# EDGAR Filing Document

**Accession Number:** 0001017655
**File Stem:** 0001437749-26-017412
**Filing Date:** 2026-5
**Character Count:** 81894
**Document Hash:** fa2273fd444746982eda3e5a9d21e8fc
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001437749-26-017412.hdr.sgml**: 20260515

**ACCESSION NUMBER**: 0001437749-26-017412

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 50

**CONFORMED PERIOD OF REPORT**: 20260331

**FILED AS OF DATE**: 20260515

**DATE AS OF CHANGE**: 20260515

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** PAID INC
- **CENTRAL INDEX KEY:** 0001017655
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-BUSINESS SERVICES, NEC [7389]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 731479833
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-28720
- **FILM NUMBER:** 26989019

**BUSINESS ADDRESS:**
- **STREET 1:** 200 FRIBERG PARKWAY
- **STREET 2:** SUITE 4004
- **CITY:** WESTBOROUGH
- **STATE:** MA
- **ZIP:** 01581
- **BUSINESS PHONE:** 617-861-6050

**MAIL ADDRESS:**
- **STREET 1:** 200 FRIBERG PARKWAY
- **STREET 2:** SUITE 4004
- **CITY:** WESTBOROUGH
- **STATE:** MA
- **ZIP:** 01581

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** SALES ONLINE DIRECT INC
- **DATE OF NAME CHANGE:** 19990525

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** SECURITIES RESOLUTION ADVISORS INC
- **DATE OF NAME CHANGE:** 19980814

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** ROSE INTERNATIONAL LTD
- **DATE OF NAME CHANGE:** 19960627

?xml version='1.0' encoding='ASCII'? payd20260331_10q.htm

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

**☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)**

**OF THE SECURITIES EXCHANGE ACT OF 1934**

**☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)**

**OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the quarterly period ended March 31, 2026**

**COMMISSION FILE NUMBER 0-28720**

![logo.jpg](logo.jpg)

**(Exact Name of Registrant as Specified in its Charter)**

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| | |
|:---|:---|
| **Delaware** | **73-1479833** |
| (State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |

---

**P.O. Box 17 Southborough, MA 01772**

(Address of Principal Executive Offices) (Zip Code)

**(617) 861-6050**

(Registrant's Telephone Number, Including Area Code)

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

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| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol | Name of each exchange on which registered |

---

Securities registered under Section 12(g) of the Act:

**<u>Common Stock, $0.001 Par Value</u>**

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 ☒&nbsp;&nbsp;&nbsp;&nbsp; No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted 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 and post such files).

Yes ☒&nbsp;&nbsp;&nbsp;&nbsp; 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. (Check one):

---

| | | | | |
|:---|:---|:---|:---|:---|
| Large accelerated filer&nbsp;&nbsp;&nbsp;&nbsp; ☐ | Accelerated Filer&nbsp;&nbsp;&nbsp;&nbsp; ☐ | Non-accelerated filer&nbsp;&nbsp;&nbsp;&nbsp; ☑ | Smaller reporting company&nbsp;&nbsp;&nbsp;&nbsp; ☑  | Emerging Growth<br> Company&nbsp;&nbsp;&nbsp;&nbsp; ☐ |

---

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐&nbsp;&nbsp;&nbsp;&nbsp; No ☒

As of May 15, 2026, the issuer had outstanding 8,475,159 shares of its Common Stock.

------

**PAID, INC.**

**FORM 10-Q**

**<u>**TABLE OF CONTENTS**</u>**

---

| | | |
|:---|:---|:---|
| **Part I** – **Financial Information** | **Part I** – **Financial Information** |  |
| Item 1. | **Financial Statements** |  |
|  | Unaudited Condensed Consolidated Balance Sheets as of March 31, 2026, and December 31, 2025 | 3 |
|  | Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2026, and 2025 | 4 |
|  | Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026, and 2025 | 5 |
|  | Unaudited Condensed Consolidated Statements of Changes in Shareholders' Equity for the Three Months Ended March 31, 2026, and 2025 | 6 |
|  | Notes to Unaudited Condensed Consolidated Financial Statements | 7-16 |
| Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 16 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 19 |
| Item 4. | Controls and Procedures | 19 |
| **Part II** – **Other Information** | **Part II** – **Other Information** |  |
| Item 1. | Legal Proceedings | 19 |
| Item 1A. | Risk Factors | 20 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 20 |
| Item 3. | Defaults Upon Senior Securities | 20 |
| Item 4. | Mine Safety Disclosures | 20 |
| Item 5. | Other Information | 20 |
| Item 6. | Exhibits | 20 |
| Signatures | Signatures | 21 |

---

------

**<u>PART I</u>** <u>–</u> **<u>FINANCIAL INFORMATION</u>**

**ITEM 1. <u>FINANCIAL STATEMENTS</u>**

**PAID, INC.**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | March 31, 2026 | December 31,<br> 2025 |
| ASSETS |  |  |
| Current assets: |  |  |
| Cash and cash equivalents | $951698 | $1108059 |
| Accounts receivable, net | 441861 | 302894 |
| Prepaid expenses and other current assets | 364264 | 370064 |
| Total current assets | 1757823 | 1781017 |
| Property and equipment, net | 8244 | 4096 |
| Intangible assets, net | 1889072 | 1758606 |
| Operating lease right-of-use assets | 80411 | 89685 |
| Notes receivable, long term | 4656064 | 4644360 |
| Total assets | $8391614 | $8277764 |
| LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |
| Current liabilities: |  |  |
| Accounts payable | $1398579 | $1390109 |
| Accrued expenses | 263330 | 332973 |
| Contract liabilities | 342584 | 329725 |
| Operating lease obligations | 32322 | 32422 |
| Notes payable | 75000 |  |
| Total current liabilities | 2111815 | 2085229 |
| Long-term liabilities: |  |  |
| Deferred tax liability, net | 398463 | 407901 |
| Uncertain tax position liability | 181824 | 181824 |
| Operating lease obligation, net of current portion | 51395 | 60550 |
| Total liabilities | 2743497 | 2735504 |
| Commitments and contingencies (Note 5) |  |  |
| Shareholders' equity: |  |  |
| Series A Preferred stock, $0.001 par value, 5,000,000 shares authorized; no shares issued and outstanding at March 31, 2026, and December 31, 2025 |  |  |
| Common stock, $0.001 par value, 25,000,000 shares authorized; 8,613,299 shares issued and 8,465,666 shares outstanding at March 31, 2026, and 8,527,467 shares issued and 8,379,834 shares outstanding at December 31, 2025 | 8614 | 8528 |
| Accrued common stock bonus |  | 124709 |
| Additional paid-in capital | 74867087 | 74579428 |
| Accumulated other comprehensive income | 225052 | 240700 |
| Accumulated deficit | (69283800) | (69242269) |
| Common stock in treasury, at cost, 147,633 shares at March 31, 2026, and December 31, 2025 | (168836) | (168836) |
| Total shareholders' equity | 5648117 | 5542260 |
| Total liabilities and shareholders' equity | $8391614 | $8277764 |

