Company: KWIK
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001683168-25-003684
Chunk: 16

Company: KwikClick, Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 16
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 $432,821 decrease resulted from non-recurring stock-based compensation of $406,772 recognized in the three months ended
March 31, 2024. Additionally, we have reduced our research and development costs as we have been able to focus on implementing and operating
our software platform.

In the event we are able to
raise additional capital, we would anticipate our total operating expenses will trend upward as we add additional employees and consultants
to work on the execution of our business plan, which includes activities such as design and coding of our website and app, vendor acquisition,
cybersecurity, and user acquisition. We anticipate that much of this work will be done by outside consultants. 

Other Income (Expense)

During the three months ended
March 31, 2025, the Company negotiated settlements with previous brands surrounding previously accrued commissions payable on their behalf
for no additional consideration resulting in a gain on settlement totaling $147,527 ($30,000 for similarly settled vendor obligations
for the three months ended March 31, 2024). We do not expect these settlements to occur on a frequent basis in the future.

Other income was offset by
an increase in related party interest to $62,672 from $47,211. The increase was the result of continued compounding (at a rate of 10%
per annum) of our unpaid related party loan outstanding. If we are successful in increasing our customer base, we do not expect an increase
the principal balance of the loan over the next twelve months.

 15 

Liquidity and capital resources

At
March 31, 2025, we had a working capital deficit of $3,638,896. Approximately 78% of our liabilities as of March 31, 2025 are due to our
founder, majority shareholder, and CEO Mr. Fred Cooper under a note payable arrangement carrying an interest rate of 10% per annum. Mr.
Cooper has informally agreed to defer repayment of the note until the Company has achieved a more stable liquidity position, however,
he is not legally obligated to continue to do so.

We require additional capital
to continue to operate our business, and to develop and expand our business. Sources of additional capital through various financing transactions
or arrangements with third parties may include equity or debt financing, bank loans or revolving credit facilities. We may not be successful
in locating suitable financing transactions in the time period required or at all, and we may not obtain the capital we require by other
means