10-Q

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
For the quarterly period ended March 31, 2022
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 0-53944

REGO PAYMENT ARCHITECTURES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware	35-2327649
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
325 Sentry Parkway, Suite 200
Blue Bell, PA	19422
(Address of Principal Executive Offices)	(Zip Code)

(267) 465-7530

(Registrant’s Telephone Number, Including Area Code)

(Former name, former address and former fiscal year, if changed since last report)

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

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
None

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

1

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an 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.

Large accelerated filer  ☐	Accelerated filer ☐
Non-accelerated filer  ☒	Smaller reporting company ☒
Emerging growth company  ☐

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 ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 123,552,213 shares of common stock outstanding at May 16, 2022.

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TABLE OF CONTENTS

	Page
PART I - FINANCIAL INFORMATION
Cautionary Note Regarding Forward-Looking Statements	4

ITEM 1. Financial Statements 20

Condensed Consolidated Balance Sheets (Unaudited)	6
Condensed Consolidated Statements of Comprehensive Loss (Unaudited)	7
Condensed Consolidated Statements of Changes in Stockholders’ Deficit (Unaudited)	8
Condensed Consolidated Statements of Cash Flows (Unaudited)	9
Notes to Condensed Consolidated Financial Statements (Unaudited)	10

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	24
ITEM 4.	Controls and Procedures	25
PART II - OTHER INFORMATION
ITEM 1.	Legal Proceedings	26
ITEM 1A.	Risk Factors	26
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
ITEM 3.	Defaults Upon Senior Securities	26
ITEM 4.	Mine Safety Disclosures	26
ITEM 5.	Other Information	26
ITEM 6.	Exhibits	26
SIGNATURES		27

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PART I - FINANCIAL INFORMATION

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included or incorporated by reference in this Quarterly Report on Form 10-Q, including without limitation, statements regarding our future financial position, business strategy, budgets, projected revenues, projected costs and plans and objectives of management for future operations, are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expects,” “intends,” “plans,” “projects,” “estimates,” “anticipates,” “believes,” “contemplates,” “targets,” “could,” “would” or “should” or the negative thereof or any variation thereon or similar terminology or expressions. Management cautions readers not to place undue reliance on any of the Company’s forward-looking statements, which speak only as of the date made.

We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are not guarantees and are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially from our expectations include, but are not limited to: our ability to raise additional capital, the absence of any material operating history or revenue, our ability to attract and retain qualified personnel, our ability to develop and introduce a new service and products to the market in a timely manner, market acceptance of our services and products, our limited experience in the industry, the ability to successfully develop licensing programs and generate business, rapid technological change in relevant markets, unexpected network interruptions or security breaches, changes in demand for current and future intellectual property rights, legislative, regulatory and competitive developments, intense competition with larger companies, general economic conditions, the impact of the current COVID-19 pandemic, and other risks discussed in Part I – Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the Securities and Exchange Commission (the “SEC”), and the Company’s other subsequent filings with the SEC.

All subsequent written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the foREGOing. The Company has no obligation to and does not undertake to update, revise, or correct any of these forward-looking statements after the date of this report.

4

ITEM 1. FINANCIAL STATEMENTS

REGO Payment Architectures, Inc.

CONTENTS

	PAGE
CONDENSED CONSOLIDATED BALANCE SHEETS	6
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS	7
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT	8
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS	9
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS	10 to 19

5

REGO Payment Architectures, Inc.

Condensed Consolidated Balance Sheets

	March 31, 2022			December 31, 2021
ASSETS	(Unaudited)
CURRENT ASSETS
Cash and cash equivalents	$	2,564,955		$	553,131
Prepaid expenses		22,005			108,131
Deposits		341			341
TOTAL CURRENT ASSETS		2,587,301			661,603
OTHER ASSETS
Patents and trademarks, net of accumulated
amortization of $263,971 and $253,262		470,138			379,401
		470,138			379,401
TOTAL ASSETS	$	3,057,439		$	1,041,004
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable and accrued expenses	$	6,367,629		$	6,108,019
Accounts payable and accrued expenses - related parties		9,808			141,522
Loans payable		42,600			42,600
10% secured convertible notes payable - stockholders		3,316,357			3,316,357
Notes payable - stockholders		595,000			595,000
4% secured convertible notes payable - stockholders		14,981,250			14,781,250
Preferred stock dividend liability		8,215,549			7,928,199
TOTAL CURRENT LIABILITIES		33,528,193			32,912,947
CONTINGENCIES
STOCKHOLDERS' DEFICIT
Preferred stock, $.0001 par value; 2,000,000 preferred shares
authorized; 195,500 preferred shares Series A authorized; 101,350 shares
issued and outstanding at March 31, 2022 and 102,350 shares issued and outstanding at December 31, 2021		10			10
Preferred stock, $.0001 par value; 2,000,000 preferred shares
authorized; 222,222 preferred shares Series B authorized; 75,478 shares
issued and outstanding at March 31, 2022 and 35,879 issued and
outstanding at December 31, 2021		8			4
Preferred stock, $.0001 par value; 2,000,000 preferred shares
authorized; 300,000 preferred shares Series C authorized; 0 shares
issued and outstanding at March 31, 2022 and December 31, 2021		-			-
Common stock, $ .0001 par value; 230,000,000 shares authorized;
123,552,213 shares issued and outstanding at March 31, 2022 and
123,441,102 shares issued and outstanding at December 31, 2021		12,355			12,344
Additional paid in capital		71,707,683			67,740,012
Accumulated deficit		(102,108,106	)		(99,546,710	)
Noncontrolling interests		(82,704	)		(77,603	)
STOCKHOLDERS' DEFICIT		(30,470,754	)		(31,871,943	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	3,057,439		$	1,041,004

See the accompanying notes to the condensed consolidated financial statements.

6

REGO Payment Architectures, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited)

	For the Three Months Ended
	March 31,
	2022			2021
NET REVENUE	$	1,397		$	533
OPERATING EXPENSES
Transaction expense		62,531			37,314
Sales and marketing		636,608			457,016
Product development		435,366			830,358
General and administrative		893,554			3,068,957
Total operating expenses		2,028,059			4,393,645
NET OPERATING LOSS		(2,026,662	)		(4,393,112	)
OTHER INCOME (EXPENSE)
Interest income		38			251
Forgiveness of debt		-			81,500
Interest expense		(252,523	)		(334,440	)
		(252,485	)		(252,689	)
NET LOSS		(2,279,147	)		(4,645,801	)
LESS: Accrued preferred dividends		(287,350	)		(267,114	)
Net loss attributable to noncontrolling interests		101			101
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	$	(2,566,396	)	$	(4,912,814	)
BASIC AND DILUTED NET LOSS PER
COMMON SHARE	$	(0.02	)	$	(0.04	)
BASIC AND DILUTED WEIGHTED AVERAGE
COMMON SHARES OUTSTANDING		123,444,806			121,255,150

See the accompanying notes to the condensed consolidated financial statements.

7

REGO Payment Architectures, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

For the Three Months Ended March 31, 2022

	Preferred					Preferred				Preferred				Common
	Stock Series A					Stock Series B				Stock Series C				Stock				Additional
	Number of					Number of				Number of				Number of				Paid-In			Accumulated			Noncontrolling
	Shares			Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			Interests			Total
Balance, December 31, 2021		102,350		$	10		35,879	$	4		-	$	-		123,441,102	$	12,344	$	67,740,012		$	(99,546,710	)	$	(77,603	)	$	(31,871,943	)
Conversion of Series A Preferred stock into common stock		(1,000	)		-		-		-		-		-		111,111		11		(11	)		-			-			-
Sale of Series B Preferred stock		-			-		39,599		4		-		-		-		-		3,563,996			-			-			3,564,000
Fair value of options for services		-			-		-		-		-		-		-		-		403,686			-			-			403,686
Accrued preferred dividends		-			-		-		-		-		-		-		-		-			(282,350	)		(5,000	)		(287,350	)
Net loss		-			-		-		-		-		-		-		-		-			(2,279,046	)		(101	)		(2,279,147	)
Balance, March 31, 2022 (Unaudited)		101,350		$	10		75,478	$	8		-	$	-		123,552,213	$	12,355	$	71,707,683		$	(102,108,106	)	$	(82,704	)	$	(30,470,754	)

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

For the Three Months Ended March 31, 2021

	Preferred						Preferred				Preferred				Common
	Stock Series A						Stock Series B				Stock Series C				Stock				Additional
	Number of						Number of				Number of				Number of				Paid-In			Accumulated			Noncontrolling
	Shares			Amount			Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			Interests			Total
Balance, December 31, 2020, as adjusted		107,850			11			28,378		3		-		-		120,096,866		12,010		61,447,232			(87,783,083	)		(57,502	)		(26,381,329	)
Conversion of Series A Preferred stock into common stock		(5,500	)		(1	)		-		-		-		-		611,111		61	$	(60	)		-			-			-
Issuance of common stock to board members and employees		-			-			-		-		-		-		1,800,000		180		1,929,820			-			-			1,930,000
Issuance of common stock for accounts payable		-			-			-		-		-		-		150,000		15		134,985			-			-			135,000
Exercise of options		-			-			-		-		-		-		80,000		8		19,992			-			-			20,000
Fair value of options for software		-			-			-		-		-		-		-		-		111,817			-			-			111,817
Fair value of options for services		-			-			-		-		-		-		-		-		1,417,625			-			-			1,417,625
Accrued preferred dividends		-			-			-		-		-		-		-		-		-			(262,114	)		(5,000	)		(267,114	)
Net loss		-			-			-		-		-		-		-		-		-			(4,645,700	)		(101	)		(4,645,801	)
Balance, March 31, 2021 (Unaudited)		102,350		$	10			28,378	$	3		-	$	-		122,737,977	$	12,274	$	65,061,411		$	(92,690,897	)	$	(62,603	)	$	(27,679,802	)

See the accompanying notes to the condensed consolidated financial statements.

8

REGO Payment Architectures, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	For the Three Months Ended March 31,
	2022			2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(2,279,147	)	$	(4,645,801	)
Adjustments to reconcile net loss to net cash used in operating activities:
Fair value of common stock issued in exchange for services		-			1,930,000
Fair value of options issued in exchange for services		403,686			1,417,626
Impairment loss		-			111,817
Depreciation and amortization		10,709			7,381
Forgiveness of debt		-			(81,500	)
Decrease in assets
Prepaid expenses		86,126			147,245
Increase (decrease) in liabilities
Accounts payable and accrued expenses		259,610			314,067
Accounts payable and accrued expenses - related parties		(131,714	)		(60,324	)
Net cash used in operating activities		(1,650,730	)		(859,489	)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in patents		(101,446	)		-
Net cash used in investing activities		(101,446	)		-
CASH FLOWS FROM FINANCING ACTIVITIES
Exercise of options		-			20,000
Proceeds from sale of Series B Preferred stock		3,564,000			-
Proceeds from 4% secured notes payable - stockholders		200,000			-
Proceeds from convertible notes payable - stockholders		-			2,425,000
Net cash provided by financing activities		3,764,000			2,445,000
NET INCREASE IN CASH AND CASH EQUIVALENTS		2,011,824			1,585,511
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD		553,131			273,176
CASH AND CASH EQUIVALENTS - END OF PERIOD	$	2,564,955		$	1,858,687
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during year for:
Interest	$	-		$	576
Income taxes	$	-		$	-
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Accrued preferred dividends	$	287,350		$	267,114
Options issued for software	$	-		$	111,817
Issuance of common stock for accounts payable	$	-		$	135,000
Conversion of Series A Preferred stock to common stock	$	11		$	61
Adoption of new accounting principle for embedded derivative liabilities
affecting accumulated deficit	$	-		$	10,987,578

See the accompanying notes to the condensed consolidated financial statements.

9

REGO Payment Architectures, Inc.

Notes to Condensed Consolidated Financial Statements

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of the Business

REGO Payment Architectures, Inc. (“REGO”) was incorporated in the state of Delaware on February 11, 2008.

REGO Payment Architectures, Inc. and its subsidiaries (collectively, except where the context requires, the “Company”) is a provider of consumer software that delivers a mobile payment platform solution—Mazoola® - a family focused mobile banking solution. Headquartered in Blue Bell, Pennsylvania, the Company maintains a portfolio of trade secrets and four US patent awards. REGO offers an all-digital financial payments platform to enable minors, particularly under 13 years old, to purchase goods and services, complete chores and learn in a secure online environment guided by parental permission, oversight, and control, while remaining Children’s Online Privacy Protection Act (“COPPA”) and General Data Protection Regulation (“GDPR”) compliant.

Management believes that building on its COPPA advantage the future of REGO Payment Architectures, Inc. will be based on the foundational architecture of its technology platform (the “Platform”) that will allow its use across multiple financial markets where secure controlled payments are needed. The Company intends to license in each alternative field of use the ability for its partners, distributors and/or value added resellers to private label each of the alternative markets. These partners would deploy, customize and support each implementation under their own label, but with acknowledgement of the Company’s proprietary intellectual assets as the base technology. Management believes this approach will enable the Company to reduce expenses while broadening its reach.