---

See accompanying notes to condensed consolidated financial statements

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**PAID, INC.** 

**CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS**

**FOR THE THREE MONTHS ENDED MARCH 31,** 

**(Unaudited)**

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| | | |
|:---|:---|:---|
|  | 2026 | 2025 |
| Revenues, net | $5326545 | $4377790 |
| Cost of revenues | 4265957 | 3357714 |
| Gross profit | 1060588 | 1020076 |
| Operating expenses: |  |  |
| Salaries and related | 673147 | 583037 |
| General and administrative | 370875 | 525122 |
| Share-based compensation | 61251 | 1267 |
| Amortization of other intangible assets | 73036 | 69779 |
| Total operating expenses | 1178309 | 1179205 |
| Loss from Operations | (117721) | (159129) |
| Other income: |  |  |
| Interest income | 10982 | 10356 |
| Other income | 65664 |  |
| Total other income | 76646 | 10356 |
| Loss before income tax provision | (41075) | (148773) |
| Income tax provision | 456 |  |
| Net loss | $(41531) | $(148773) |
| Net loss per share – basic | $(0.00) | $(0.02) |
| Weighted average number of common shares outstanding - basic | 8553425 | 8074080 |
| Net loss per share – diluted | $(0.00) | $(0.02) |
| Weighted average number of common shares outstanding - diluted | 8553425 | 8074080 |
| Condensed consolidated statements of comprehensive loss: |  |  |
| Net loss | $(41531) | $(148773) |
| Other comprehensive loss: |  |  |
| Foreign currency translation adjustments | (15648) | (47281) |
| Comprehensive loss | $(57179) | $(196054) |

---

See accompanying notes to condensed consolidated financial statements

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**PAID, INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**FOR THE THREE MONTHS ENDED MARCH 31,** 

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | 2026 | 2025 |
| Cash flows from operating activities: |  |  |
| Net loss | $(41531) | $(148773) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| Depreciation and amortization | 74096 | 70347 |
| Amortization of operating lease right-of-use assets | 7963 | 7377 |
| Provision for bad debts |  | 22286 |
| Payment of accrued common stock bonus | 124709 |  |
| Share-based compensation | 61251 | 1267 |
| Interest income accrued on note receivable | (11704) | (7315) |
| Changes in assets and liabilities: |  |  |
| Accounts receivable | (146713) | (115152) |
| Prepaid expenses and other current assets | 412 | 88947 |
| Accounts payable | (18894) | (255682) |
| Accrued expenses | (190989) | (78333) |
| Contract liabilities | 18425 | (55229) |
| Operating lease obligations | (7890) | (7308) |
| Net cash used in operating activities | (130865) | (477568) |
| Cash flows from investing activities |  |  |
| Purchase of property and equipment | (1915) |  |
| Net cash used in investing activities | (1915) |  |
| Cash flows from financing activities |  |  |
| Proceeds from stock option exercises |  | 2213 |
| Net cash provided by financing activities |  | 2213 |
| Effect of exchange rate changes on cash and cash equivalents | (15306) | (58511) |
| Net change in cash and cash equivalents | (148086) | (533866) |
| Cash and cash equivalents, beginning of period | 1099784 | 1284965 |
| Cash and cash equivalents, end of period | $951698 | $751099 |
| SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION |  |  |
| Cash paid during the period for: |  |  |
| Income taxes | $456 | $- |
| Interest | $- | $- |
| SUPPLEMENTAL DISCLOSURES OF NON-CASH ITEMS |  |  |
| Issuance of common shares related to the Warehowz Inc. acquisition | $101785 | $- |
| Issuance of common shares in settlement of accrued common stock bonus | $124709 | $193246 |

---

See accompanying notes to condensed consolidated financial statements

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**PAID, INC.**<br> **CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY** <br> **FOR THE THREE MONTHS ENDED MARCH 31, 2026**<br> **(Unaudited)**<br>

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Common Stock | Common Stock | Accrued<br> Common | Additional | Accumulated Other |  | Treasury Stock | Treasury Stock |  |
|  | Shares | Amount | Stock<br> Bonus | Paid-in<br> Capital | Comprehensive<br> Income | Accumulated<br> Deficit | Shares | Amount | Total |
| Balance, January 1, 2026 | 8527467 | $8528 | $124709 | $74579428 | $240700 | $(69242269) | (147633) | $(168836) | $5542260 |
| Foreign currency translation adjustment |  |  |  |  | (15648) |  |  |  | (15648) |
| Issuance of common stock for accrued bonus | 50974 | 51 | (124709) | 124658 |  |  |  |  |  |
| Share issuance for Warehowz acquisition | 34858 | 35 |  | 101750 |  |  |  |  | 101785 |
| Share-based compensation expense |  |  |  | 61251 |  |  |  |  | 61251 |
| Net loss |  |  |  |  |  | (41531) |  |  | (41531) |
| Balance, March 31, 2026 | 8613299 | $8614 | $- | $74867087 | $225052 | $(69283800) | (147633) | $(168836) | $5648117 |

---

**PAID, INC.**<br> **CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY** <br> **FOR THE THREE MONTHS ENDED MARCH 31, 2025**<br> **(Unaudited)**<br>

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Common Stock | Common Stock | Accrued<br> Common | Additional | Accumulated Other |  | Treasury Stock | Treasury Stock |  |
|  | Shares | Amount | Stock<br> Bonus | Paid-in<br> Capital | Comprehensive<br> Income | Accumulated<br> Deficit | Shares | Amount | Total |
| Balance, January 1, 2025 | 8213533 | $8214 | $193246 | $73640538 | $226031 | $(68874026) | (147633) | $(168836) | $5025167 |
| Foreign currency translation adjustment |  |  |  |  | (47281) |  |  |  | (47281) |
| Issuance of common stock for accrued bonus | 62501 | 62 | (193246) | 193184 |  |  |  |  |  |
| Issuance of commons stock for stock options exercises | 1433 | 2 |  | 2210 |  |  |  |  | 2212 |
| Share-based compensation expense |  |  |  | 1267 |  |  |  |  | 1267 |
| Net loss |  |  |  |  |  | (148773) |  |  | (148773) |
| Balance, March 31, 2025 | 8277467 | $8278 | $- | $73837199 | $178750 | $(69022799) | (147633) | $(168836) | $4832592 |

---

See accompanying notes to condensed consolidated financial statements

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**PAID, INC.**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS** 

**MARCH 31, 2026**

**(Unaudited)**

**Note 1. Organization and Significant Accounting Policies**

PAID, Inc. ("PAID", the "Company", "we", "us", or "our") has developed a full line of SaaS-based business services including ShipTime, Warehowz, PaidPayments and PaidShipping. These solutions are developed to provide businesses with streamlined experiences for online sales, payment collection, fulfillment and shipping all in one platform.

ShipTime Canada Inc. ("ShipTime") has developed a SaaS-based application, which focuses on the small and medium business segments. This offering allows members to quote, process, generate labels, dispatch and track courier and LTL shipments all from a single interface. The application provides customers with a choice of today's leading couriers and freight carriers, all with discounted pricing allowing members to save on every shipment. Backed by Heroic Support™, ShipTime offers live support via phone, chat and email to enhance the customer experience. The software can also be integrated into on-line shopping carts to facilitate sales via e-commerce. We actively sell directly to small and medium businesses and through long standing partnerships with selected associations throughout Canada.

Paid provides integrated technology solutions that support businesses through payment processing and logistics services across North America and international markets. The Company's platforms are designed to help businesses streamline operations, manage transactions, and optimize shipping and transportation workflows through centralized and scalable technology solutions. PaidPayments provides businesses with secure payment processing capabilities, including invoicing, virtual terminal functionality, subscription billing, hosted checkout pages, and point-of-sale solutions with support for USD, CAD, and EUR currencies. PaidShipping provides a multi-carrier logistics and transportation management platform that enables businesses to quote, process, generate labels, dispatch, and track shipments through a single interface. The platform supports parcel, Less-Than-Truckload (LTL), and Full Truckload (FTL) shipments through an extensive network of national and regional carriers and transportation partners. PaidShipping includes multi-carrier rate comparison tools, eCommerce platform integrations, branded tracking capabilities, shipping insurance solutions, shipment audit capabilities, and access to discounted shipping rates through strategic carrier partnerships.

