions.

The total purchase price to acquire 100% of AiChat is $1,140,000, which consists of: (i) $312,000 in restricted common stock, issuable by January 1, 2025; (ii) $588,000 in restricted common stock, issuable by April 1, 2025, subject to adjustments set forth in the Business Acquisition Agreement; and (iii) $240,000 in restricted common stock, issuable by December 1, 2025.

The table below represents the final purchase price allocation to total assets acquired and liabilities assumed and the associated estimated useful lives as of the acquisition date.

		Final Purchase Price Allocation
Cash & cash equivalents		$	1,911
Accounts receivable			42,536
Other current assets			7,895
Net property plant & equipment			3,715
Goodwill			1,708,915
Intangible assets			1,135,000
Accounts payable			(160,815	)
Accrued expenses			(231,197	)
Other current liabilities			(65,675	)
Debt assumed			(1,238,785	)
Net assets acquired		$	1,203,500

The determination of the fair value for the acquired business employed the income approach, specifically the DCF method. This method involves assessing the present value of anticipated future cash flows from the acquired business. These cash flows are discounted at the WACC, which represents the necessary return on the combined entity’s equity and debt. The WACC is weighted by the respective proportions of equity and debt in the overall capital structure.

For the fair valuation of developed technology, the relief from royalty method was applied. The estimation of the economic useful life of these assets took into account factors outlined in ASC 350. Trademarks and trade names fair value was determined using the relief from royalty method. Customer and other relationships were valued through MPEEM, which calculates the present value of excess earnings attributed to these relationships over their estimated remaining useful life. Assembled workforce is not recognized separately from goodwill, as it lacks separability and contractual nature.

The final purchase price allocation includes $1,135,000 of acquired identifiable intangible assets, all of which have finite lives. The intangible assets are being amortized over their estimated useful lives on a straight-line basis. The determination of the useful lives is based upon various industry studies, historical acquisition experience, economic factors, and future forecasted cash flows of the Company following the acquisition of AiChat.

Additionally, as part of the acquisition of AiChat, we committed to purchase 55,710 ordinary shares of AiChat at a cost of $60,000, payable at the transaction’s closing. Furthermore, we also agreed to purchase an additional 222,841 ordinary shares of AiChat for $240,000. The specific dates for these payments are outlined in the Business Acquisition Agreement.

The purchase price allocation to identifiable intangible assets acquired subject to amortization consists of the following:

		Estimated Useful Life (in years)				Gross Value				Accumulated Amortization				Net Book Value
Definite Lived Intangible Assets:
Developed technology			5			$	800,000			$	75,397			$	724,603
Trademarks and trade names			9				272,000				14,242				257,758
Customer and other relationships			10				63,000				2,969				60,031
Balance, December 31, 2024						$	1,135,000			$	92,608			$	1,042,392

We estimate amortization expense for the next five years and beyond will be as follows:

Years Ending December 31:		Amount
2025			196,522
2026			196,522
2027			196,522
2028			196,522
2029			121,125
Thereafter			135,179
Total		$	1,042,392

Acquisition of Debt Does Deals, LLC (d/b/a Be My Neighbor)

On September 8, 2024, we entered into a Membership Interest Purchase Agreement (the “MIPA”) with Debt Does Deals, LLC (d/b/a Be My Neighbor) (“Be My Neighbor” or “BMN”), a Texas-based mortgage brokerage, and its sellers, Christopher Bradley Griffith and Isabel Williams (collectively, the “Sellers”). In accordance with the MIPA, we acquired 100% of the membership interests of Be My Neighbor that were outstanding prior to the consummation of the acquisition.

The purchase price was $6,000,000, consisting of: (i) $1,500,000 in cash to the Sellers based on their ownership percentages; (ii) $1,500,000 in restricted common stock, or 1,146,837 shares valued at $1.31 per share, to be issued within 90 days of closing, allocated proportionally to each of the Sellers’ membership interests in Be My Neighbor; and (iii) up to $3,000,000 in potential earn-out payments, subject to BMN’s achievement of certain financial metrics set forth in the MIPA.

The table below represents the final purchase price allocation to total assets acquired and liabilities assumed and the associated estimated useful lives as of the acquisition date.