Revenues generated from the Platform will come from multiple sources depending on the level of service and facilities requested by the parent. There will be levels of subscription revenue paid monthly, service fees, transaction fees and revenue sharing and licensing with banking and distribution partners.

ZOOM Solutions, Inc. (“ZS”)

ZS (formerly Zoom Payment Solutions, Inc.) was incorporated in the state of Delaware on February 16, 2018 as a subsidiary of REGO Payment Architectures, Inc. During the year ended December 31, 2020, the minority common shareholders of ZS exchanged their shares in ZS for REGO 10% secured convertible notes payable. REGO now owns 100% of the common stock of ZS. ZS is the holding company for various subsidiaries that will utilize REGO’s payment platform to address emerging markets.

There were minimal operations at ZS during the three months ended March 31, 2022 and 2021.

ZOOM Payment Solutions, Inc. (“ZPS”)

ZPS (formerly Zoom Payment Solutions USA, Inc.) was incorporated in the state of Nevada on December 6, 2017. ZPS is a wholly owned subsidiary of ZS with the core focus on providing mobile payments solutions. ZPS has secured a sublicense from ZS for the REGO payment platform and access to the patents from REGO.

There were minimal operations at ZPS during the three months ended March 31, 2022 and 2021.

ZOOM Blockchain Solutions, Inc. (“ZBS”)

ZBS was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. This company was focused on blockchain as a business solution for the retail and Consumer Packaged Goods (“CPG”) industries.

There were minimal operations at ZBS during the three months ended March 31, 2022 and 2021.

ZOOM Cloud Solutions, Inc. (“ZCS”)

ZCS (formerly Zoom Canada Solutions, Inc.) was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. ZCS was focused on providing a highly secure cloud storage as a service.

10

There were minimal operations at ZCS during the three months ended March 31, 2022 and 2021.

ZOOM Auto Solutions, Inc. (“ZAS”)

ZAS (formerly Zoom Mining Solutions) was incorporated in the State of Delaware on February 19, 2018 as a wholly owned subsidiary of ZCS. It is now a wholly owned subsidiary of ZBS.

There were minimal operations at ZAS during the three months ended March 31, 2022 and 2021.

The Company’s principal office is located in Blue Bell, Pennsylvania.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). These statements include all adjustments (consisting only of normal recurring adjustments) which management believes necessary for a fair presentation of the financial statements and have been prepared on a consistent basis using the accounting policies described in the summary of accounting policies included in the Company’s 2021 Annual Report on Form 10-K (the “Form 10-K”). All significant intercompany transactions and balances have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with US GAAP have been condensed, or omitted pursuant to such rules and regulations, although the Company believes that the accompanying disclosures are adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional financing to operationalize the Company’s current technology before another company develops similar technology to compete with the Company.

Recently Adopted Accounting Pronouncements

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40), Issuer’s Accounting for Certain Modifications or Exchanges or Freestanding Equity – Classified Written Call Options. The amendments in this Update clarify an issuer’s accounting for modifications or exchanges of freestanding equity – classified written call options (for example, warrants) that remain equity classified after modification or exchange. This was adopted January 1, 2022 and there was no material impact to the financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

As of March 31, 2022, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements.

NOTE 2 – MANAGEMENT PLANS

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred significant losses and experienced negative cash flow from operations since inception. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Since inception, the Company has focused on developing and implementing its business plan. The Company believes that its existing cash resources will not be sufficient to sustain operations during the next twelve months. The Company currently needs to generate revenue in order to sustain its operations. In the event that the Company cannot generate sufficient revenue to sustain its operations, the Company will need to reduce expenses or obtain financing through the sale of debt and/or equity securities. The issuance of additional equity would result in dilution to existing shareholders. If the Company is unable to obtain additional funds when they are needed or if such funds cannot be obtained on terms acceptable to the Company, the Company would be unable to execute upon the business plan or pay costs and expenses as they are incurred, which would have a material, adverse effect on the business, financial condition and results of operations.

11

The Company’s current monetization model is to derive revenues from levels of service fees, transaction fees and in some cases revenue sharing with banking and distribution partners. As these bases of revenues grow, the Company expects to generate additional revenue to support operations.

The Covid-19 pandemic caused a significant economic slowdown that adversely affected the demand for services. While the Company expects this matter to negatively impact its results of operations, cash flow and financial position, the future financial impact cannot be reasonably estimated at this time.

As of May 16, 2022, the Company has a cash position of approximately $1.9 million. Based upon the current cash position and the Company’s planned expense run rate, management believes the Company has funds currently to finance its operations through November 2022.

NOTE 3 – IMPAIRMENT OF LONG-LIVED ASSETS

On January 1, 2021, REGO entered into a Purchase of Business Agreement (“Agreement”) with Chore Check, LLC pursuant to which it purchased the assets of Chore Check, LLC, consisting primarily of a software application, valued at $111,817, fair value. The consideration for the acquisition consisted of the issuance of an option to purchase 100,000 shares of the Company’s common stock, with an exercise price of $0.90, vesting immediately and with a term of three years.

Long-lived assets are tested for impairment by performing a qualitative assessment to determine whether it is more likely than not that the fair value is less than the carrying value. Long-lived assets are considered impaired if the carrying value exceeds its fair value. The Company determined that the carrying value of the asset acquired from Chore Check, LLC exceeded its fair value and has recorded an impairment loss in the amount of $111,817 as of March 31, 2021, which was included in general and administrative expenses.

NOTE 4 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES - RELATED PARTIES

As of March 31, 2022 and December 31, 2021, the Company owed the Chief Executive Officer, who is also a more than 5% beneficial owner, a total of $5,962 and $95,185, consisting of $5,962 and $95,185 in unpaid salary.

Additionally, as of March 31, 2022 and December 31, 2021, the Company owed the son of a more than 5% beneficial owner, Chief Executive Officer, President and Board member, $0 and $10,349, pursuant to a consulting agreement.

As of March 31, 2022 and December 31, 2021, the Company owed the Chief Financial Officer $3,846 and $35,988 in unpaid salary.

NOTE 5 – LOANS PAYABLE

Loans payable as of March 31, 2022 and December 31, 2021 were $42,600. Interest accrued on the loans at 6% and 10% was $4,536 and $3,806 as of March 31, 2022 and December 31, 2021. Interest expense related to these loans payable was $730 and $251 for the three months ended March 31, 2022 and 2021.

NOTE 6 – 10% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

On March 6, 2015, the Company, pursuant to a Securities Purchase Agreement (the “Purchase Agreement”), issued $2,000,000 aggregate principal amount of its 10% Secured Convertible Promissory Notes due March 5, 2016 (the “Notes”) to certain stockholders. On May 11, 2015, the Company issued an additional $940,000 of Notes to stockholders. The maturity dates of the Notes have been extended most recently to October 31, 2022, with the consent of the Note holders.

12

The Notes are convertible by the holders, at any time, into shares of the Company’s Series B Preferred Stock at a conversion price of $90.00 per share, subject to adjustment for stock splits, stock dividends and similar transactions with respect to the Series B Preferred Stock only. Each share of Series B Preferred Stock is currently convertible into 100 shares of the Company’s common stock at a current conversion price of $0.90 per share, subject to anti-dilution adjustment as described in the Certificate of Designation of the Series B Preferred Stock. In addition, pursuant to the terms of a Security Agreement entered into on May 11, 2015 by and among the Company, the Note holders and a collateral agent acting on behalf of the Note holders (the “Security Agreement”), the Notes are secured by a lien against substantially all of the Company’s business assets. Pursuant to the Purchase Agreement, the Company also granted piggyback registration rights to the holders of the Series B Preferred Stock upon a conversion of the Notes.

The Notes are recorded as a current liability as of March 31, 2022 and December 31, 2021 in the amount of $3,316,357. Interest accrued on the Notes was $2,262,511 and $2,179,602 as of March 31, 2022 and December 31, 2021. Interest expense related to these Notes payable was $82,909 and $77,909 for the three months ended March 31, 2022 and 2021.

NOTE 7 – NOTES PAYABLE – STOCKHOLDERS

These notes payable have no formal repayment terms and $370,000 of the notes bear interest at 10% per annum and the remaining $225,000 of the notes bear interest at 20% per annum. 

These notes payable are recorded as a current liability as of March 31, 2022 and December 31, 2021 in the amount of $595,000. Interest accrued on the notes, as of March 31, 2022 and December 31, 2021 was $216,017 and $195,626. Interest expense was $20,391 and $155,205 for the three months March 31, 2022 and 2021.

NOTE 8 – 4% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

On August 26, 2016, the Company, pursuant to a Securities Purchase Agreement, issued $600,000 aggregate principal amount of its 4.0% Secured Convertible Promissory Notes due June 30, 2019 (the “New Secured Notes”) to certain accredited investors (“investors”). The Company issued additional New Secured Notes during 2016, 2017, 2018, 2019 2020, 2021 and 2022.

During the three months ended March 31, 2022, the Company issued $200,000 aggregate principal amount of its New Secured Notes to a member of the Board of Directors and his son.

The New Secured Notes are convertible by the holders, at any time, into shares of the Company’s authorized Series C Cumulative Convertible Preferred Stock (“Series C Preferred Stock”) at a conversion price of $90.00 per share, subject to adjustment for stock splits, stock dividends and similar transactions with respect to the Series C Preferred Stock only. Each share of Series C Preferred Stock is currently convertible into 100 shares of the Company’s common stock at a current conversion price of $0.90 per share, subject to full ratchet anti-dilution adjustment for one year and weighted average anti-dilution adjustment thereafter, as described in the Certificate of Designation of the Series C Preferred Stock. Upon a liquidation event, the Company shall first pay to the holders of the Series C Preferred Stock, on a pari passu basis with the holders of the Company’s outstanding Series A Preferred Stock and Series B Preferred Stock, an amount per share equal to 700% of the conversion price (i.e., $630.00 per share of Series C Preferred Stock), plus all accrued and unpaid dividends on each share of Series C Preferred Stock (the “Series C Preference Amount”). The Series C Preference Amount shall be paid prior and in preference to payment of any amounts to the Common Stock. After the payment of all preferential amounts required to be paid to the holders of shares of Series C Preferred Stock, Series A Preferred Stock, Series B Preferred Stock and any additional senior preferred stock, the Series C Preferred Stock participates in further distributions subject to an aggregate cap of seven and one-half times (7.5x) the original issue price thereof, plus all accrued and unpaid dividends.

The maturity dates of the New Secured Notes were extended by the investors to October 31, 2022.

The New Secured Notes are recorded as a current liability in the amount of $14,981,250 and $14,781,250 as of March 31, 2022 and December 31, 2021. Interest accrued on the New Secured Notes was $1,701,011 and $1,552,519 as of March 31, 2022 and December 31, 2021. Interest expense related to these notes payable was $148,492 and $100,449 for the three months ended March 31, 2022 and 2021.

NOTE 9 – INCOME TAXES

Income tax expense was $0 for the three months ended March 31, 2022 and 2021.

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As of January 1, 2022, the Company had no unrecognized tax benefits, and accordingly, the Company did not recognize interest or penalties during 2022 related to unrecognized tax benefits. There has been no change in unrecognized tax benefits during the three months ended March 31, 2022, and there was no accrual for uncertain tax positions as of March 31, 2022. Tax years from 2018 through 2021 remain subject to examination by major tax jurisdictions.

There is no income tax benefit for the losses for the three months ended March 31, 2022 and 2021, since management has determined that the realization of the net tax deferred asset is not assured and has created a valuation allowance for the entire amount of such benefits.

NOTE 10 – CONVERTIBLE PREFERRED STOCK

REGO Payment Architectures, Inc. Series A Preferred Stock

The Series A Preferred Stock has a preference in liquidation equal to two times its original issue price, or $20,270,000, to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 2.5 times its original issue price. The Series A Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series A Preferred Stock can be converted. The Series A Preferred Stock also contains customary approval rights with respect to certain matters. The Series A Preferred Stock accrues dividends at the rate of 8% per annum or $8.00 per Series A Preferred Share.

The conversion price of Series A Preferred Stock is currently $0.90 per share. The Series A Preferred Stock is subject to mandatory conversion if certain registration or related requirements are satisfied and the average closing price of the REGO’s common stock exceeds 2.5 times the conversion price over a period of twenty consecutive trading days.

During the three months ended March 31, 2022, a Series A Preferred stockholder converted 1,000 Series Preferred A shares into 111,111 shares of common stock.

REGO Payment Architectures, Inc. Series B Preferred Stock

The Series B Preferred Stock is pari passu with the Series A Preferred Stock and has a preference in liquidation equal to two times its original issue price, or $13,586,040 as of March 31, 2022, to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 2.5 times its original issue price. The Series B Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series B Preferred Stock can be converted. The Series B Preferred Stock also contains customary approval rights with respect to certain matters. The Series B Preferred Stock accrues dividends at the rate of 8% per annum.

The conversion price of the Series B Preferred Stock is currently $0.90 per share. The Series B Preferred Stock is subject to mandatory conversion if certain registration or related requirements are satisfied and the average closing price of the Company’s common stock exceeds 2.5 times the conversion price over a period of twenty consecutive trading days.