Warehowz Inc. provides an on-demand warehousing and fulfillment marketplace that connects businesses with flexible storage, distribution, and fulfillment capacity through a network of certified warehouse partners across North America. With access to more than 2,500 warehouse facilities throughout the United States and Canada, Warehowz enables businesses to optimize inventory placement, improve delivery times, and scale fulfillment operations based on changing business requirements. The platform is designed to provide greater flexibility, visibility, and operational efficiency across the supply chain for both merchants and enterprise customers.

<u>General Presentation and Basis of Condensed Consolidated Financial Statements</u> 

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and with the rules and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2025 that was filed on March 31, 2026.

In the opinion of management, the Company has prepared the accompanying unaudited condensed consolidated financial statements on the same basis as its audited consolidated financial statements, and these unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year 2026.

<u>Liquidity and Management's Plans</u>

The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has continued to incur losses, although it has taken significant steps to reduce them. At March 31, 2026, the Company reported cash and cash equivalents of $951,698 and working deficit of $353,992 and reported cash flows used from operations of $130,865 for the three months ended March 31, 2026. The Company has reported a net loss of $41,531 for the three months ended March 31, 2026 and has an accumulated deficit of $69,283,800at March 31, 2026.

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Management believes that the Company has adequate cash resources to fund operations during the next 12 months after the filing of this quarterly report on Form 10-Q. The repayment of the Embolx note receivable will alleviate the concern however the repayment date is uncertain. Additionally, the costs of doing business can be significantly reduced in hopes of eliminating the net loss and providing positive cash flow from operations. Management continues to explore opportunities and has organized additional resources to grow the Paid platform. There can be no assurance that anticipated growth in new business will occur and that the Company will be successful in launching new products and services, Management may seek alternative sources of capital to support the growth of future operations.

Although there can be no assurances, the Company believes that the above management plans will be sufficient to meet the Company's working capital requirements through the end of May 2027 and will have a positive impact on the Company for the foreseeable future.

<u>Principles of Consolidation</u>

The condensed consolidated financial statements include the accounts of PAID, Inc. and its wholly owned subsidiaries ShipTime Canada, Inc. and Warehowz Inc. All intercompany accounts and transactions have been eliminated.

<u>Foreign Currency</u>

The currency of ShipTime, the Company's international subsidiary, is in Canadian dollars. Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at March 31, 2026, and December 31, 2025. Results of operations and cash flows are translated using the average exchange rates throughout the period. The effect of exchange rate fluctuations on translation of assets and liabilities is included as a separate component of shareholders' equity in accumulated other comprehensive income.

<u>Geographic Concentrations</u>

The Company conducts business in the U.S. and Canada. For customers headquartered in their respective countries, the Company derived approximately 99% of its revenues from Canada and 1% from the U.S. during the three months ended March 31, 2026, and 2025.

At March 31, 2026, the Company maintained 100% of its property and equipment, net of accumulated depreciation, in Canada.

<u>Right of Use Assets</u>

A right-of-use asset represents a lessee's right to use a leased asset for the term of the lease. Our right-of-use assets generally consist of an operating lease for a building.

Right-of-use assets are measured initially at the present value of the lease payments, plus any lease payments made before a lease began and any initial direct costs, such as commissions paid to obtain a lease.

Right-of-use assets are subsequently measured at the present value of the remaining lease payments, adjusted for incentives, prepaid or accrued rent, and any initial direct costs not yet expensed.

<u>Long-Lived Assets</u> 

The Company reviews the carrying values of its long-lived assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the expected future cash flow from the use of the asset and its eventual disposition is less than the carrying amount of the asset, an impairment loss is recognized and measured using the fair value of the related asset. No impairment charges were recognized during the three months ended March 31, 2026 and 2025. There can be no assurance, however, that market conditions will not change or demand for the Company's services will continue, which could result in impairment of long-lived assets in the future.

<u>Revenue Recognition</u>

The Company generates revenue principally from fees for coordinating shipping services, merchant processing services and client services.

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The Company recognizes revenue by taking into consideration the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. Due to the nature of the Company's service and product offerings and contracts associated with these, the Company's deliverables do not fluctuate, and its revenue recognition is consistent. The Company evaluates whether amounts billed to customers should be reported as revenues on a gross or net basis. Generally, revenue is recorded on a gross basis when the Company is primarily responsible for fulfilling the promise to provide the services, when it assumes the risk of loss, when it has discretion in setting the prices for the services to the customers, and when the Company has the ability to direct the use of the services provided by the third party. We generally are responsible for the fulfillment of a customer order despite the fact we do not directly provide the delivery services; we can redirect delivery to other shipping companies in our network. We control the price for which the customer pays and generally collect the gross shipping fees and remit the contractual rate to this shipping company. Our risk of loss relates to credit card chargebacks, certain self-insured shipping losses and other miscellaneous charges that we cannot pass through to the shipping company. During 2025 and continuing in 2026, the Company discontinued its client services which had an immaterial effect on revenue. Due to the immateriality, the related amounts have not been separately disclosed for financial statement purposes. The Company recognizes warehousing revenue on a net basis.

<u>Nature of Goods and Services</u>

For label generation service revenues, the Company recognizes revenue when a customer has successfully prepared a shipping label and their shipment is delivered. Customers with pickups and shipments in transit after the end of the reporting period are recorded as contract liabilities on the condensed consolidated balance sheets. The service is offered to consumers via an online registration and allows users to create a shipping label using a credit card on their account (all customers must have a valid credit card on file to process shipments on the ShipTime platform).

eCommerce and merchant processing revenue consists of fees a seller pays us to process their payment transactions and is recognized upon authorization of a transaction. Revenue is recognized net of estimated refunds, which are reversals of transactions initiated by sellers. We act as the merchant of record for our sellers, which puts us in their shoes with respect to card networks and puts the risk for refunds and chargebacks on us. The gross transaction fees collected from sellers is recognized as revenue as we are the primary obligor to the seller and are responsible for processing the payment, have latitude in establishing pricing with respect to the sellers and other terms of service, have sole discretion in selecting the third party to perform the settlement, and assume the credit risk for the transaction processed

Warehousing revenue is recognized on a net basis and consists of fees paid by clients whose goods are stored at warehouses nationwide in addition to warehouse partners providing space solutions for storage and fulfillment to clients.

<u>Revenue Disaggregation</u>

The Company operates in five reportable segments (see segment reporting below).

<u>Performance Obligations</u>

At contract inception, an assessment of the goods and services promised in the contracts with customers is performed and a performance obligation is identified for each distinct promise to transfer to the customer a good or service (or bundle of goods or services). The Company fulfills nearly all of its performance obligations within a one-to-two-week period and contracts with customers have an original expected duration of less than one month. The Company generally has an unconditional right to consideration when the services are initiated or soon thereafter. The amount due from the customer is either collected up front or recorded as accounts receivable. The amounts related to services that are not yet completed at the reporting date are presented as contract liabilities. The Company measures the performance of its obligations as services are completed over the life of a shipment, including services at origin, freight and destination. This method of measurement of progress depicts the pattern of the Company's actual performance under the contracts with the customer.

For arrangements under which the Company provided a subscription for brewery management software, the Company satisfies its performance obligations over the life of the subscription, typically twelve months or less.

Merchant processing customers receive a merchant identification number which allows them to process credit card transactions. Once the transaction is approved, the funds are distributed in an overnight feed and the Company has met its performance obligation.

The Company has no shipping and handling activities related to contracts with customers.

