Filing Impact
(Moderate)
Filing Sentiment
(Neutral)
Form Type
10-K
Rhea-AI Filing Summary
Legend Spices Inc. (LGSP), a Nevada corporation, filed its annual report for the year ended December 31, 2025. The company has ceased its seasoning production business in Armenia, has generated only $644 in revenue for 2025 and is currently operating as a shell company while it explores new business opportunities and potential acquisitions, with no new operating business identified to date.
The company reported a net loss of $18,787 for 2025 and an accumulated deficit of $128,012 since inception. As of year-end it had $0 cash, no current assets, current liabilities of $17,525, and a corresponding working capital deficit of $17,525. A related party forgave $69,717 of debt, recorded as additional paid-in capital, but auditors and management both state there is substantial doubt about the company’s ability to continue as a going concern.
On March 29, 2025, control shifted from founder Khachatur Mkrtchyan to Qihui Wang and investors; Ms. Wang now serves as sole director and all principal officers. The report highlights material weaknesses in internal control over financial reporting, absence of staff, reliance on related-party funding, lack of an active trading market, penny-stock risks, and potential dilution given authorization for up to 500,000,000 common shares versus 6,850,000 currently outstanding.
Positive
- $69,717 of related-party debt was forgiven and recorded as a capital contribution, materially reducing liabilities and narrowing the stockholders’ deficit.
- Current liabilities decreased from $71,985 to $17,525 year over year, primarily due to the debt forgiveness, improving the balance sheet despite ongoing losses.
Negative
- Auditors and management cite substantial doubt about the company’s ability to continue as a going concern due to recurring losses and lack of financing.
- The company ended 2025 with $0 cash, no current assets, and a working capital deficit of $17,525, leaving it dependent on external funding.
- Operating results show minimal 2025 revenue of $644 and a net loss of $18,787, with the core seasoning business discontinued and no replacement business yet.
- Internal control over financial reporting was assessed as not effective, with a disclosed material weakness from inadequate staffing and segregation of duties.
- LGSP is currently a shell company with suspended operations since February 2025, heightening business-model risk and execution uncertainty.
- There is no active trading market for the common stock, which is expected to be a penny stock, implying liquidity constraints and potential price volatility.