During the three months ended March 31, 2022 and 2021, the Company sold 39,599 and 0 shares of the Company’s Series B Preferred Stock in private placements to accredited investors and received proceeds of $3,564,000 and $0.

REGO Payment Architectures, Inc. Series C Preferred Stock

In August 2016, REGO authorized 150,000 shares of REGO’s Series C Cumulative Convertible Preferred Stock (“Series C Preferred Stock”). On August 23, 2021, REGO filed with the Delaware Secretary of State an Amendment to Certificate of Designation of Preferences, Rights and Limitations of Series C Cumulative Convertible Preferred Stock, pursuant to which the amount of authorized Series C Preferred Stock was increased from 150,000 shares to 300,000 shares. As of March 31, 2022, none of the Series C Preferred Stock was issued or outstanding. After the date of issuance of Series C Preferred Stock, dividends at the rate of $7.20 per share will begin accruing and will be cumulative. The Series C Preferred Stock is pari passu with the Series A Preferred Stock and Series B Preferred Stock and has a preference in liquidation equal to seven times its original issue price to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 7.5 times its original issue price. The Series C Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series C Preferred Stock can be converted. The Series C Preferred Stock also contains customary approval rights with respect to certain matters. There are no outstanding Series C Preferred Shares, therefore the current per annum dividend per share is $0.

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As of March 31, 2022, the value of the cumulative 8% dividends for all REGO preferred stock was $8,147,216. Such dividends will be paid when and if declared payable by REGO’s board of directors or upon the occurrence of certain liquidation events. In accordance with FASB ASC 260-10-45-11, the Company has recorded these accrued dividends as a current liability.

ZS Series A Preferred Stock

In November 2018, ZS pursuant to a Securities Purchase Agreement (the “ZS Series A Purchase Agreement”), issued in a private placement to an accredited investor, 83,334 units at an original issue price of $3 per unit (the “ZS Original Series A Issue Price”), which includes one share of ZS’ Series A Cumulative Convertible Preferred Stock (the “ZS Series A Preferred Stock”) and one warrant to purchase one share of ZS’ common stock with an exercise price of $3.00 per share expiring in three years (the “Series A Warrants”). ZS raised $250,000 with respect to this transaction. Dividends on the ZS Series A Preferred Stock accrue at a rate of 8% per annum and are cumulative. The ZS Series A Preferred Stock has a preference in liquidation equal to two times the ZS Original Series A Issue Price to be paid out of assets available for distribution prior to holders of ZS common stock and thereafter participates with the holders of ZS common stock in any remaining proceeds subject to an aggregate cap of 2.5 times the ZS Original Series A Issue Price. The ZS Series A Preferred Stockholders may cast the number of votes equal to the number of whole shares of ZS common stock into which the shares of ZS Series A Preferred Stock can be converted.

As of March 31, 2022, the value of the cumulative 8% dividends for ZS preferred stock was $68,333. Such dividends will be paid when and if declared payable by the ZS’ board of directors or upon the occurrence of certain liquidation events. In accordance with FASB ASC 260-10-45-11, the Company has recorded these accrued dividends as a current liability.

NOTE 11 – STOCKHOLDERS’ EQUITY

The Company entered into a financial advisory agreement in November 2018 whereby generally the Company will pay a financial advisor a success fee equal to 6% of the capital committed in a capital transaction involving the sale of the Company.

Issuance of Restricted Shares

A restricted stock award (“RSA”) is an award of common shares that is subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. The grantee cannot transfer the shares before the restricted shares vest. Shares of nonvested restricted stock have the same voting rights as common stock, are entitled to receive dividends and other distributions thereon and are considered to be currently issued and outstanding. The Company’s restricted stock awards generally vest over a period of one year. The Company expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant, straight-line over the period during which the restrictions lapse. For these purposes, the fair market value of the restricted stock is determined based on the closing price of the Company’s common stock on the grant date.

NOTE 12 – STOCK OPTIONS AND WARRANTS

During 2008, the Board of Directors (“Board”) of the Company adopted the 2008 Equity Incentive Plan (“2008 Plan”) that was approved by the stockholders. Under the 2008 Plan, the Company was authorized to grant options to purchase up to 25,000,000 shares of common stock to any officer, other employee or director of, or any consultant or other independent contractor who provides services to the Company. The 2008 Plan was intended to permit stock options granted to employees under the 2008 Plan to qualify as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (“Incentive Stock Options”). All options granted under the 2008 Plan, which are not intended to qualify as Incentive Stock Options are deemed to be non-qualified options (“Non-Statutory Stock Options”). As of March 31, 2022, under the 2008 Plan, options to purchase 1,250,000 shares of common stock have been issued and are unexercised, and no shares are available for grants under the 2008 Plan. The 2008 Plan expired on March 3, 2019.

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During 2013, the Board adopted the 2013 Equity Incentive Plan (“2013 Plan”), which was approved by stockholders at the 2013 annual meeting of stockholders. Under the 2013 Plan, the Company is authorized to grant awards of stock options, restricted stock, restricted stock units and other stock-based awards of up to an aggregate of 5,000,000 shares of common stock to any officer, employee, director or consultant. The 2013 Plan is intended to permit stock options granted to employees under the 2013 Plan to qualify as Incentive Stock Options. All options granted under the 2013 Plan, which are not intended to qualify as Incentive Stock Options are deemed to be Non-Statutory Stock Options. As of March 31, 2022, under the 2013 Plan, grants of restricted stock and options to purchase 4,700,000 shares of common stock have been issued and are unexercised, and 300,000 shares of common stock remain available for grants under the 2013 Plan.

The 2013 Plan is administered by the Board or its compensation committee, which determines the persons to whom awards will be granted, the number of awards to be granted, and the specific terms of each grant, including the vesting thereof, subject to the terms of the 2013 Plan.

The Company also grants stock options outside the 2013 Plan on terms determined by the Board.

In connection with Incentive Stock Options, the exercise price of each option may not be less than 100% of the fair market value of the common stock on the date of the grant (or 110% of the fair market value in the case of a grantee holding more than 10% of the outstanding stock of the Company).

Prior to January 1, 2014, volatility in all instances presented is the Company’s estimate of volatility that is based on the volatility of other public companies that are in closely related industries to the Company. Beginning January 1, 2014, volatility in all instances presented is the Company’s estimate of volatility that is based on the historical volatility of the Company’s common stock.

The following table presents the weighted-average assumptions used to estimate the fair values of the stock options granted by REGO during the three months ended March 31, 2022:

Risk Free Interest Rate		1.5	%
Expected Volatility		112.9	%
Expected Life (in years)		2.9
Dividend Yield		0	%
Weighted average estimated fair value of options during the period	$	0.53

During the three months ended March 31, 2022, the Company issued options to purchase 3,725,000 shares of the Company’s common stock to various consultants and employees. The options were valued at $1,991,450 fair value, using the Black-Scholes option pricing model to calculate the grant-date fair value of the options. The fair value of options was expensed immediately.

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The following table summarizes the activities for REGO’s stock options for the three months ended March 31, 2022:

	Options Outstanding
						Weighted -
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		11,317,500		$	0.57		2.1	$	2,145
Granted		3,725,000		$	0.90		2.8	$	1,378
Expired/Cancelled		(200,000	)	$	0.90		-		-
Exercisable at March 31, 2022		14,842,500		$	0.65		2.1	$	9,192
Exercisable at March 31, 2022 and expected to
vest thereafter		14,842,500		$	0.65		2.1	$	9,192

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

REGO expensed $403,686 and $1,417,624 for the three months months ended March 31, 2022 and 2021 with respect to options.

As of March 31, 2022, there was $1,587,763 of unrecognized compensation cost related to outstanding stock options. The difference, if any, between the stock options exercisable at March 31, 2022 and the stock options exercisable and expected to vest relates to management’s estimate of options expected to vest in the future.

The following table summarizes the activities for REGO’s warrants for the three months ended March 31, 2022:

						Weighted-
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,500,000		$	0.90		0.5	$	-
Expired/Cancelled		(500,000	)	$	0.90		-	$	-
Balance, March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022 and expected to
vest thereafter		1,000,000		$	0.90		0.2	$	370

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying warrants and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

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REGO expensed $0 for the three months ended March 31, 2022 and 2021 with respect to warrants.

All warrants were vested on the date of grant.

The following table summarizes the activities for ZS’s stock options for the three months ended March 31, 2022:

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
			Weighted-		Contractual		Intrinsic
	Number of		Average		Term		Value
	Shares		Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00		2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00		1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $4.00 for ZS’s common stock on March 31, 2022.

For the three months ended March 31, 2022 and 2021, ZS expensed $0 with respect to options.

The following table summarizes the activities for ZCS’s stock options for the three months ended March 31, 2022:

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
				Weighted-	Contractual		Intrinsic
		Number of		Average	Term		Value
		Shares		Exercise Price	(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00	2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00	1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $0.01 for ZCS’s common stock on March 31, 2022.

For the three months ended March 31, 2022 and 2021, ZCS expensed $0 with respect to options.

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NOTE 13 – NONCONTROLLING INTERESTS

Losses incurred by the noncontrolling interests for the three months ended March 31, 2022 and 2021 were $101.

NOTE 14 – OPERATING LEASES

For the three months ended March 31, 2022 and 2021, total rent expense under leases amounted to $800 and $761. The Company has elected not to recognize right-of-use assets and lease liabilities arising from short-term leases. The Company has no long-term lease obligations as of March 31, 2022.

NOTE 15 – RELATED PARTY TRANSACTIONS

On January 20, 2022, the Board members received cash bonuses of $50,000 each, or a total of $100,000.

On January 26, 2022, the Board approved a salary increase raising the Chief Executive Officer’s salary to $310,000 per year.

On February 22, 2022, a Board member and his son each purchased a 4% Secured Note Payable for $100,000.

During the three months ended March 31, 2022, the Company paid a consultant who is also a shareholder of $10,800 for marketing services.

NOTE 16 – SUBSEQUENT EVENTS

Between April 1, 2022 and May 16, 2022, the Company sold 1,556 shares of the Company’s Series B Preferred Stock in a private placement to an accredited investor and received proceeds of $140,000.

In April 2022, the Chief Executive Officer received a cash bonus of $50,000 and the Chief Financial Officer received a cash bonus of $75,000.

During April, 2022, the Company issued options to purchase 225,000 shares of the Company’s common stock to various consultants with 2 year terms and exercise prices between $1.28 and $1.31 per share.

In May 2022, the Company extended the term of options to purchase 200,000 shares of the Company’s common stock with an exercise price of $0.2595 and options to purchase 400,000 shares of the Company’s common stock with an exercise price of $0.90. All of these options were extended to June 15, 2023.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Overview

REGO Payment Architectures, Inc. is a provider of consumer software that delivers a mobile payment platform solution—Mazoola^R - a family focused mobile banking solution. Headquartered in Blue Bell, Pennsylvania, the Company maintains a portfolio of trade secrets and four US patent awards. REGO offers an all-digital financial payments platform to enable minors, particularly under 13 years old, to transact, complete chores and learn in a secure online environment guided by parental permission, oversight, and control, while remaining COPPA and GDPR compliant. 

COPPA applies not only to websites and mobile apps.  It can apply to a growing list of connected devices that is included in the Internet of Things.  Some of these include toys and products that could collect personal information, such as voice recordings or geolocation information. Non-compliance with COPPA has meant substantial fines for many violators.

Management believes that by building on its COPPA compliance advantage, the future of REGO Payment Architectures, Inc. will be based on the foundational architecture of its software platform (the “Platform”) that will allow its use across multiple financial markets where secure controlled payments are needed.  The Company intends to license in each alternative field of use the ability for its partners, distributors and/or value-added resellers to private label each of the alternative markets.  These partners will deploy, customize and support each implementation under their own label, but with acknowledgement of the Company’s proprietary intellectual assets as the base technology.  Management believes this approach will enable the Company to reduce marketing expenses while broadening its reach.

Further, California passed the California Consumer Privacy Act of 2018 (“CCPA”) on June 28, 2018. CCPA gives consumers (defined as natural citizens who are California residents) four rights relative to their personal information as follows:

● the right to know, through a general privacy policy and with more specifics available upon request, what personal information a business has collected about them, where it was sourced from, what it is being used for, whether it is being disclosed or sold, and to whom it is being disclosed or sold;

● the right to “opt out” of allowing a business to sell their personal information to third parties (or, for consumers who are under 16 years old, the right not to have their personal information sold absent their, or their parent’s, opt-in);

● the right to have a business delete their personal information, with some exceptions; and

● the right to receive equal service and pricing from a business, even if they exercise their privacy rights under the CCPA.

With respect to the evolving CCPA, the Company has designed its Platform and app to be in compliance.

Additionally, the European Parliament and Council agreed upon the General Data Protection Regulation (“GDPR”) in April 2016, to replace the Data Protection Directive 95/46/EC. This is the primary law regulating how companies protect European Union (“EU”) citizens’ personal data. GDPR became effective on May 25, 2018. Companies that fail to achieve GDPR compliance are subject to severe fines and penalties.