Revenues are recognized net of any taxes collected from customers, which are subsequently remitted to government authorities.

<u>Significant Payment Terms</u>

Pursuant to the Company's contracts with its customers, amounts are collected up front primarily through credit/debit card transactions. The Company has offered its customers consolidated payments which are billed weekly and are paid with a credit card on file. Accordingly, the Company determined that its contracts with customers do not include extended payment terms or a significant financing component.

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<u>Measurement of Credit Losses</u>

The Company has accounts receivable and note receivable and monitors the granting of credit and collecting debt on an ongoing basis. The Company maintains an allowance for doubtful accounts based on historical loss patterns, the number of days that billings are past due, and an evaluation of potential risk of loss associated with delinquent accounts. The Company has evaluated the accounts receivable for 2026 and has not recorded any allowance for credit losses as of March 31, 2026. The Company has two notes receivable and is a senior secure lender with an absolute obligation for one of the notes. The primary note was evaluated for credit losses as of March 31, 2026 by considering the contractual obligation, the valuation of the assets and the senior position of the repayment.

<u>Variable Consideration</u>

In some cases, the nature of the Company's contracts may give rise to variable consideration, including rebates, refunds, and cancellations or other similar items that generally decrease the transaction price.

Variable consideration is estimated at the most likely amount that is expected to be earned. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the anticipated performance and all information (historical, current and forecasted) that is reasonably available.

<u>Warranties</u>

The Company's products and services are provided on an "as is" basis and no warranties are included in the contracts with customers. Also, the Company does not offer separately priced extended warranty or product maintenance contracts.

<u>Contract Assets</u>

Typically, the Company has already collected revenue from the customer at the time it has satisfied its performance obligation. However, at times the Company extends credit to certain recurring customers. Accordingly, the Company has a balance of accounts receivable, totaling $441,861 and $302,894 as of March 31, 2026, and December 31, 2025, respectively. The Company has no customers that made up 10% of the accounts receivable balance at March 31, 2026, and December 31, 2025. Generally, the Company does not have material amounts of contract assets since revenue is recognized as control of goods is transferred or as services are performed. The Company has recorded a balance of $242,350 in contract assets as of March 31, 2026 related to unbilled receivables.

<u>Contract Liabilities (Deferred Revenue)</u>

Contract liabilities are recorded when cash payments are received in advance of the Company's performance. Contract liabilities were $342,584 and $329,725 at March 31, 2026 and December 31, 2025, respectively. During the three months ended March 31, 2026, the Company recognized revenues of $329,725 related to contract liabilities outstanding at the beginning of the period.

<u>Income (Loss) Per Common Share</u>

Basic earnings (loss) per share represent income (loss) divided by the weighted-average number of common shares outstanding during the period. Diluted income (loss) per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income (loss) that would result from the assumed issuance. The potential common shares that may be issued by the Company relate to outstanding stock options and have been excluded from the computation of diluted income (loss) per share if they would reduce the reported loss per share and therefore have an anti-dilutive effect.

For the three months ended March 31, 2026, there were approximately 516,000 of potentially dilutive shares excluded from the diluted loss per share calculation, as their effect would be anti-dilutive.

------

<u>Segment Reporting</u>

The Company reports information about segments of its business in its annual consolidated financial statements and reports selected segment information in its quarterly reports issued to shareholders. The Company also reports on its entity-wide disclosures about the products and services it provides and reports revenues and its major customers. The Company's five reportable segments are managed separately based on fundamental differences in their operations. At March 31, 2026, the Company operated in the following five reportable segments:

a. Client services;

b. eCommerce services;

c. Shipping coordination and label generation services; and

d. Corporate operations

e. Warehousing services

The Company evaluates performance and allocates resources based upon operating income. The accounting policies of the reportable segments are the same as those described in this summary of significant accounting policies. The Company's chief operating decision maker is the Chief Executive Officer/Chief Financial Officer.

The following table compares total net revenue for the periods indicated.

---

| | | |
|:---|:---|:---|
|  | Three Months Ended | Three Months Ended |
|  | March 31, 2026 | March 31, 2025 |
| Client services | $- | $2034 |
| eCommerce services | 5750 | 29617 |
| Shipping coordination and label generation services | 5244788 | 4346139 |
| Warehousing services | 76007 |  |
| Total revenues | $5326545 | $4377790 |

---

The following table compares total loss from operations for the periods indicated.

---

| | | |
|:---|:---|:---|
|  | Three Months Ended | Three Months Ended |
|  | March 31, 2026 | March 31, 2025 |
| Client services | $- | $(1004) |
| eCommerce services | 1617 | (78451) |
| Shipping coordination and label generation services | (109652) | (12296) |
| Warehousing services | (32570) |  |
| Corporate operations | 22884 | (67378) |
| Total loss from operations | $(117721) | $(159129) |

---

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<u>Recent Accounting Pronouncements</u>

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.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This ASU clarifies the applicability of interim reporting guidance and reorganizes certain interim disclosure requirements within ASC 270 to improve consistency and usability. The guidance also introduces a disclosure principle requiring entities to disclose material events and changes occurring after the most recent annual reporting period. 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 interim reporting periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

**Note 2. Notes Receivable**

On October 13, 2022, the Company entered into a Securities Purchase Agreement ("SPA") with respect to a secured $1,875,000 convertible note ("Convertible Note") made by Embolx, Inc. ("Noteholder"). The Convertible Note was purchased at a 20% ($375,000) original issue discount and is subject to a 9-month maturity, after which, if unpaid will then carry a 20% interest rate. The Company recognized $270,833 in other income related to accretion of the discount on the Convertible Note for the year ended December 31, 2023 in addition to a $375,000, 20% non-payment penalty and interest due on the note of $203,425. The Company has the option to convert the Convertible Note into shares of common stock of Embolx. The Convertible Note is secured by substantially all assets of the Noteholder. Under the SPA, the Company has a right to purchase additional notes and receive warrants on the same terms for a total potential investment amount of $2,000,000 with an additional over-allotment option of $500,000 as defined in the SPA. As additional consideration, the Company received a 5-year warrant to purchase shares of common stock of Embolx. The shares are subject to certain piggyback registration rights under a Registration Rights Agreement. The warrant was offered at 50% of the original principal amount and will be valued at the price per share of common stock paid in the first liquidity event following October 19, 2022. The warrants were to expire five years from the original issue date. As of July 19, 2023, the note was in default and carried an additional 20% penalty and 20% interest resulting in $578,425 of other income which was recognized in the Company's consolidated financial statements for the year ended December 31, 2023. In March 2024, the Company amended and replaced the note and terminated the warrants. The terms on the amended note receivable include an additional investment of $500,000with a 25% original issue discount and is due on June 19, 2024. The Company was granted a $50,000 increase to the debt owed by Embolx which was applied toward legal expenses incurred during the first quarter of 2024 relating to the preparation of the note documentation.

The note receivable was in default effective June 19, 2024, in the amount of $4,193,607 and the Company ceased recording of interest and penalties of $2,751,833 and default penalties of $838,721. The total due on the note as of March 31, 2026 was $7,784,161. On July 29, 2024, the Board of Directors approved an extension with Embolx which was effective as of January 31, 2025. The Company entered into a Forbearance and Loan Modification Agreement with Embolx which extended the note receivable of $5,967,100 until September 30, 2025 and carried a 25% interest rate. On September 30, 2025 the Company amended the Forbearance Agreement to expire on August 31, 2026. Although the note is considered a short-term note, the full amount of the note receivable is not expected to be collected by March 31, 2027, and thus has been reclassed as long-term.