		Initial Amounts Recognized as of the acquisition date				Measurement Period Adjustment				Final Purchase Price Allocation
Cash & cash equivalents		$	442,439			$	-			$	442,439
Accounts receivable			92,822								92,822
Goodwill⁽¹⁾			2,248,782				138,438				2,387,220
Intangible assets			1,434,000								1,434,000
Accounts payable			(3,794	)							(3,794	)
Other current liabilities			(251,249	)							(251,249	)
Net assets acquired		$	3,963,000			$	138,438			$	4,101,438

(1)	During the measurement period, adjustments were made to the recorded value of goodwill based on the newly available information regarding the fair values of the acquired assets and liabilities.

The determination of the fair value for the acquired business employed the income approach, specifically the DCF method. This method involves assessing the present value of anticipated future cash flows from the acquired business. These cash flows are discounted at the WACC, which represents the necessary return on the combined entity’s equity and debt. The WACC is weighted by the respective proportions of equity and debt in the overall capital structure.

For the fair valuation of trademarks and trade names the relief from royalty method was applied. Assembled workforce is not recognized separately from goodwill, as it lacks separability and contractual nature.

The final purchase price allocation includes $1,434,000 of acquired identifiable intangible assets, all of which have finite lives. The intangible assets are being amortized over their estimated useful lives on a straight-line basis. The determination of the useful lives is based upon various industry studies, historical acquisition experience, economic factors, and future forecasted cash flows of the Company following the acquisition of Be My Neighbor.

The purchase price allocation to identifiable intangible assets acquired subject to amortization consists of the following:

		Estimated Useful Life (in years)				Gross Value				Accumulated Amortization				Net Book Value
Definite Lived Intangible Assets:
Trademarks and trade names			15			$	1,434,000			$	29,859			$	1,404,141
Balance, December 31, 2024						$	1,434,000			$	29,859			$	1,404,141

We estimate amortization expense for the next five years and beyond will be as follows:

Years Ending December 31:		Amount
2025			95,600
2026			95,600
2027			95,600
2028			95,600
2029			95,600
Thereafter			926,141
Total		$	1,404,141

Acquisition of Hyperfast Title, LLC

On July 24, 2024, we acquired 85% of the membership interests of Hyperfast Title LLC (“Hyperfast”), a Florida-based title insurance provider, through a membership interest purchase agreement for an aggregate purchase price of $21,250. This transaction resulted in an increase in goodwill of $25,054.

Acquisition of USRealty, LLC

In November 2024, the Company entered into agreements related to the acquisition of USRealty Brokerage Solutions, LLC and an investment in Unreal Estate Inc.

As part of these agreements the Company agreed to provide $250,000 in in-kind services as consideration for the acquisition of USRealty Brokerage Solutions, LLC. These services were to be delivered over a one-year period. The Company also entered into a Letter Agreement to purchase $600,000 in convertible promissory notes from Unreal Estate Inc., to be paid in six installments. Only the first installment of $60,000 was made at closing.

On March 19, 2025, the Company entered into a Mutual Settlement and Release Agreement (the “Settlement Agreement”) with Unreal Estate Inc. (“Unreal Estate”), resolving certain claims and disputes related to the previously disclosed Membership Interest Purchase Agreement, Letter Agreement, and convertible promissory note (collectively, the “Agreements”). Pursuant to the Settlement Agreement, the Company agreed to pay Unreal Estate a one-time cash amount of $80,000. In exchange, Unreal Estate released the Company from any further obligations under the Agreements, including the Company’s obligation to purchase additional convertible promissory notes. The Company retained full ownership and control of the membership interests in USRealty Brokerage Solutions, LLC previously acquired from Unreal Estate. As part of the Settlement Agreement, the outstanding $60,000 convertible promissory note was cancelled, and the Letter Agreement was terminated. The parties also executed a mutual release of claims, subject to limited exceptions, and the Settlement Agreement includes customary representations, warranties, and covenants.

The $60,000 first installment and $80,000 one-time cash payment were expensed as of year-end as a type 1 subsequent event and recorded as operating expense in the consolidated statement of operations for the year ended December 31, 2024.