GDPR requirements apply to each member state of the European Union, aiming to create more consistent protection of consumer and personal data across EU nations. Some of the key privacy and data protection requirements of the GDPR include:

● Requiring the consent of subjects for data processing

● Anonymizing collected data to protect privacy

● Providing data breach notifications

● Safely handling the transfer of data across borders

● Requiring certain companies to appoint a data protection officer to oversee GDPR compliance

In short, the handling of EU citizens’ data is mandated by GDPR using a baseline set of standards for companies that are designed to better safeguard the processing and movement of personal data. The Company has designed its Platform and app to be in compliance with GDPR, and has received the GDPRkids^TM Trustmark from PRIVO.

Revenues generated from the Platform will come from multiple sources depending on the level of service and facilities requested.  There will be levels of subscription revenue paid monthly, service fees, transaction fees and in some cases, revenue sharing and licensing with banking and distribution partners.

Our goal, moving forward, is to enable both incumbent and new financial technology (“FinTech”) participants, as well as key verticals with a large base of ‘family accounts,’ to provide their consumers with safe and empowering youth money management and financial literacy content and tools via the mobile payment platform.

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While some of the REGO Platform can be easily duplicated/commoditized, such as the app skin, APIs to retailers, APIs to financial infrastructure and cloud storage, we believe that defending our market position rests on three factors:

1. The ability to define data control settings from parent to child.

Our approach to this opportunity uses a master account to dictate purchase rules to sub-accounts via a hierarchical architecture. This approach adheres to data flow and privacy policy requirements specifically outlined for COPPA compliance. We believe other approaches based on machine learning, or other artificial intelligence methodologies are potentially viable alternatives but are likely too costly, do not meet current compliance timelines, and may defy the core of COPPA’s “opt-in” parameters. There is considerable room for next-generation automation techniques to be layered on REGO’s hierarchical approach. Given its current stability and scalability metrics, the REGO Platform strongly features these advances in its technical development roadmap without compromising any of its current data control performance.

2. The ability to (mis)attribute the child’s transaction and personal identification.

REGO has solved this issue by masking user data and maintaining separate identity and financial data flows. As a result, REGO can verify the age of the internet user through the transaction lifecycle on its Platform. Authenticating and validating the identity of the actual user on the internet remains one of the more difficult cybersecurity challenges. Current approaches are mainly not for commercial use; however, there is investment in commercial innovation in this area. REGO’s data control features and its (mis)attribution approach are inextricably linked and a key to its scalability and extensibility.

3. The ability to disseminate transactional data on minors while remaining COPPA and GDPR compliant.

The highest value data will be that which shows the most nuanced detail afforded under current regulations. Without extreme data control features, such as in the REGO Platform, any lesser data precision will be less valuable.

These three factors are all supported by REGO’s patented technology.

REGO addresses hard industry problems such as:

● COPPA compliant technology with a key component being its ability to verify the age of an internet user

● A master and sub-account architecture with the ability to administer user-specific controls

● An advanced rules engine to provide strict automated compliance of the parental rules for each child

● Near real-time buying behavior database on minors - anonymized geolocation, age range and purchases 

Currently, we are targeting established brands with large family-focused account bases — including banks, telecommunication companies, faith-based organizations, media distributors, mobile device Original Equipment Manufacturers (“OEMs”), and merchants.

We are seeking partners that will leverage our Platform to:

Buy vs. Build: Partners can license or revenue share for their specific market or field of use a safe, compliant system, instead of building one on their own.

Safety & Security: Partners can safely engage a younger consumer segment and their families with a new family friendly peer to peer payments approach.  Vendors will be explicitly protected from non-compliant transactions and the underlying technology protects the privacy of the user.

Youth Financial Literacy: Partners can expand their brand story around empowerment and education of youth financial literacy while engaging their ‘future customers’ with Gen Z, a digital native population of post-millennial youth.

The REGO Mazoola^SM app and associated digital wallet technology is designed to enable our partners to engage families with Gen Z and Gen Alpha youths through a money management, transactional and financial literacy platform that enables young people to make smart decisions about the things they value in life — including their money, their time, their ideas and their connections.  The Mazoola^SM app enables a new way for individual users to own and monetize their purchasing behavior that is currently unavailable to them.

In addition, we are analyzing specific components of our technology for individual monetization as well as exploring opportunities in the Business to Business (“B2B”) realm.

Other markets for potential licensed applications are:

● Government social services payments where control over how benefits allowances are used is required.  This is particularly necessary in some European countries where social benefits are not being used as intended by the government or where benefits are subject to fraud.

● Closed network consumer to business (C2B) and business to business (B2B).  An example is school lunch programs where the consumer can make direct mobile payments to the provider’s point of sale (POS) terminal without the need to traverse the traditional merchant payment system.  This reduces the cost per transaction for the vendor and provides instant non-repudiated settlement.  Many school lunch programs are now provided by large catering companies.  This is particularly valuable as credit card fees, transaction fees and service fees can exceed 3% in overhead costs per transaction dependent on the negotiated rate.  Removing this overhead can have significant positive financial impact on profitably.  It also allows the closed network to own its own behavioral use data thus obviating the need to pay a third party for the same data.

We believe that our near-term success will depend particularly on our ability to develop customer awareness and confidence in our service.  Since we have extremely limited capital resources, we will need to closely manage our expenses and conserve our cash by continually monitoring any increase in expenses and reducing or eliminating unnecessary expenditures. Our prospects must be considered in light of the risks, expenses and difficulties encountered by companies at an early stage of development, particularly given that we operate in new and rapidly evolving markets, that we have limited financial resources, and face an uncertain economic environment. We may not be successful in addressing such risks and difficulties.

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Results of Operations

Comparison of the Three Months Ended March 31, 2022 and 2021

The following discussion analyzes our results of operations for the three months ended March 31, 2022 and 2021. The following information should be considered together with our condensed financial statements for such period and the accompanying notes thereto.

Net Revenue

We have not generated significant revenue since our inception. For the three months ended March 31, 2022 and 2021, we generated revenues of $1,397 and $533.  

Net Loss 

For the three months ended March 31, 2022 and 2021, we had a net loss of $2,279,147 and $4,645,801.

Transaction Expense

Transaction expense for the three months ended March 31, 2022 was $62,531 compared to $37,314 for the three months ended March 31, 2021. These are transactional charges primarily for the operation of the Mazoola® app, and the Chore Check app.

Sales and Marketing

Sales and marketing expenses for the three months ended March 31, 2022 were $636,608 compared to $457,016 for the three months ended March 31, 2021, an increase of $179,592. This resulted from a marketing plan designed to bring users to the Platform.

Product Development

Product development expenses were $435,366 and $830,358 for the three months ended March 31, 2022 and 2021, a decrease of $394,992. The Company continued the process to add further enhancement to Mazoola® app to increase its marketability.

General and Administrative Expenses

General and administrative expenses decreased $2,175,403 to $893,554 for the three months ended March 31, 2022 from $3,068,957 for the three months ended March 31, 2021. This resulted from the Company issuing shares of common stock and options to Board members, officers and consultants, an increase of approximately $2,565,000, during the three months ended March 31, 2021, which did not reoccur during the three months ended March 31, 2022. This was offset by bonuses to the Board members of $100,000 and options issued to consultants in the amount of $318,000, during the three months ended March 31, 2022.

22

Forgiveness of Debt

Forgiveness of debt decreased $81,500 to $0 for the three months ended March 31, 2022. This resulted from forgiveness of debt related to the Paycheck Protection Program, during 2021.

Interest Expense

During the three months ended March 31, 2022, the Company incurred interest expense of $252,523, compared to $334,440 for the three months ended March 31, 2021, a decrease of $81,917. The decrease in interest expense relates to the exchange of 10% Secured Promissory Notes for 4% Secured Promissory Notes, during 2021.

Liquidity and Capital Resources

As of May 16, 2022 we had cash on hand of approximately $1.9 million.

Net cash used in operating activities increased $791,240 to $1,650,729 for the three months ended March 31, 2022 as compared to $859,489 for the three months ended March 31, 2021.  The increase resulted primarily from the increased marketing costs related to the Mazoola® app offset by the reduction in non-cash based compensation.

Net cash used in investing activities increased $101,446 for the three months ended March 31, 2022 from $0 for the three months ended March 31, 2021 as a result of patent expenses related to current patents.

Net cash provided by financing activities increased to $3,764,000 for the three months ended March 31, 2022 from $2,445,000 for the three months ended March 31, 2021.  Cash provided by financing activities during the three months ended March 31, 2022, consisted primarily of proceeds from the sale of Series B Preferred Stock to provide capital to continue operations.

As we have not realized significant revenues since our inception, we have financed our operations through offerings of debt and equity securities.  We do not currently maintain a line of credit or term loan with any commercial bank or other financial institution.  

Since our inception, we have focused on developing and implementing our business plan.  We believe that our existing cash resources will not be sufficient to sustain our operations during the next twelve months.  We currently need to generate sufficient revenues to support our cost structure to enable us to pay ongoing costs and expenses as they are incurred, finance enhancements to our Platform, and execute the business plan.  If we cannot generate sufficient revenue to fund our business plan, we intend to seek to raise such financing through the sale of debt and/or equity securities.  The issuance of additional equity would result in dilution to existing shareholders. The issuance of convertible debt may also result in dilution to existing stockholders. If we are unable to obtain additional funds when they are needed or if such funds cannot be obtained on terms acceptable to us, we will be unable to execute upon the business plan or pay costs and expenses as they are incurred, which would have a material, adverse effect on our business, financial condition and results of operations. See Note 2 to our consolidated financial statements included in this Form 10-Q. 

Even if we are successful in generating sufficient revenue or in raising sufficient capital in order to commercialize the Platform, our ability to continue in business as a viable going concern can only be achieved when our revenues reach a level that sustains our business operations.  We do not project that significant revenue will be developed at the earliest until the fourth quarter of 2022. There can be no assurance that we will raise sufficient proceeds, or any proceeds, for us to implement fully our proposed business plan.  Moreover, there can be no assurance that even if the Platform is fully developed and successfully commercialized, that we will generate revenues sufficient to fund our operations.  In either such situation, we may not be able to continue our operations and our business might fail.

Based upon the current cash position and the Company’s planned expense run rate, management believes the Company will not be able to finance its operations beyond November 2022.

23

The foREGOing forward-looking information was prepared by us in good faith based upon assumptions that we believe to be reasonable. No assurance can be given, however, regarding the attainability of the projections or the reliability of the assumptions on which they are based. The projections are subject to the uncertainties inherent in any attempt to predict the results of our operations, especially where new products and services are involved. Certain of the assumptions used will inevitably not materialize and unanticipated events will occur. Actual results of operations are, therefore, likely to vary from the projections and such variations may be material and adverse to us. Accordingly, no assurance can be given that such results will be achieved. Moreover, due to changes in technology, new product announcements, competitive pressures, system design and/or other specifications we may be required to change the current plans. 

Off-Balance Sheet Arrangements

As of March 31, 2022, we do not have any off-balance sheet arrangements.

Critical Accounting Policies

Our financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. A complete summary of these policies is included in Note 1 of the Notes to Financial Statements included in the Company’s Form 10-K for the year ended December 31, 2021. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows and which require the application of significant judgment by management.

Stock-based Compensation

We have adopted the fair value recognition provisions of Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) 718. In addition, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 107 “Share-Based Payment” (“SAB 107”), which provides supplemental FASB ASC 718 application guidance based on the views of the SEC. Under FASB ASC 718, compensation cost recognized includes compensation cost for all share-based payments granted, based on the grant date fair value estimated in accordance with the provisions of FASB ASC 718.

We have used the Black-Scholes option-pricing model to estimate the option fair values. The option-pricing model requires a number of assumptions, of which the most significant are, expected stock price volatility, the expected pre-vesting forfeiture rate and the expected option term (the amount of time from the grant date until the options are exercised or expire).

All issuances of stock options or other equity instruments to non-employees as consideration for goods or services received by the Company are accounted for based on the fair value of the equity instruments issued.  Non-employee equity based payments that do not vest immediately upon grant are recorded as an expense over the vesting period.

Revenue Recognition

In accordance with FASB ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when it satisfies performance obligations, by transferring promised goods or services to customers, in an amount that reflects the consideration to which the Company expects to be entitled in exchange for fulfilling those performance obligations.

Recently Issued Accounting Pronouncements

Recently issued accounting pronouncements are discussed in Note 1 of the Notes to Financial Statements contained elsewhere in this report. 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not required.

24

ITEM 4. CONTROLS AND PROCEDURES.

As of March 31, 2022 we carried out the evaluation of the effectiveness of our disclosure controls and procedures required by Rule 13a-15(e) under the Exchange Act under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of March 31, 2022, our disclosure controls and procedures were effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There has been no change in our internal control over financial reporting that occurred during our fiscal quarter ended March 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

25

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

There have been no material developments since the disclosure provided in the Company’s Form 10-K for the year ended December 31, 2021.

ITEM 1A. RISK FACTORS.

Not required. 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

During the three months ended March 31, 2022, the Company sold 39,599 shares of the Company’s Series B Preferred stock in a private placement to accredited investors and received proceeds of $3,564,000.

During the three months ended March 31, 2022, the Company issued $200,000 aggregate principal amount of its New Secured Notes to a Board member and his son, each of whom are accredited investors.