The Company does not believe there is any impairment to the note receivable due to its secured position on the assets of Embolx and its expectation that the amounts will be recoverable if and when Embolx consummates a financial or merger transaction which is expected to happen in 2026.

The Company entered into a $50,000 short term note with 5String Solutions LLC on April 4, 2024. The terms on the note include a 12% annual interest rate from the inception of the note which was due on May 15, 2024. The note has been amended as of July 3, 2024 and the initial investment shall be deducted from the future advance and the note shall be deemed paid in full. The new note includes an additional $198,500 investment carrying a 12% interest rate. The short term note of $50,000 plus $1,500 interest calculated from April 4, 2024 to July 3, 2024, along with the $198,500 additional investment results in a $250,000 long term note due on or before April 30, 2027. On April 30, 2027 the Company has the option to convert the balance of the $400,000 note receivable into 55% ownership of 5String Solutions. In the event that the Company elects to convert the note they subsequently have the option to purchase the remaining 45% ownership of 5String Solutions at a rate of 5-times EBITDA reported for the year ended December 31, 2026. On July 1, 2025 and October 10, 2025, the Company made an additional investment of $75,000 per occurrence and in accordance with the original terms of the July 3, 2024 amendment.

Interest income of $11,704 has been recorded based on the outstanding balance of the $400,000 note for the three months ended March 31, 2026 compared to $7,315 of interest income for the three months ended March 31, 2025.

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**Note 3. Accrued Expenses**

Accrued expenses are comprised of the following:

---

| | | |
|:---|:---|:---|
|  | March 31, 2026 | December 31,<br> 2025 |
| Payroll and related costs | $96890 | $208087 |
| Professional and consulting fees | 3588 | 22646 |
| Royalties |  | 40075 |
| Accrued cost of revenues | 162442 | 39527 |
| Sales tax |  | 22228 |
| Other | 410 | 410 |
| Total | $263330 | $332973 |

---

**Note 4. Intangible Assets and Acquisitions**

The Company holds several patents for the real-time calculation of shipping costs for items purchased through online auctions using a zip code as a destination location indicator. It includes shipping charge calculations across multiple carriers and accounts for additional characteristics of the item being shipped, such as weight, special packaging or handling, and insurance costs. These patents help facilitate rapid and accurate estimation of shipping costs across multiple shipping carriers and include real-time calculation of shipping. The Company recorded intangible assets of $230,506 for the platform development of Warehowz.com. This addition is expected to depreciate over a 3-year period.

<u>Acquisition of Warehowz Inc.</u>

On January 30, 2026, the Company entered into a purchase agreement with Warehowz Inc., a Virginia corporation ("Warehowz") whereas the Company acquired the equity interests of Warehowz for a total consideration of $176,786 plus a payment of 8.5% of net revenue plus 40% of the net income, for each of the 12 months ended December 31, 2026, and 2027. Warehowz provides access to over 2500 warehousing and fulfillment facilities to shippers across the United States and Canada. The Company feels that this acquisition will complement the shipping label generation services currently provided by ShipTime by offering a complete, discounted fulfillment solution. Additionally, overlap of the customer base will allow for marketing and cross selling of future services on the Paid and ShipTime platforms. The acquisition is considered a business combination under ASC 805. The transaction was funded by an assumption of liabilities which was paid in a combination of cash and shares of the Company's stock based on the closing price as of the acquisition date. The contingent consideration represents a revenue-based earnout of accounts payable, accrued liabilities and other post close expenses. The Company has included the results of operations beginning January 31, 2026, in its financial reporting for the first quarter of 2026. Pro forma financial information has been excluded from prior period reporting as the historical financial results of Warehowz are not considered significant to the Company's financial statements.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at January 30, 2026.

---

| | |
|:---|:---|
| Cash and cash equivalents | $(8275) |
| Property and equipment | 3376 |
| Intangible assets | 230506 |
|  | 225607 |
| Accounts payable and accrued liabilities | 48822 |
| Note payable to former shareholder | 75000 |
| Advances from former shareholders | 101785 |
| Total liabilities assumed | 225607 |
| Net assets acquired | $- |

---

<u>Intangible Assets</u>

In determining the estimated fair value of the intangible assets, the Company considered, among other factors, the best use of the acquired assets, analyses of historical financial performance and estimates of future performance of Warehowz.

------

Fair Value Useful Life

---

| | | |
|:---|:---|:---|
|  | Fair Value | Useful Life (in years) |
| Technology | $230506 | 3 |

---

Technology acquired would complement the current offering by the Company and the future development of products as a result of the acquisition may result in incremental growth.

As of March 31, 2026, shareholders representing approximately 96% of the outstanding shares have executed and returned required documentation and received merger consideration. The remaining shares are subject to ongoing administrative settlement procedures and/or statutory merger provisions. The Company has recorded the acquisition as of the closing date.

In addition, the Company has various other intangibles from past business combinations.

At March 31, 2026, intangible assets consisted of the following:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Patents | Trade Name | Technology<br> &<br> Software | Customer<br> Relationships | Total |
| Gross carrying amount | $16000 | $780637 | $812806 | $4527384 | $6116827 |
| Accumulated amortization | (16000) | (780637) | (582300) | (2868818) | (4227755) |
|  | $- | $- | $230506 | $1658566 | $1889072 |

---

At December 31, 2025, intangible assets consisted of the following:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Patents | Trade Name | Technology<br> &<br> Software | Customer<br> Relationships | Total |
| Gross carrying amount | $16000 | $780931 | $582487 | $4597547 | $5976965 |
| Accumulated amortization | (16000) | (780931) | (582487) | (2838941) | (4218359) |
|  | $- | $- | $- | $1758606 | $1758606 |

---

Amortization expense of intangible assets for the three months ended March 31, 2026, and 2025 was $73,036 and $69,779, respectively.

**Note 5. Commitments and Contingencies**

<u>Notes Payable</u>

On January 30, 2026, the Company acquired Warehowz Inc. Through this acquisition the Company acquired a $75,000 note payable with one investor which is due 105 days from the closing date. The balance of the note is included in the purchase price of Warehowz Inc. Subsequent to the quarter end, the Company repaid the note in full.

<u>Legal Matters</u>

In the normal course of business, the Company periodically becomes involved in litigation and disputes. During 2021, the Company was notified of a dispute related to its non-renewal of the employment agreement with Mr. Allan Pratt, the Company's former President, CEO and Chairman. On or around January 2020, the Company had allowed Mr. Pratt's employment agreement to not renew, but Mr. Pratt alleges in a court in Canada that the Company terminated him and that the Company owes him a severance and bonus payment. Around the same time that Mr. Pratt's employment term expired, the Company's Board of Directors voted to reduce the size of the Board from five to three members, and Mr. Pratt and Mr. Austin Lewis, then CFO, automatically rolled off from the Board of Directors. More than a year later, in 2021, Mr. Pratt filed a claim in Delaware court to contest that decision. In July 2022, Mr. Pratt amended the Delaware complaint to dispute the proper authorization of a stock bonus that was awarded to the Company's CEO in March 2021. On November 9, 2023, the Delaware court dismissed the claim contesting the reduction of the board size. The trial on the remaining claim was held before the Delaware court on December 5-6, 2024. Post-trial briefing in the Delaware action was completed on March 21, 2025, followed by a post-trial hearing on May 14, 2025. The trial for the Canadian litigation is set to begin on May 25, 2026. The Company has not recorded a reserve as the outcome of these matters has not and cannot be determined.

