The Forge Atlanta note default and missed payments signal imminent foreclosure risk on the company's primary asset. Monitor for any bankruptcy court developments regarding the Owens estate asset sale and whether the company can secure financing before the October 1, 2026 note maturity.
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Executive Summary
Webstar Technology Group filed an amended 10-K/A restating its 2024 financial statements due to two errors: (1) insufficient authorized shares to settle equity-linked instruments, requiring a $18.7M derivative liability classification under ASC 815, and (2) a $4.0M misclassification of liabilities settled with common stock. The auditor's report includes a going-concern opinion citing a $63.3M accumulated deficit, $55.4M working capital deficit, and zero revenue since inception. The company's $33.7M Forge Atlanta promissory note is in default with an extension to October 1, 2026, but the company has missed multiple interest and extension fee payments.
Key Facts
- Restatement of 2024 financials: $18,676,168 derivative liability recorded for insufficient authorized shares to settle convertible note; $4,021,910 reclassification of liabilities settled with shares from other expense to additional paid-in capital.
- Going concern: accumulated deficit of $63,337,851, working capital deficit of $55,386,238, net loss of $1,446,714 in 2025, zero revenue since inception.
- Material weakness in internal controls identified for both 2024 and 2025; auditor change from Pipara & Co LLP to Victor Mokuolu, CPA PLLC.
- $33,700,000 Purchase Money Promissory Note for Forge Atlanta in default since April 1, 2026; modification extends to October 1, 2026 but company has not paid required interest and extension fees.
- Convertible note payable to former CEO James Owens ($1,000,000 principal) in default; convertible at $0.01/share into 100,000,000 shares.
- Total liabilities of $56,194,958 vs total assets of $35,098,965 as of December 31, 2025.
- Cash balance of only $4,271 as of December 31, 2025.
Financial Impact
Restatement added $18.7M derivative liability and $4.0M reclassification; $33.7M promissory note in default; $63.3M accumulated deficit; zero revenue.
Risk Factors
- Foreclosure on Forge Atlanta property due to default on $33.7M promissory note
- Inability to raise capital with only $4,271 cash and $55.4M working capital deficit
- Potential SEC investigation or shareholder litigation following restatement and material weaknesses
- Dilution from conversion of $1M convertible note at $0.01/share (100M shares) and other convertible instruments
Investment Themes
Documents Analyzed
This report is based on 7 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 10-K/A Filing (Primary) | 0001493152-26-047289 |
| Exhibit: ex19-1.htm | 0001493152-26-047289 |
| Exhibit: ex31-1.htm | 0001493152-26-047289 |
| Exhibit: ex32-1.htm | 0001493152-26-047289 |
| Document: 0001493152-26-047289-index-headers.html | 0001493152-26-047289 |
| Document: 0001493152-26-047289-index.html | 0001493152-26-047289 |
| Document: 0001493152-26-047289.txt | 0001493152-26-047289 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 19, 2026 7d ago | 10-K/A | $0.0100 $0.0100 | · 0.00% | ▲ +0.53% | $0.010000 (+0.00%) |
Oct 15, 2026 11d ago | 10-K/A | $0.0100 $0.0100 | · 0.00% | ▲ +0.42% | $0.010000 (+0.00%) |
Apr 17, 2026 27w ago | 8-K | $0.0695 $0.0700 | ▼ −0.72% | ▼ −0.91% | $0.010000 (+85.61%) |
US Market Status
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