Each of the foregoing issuances were exempt from registration pursuant to Section 4(a)(2) of the Securities Act. See the footnotes to the financial statements contained herein for additional detail on the applicable securities issued.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

The disclosure set forth in Part II – Item 2 above is incorporated by reference.

ITEM 6. EXHIBITS

31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Exhibit 101.INS	XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
Exhibit 101.SCH	Inline XBRL Taxonomy Extension Schema Document.
Exhibit 101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
Exhibit 101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
Exhibit 101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
Exhibit 101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
Exhibit 104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

26

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	REGO PAYMENT ARCHITECTURES, INC.
	By:	/s/ Scott McPherson
		Scott McPherson
		Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)
Date: May 16, 2022

27

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO RULE 13a-14(a) UNDER

THE SECURITIES EXCHANGE ACT OF 1934

I, Peter S. Pelullo, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Rego Payment Architectures, Inc. (the “Registrant”);

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 present in this report;

4. The Registrant’s other certifying officer(s) and I are 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 13-a-15(f) and 15d-15(f)) for the registrant and have:

(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;

(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;

(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

(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. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(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; and

(b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting. 

Date: May 16, 2022	By:	/s/ Peter S. Pelullo
		Peter S. Pelullo
		Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO RULE 13a-14(a) UNDER

THE SECURITIES EXCHANGE ACT OF 1934

I, Scott A. McPherson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Rego Payment Architectures, Inc. (the “Registrant”);

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 present in this report;

4. The Registrant’s other certifying officer(s) and I are 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 13-a-15(f) and 15d-15(f)) for the registrant and have:

(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;

(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;

(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

(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. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(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; and

(b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the registrant’s internal control over financial reporting. 

Date: May 16, 2022	By:	/s/ Scott A. McPherson
		Scott A. McPherson
		Chief Financial Officer

EX-32.1

Exhibit 32.1

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 this Quarterly Report of Rego Payment Architectures, Inc. (the “Registrant”) on Form 10-Q for the quarterly period ended March 31, 2022, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Report”), I, Peter S. Pelullo, Chief Executive Officer (Principal Executive Officer) of the Registrant, certify to the best of my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) This 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 this Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date:  May 16, 2022	By:	/s/ Peter S. Pelullo
		Peter S. Pelullo
		Chief Executive Officer

EX-32.2

Exhibit 32.2

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 this Quarterly Report of Rego Payment Architectures, Inc. (the “Registrant”) on Form 10-Q for the quarterly period ended March 31, 2022, as filed with the U.S. Securities and Exchange Commission on the date hereof (the “Report”), I, Scott A. McPherson, Chief Financial Officer (Principal Financial Officer) of the Registrant, certify to the best of my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1) This 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 this Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: May 16, 2022	By:	/s/ Scott A. McPherson
		Scott A. McPherson
		Chief Financial Officer

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2022	May 16, 2022
Document Information Line Items
Entity Registrant Name	REGO PAYMENT ARCHITECTURES, INC.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		123,552,213
Amendment Flag	false
Entity Central Index Key	0001437283
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Mar. 31, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	0-53944
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	35-2327649
Entity Address, Address Line One	325 Sentry Parkway
Entity Address, Address Line Two	Suite 200
Entity Address, City or Town	Blue Bell
Entity Address, State or Province	PA
Entity Address, Postal Zip Code	19422
City Area Code	(267)
Local Phone Number	465-7530
Entity Interactive Data Current	Yes

XML

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2022	Dec. 31, 2021
CURRENT ASSETS
Cash and cash equivalents	$ 2,564,955	$ 553,131
Prepaid expenses	22,005	108,131
Deposits	341	341
TOTAL CURRENT ASSETS	2,587,301	661,603
OTHER ASSETS
Patents and trademarks, net of accumulated amortization of $263,971 and $253,262	470,138	379,401
Total Other Assets	470,138	379,401
TOTAL ASSETS	3,057,439	1,041,004
CURRENT LIABILITIES
Accounts payable and accrued expenses	6,367,629	6,108,019
Accounts payable and accrued expenses - related parties	9,808	141,522
Loans payable	42,600	42,600
10% secured convertible notes payable - stockholders	3,316,357	3,316,357
Notes payable - stockholders	595,000	595,000
4% secured convertible notes payable - stockholders	14,981,250	14,781,250
Preferred stock dividend liability	8,215,549	7,928,199
TOTAL CURRENT LIABILITIES	33,528,193	32,912,947
CONTINGENCIES
Preferred stock, $.0001 par value; 2,000,000 preferred shares
Preferred stock, $.0001 par value; 2,000,000 preferred shares authorized; 195,500 preferred shares Series A authorized; 101,350 shares issued and outstanding at March 31, 2022 and 102,350 shares issued and outstanding at December 31, 2021	10	10
Preferred stock, $.0001 par value; 2,000,000 preferred shares authorized; 222,222 preferred shares Series B authorized; 75,478 shares issued and outstanding at March 31, 2022 and 35,879 issued and outstanding at December 31, 2021	8	4
Preferred stock, $.0001 par value; 2,000,000 preferred shares authorized; 300,000 preferred shares Series C authorized; 0 shares issued and outstanding at March 31, 2022 and December 31, 2021
Common stock, $ .0001 par value; 230,000,000 shares authorized; 123,552,213 shares issued and outstanding at March 31, 2022 and 123,441,102 shares issued and outstanding at December 31, 2021	12,355	12,344
Additional paid in capital	71,707,683	67,740,012
Accumulated deficit	(102,108,106)	(99,546,710)
Noncontrolling interests	(82,704)	(77,603)
STOCKHOLDERS' DEFICIT	(30,470,754)	(31,871,943)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$ 3,057,439	$ 1,041,004

XML

Condensed Consolidated Balance Sheets (Parentheticals) - USD ($)	Mar. 31, 2022	Dec. 31, 2021
Patents and trademarks, accumulated amortization (in Dollars)	$ 263,971	$ 253,262
Preferred stock, par value (in Dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	2,000,000	2,000,000
Common stock, par value (in Dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	230,000,000	230,000,000
Common stock, shares issued	123,552,213	123,441,102
Common stock, shares outstanding	123,552,213	123,441,102
Preferred Stock Series A
Preferred stock, shares authorized	195,500	195,500
Preferred stock, shares issued	101,350	102,350
Preferred stock, shares outstanding	101,350	102,350
Preferred Stock Series B
Preferred stock, shares authorized	222,222	222,222
Preferred stock, shares issued	75,478	35,879
Preferred stock, shares outstanding	75,478	35,879
Preferred Stock Series C
Preferred stock, shares authorized	300,000	300,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

XML

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Income Statement [Abstract]
NET REVENUE	$ 1,397	$ 533
OPERATING EXPENSES
Transaction expense	62,531	37,314
Sales and marketing	636,608	457,016
Product development	435,366	830,358
General and administrative	893,554	3,068,957
Total operating expenses	2,028,059	4,393,645
NET OPERATING LOSS	(2,026,662)	(4,393,112)
OTHER INCOME (EXPENSE)
Interest income	38	251
Forgiveness of debt		81,500
Interest expense	(252,523)	(334,440)
Total other income (expense)	(252,485)	(252,689)
NET LOSS	(2,279,147)	(4,645,801)
LESS: Accrued preferred dividends	(287,350)	(267,114)
Net loss attributable to noncontrolling interests	101	101
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	$ (2,566,396)	$ (4,912,814)
BASIC AND DILUTED NET LOSS PER
COMMON SHARE (in Dollars per share)	$ (0.02)	$ (0.04)
BASIC AND DILUTED WEIGHTED AVERAGE
COMMON SHARES OUTSTANDING (in Shares)	123,444,806	121,255,150

XML

Condensed Consolidated Statements of Changes in Stockholders’ Deficit - USD ($)	Series A Preferred Stock	Series B Preferred Stock	Series C Preferred Stock	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Noncontrolling Interests	Total
Balance (in Shares) at Dec. 31, 2020	107,850	28,378		120,096,866
Balance at Dec. 31, 2020	$ 11	$ 3		$ 12,010	$ 61,447,232	$ (87,783,083)	$ (57,502)	$ (26,381,329)
Conversion of Series A Preferred stock into common stock	$ (1)			$ 61	(60)
Conversion of Series A Preferred stock into common stock (in Shares)	(5,500)			611,111
Issuance of common stock to board members and employees (in Shares)				1,800,000
Issuance of common stock to board members and employees				$ 180	1,929,820			1,930,000
Issuance of common stock for accounts payable (in Shares)				150,000
Issuance of common stock for accounts payable				$ 15	134,985			135,000
Exercise of options (in Shares)				80,000
Exercise of options				$ 8	19,992			20,000
Fair value of options for software					111,817			111,817
Fair value of options for services					1,417,625			1,417,625
Accrued preferred dividends						(262,114)	(5,000)	(267,114)
Net loss						(4,645,700)	(101)	(4,645,801)
Balance (in Shares) at Mar. 31, 2021	102,350	28,378		122,737,977
Balance at Mar. 31, 2021	$ 10	$ 3		$ 12,274	65,061,411	(92,690,897)	(62,603)	(27,679,802)
Balance (in Shares) at Dec. 31, 2021	102,350	35,879		123,441,102
Balance at Dec. 31, 2021	$ 10	$ 4		$ 12,344	67,740,012	(99,546,710)	(77,603)	(31,871,943)
Conversion of Series A Preferred stock into common stock				$ 11	(11)
Conversion of Series A Preferred stock into common stock (in Shares)	(1,000)			111,111
Sale of Series B Preferred stock		$ 4			3,563,996			3,564,000
Sale of Series B Preferred stock (in Shares)		39,599
Fair value of options for services					403,686			403,686
Accrued preferred dividends						(282,350)	(5,000)	(287,350)
Net loss						(2,279,046)	(101)	(2,279,147)
Balance (in Shares) at Mar. 31, 2022	101,350	75,478		123,552,213
Balance at Mar. 31, 2022	$ 10	$ 8		$ 12,355	$ 71,707,683	$ (102,108,106)	$ (82,704)	$ (30,470,754)

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (2,279,147)	$ (4,645,801)
Adjustments to reconcile net loss to net cash used in operating activities:
Fair value of common stock issued in exchange for services		1,930,000
Fair value of options issued in exchange for services	403,686	1,417,626
Impairment loss		111,817
Depreciation and amortization	10,709	7,381
Forgiveness of debt		(81,500)
Decrease in assets
Prepaid expenses	86,126	147,245
Increase (decrease) in liabilities
Accounts payable and accrued expenses	259,610	314,067
Accounts payable and accrued expenses - related parties	(131,714)	(60,324)
Net cash used in operating activities	(1,650,730)	(859,489)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in patents	(101,446)
Net cash used in investing activities	(101,446)
CASH FLOWS FROM FINANCING ACTIVITIES
Exercise of options		20,000
Proceeds from sale of Series B Preferred stock	3,564,000
Proceeds from 4% secured notes payable - stockholders	200,000
Proceeds from convertible notes payable - stockholders		2,425,000
Net cash provided by financing activities	3,764,000	2,445,000
NET INCREASE IN CASH AND CASH EQUIVALENTS	2,011,824	1,585,511
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD	553,131	273,176
CASH AND CASH EQUIVALENTS - END OF PERIOD	2,564,955	1,858,687
Cash paid during year for:
Interest		576
Income taxes
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Accrued preferred dividends	287,350	267,114
Options issued for software		111,817
Issuance of common stock for accounts payable		135,000
Conversion of Series A Preferred stock to common stock	$ 11	61
Adoption of new accounting principle for embedded derivative liabilities
affecting accumulated deficit		$ 10,987,578

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Condensed Consolidated Statements of Cash Flows (Unaudited) (Parentheticals)	3 Months Ended
	Mar. 31, 2022
Statement of Cash Flows [Abstract]
Secured notes payable	4.00%

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of the Business

REGO Payment Architectures, Inc. (“REGO”) was incorporated in the state of Delaware on February 11, 2008.

REGO Payment Architectures, Inc. and its subsidiaries (collectively, except where the context requires, the “Company”) is a provider of consumer software that delivers a mobile payment platform solution—Mazoola® - a family focused mobile banking solution. Headquartered in Blue Bell, Pennsylvania, the Company maintains a portfolio of trade secrets and four US patent awards. REGO offers an all-digital financial payments platform to enable minors, particularly under 13 years old, to purchase goods and services, complete chores and learn in a secure online environment guided by parental permission, oversight, and control, while remaining Children’s Online Privacy Protection Act (“COPPA”) and General Data Protection Regulation (“GDPR”) compliant.

Management believes that building on its COPPA advantage the future of REGO Payment Architectures, Inc. will be based on the foundational architecture of its technology platform (the “Platform”) that will allow its use across multiple financial markets where secure controlled payments are needed. The Company intends to license in each alternative field of use the ability for its partners, distributors and/or value added resellers to private label each of the alternative markets. These partners would deploy, customize and support each implementation under their own label, but with acknowledgement of the Company’s proprietary intellectual assets as the base technology. Management believes this approach will enable the Company to reduce expenses while broadening its reach.

Revenues generated from the Platform will come from multiple sources depending on the level of service and facilities requested by the parent. There will be levels of subscription revenue paid monthly, service fees, transaction fees and revenue sharing and licensing with banking and distribution partners.