<u>Indemnities and Guarantees</u>

The Company has made certain indemnities and guarantees, under which it may be required to make payments to a guaranteed or indemnified party, in relation to certain actions or transactions. The Company indemnifies its directors, officers, employees and agents, as permitted under the laws of the State of Delaware. In connection with its facility lease, the Company has agreed to indemnify its lessor for certain claims arising from the use of the facilities. The duration of the guarantees and indemnities varies and is generally tied to the life of the agreement. These guarantees and indemnities do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. Historically, the Company has not been obligated nor incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities and guarantees in the accompanying condensed consolidated balance sheets.

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**Note 6. Shareholders**' **Equity**

<u>Preferred Stock</u>

The Company's amended Certificate of Incorporation authorizes the issuance of 20,000,000 shares of blank-check preferred stock at $0.001 par value. The Board of Directors will be authorized to fix the designations, rights, preferences, powers and limitations of each series of the preferred stock.

The Company filed a Certificate of Designations effective on December 30, 2016, which sets aside 5,000,000 shares of Preferred Stock as Series A Preferred Stock. The Series A Preferred Stock carries a coupon payment obligation of 1.5% of the liquidation value per share ($3.03) per year in cash or additional Series A Preferred Stock, calculated by taking the 30-day average closing price for a share of common stock for the month immediately preceding the coupon payment date which is made annually. The Series A Preferred Stock has no voting or conversion rights. If purchased, redeemed, or otherwise acquired (other than conversion), the preferred stock may be reissued. As of March 31, 2026, and December 31, 2025, there are no outstanding shares of Series A Preferred Stock.

<u>Common Stock</u>

On March 7, 2025, the Company's Board of Directors authorized the issuance of 62,501 bonus shares of PAID common stock to the CEO/CFO, one additional officer and two employees for services rendered during 2024. This bonus was valued at $193,246 based on the closing price of the Company's common stock at March 6, 2025 and was issued in March 2025. This bonus was recorded in accrued common stock bonus in shareholders' equity as of December 31, 2024.

On May 15, 2025, the Company's Board of Directors authorized the issuance of 250,000 bonus shares of PAID common stock to the CEO/CFO as a renewal bonus valued at $747,500based upon the $2.99 closing price of the Company's stock on May 15, 2025. $373,750 of share-based compensation expense was recognized immediately as 125,000 of the bonus shares were immediately vested. The remaining $373,750 of share-based compensation expense is to be recognized ratably during 2025 and 2026 as 125,000 of the bonus shares are subject to repurchase if the CEO/CFO were to terminate employment through the period ended January 1, 2027. The Company recorded $57,500 of share-based compensation expense for the three-month period ended March 31, 2026, in connection with the additional vesting of these shares.

On February 27, 2026, the Board of Directors approved the allocation of the 2025 bonus accrual to be paid out in cash and shares of which $124,709 have been recorded as share-based compensation expense for the year ended December 31, 2025. A total of 50,974 shares of common stock were issued to two officers and three employees in March 2026.

On March 2, 2026, the Company issued 34,858 shares of common stock to the founders of Warehowz in connection with the acquisition. The shares were valued at $101,785 and were based upon the $2.92 closing price of the Company's common stock on January 30, 2026.

<u>Share-based Incentive Plans</u>

On May 15, 2025, the Board of Directors voted to approve the issuance of options to purchase 55,000 shares of common stock to three board members. The value of each option granted is estimated using a Black-Scholes option pricing model. The weighted-average assumptions used consider an expected dividend yield of 0%, a risk-free interest rate of 4.07%, an expected life (in years) of 5.84, and expected volatility of 93.04%, resulting in a weighed average fair value of $2.30 per share. Option compensation for the period ended September 30, 2025 related to the issuance of these shares is $126,500. The options have an exercise price of $2.99 per share and vest immediately.

On July 15, 2025, the Company issued options to purchase 16,232 shares of common stock to one employee. The options have an exercise price of $2.70 and are vested immediately. The value of each option granted is estimated using a Black-Scholes pricing model. The weighted-average assumptions used consider an expected dividend yield of 0%, a risk-free interest rate of 4.05%, an expected life (in years) of 5.84, and expected volatility of 93.55%, resulting in a weighted average fair value of $2.08 per share.

On February 23, 2026, the Company issued options to purchase 3,224 shares of common stock to two employees. The options have an exercise price of $2.86 and are vested over a three-year period. For the three-month period ended March 31, 2026, the Company recorded $3,751 of share-based compensation expense related to the vesting of applicable options granted in 2026 and prior years.

The Company has recorded share-based compensation expense as of March 31, 2026, of $61,251. The expense includes $3,751 for existing grants and $57,500 for shares issued to the CEO/CFO which are subject to repurchase. As of March 31, 2026, the Company has an unrecognized share-based compensation expense of $12,223 for outstanding options and $172,500 for restricted stock units which will be recognized in future periods.

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**Note 7. Leases**

On July 2, 2024, the Company entered into an operating lease for our corporate office located at 700 Dorval Drive in Oakville Ontario. The lease commences September 1, 2024 with an expiration date of August 31, 2028. Future renewal options that are not likely to be executed as of the balance sheet date and are excluded from right-of-use assets and related lease liabilities.

We report operating lease assets, as well as operating lease current and non-current obligations, on our condensed consolidated balance sheets for the right to use the building in our business.

The components of lease expense were as follows:

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| | | |
|:---|:---|:---|
|  | Three Months<br> Ended<br> March 31, 2026 | Three Months<br> Ended<br> March 31, 2025 |
| Operating lease cost | $8697 | $12034 |

---

Supplemental balance sheet information related to leases was as follows:

---

| | | |
|:---|:---|:---|
|  | March 31, 2026 | December 31,<br> 2025 |
| Operating leases: |  |  |
| Operating lease right-of-use assets | $80411 | $89685 |
| Current portion of operating lease obligations | $32322 | $32422 |
| Operating lease obligations, net of current portion | $51395 | $60550 |
| Total operating lease liabilities | $83717 | $92972 |

---

---

| | | |
|:---|:---|:---|
|  | March 31, 2026 | December 31,<br> 2025 |
| Weighted Average Remaining Lease Term |  |  |
| Operating lease (in years) | 2.4 | 2.6 |
| Weighted Average Discount Rate |  |  |
| Operating lease | 6.37% | 6.37% |

---

A summary of future minimum payments under non-cancellable operating lease commitment as of March 31, 2026 is as follows:

---

| | |
|:---|:---|
| Years ending December 31, | Total |
| 2026 (remainder of the year) | $25832 |
| 2027 | 34838 |
| 2028 | 23225 |
| Total lease liabilities | $83895 |
| Less amount representing interest | (178) |
| Total | 83717 |
| Less current portion | (32322) |
| Long term portion | $51395 |

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**Note 8. Subsequent Events** 

On April 1, 2026, two shareholders exercised stock options. As a result, the company recorded a payment of $2,438 in exchange for 2,500 shares of stock of the Company. On April 29, 2026, the Company fulfilled the debt obligation of $75,000 for the purchase of Warehowz Inc which was recorded as a note payable on March 31, 2026, consolidated financial statements.

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| | |
|:---|:---|
| **ITEM 2.**  | **<u>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</u>** |

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**Forward Looking Statements**

This Quarterly Report on Form 10-Q contains certain forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) regarding PAID, Inc. (the "Company") and its business, financial condition, results of operations and prospects. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates", "could", "may", "should", "will", "would", and similar expressions or variations of such words are intended to identify forward-looking statements in this report. Additionally, statements concerning future matters such as the development of new services, technology enhancements, purchase of equipment, credit arrangements, possible changes in legislation and other statements regarding matters that are not historical are forward-looking statements.

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Although forward-looking statements in this quarterly report reflect the good faith judgment of the Company's management, such statements can only be based on facts and factors currently known by the Company. Consequently, forward-looking statements are inherently subject to risks, contingencies and uncertainties, and actual results and outcomes may differ materially from results and outcomes discussed in this report. Although the Company believes that its plans, intentions and expectations reflected in these forward-looking statements are reasonable, the Company can give no assurance that its plans, intentions or expectations will be achieved. For a more complete discussion of these risk factors, see Item 1A, "Risk Factors", in the Company's Form 10-K for the fiscal year ended December 31, 2025, that was filed on March 31, 2026.

For example, the Company's ability to maintain positive cash flow and to become profitable may be adversely affected as a result of a number of factors that could thwart its efforts. These factors include the Company's inability to successfully implement the Company's business and revenue model, higher costs than anticipated, the Company's inability to sell its products and services to a sufficient number of customers, the introduction of competing products or services by others, the Company's failure to attract sufficient interest in, and traffic to, its site, the Company's inability to complete development of its products, the failure of the Company's operating systems, and the Company's inability to increase its revenues as rapidly as anticipated. If the Company is not profitable in the future, it will not be able to continue its business operations.

Except as required by applicable laws, we do not intend to publish updates or revisions of any forward-looking statements we make to reflect new information, future events or otherwise. Readers are urged to review carefully and to consider the various disclosures made by the Company in this Quarterly Report, which attempts to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects.

**Overview**

ShipTime Inc. has developed a SaaS based application, which focuses on the small to medium business segment. This offering allows members to quote, process, generate labels, insure, dispatch and track courier and LTL shipments all from a single interface. The application provides customers with a choice of today's leading couriers and freight carriers, all with discounted pricing allowing members to save on every shipment. ShipTime can also be integrated into on-line shopping carts to facilitate sales via e-commerce. We actively sell directly to small businesses and through long standing partnerships with selected associations throughout Canada. Our focus in 2025 will be to continue to grow this portion of our business.

Paid provides integrated technology solutions that support businesses through payment processing and logistics services across North America and international markets. The Company's platforms are designed to help businesses streamline operations, manage transactions, and optimize shipping and transportation workflows through centralized and scalable technology solutions. PaidPayments provides businesses with secure payment processing capabilities, including invoicing, virtual terminal functionality, subscription billing, hosted checkout pages, and point-of-sale solutions with support for USD, CAD, and EUR currencies. PaidShipping provides a multi-carrier logistics and transportation management platform that enables businesses to quote, process, generate labels, dispatch, and track shipments through a single interface. The platform supports parcel, Less-Than-Truckload (LTL), and Full Truckload (FTL) shipments through an extensive network of national and regional carriers and transportation partners. PaidShipping includes multi-carrier rate comparison tools, eCommerce platform integrations, branded tracking capabilities, shipping insurance solutions, shipment audit capabilities, and access to discounted shipping rates through strategic carrier partnerships.

Warehowz provides an on-demand warehousing and fulfillment marketplace that connects businesses with flexible storage, distribution, and fulfillment capacity through a network of certified warehouse partners across North America. With access to more than 2,500 warehouse facilities throughout the United States and Canada, Warehowz enables businesses to optimize inventory placement, improve delivery times, and scale fulfillment operations based on changing business requirements. The platform is designed to provide greater flexibility, visibility, and operational efficiency across the supply chain for both merchants and enterprise customers.

<u>Significant Accounting Policies</u>

Our significant accounting policies are more fully described in Note 3 to our consolidated financial statements for the years ended December 31, 2025 and 2024 included in our Form 10-K filed on March 31, 2026, as updated and amended in Note 1 of the Notes to Condensed Consolidated Financial Statements included herein. However, certain of our accounting policies, most notably with respect to revenue recognition, are particularly important to the portrayal of our financial position and results of operations and require the application of significant judgment by our management; as a result, they are subject to an inherent degree of uncertainty. In applying these policies, our management makes estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures. Those estimates and judgments are based upon our historical experience, the terms of existing contracts, our observance of trends in the industry, information that we obtain from our customers and outside sources, and on various other assumptions that we believe to be reasonable and appropriate under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

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<u>Results of Operations</u> 

***Comparison of the three months ended March 31, 2026 and 2025.***

The following discussion compares the Company's results of operations for the three months ended March 31, 2026, with those for the three months ending March 31, 2025. The Company's condensed consolidated financial statements and notes thereto included elsewhere in this quarterly report contain detailed information that should be referred to in conjunction with the following discussion.

<u>Revenues</u> 

The following table compares total net revenue for the periods indicated.

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| | | | |
|:---|:---|:---|:---|
|  | Three Months Ended March 31, | Three Months Ended March 31, | Three Months Ended March 31, |
|  | 2026 | 2025 | % Change |
| Client services | $- | $2034 | (100)% |
| Shipping coordination and label generation services | 5244788 | 4346139 | 21% |
| eCommerce services | 5750 | 29617 | (81)% |
| Warehousing services | 76007 |  | 100% |
| Total net revenues | $5326545 | $4377790 | 22% |

---

Revenues increased 22% in the first quarter as a result of the shipping coordination and label generation segment of the business. Strategic sales initiatives and pricing strategies have contributed to the shipping volume increase of 22% in first quarter of 2026 in addition to the addition of the new warehousing segment which contributed to the overall revenue increase for 2026.

Client services revenues, which included brewery management software and shipping calculator services decreased $2,034 or 100% to $0 in the first quarter of 2026 compared to $2,034 in 2025. The decrease in revenues is due to the retirement of the brewery management software application and the online shipping calculation services. The Company announced the closing of this BeerRun Software in June of 2025.

Shipping coordination and label generation services revenues increased $898,649 or 21% to $5,244,788 in the first quarter of 2026 compared to $4,346,139 in 2025. The increase is primarily due to additional pricing and sales initiatives. Additional carriers and product enhancements continue to attract new clients to the platform.

eCommerce services are available to small businesses that process online payment and shipping transactions. These include payments and web hosting services. The Company has recognized revenues of $5,750, a decrease of $23,867 or 81% compared to $29,617 for the same period in 2025. The decrease is attributed to the loss of a client for the PaidPayments portion of this segment of the business in 2025.

Warehousing services is a new segment of the Company.

<u>Gross Profit</u>

Gross profit increased $40,512 in the first quarter of 2026 to $1,060,588 compared to $1,020,076 in 2025. Gross margin decreased 2% to 20% in the first quarter of 2026 compared to 22% for the same period in 2025.

<u>Operating Expenses</u>

Total operating expenses in the first quarter of 2026 were $1,178,309 compared to $1,179,205 in the first quarter of 2025, a decrease of $896 or less than 1%.

<u>Other Income/Expense, net</u> 

Net other income in 2026 was $65,664 compared to $0 in 2025, an increase of $65,664 or 100%. The other income in the first quarter of 2026 was made up of several write offs of aged payables and accrued expenses.

<u>Net Income (Loss)</u>

The Company recorded a net loss in the first quarter of 2026 of ($41,531) compared to a net loss of ($148,773) for the same period in 2025. The net loss per share for the first quarter of 2026 was $0.00 and the net loss per share for 2025 was ($0.02).