ZOOM Solutions, Inc. (“ZS”)

ZS (formerly Zoom Payment Solutions, Inc.) was incorporated in the state of Delaware on February 16, 2018 as a subsidiary of REGO Payment Architectures, Inc. During the year ended December 31, 2020, the minority common shareholders of ZS exchanged their shares in ZS for REGO 10% secured convertible notes payable. REGO now owns 100% of the common stock of ZS. ZS is the holding company for various subsidiaries that will utilize REGO’s payment platform to address emerging markets.

There were minimal operations at ZS during the three months ended March 31, 2022 and 2021.

ZOOM Payment Solutions, Inc. (“ZPS”)

ZPS (formerly Zoom Payment Solutions USA, Inc.) was incorporated in the state of Nevada on December 6, 2017. ZPS is a wholly owned subsidiary of ZS with the core focus on providing mobile payments solutions. ZPS has secured a sublicense from ZS for the REGO payment platform and access to the patents from REGO.

There were minimal operations at ZPS during the three months ended March 31, 2022 and 2021.

ZOOM Blockchain Solutions, Inc. (“ZBS”)

ZBS was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. This company was focused on blockchain as a business solution for the retail and Consumer Packaged Goods (“CPG”) industries.

There were minimal operations at ZBS during the three months ended March 31, 2022 and 2021.

ZOOM Cloud Solutions, Inc. (“ZCS”)

ZCS (formerly Zoom Canada Solutions, Inc.) was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. ZCS was focused on providing a highly secure cloud storage as a service.

There were minimal operations at ZCS during the three months ended March 31, 2022 and 2021.

ZOOM Auto Solutions, Inc. (“ZAS”)

ZAS (formerly Zoom Mining Solutions) was incorporated in the State of Delaware on February 19, 2018 as a wholly owned subsidiary of ZCS. It is now a wholly owned subsidiary of ZBS.

There were minimal operations at ZAS during the three months ended March 31, 2022 and 2021.

The Company’s principal office is located in Blue Bell, Pennsylvania.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). These statements include all adjustments (consisting only of normal recurring adjustments) which management believes necessary for a fair presentation of the financial statements and have been prepared on a consistent basis using the accounting policies described in the summary of accounting policies included in the Company’s 2021 Annual Report on Form 10-K (the “Form 10-K”). All significant intercompany transactions and balances have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with US GAAP have been condensed, or omitted pursuant to such rules and regulations, although the Company believes that the accompanying disclosures are adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional financing to operationalize the Company’s current technology before another company develops similar technology to compete with the Company.

Recently Adopted Accounting Pronouncements

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40), Issuer’s Accounting for Certain Modifications or Exchanges or Freestanding Equity – Classified Written Call Options. The amendments in this Update clarify an issuer’s accounting for modifications or exchanges of freestanding equity – classified written call options (for example, warrants) that remain equity classified after modification or exchange. This was adopted January 1, 2022 and there was no material impact to the financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

As of March 31, 2022, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements.

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Management Plans

3 Months Ended

Mar. 31, 2022

Management Plans Disclosure [Abstract]

MANAGEMENT PLANS

NOTE 2 – MANAGEMENT PLANS

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The Company has incurred significant losses and experienced negative cash flow from operations since inception. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Since inception, the Company has focused on developing and implementing its business plan. The Company believes that its existing cash resources will not be sufficient to sustain operations during the next twelve months. The Company currently needs to generate revenue in order to sustain its operations. In the event that the Company cannot generate sufficient revenue to sustain its operations, the Company will need to reduce expenses or obtain financing through the sale of debt and/or equity securities. The issuance of additional equity would result in dilution to existing shareholders. If the Company is unable to obtain additional funds when they are needed or if such funds cannot be obtained on terms acceptable to the Company, the Company would be unable to execute upon the business plan or pay costs and expenses as they are incurred, which would have a material, adverse effect on the business, financial condition and results of operations.

The Company’s current monetization model is to derive revenues from levels of service fees, transaction fees and in some cases revenue sharing with banking and distribution partners. As these bases of revenues grow, the Company expects to generate additional revenue to support operations.

The Covid-19 pandemic caused a significant economic slowdown that adversely affected the demand for services. While the Company expects this matter to negatively impact its results of operations, cash flow and financial position, the future financial impact cannot be reasonably estimated at this time.

As of May 16, 2022, the Company has a cash position of approximately $1.9 million. Based upon the current cash position and the Company’s planned expense run rate, management believes the Company has funds currently to finance its operations through November 2022.

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Impairment of Long-Lived Assets

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

IMPAIRMENT OF LONG-LIVED ASSETS

NOTE 3 – IMPAIRMENT OF LONG-LIVED ASSETS

On January 1, 2021, REGO entered into a Purchase of Business Agreement (“Agreement”) with Chore Check, LLC pursuant to which it purchased the assets of Chore Check, LLC, consisting primarily of a software application, valued at $111,817, fair value. The consideration for the acquisition consisted of the issuance of an option to purchase 100,000 shares of the Company’s common stock, with an exercise price of $0.90, vesting immediately and with a term of three years.

Long-lived assets are tested for impairment by performing a qualitative assessment to determine whether it is more likely than not that the fair value is less than the carrying value. Long-lived assets are considered impaired if the carrying value exceeds its fair value. The Company determined that the carrying value of the asset acquired from Chore Check, LLC exceeded its fair value and has recorded an impairment loss in the amount of $111,817 as of March 31, 2021, which was included in general and administrative expenses.

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Accounts Payable and Accrued Expenses - Related Parties

3 Months Ended

Mar. 31, 2022

Payables and Accruals [Abstract]

ACCOUNTS PAYABLE AND ACCRUED EXPENSES - RELATED PARTIES

NOTE 4 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES - RELATED PARTIES

As of March 31, 2022 and December 31, 2021, the Company owed the Chief Executive Officer, who is also a more than 5% beneficial owner, a total of $5,962 and $95,185, consisting of $5,962 and $95,185 in unpaid salary.

Additionally, as of March 31, 2022 and December 31, 2021, the Company owed the son of a more than 5% beneficial owner, Chief Executive Officer, President and Board member, $0 and $10,349, pursuant to a consulting agreement.

As of March 31, 2022 and December 31, 2021, the Company owed the Chief Financial Officer $3,846 and $35,988 in unpaid salary.

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Loans Payable

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

LOANS PAYABLE

NOTE 5 – LOANS PAYABLE

Loans payable as of March 31, 2022 and December 31, 2021 were $42,600. Interest accrued on the loans at 6% and 10% was $4,536 and $3,806 as of March 31, 2022 and December 31, 2021. Interest expense related to these loans payable was $730 and $251 for the three months ended March 31, 2022 and 2021.

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10% Secured Convertible Notes Payable - Stockholders

3 Months Ended

Mar. 31, 2022

Convertible Notes Payable To Stockholders Disclosure [Abstract]

10% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

NOTE 6 – 10% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

On March 6, 2015, the Company, pursuant to a Securities Purchase Agreement (the “Purchase Agreement”), issued $2,000,000 aggregate principal amount of its 10% Secured Convertible Promissory Notes due March 5, 2016 (the “Notes”) to certain stockholders. On May 11, 2015, the Company issued an additional $940,000 of Notes to stockholders. The maturity dates of the Notes have been extended most recently to October 31, 2022, with the consent of the Note holders.

The Notes are convertible by the holders, at any time, into shares of the Company’s Series B Preferred Stock at a conversion price of $90.00 per share, subject to adjustment for stock splits, stock dividends and similar transactions with respect to the Series B Preferred Stock only. Each share of Series B Preferred Stock is currently convertible into 100 shares of the Company’s common stock at a current conversion price of $0.90 per share, subject to anti-dilution adjustment as described in the Certificate of Designation of the Series B Preferred Stock. In addition, pursuant to the terms of a Security Agreement entered into on May 11, 2015 by and among the Company, the Note holders and a collateral agent acting on behalf of the Note holders (the “Security Agreement”), the Notes are secured by a lien against substantially all of the Company’s business assets. Pursuant to the Purchase Agreement, the Company also granted piggyback registration rights to the holders of the Series B Preferred Stock upon a conversion of the Notes.

The Notes are recorded as a current liability as of March 31, 2022 and December 31, 2021 in the amount of $3,316,357. Interest accrued on the Notes was $2,262,511 and $2,179,602 as of March 31, 2022 and December 31, 2021. Interest expense related to these Notes payable was $82,909 and $77,909 for the three months ended March 31, 2022 and 2021.

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Notes Payable – Stockholders

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

NOTES PAYABLE – STOCKHOLDERS

NOTE 7 – NOTES PAYABLE – STOCKHOLDERS

These notes payable have no formal repayment terms and $370,000 of the notes bear interest at 10% per annum and the remaining $225,000 of the notes bear interest at 20% per annum. 

These notes payable are recorded as a current liability as of March 31, 2022 and December 31, 2021 in the amount of $595,000. Interest accrued on the notes, as of March 31, 2022 and December 31, 2021 was $216,017 and $195,626. Interest expense was $20,391 and $155,205 for the three months March 31, 2022 and 2021.

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4% Secured Convertible Notes Payable - Stockholders

3 Months Ended

Mar. 31, 2022

Secured Convertible Promissory Notes Payable [Abstract]

4% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

NOTE 8 – 4% SECURED CONVERTIBLE NOTES PAYABLE - STOCKHOLDERS

On August 26, 2016, the Company, pursuant to a Securities Purchase Agreement, issued $600,000 aggregate principal amount of its 4.0% Secured Convertible Promissory Notes due June 30, 2019 (the “New Secured Notes”) to certain accredited investors (“investors”). The Company issued additional New Secured Notes during 2016, 2017, 2018, 2019 2020, 2021 and 2022.

During the three months ended March 31, 2022, the Company issued $200,000 aggregate principal amount of its New Secured Notes to a member of the Board of Directors and his son.

The New Secured Notes are convertible by the holders, at any time, into shares of the Company’s authorized Series C Cumulative Convertible Preferred Stock (“Series C Preferred Stock”) at a conversion price of $90.00 per share, subject to adjustment for stock splits, stock dividends and similar transactions with respect to the Series C Preferred Stock only. Each share of Series C Preferred Stock is currently convertible into 100 shares of the Company’s common stock at a current conversion price of $0.90 per share, subject to full ratchet anti-dilution adjustment for one year and weighted average anti-dilution adjustment thereafter, as described in the Certificate of Designation of the Series C Preferred Stock. Upon a liquidation event, the Company shall first pay to the holders of the Series C Preferred Stock, on a pari passu basis with the holders of the Company’s outstanding Series A Preferred Stock and Series B Preferred Stock, an amount per share equal to 700% of the conversion price (i.e., $630.00 per share of Series C Preferred Stock), plus all accrued and unpaid dividends on each share of Series C Preferred Stock (the “Series C Preference Amount”). The Series C Preference Amount shall be paid prior and in preference to payment of any amounts to the Common Stock. After the payment of all preferential amounts required to be paid to the holders of shares of Series C Preferred Stock, Series A Preferred Stock, Series B Preferred Stock and any additional senior preferred stock, the Series C Preferred Stock participates in further distributions subject to an aggregate cap of seven and one-half times (7.5x) the original issue price thereof, plus all accrued and unpaid dividends.

The maturity dates of the New Secured Notes were extended by the investors to October 31, 2022.

The New Secured Notes are recorded as a current liability in the amount of $14,981,250 and $14,781,250 as of March 31, 2022 and December 31, 2021. Interest accrued on the New Secured Notes was $1,701,011 and $1,552,519 as of March 31, 2022 and December 31, 2021. Interest expense related to these notes payable was $148,492 and $100,449 for the three months ended March 31, 2022 and 2021.

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Income Taxes

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 9 – INCOME TAXES

Income tax expense was $0 for the three months ended March 31, 2022 and 2021.

As of January 1, 2022, the Company had no unrecognized tax benefits, and accordingly, the Company did not recognize interest or penalties during 2022 related to unrecognized tax benefits. There has been no change in unrecognized tax benefits during the three months ended March 31, 2022, and there was no accrual for uncertain tax positions as of March 31, 2022. Tax years from 2018 through 2021 remain subject to examination by major tax jurisdictions.

There is no income tax benefit for the losses for the three months ended March 31, 2022 and 2021, since management has determined that the realization of the net tax deferred asset is not assured and has created a valuation allowance for the entire amount of such benefits.

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Convertible Preferred Stock

3 Months Ended

Mar. 31, 2022

Disclosure Text Block Supplement [Abstract]

CONVERTIBLE PREFERRED STOCK

NOTE 10 – CONVERTIBLE PREFERRED STOCK

REGO Payment Architectures, Inc. Series A Preferred Stock

The Series A Preferred Stock has a preference in liquidation equal to two times its original issue price, or $20,270,000, to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 2.5 times its original issue price. The Series A Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series A Preferred Stock can be converted. The Series A Preferred Stock also contains customary approval rights with respect to certain matters. The Series A Preferred Stock accrues dividends at the rate of 8% per annum or $8.00 per Series A Preferred Share.

The conversion price of Series A Preferred Stock is currently $0.90 per share. The Series A Preferred Stock is subject to mandatory conversion if certain registration or related requirements are satisfied and the average closing price of the REGO’s common stock exceeds 2.5 times the conversion price over a period of twenty consecutive trading days.

During the three months ended March 31, 2022, a Series A Preferred stockholder converted 1,000 Series Preferred A shares into 111,111 shares of common stock.

REGO Payment Architectures, Inc. Series B Preferred Stock

The Series B Preferred Stock is pari passu with the Series A Preferred Stock and has a preference in liquidation equal to two times its original issue price, or $13,586,040 as of March 31, 2022, to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 2.5 times its original issue price. The Series B Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series B Preferred Stock can be converted. The Series B Preferred Stock also contains customary approval rights with respect to certain matters. The Series B Preferred Stock accrues dividends at the rate of 8% per annum.

The conversion price of the Series B Preferred Stock is currently $0.90 per share. The Series B Preferred Stock is subject to mandatory conversion if certain registration or related requirements are satisfied and the average closing price of the Company’s common stock exceeds 2.5 times the conversion price over a period of twenty consecutive trading days.

During the three months ended March 31, 2022 and 2021, the Company sold 39,599 and 0 shares of the Company’s Series B Preferred Stock in private placements to accredited investors and received proceeds of $3,564,000 and $0.

REGO Payment Architectures, Inc. Series C Preferred Stock

In August 2016, REGO authorized 150,000 shares of REGO’s Series C Cumulative Convertible Preferred Stock (“Series C Preferred Stock”). On August 23, 2021, REGO filed with the Delaware Secretary of State an Amendment to Certificate of Designation of Preferences, Rights and Limitations of Series C Cumulative Convertible Preferred Stock, pursuant to which the amount of authorized Series C Preferred Stock was increased from 150,000 shares to 300,000 shares. As of March 31, 2022, none of the Series C Preferred Stock was issued or outstanding. After the date of issuance of Series C Preferred Stock, dividends at the rate of $7.20 per share will begin accruing and will be cumulative. The Series C Preferred Stock is pari passu with the Series A Preferred Stock and Series B Preferred Stock and has a preference in liquidation equal to seven times its original issue price to be paid out of assets available for distribution prior to holders of common stock and thereafter participates with the holders of common stock in any remaining proceeds subject to an aggregate cap of 7.5 times its original issue price. The Series C Preferred Stockholders may cast the number of votes equal to the number of whole shares of common stock into which the shares of Series C Preferred Stock can be converted. The Series C Preferred Stock also contains customary approval rights with respect to certain matters. There are no outstanding Series C Preferred Shares, therefore the current per annum dividend per share is $0.

As of March 31, 2022, the value of the cumulative 8% dividends for all REGO preferred stock was $8,147,216. Such dividends will be paid when and if declared payable by REGO’s board of directors or upon the occurrence of certain liquidation events. In accordance with FASB ASC 260-10-45-11, the Company has recorded these accrued dividends as a current liability.

ZS Series A Preferred Stock

In November 2018, ZS pursuant to a Securities Purchase Agreement (the “ZS Series A Purchase Agreement”), issued in a private placement to an accredited investor, 83,334 units at an original issue price of $3 per unit (the “ZS Original Series A Issue Price”), which includes one share of ZS’ Series A Cumulative Convertible Preferred Stock (the “ZS Series A Preferred Stock”) and one warrant to purchase one share of ZS’ common stock with an exercise price of $3.00 per share expiring in three years (the “Series A Warrants”). ZS raised $250,000 with respect to this transaction. Dividends on the ZS Series A Preferred Stock accrue at a rate of 8% per annum and are cumulative. The ZS Series A Preferred Stock has a preference in liquidation equal to two times the ZS Original Series A Issue Price to be paid out of assets available for distribution prior to holders of ZS common stock and thereafter participates with the holders of ZS common stock in any remaining proceeds subject to an aggregate cap of 2.5 times the ZS Original Series A Issue Price. The ZS Series A Preferred Stockholders may cast the number of votes equal to the number of whole shares of ZS common stock into which the shares of ZS Series A Preferred Stock can be converted.

As of March 31, 2022, the value of the cumulative 8% dividends for ZS preferred stock was $68,333. Such dividends will be paid when and if declared payable by the ZS’ board of directors or upon the occurrence of certain liquidation events. In accordance with FASB ASC 260-10-45-11, the Company has recorded these accrued dividends as a current liability.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY

NOTE 11 – STOCKHOLDERS’ EQUITY

The Company entered into a financial advisory agreement in November 2018 whereby generally the Company will pay a financial advisor a success fee equal to 6% of the capital committed in a capital transaction involving the sale of the Company.

Issuance of Restricted Shares

A restricted stock award (“RSA”) is an award of common shares that is subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. The grantee cannot transfer the shares before the restricted shares vest. Shares of nonvested restricted stock have the same voting rights as common stock, are entitled to receive dividends and other distributions thereon and are considered to be currently issued and outstanding. The Company’s restricted stock awards generally vest over a period of one year. The Company expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant, straight-line over the period during which the restrictions lapse. For these purposes, the fair market value of the restricted stock is determined based on the closing price of the Company’s common stock on the grant date.

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Stock Options and Warrants

3 Months Ended

Mar. 31, 2022

Share-Based Payment Arrangement [Abstract]

STOCK OPTIONS AND WARRANTS

NOTE 12 – STOCK OPTIONS AND WARRANTS

During 2008, the Board of Directors (“Board”) of the Company adopted the 2008 Equity Incentive Plan (“2008 Plan”) that was approved by the stockholders. Under the 2008 Plan, the Company was authorized to grant options to purchase up to 25,000,000 shares of common stock to any officer, other employee or director of, or any consultant or other independent contractor who provides services to the Company. The 2008 Plan was intended to permit stock options granted to employees under the 2008 Plan to qualify as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (“Incentive Stock Options”). All options granted under the 2008 Plan, which are not intended to qualify as Incentive Stock Options are deemed to be non-qualified options (“Non-Statutory Stock Options”). As of March 31, 2022, under the 2008 Plan, options to purchase 1,250,000 shares of common stock have been issued and are unexercised, and no shares are available for grants under the 2008 Plan. The 2008 Plan expired on March 3, 2019.

During 2013, the Board adopted the 2013 Equity Incentive Plan (“2013 Plan”), which was approved by stockholders at the 2013 annual meeting of stockholders. Under the 2013 Plan, the Company is authorized to grant awards of stock options, restricted stock, restricted stock units and other stock-based awards of up to an aggregate of 5,000,000 shares of common stock to any officer, employee, director or consultant. The 2013 Plan is intended to permit stock options granted to employees under the 2013 Plan to qualify as Incentive Stock Options. All options granted under the 2013 Plan, which are not intended to qualify as Incentive Stock Options are deemed to be Non-Statutory Stock Options. As of March 31, 2022, under the 2013 Plan, grants of restricted stock and options to purchase 4,700,000 shares of common stock have been issued and are unexercised, and 300,000 shares of common stock remain available for grants under the 2013 Plan.

The 2013 Plan is administered by the Board or its compensation committee, which determines the persons to whom awards will be granted, the number of awards to be granted, and the specific terms of each grant, including the vesting thereof, subject to the terms of the 2013 Plan.

The Company also grants stock options outside the 2013 Plan on terms determined by the Board.

In connection with Incentive Stock Options, the exercise price of each option may not be less than 100% of the fair market value of the common stock on the date of the grant (or 110% of the fair market value in the case of a grantee holding more than 10% of the outstanding stock of the Company).

Prior to January 1, 2014, volatility in all instances presented is the Company’s estimate of volatility that is based on the volatility of other public companies that are in closely related industries to the Company. Beginning January 1, 2014, volatility in all instances presented is the Company’s estimate of volatility that is based on the historical volatility of the Company’s common stock.

The following table presents the weighted-average assumptions used to estimate the fair values of the stock options granted by REGO during the three months ended March 31, 2022:

Risk Free Interest Rate		1.5	%
Expected Volatility		112.9	%
Expected Life (in years)		2.9
Dividend Yield		0	%
Weighted average estimated fair value of options during the period	$	0.53

During the three months ended March 31, 2022, the Company issued options to purchase 3,725,000 shares of the Company’s common stock to various consultants and employees. The options were valued at $1,991,450 fair value, using the Black-Scholes option pricing model to calculate the grant-date fair value of the options. The fair value of options was expensed immediately.

The following table summarizes the activities for REGO’s stock options for the three months ended March 31, 2022:

	Options Outstanding
						Weighted -
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		11,317,500		$	0.57		2.1	$	2,145
Granted		3,725,000		$	0.90		2.8	$	1,378
Expired/Cancelled		(200,000	)	$	0.90		-		-
Exercisable at March 31, 2022		14,842,500		$	0.65		2.1	$	9,192
Exercisable at March 31, 2022 and expected to
vest thereafter		14,842,500		$	0.65		2.1	$	9,192

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

REGO expensed $403,686 and $1,417,624 for the three months months ended March 31, 2022 and 2021 with respect to options.

As of March 31, 2022, there was $1,587,763 of unrecognized compensation cost related to outstanding stock options. The difference, if any, between the stock options exercisable at March 31, 2022 and the stock options exercisable and expected to vest relates to management’s estimate of options expected to vest in the future.

The following table summarizes the activities for REGO’s warrants for the three months ended March 31, 2022:

						Weighted-
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,500,000		$	0.90		0.5	$	-
Expired/Cancelled		(500,000	)	$	0.90		-	$	-
Balance, March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022 and expected to
vest thereafter		1,000,000		$	0.90		0.2	$	370

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying warrants and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

REGO expensed $0 for the three months ended March 31, 2022 and 2021 with respect to warrants.

All warrants were vested on the date of grant.

The following table summarizes the activities for ZS’s stock options for the three months ended March 31, 2022:

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
			Weighted-		Contractual		Intrinsic
	Number of		Average		Term		Value
	Shares		Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00		2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00		1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $4.00 for ZS’s common stock on March 31, 2022.

For the three months ended March 31, 2022 and 2021, ZS expensed $0 with respect to options.

The following table summarizes the activities for ZCS’s stock options for the three months ended March 31, 2022:

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
				Weighted-	Contractual		Intrinsic
		Number of		Average	Term		Value
		Shares		Exercise Price	(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00	2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00	1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $0.01 for ZCS’s common stock on March 31, 2022.

For the three months ended March 31, 2022 and 2021, ZCS expensed $0 with respect to options.

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Noncontrolling Interests

3 Months Ended

Mar. 31, 2022

Noncontrolling Interest [Abstract]

NONCONTROLLING INTERESTS

NOTE 13 – NONCONTROLLING INTERESTS

Losses incurred by the noncontrolling interests for the three months ended March 31, 2022 and 2021 were $101.

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Operating Leases

3 Months Ended

Mar. 31, 2022

Disclosure Text Block [Abstract]

OPERATING LEASES

NOTE 14 – OPERATING LEASES

For the three months ended March 31, 2022 and 2021, total rent expense under leases amounted to $800 and $761. The Company has elected not to recognize right-of-use assets and lease liabilities arising from short-term leases. The Company has no long-term lease obligations as of March 31, 2022.

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Related Party Transactions

3 Months Ended

Mar. 31, 2022

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 15 – RELATED PARTY TRANSACTIONS

On January 20, 2022, the Board members received cash bonuses of $50,000 each, or a total of $100,000.

On January 26, 2022, the Board approved a salary increase raising the Chief Executive Officer’s salary to $310,000 per year.

On February 22, 2022, a Board member and his son each purchased a 4% Secured Note Payable for $100,000.

During the three months ended March 31, 2022, the Company paid a consultant who is also a shareholder of $10,800 for marketing services.

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Subsequent Events

3 Months Ended

Mar. 31, 2022

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 16 – SUBSEQUENT EVENTS

Between April 1, 2022 and May 16, 2022, the Company sold 1,556 shares of the Company’s Series B Preferred Stock in a private placement to an accredited investor and received proceeds of $140,000.

In April 2022, the Chief Executive Officer received a cash bonus of $50,000 and the Chief Financial Officer received a cash bonus of $75,000.

During April, 2022, the Company issued options to purchase 225,000 shares of the Company’s common stock to various consultants with 2 year terms and exercise prices between $1.28 and $1.31 per share.

In May 2022, the Company extended the term of options to purchase 200,000 shares of the Company’s common stock with an exercise price of $0.2595 and options to purchase 400,000 shares of the Company’s common stock with an exercise price of $0.90. All of these options were extended to June 15, 2023.

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Accounting Policies, by Policy (Policies)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Nature of the Business

Nature of the Business

REGO Payment Architectures, Inc. (“REGO”) was incorporated in the state of Delaware on February 11, 2008.

REGO Payment Architectures, Inc. and its subsidiaries (collectively, except where the context requires, the “Company”) is a provider of consumer software that delivers a mobile payment platform solution—Mazoola® - a family focused mobile banking solution. Headquartered in Blue Bell, Pennsylvania, the Company maintains a portfolio of trade secrets and four US patent awards. REGO offers an all-digital financial payments platform to enable minors, particularly under 13 years old, to purchase goods and services, complete chores and learn in a secure online environment guided by parental permission, oversight, and control, while remaining Children’s Online Privacy Protection Act (“COPPA”) and General Data Protection Regulation (“GDPR”) compliant.