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**Cash Flows from Operating Activities**

A summarized reconciliation of the Company's net loss to cash and cash equivalents used in operating activities for the three months ended March 31, 2026 and 2025 is as follows:

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| | | |
|:---|:---|:---|
|  | 2026 | 2025 |
| Net income (loss) | $(41531) | $(148773) |
| Depreciation and amortization | 74096 | 70347 |
| Amortization of operating lease right-of-use assets | 7963 | 7377 |
| Payment of accrued common stock bonus | 124709 |  |
| Provision for bad debts |  | 22286 |
| Share-based compensation | 61251 | 1267 |
| Interest income accrued on note receivable | (11704) | (7315) |
| Changes in assets and liabilities | (345649) | (422757) |
| Net cash used in operating activities | $(130865) | $(477568) |

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**Working Capital and Liquidity** 

The Company had cash and cash equivalents of $951,698 at March 31, 2026, compared to $1,108,059 at December 31, 2025. The Company had a net working capital deficit of $353,993 at March 31, 2026, an increase of $49,781 compared to the deficit of $304,212 at December 31, 2025. The decrease in net working capital is primarily attributable to the cash on hand and the accounts receivable balance at the end of the first quarter in 2026.

The Company may need an infusion of additional capital to fund anticipated operating costs over the next 12 months, however, management believes that the Company has adequate cash resources to fund operations. There can be no assurance that anticipated growth will occur, and that the Company will be successful in launching new products and services. If necessary, management will seek alternative sources of capital to support operations.

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| | |
|:---|:---|
| **ITEM 3.** | **<u>QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</u>** |

---

As a smaller reporting company, the Company is not required to provide the information for this Item 3.

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| | |
|:---|:---|
| **ITEM 4.** | **<u>CONTROLS AND PROCEDURES</u>** |

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**Evaluation of Disclosure Controls and Procedures**

The Company's management, including the Chief Executive Officer/Chief Financial Officer of the Company, as its principal financial officer has evaluated the effectiveness of the Company's "disclosure controls and procedures," as such term is defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based upon this evaluation, the Chief Executive Officer/Chief Financial Officer has concluded that, as of March 31, 2026, the Company's disclosure controls and procedures were not effective, due to material weaknesses in internal control over financial reporting, for the purpose of ensuring that the information required to be disclosed in the reports that the Company files or submits under the Exchange Act with the Securities and Exchange Commission is recorded, processed, summarized and reported within the time period specified by the Securities and Exchange Commission's rules and forms, and is accumulated and communicated to the Company's management, including its principal executive/financial officer as appropriate to allow timely decisions regarding required disclosure.

The Company has identified numerous material weaknesses in internal control over financial reporting as described in the Company's Form 10-K for the year ended December 31, 2025.

**Changes in Internal Control over Financial Reporting**

The Company continues to evaluate the internal controls over financial reporting and is working toward implementation of corporate governance and operational process documentation.

**<u>PART II - OTHER INFORMATION</u>**

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| | |
|:---|:---|
| **ITEM 1.**  | **<u>LEGAL PROCEEDINGS</u>** |

---

From time to time we may be a party to various legal proceedings arising in the ordinary course of our business. Our management is not aware of any litigation outstanding, threatened or pending as of the date hereof by or against us or our properties which we believe would be material to our financial condition or results of operations, except with respect to a dispute related to its non-renewal of the employment agreement with Mr. Allan Pratt, the Company's former President and CEO, in which Mr. Pratt appears to be treating it as a termination which would trigger a two-year severance payment in addition to claims of an unpaid bonus. Around the same time that Mr. Pratt's employment term expired, the Company's Board of Directors voted to reduce the board from five to three, and Mr. Pratt and Mr. Austin Lewis, CFO, automatically rolled off from the Board of Directors. More than a year later, in 2021, Mr. Pratt filed a claim in Delaware courts to contest that decision and, in November 2023 this claim was dismissed. In July 2022, Mr. Pratt amended the complaint to dispute the proper authorization of a stock bonus that was awarded to the Company's CEO in March 2021. The trial was held before the Delaware court on December 5-6, 2024. Post-trial briefing in the Delaware action was completed on March 21, 2025, followed by a post-trial hearing on May 14, 2025. The trial for the Canadian litigation is set to begin on May 25, 2026.

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| | |
|:---|:---|
| **ITEM 1A.**  | **<u>RISK FACTORS</u>** |

---

There are no material changes for the risk factors previously disclosed on Form 10-K for the year ended December 31, 2025.

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| | |
|:---|:---|
| **ITEM 2.**  | **<u>UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS</u>** |

---

On March 03, 2026, The Company issued 50,974 shares of common stock at $2.40 per share for bonus compensation. The common stock was issued in and reliance upon the exemptions from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act Rule 506(b) of Regulation D promulgated thereunder.

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| | |
|:---|:---|
| **ITEM 3.**  | **<u>DEFAULTS UPON SENIOR SECURITIES</u>** |

---

None.

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| | |
|:---|:---|
| **ITEM 4.**  | **<u>MINE SAFETY DISCLOSURES</u>** |

---

Not Applicable.

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| | |
|:---|:---|
| **ITEM 5.** | **<u>OTHER INFORMATION</u>** |

---

Not Applicable

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| | |
|:---|:---|
| **ITEM 6.**  | **<u>EXHIBITS</u>** |

---

---

| | |
|:---|:---|
| 10.1 | [<u>Amendment to 2018 Non-Qualified Stock Option Plan</u> (incorporated by reference to Exhibit 10.1 to Form 10-Q filed on November 13, 2020)](http://www.sec.gov/Archives/edgar/data/1017655/000165495421005705/ex10-1.htm) |
| 31.1 | [CEO and CFO Certification required under Section 302 of Sarbanes-Oxley Act of 2002](ex_959958.htm) |
| 32 | [CEO and CFO Certification required under Section 906 of Sarbanes-Oxley Act of 2002](ex_959957.htm) |
| 101.INS | Inline XBRL Instance Document (filed herewith) |
| 101.SCH | Inline XBRL Taxonomy Extension Schema (filed herewith) |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase (filed herewith) |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase (filed herewith) |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase (filed herewith) |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase (filed herewith) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document and include in Exhibit 101) |

---

------

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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| | | |
|:---|:---|:---|
|  | PAID, INC. | PAID, INC. |
|  | By: | /s/ W. Austin Lewis IV |
| Date: May 15, 2026 |  | W. Austin Lewis, IV, CEO, CFO |

---

LIST OF EXHIBITS

---

| | |
|:---|:---|
| 10.1 | Amendment to 2018 Non-Qualified Stock Option Plan (incorporated by reference to Exhibit 10.1 to Form 10-Q filed on November 13, 2020) |
| 31.1 | CEO and CFO Certification required under Section 302 of Sarbanes-Oxley Act of 2002 |
| 32 | CEO and CFO Certification required under Section 906 of Sarbanes-Oxley Act of 2002 |
| 101.INS | Inline XBRL Instance Document (filed herewith) |
| 101.SCH | Inline XBRL Taxonomy Extension Schema (filed herewith) |
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase (filed herewith) |
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase (filed herewith) |
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase (filed herewith) |
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase (filed herewith) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document and include in Exhibit 101) |

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## Exhibit 31.1

EXHIBIT 31.1

CERTIFICATION

I, W. Austin Lewis, IV, certify that:

1. I have reviewed this quarterly report on Form 10-Q of PAID, INC.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)) for the Registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of Registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: May 15, 2026  |  |
|  | /s/ W. Austin Lewis, IV |
|  | W. Austin Lewis, IV, Chief Executive Officer, Chief Financial Officer<br> (Principal Financial and Accounting Officer) |

---

## Ex-32

EXHIBIT 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of PAID, INC. (the "Company") on Form 10-Q for the quarter ended March 31, 2026 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in their capacities as CEO and CFO of the Company, certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| |
|:---|
| /s/ W. Austin Lewis, IV |
| W. Austin Lewis, IV, Chief Executive Officer, Chief Financial Officer |

---

May 15, 2026