Management believes that building on its COPPA advantage the future of REGO Payment Architectures, Inc. will be based on the foundational architecture of its technology platform (the “Platform”) that will allow its use across multiple financial markets where secure controlled payments are needed. The Company intends to license in each alternative field of use the ability for its partners, distributors and/or value added resellers to private label each of the alternative markets. These partners would deploy, customize and support each implementation under their own label, but with acknowledgement of the Company’s proprietary intellectual assets as the base technology. Management believes this approach will enable the Company to reduce expenses while broadening its reach.

Revenues generated from the Platform will come from multiple sources depending on the level of service and facilities requested by the parent. There will be levels of subscription revenue paid monthly, service fees, transaction fees and revenue sharing and licensing with banking and distribution partners.

ZOOM Solutions, Inc. (“ZS”)

ZS (formerly Zoom Payment Solutions, Inc.) was incorporated in the state of Delaware on February 16, 2018 as a subsidiary of REGO Payment Architectures, Inc. During the year ended December 31, 2020, the minority common shareholders of ZS exchanged their shares in ZS for REGO 10% secured convertible notes payable. REGO now owns 100% of the common stock of ZS. ZS is the holding company for various subsidiaries that will utilize REGO’s payment platform to address emerging markets.

There were minimal operations at ZS during the three months ended March 31, 2022 and 2021.

ZOOM Payment Solutions, Inc. (“ZPS”)

ZPS (formerly Zoom Payment Solutions USA, Inc.) was incorporated in the state of Nevada on December 6, 2017. ZPS is a wholly owned subsidiary of ZS with the core focus on providing mobile payments solutions. ZPS has secured a sublicense from ZS for the REGO payment platform and access to the patents from REGO.

There were minimal operations at ZPS during the three months ended March 31, 2022 and 2021.

ZOOM Blockchain Solutions, Inc. (“ZBS”)

ZBS was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. This company was focused on blockchain as a business solution for the retail and Consumer Packaged Goods (“CPG”) industries.

There were minimal operations at ZBS during the three months ended March 31, 2022 and 2021.

ZOOM Cloud Solutions, Inc. (“ZCS”)

ZCS (formerly Zoom Canada Solutions, Inc.) was incorporated in the state of Delaware on April 20, 2018 as an 85% owned subsidiary of ZS. ZCS was focused on providing a highly secure cloud storage as a service.

There were minimal operations at ZCS during the three months ended March 31, 2022 and 2021.

ZOOM Auto Solutions, Inc. (“ZAS”)

ZAS (formerly Zoom Mining Solutions) was incorporated in the State of Delaware on February 19, 2018 as a wholly owned subsidiary of ZCS. It is now a wholly owned subsidiary of ZBS.

There were minimal operations at ZAS during the three months ended March 31, 2022 and 2021.

The Company’s principal office is located in Blue Bell, Pennsylvania.

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). These statements include all adjustments (consisting only of normal recurring adjustments) which management believes necessary for a fair presentation of the financial statements and have been prepared on a consistent basis using the accounting policies described in the summary of accounting policies included in the Company’s 2021 Annual Report on Form 10-K (the “Form 10-K”). All significant intercompany transactions and balances have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with US GAAP have been condensed, or omitted pursuant to such rules and regulations, although the Company believes that the accompanying disclosures are adequate to make the information presented not misleading. The accompanying unaudited financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022.

The Company’s activities are subject to significant risks and uncertainties, including failing to secure additional financing to operationalize the Company’s current technology before another company develops similar technology to compete with the Company.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments (Subtopic 470-50), Compensation – Stock Compensation (Topic 718), and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40), Issuer’s Accounting for Certain Modifications or Exchanges or Freestanding Equity – Classified Written Call Options. The amendments in this Update clarify an issuer’s accounting for modifications or exchanges of freestanding equity – classified written call options (for example, warrants) that remain equity classified after modification or exchange. This was adopted January 1, 2022 and there was no material impact to the financial statements.

Recently Issued Accounting Pronouncements Not Yet Adopted

Recently Issued Accounting Pronouncements Not Yet Adopted

As of March 31, 2022, there are no recently issued accounting standards not yet adopted which would have a material effect on the Company’s financial statements.

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Stock Options and Warrants (Tables)

3 Months Ended

Mar. 31, 2022

Stock Options and Warrants (Tables) [Line Items]

Schedule of Weighted-average Assumptions Used to Estimate the Fair Values of Stock Options Granted

Risk Free Interest Rate		1.5	%
Expected Volatility		112.9	%
Expected Life (in years)		2.9
Dividend Yield		0	%
Weighted average estimated fair value of options during the period	$	0.53

Schedule of Stock Option Activity

	Options Outstanding
						Weighted -
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		11,317,500		$	0.57		2.1	$	2,145
Granted		3,725,000		$	0.90		2.8	$	1,378
Expired/Cancelled		(200,000	)	$	0.90		-		-
Exercisable at March 31, 2022		14,842,500		$	0.65		2.1	$	9,192
Exercisable at March 31, 2022 and expected to
vest thereafter		14,842,500		$	0.65		2.1	$	9,192

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

Schedule of Warrant Activity

						Weighted-
						Average
						Remaining		Aggregate
				Weighted-		Contractual		Intrinsic
	Number of			Average		Term		Value
	Shares			Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,500,000		$	0.90		0.5	$	-
Expired/Cancelled		(500,000	)	$	0.90		-	$	-
Balance, March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022		1,000,000		$	0.90		0.2	$	370
Exercisable at March 31, 2022 and expected to
vest thereafter		1,000,000		$	0.90		0.2	$	370

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying warrants and the closing stock price of $1.27 for REGO’s common stock on March 31, 2022.

ZS [Member]

Stock Options and Warrants (Tables) [Line Items]

Schedule of Stock Option Activity

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
			Weighted-		Contractual		Intrinsic
	Number of		Average		Term		Value
	Shares		Exercise Price		(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00		2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00		1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00		1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $4.00 for ZS’s common stock on March 31, 2022.

ZCS [Member]

Stock Options and Warrants (Tables) [Line Items]

Schedule of Stock Option Activity

	Options Outstanding
					Weighted -
					Average
					Remaining		Aggregate
				Weighted-	Contractual		Intrinsic
		Number of		Average	Term		Value
		Shares		Exercise Price	(in years)		(in 000's) (1)
Balance, December 31, 2021		1,600,000	$	5.00	2.0	$	-
Balance, March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at March 31, 2022		1,600,000	$	5.00	1.7	$	-
Exercisable at  and March 31, 2022 and expected to
vest thereafter		1,600,000	$	5.00	1.7	$	-

 (1) The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $0.01 for ZCS’s common stock on March 31, 2022.

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Summary of Significant Accounting Policies (Details)	Mar. 31, 2022
ZsSubsidiaryMember
Summary of Significant Accounting Policies (Details) [Line Items]
Ownership percentage	100.00%
ZBS [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Ownership percentage	85.00%
ZCS [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Ownership percentage	85.00%
Secured Debt [Member] | ZsSubsidiaryMember
Summary of Significant Accounting Policies (Details) [Line Items]
Interest rate	10.00%

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Management Plans (Details) $ in Millions	May 16, 2022 USD ($)
Subsequent Event [Member]
Management Plans (Details) [Line Items]
Cash position	$ 1.9

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Impairment of Long-Lived Assets (Details) - USD ($)		3 Months Ended
	Jan. 02, 2021	Mar. 31, 2022
Impairment of Long-Lived Assets (Details) [Line Items]
Impairment loss		$ 111,817
Chore Check, LLC [Member]
Impairment of Long-Lived Assets (Details) [Line Items]
Valued for software	$ 111,817
Purchase of common stock (in Shares)	100,000
Exercise price (in Dollars per share)	$ 0.9
Term	3 years

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Accounts Payable and Accrued Expenses - Related Parties (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Chief Executive Officer [Member]
Accounts Payable and Accrued Expenses - Related Parties (Details) [Line Items]
Beneficial owner, percentage	5.00%
Beneficial owner amount	$ 5,962	$ 95,185
Unpaid salary	$ 5,962	95,185
Chief Executive Officer [Member] | President and Board [Member]
Accounts Payable and Accrued Expenses - Related Parties (Details) [Line Items]
Beneficial owner, percentage	5.00%
Unpaid salary	$ 0	10,349
Chief Financial Officer [Member] | Unpaid payroll [Member]
Accounts Payable and Accrued Expenses - Related Parties (Details) [Line Items]
Unpaid salary	$ 3,846	$ 35,988

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Loans Payable (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Loans Payable (Details) [Line Items]
Loans payable	$ 42,600		$ 42,600
Loans Payable [Member]
Loans Payable (Details) [Line Items]
Interest accrued on the loans, percentage	6.00%		10.00%
Interest accrued loans	$ 4,536		$ 3,806
Interest expense	$ 730	$ 251

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10% Secured Convertible Notes Payable - Stockholders (Details) - USD ($)		3 Months Ended		12 Months Ended
	May 11, 2015	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	Mar. 05, 2016	Mar. 06, 2015
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Additional shares	$ 940,000
Loans payable		$ 42,600		$ 42,600
Preferred Class B [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Conversion price (in Dollars per share)		$ 0.9
Convertible shares (in Shares)		100
Securities Purchase Agreement [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Debt Instrument, Maturity Date	Oct. 31, 2022	Oct. 31, 2022
10% Secured Convertible Note [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Interest expense		$ 82,909	$ 77,909
Purchase Agreement [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Aggregate principal amount						$ 2,000,000
Promissory notes due, percentage					10.00%
Convertible Notes Payable [Member] | Preferred Class B [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Conversion price (in Dollars per share)		$ 90
Conversion per share (in Dollars per share)		$ 0.9
Secured Convertible Promissory Notes [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Loans payable		$ 3,316,357		$ 3,316,357
Secured Convertible Promissory Notes [Member] | Subsidiaries [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Interest accrued (in Shares)		2,262,511		2,179,602

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Notes Payable – Stockholders (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Notes Payable – Stockholders (Details) [Line Items]
Notes payable	$ 370,000
Interest rate	10.00%
Notes payable remaining amount	$ 225,000
Notes payable remaining	20.00%
Notes payable [Member]
Notes Payable – Stockholders (Details) [Line Items]
Notes payable	$ 595,000		$ 595,000
Interest accrued	216,017		$ 195,626
Interest expense	$ 20,391	$ 155,205

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4% Secured Convertible Notes Payable - Stockholders (Details)		3 Months Ended
	May 11, 2015	Mar. 31, 2022 USD ($) $ / shares shares	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)	Aug. 26, 2016 USD ($)
Series C Preferred Stock [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Conversion price, percentage		7
Conversion price per share (in Dollars per share) | $ / shares		$ 630
Board of Directors [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Aggregate principal amount		$ 200,000
4.0% Secured Convertible Note [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Interest expense, notes payable		$ 148,492	$ 100,449
4.0% Secured Convertible Note [Member] | Series C Preferred Stock [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Conversion price (in Dollars per share) | $ / shares		$ 90
Convertible shares (in Shares) | shares		100
Current conversion price (in Dollars per share) | $ / shares		$ 0.9
Securities Purchase Agreement [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Maturity date	Oct. 31, 2022	Oct. 31, 2022
New Secured Notes [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Current liability in the amount		$ 14,981,250		$ 14,781,250
Interest accrued		$ 1,701,011		$ 1,552,519
Convertible Promissory Notes due June 30, 2018, Issued on August 26, 2016 [Member]
10% Secured Convertible Notes Payable - Stockholders (Details) [Line Items]
Aggregate principal amount					$ 600,000
Convertible promissory notes percentage					4.00%

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Income Taxes (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Income Tax Disclosure [Abstract]
Income tax expense	$ 0	$ 0

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Convertible Preferred Stock (Details) - USD ($)	1 Months Ended		3 Months Ended
	Nov. 30, 2018	Aug. 31, 2016	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	Aug. 23, 2021
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)			2,000,000		2,000,000
Preferred stock			$ 287,350	$ 267,114
Common Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Shares converted (in Shares)			111,111
Authorized shares (in Shares)
Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Preferred stock			$ 8,147,216
Preferred Class A [Member]
Convertible Preferred Stock (Details) [Line Items]
Original issue price			$ 20,270,000
Dividends rate, percentage			8.00%
Per share price (in Dollars per share)			$ 8
Conversion price (in Dollars per share)			$ 0.9
Series A Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Shares converted (in Shares)			1,000
Authorized shares (in Shares)			195,500		195,500
Series A Preferred Stock [Member] | Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)
Preferred Class B [Member]
Convertible Preferred Stock (Details) [Line Items]
Original issue price			$ 13,586,040
Dividends rate, percentage			8.00%
Conversion price (in Dollars per share)			$ 0.9
Sold preferred stock			$ 39,599	0
Received proceeds			$ 3,564,000	$ 0
Series C Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)		150,000
Authorized shares (in Shares)			300,000		300,000
Dividends per share (in Dollars per share)		$ 7.2
Dividend per share (in Dollars per share)			$ 0
Series C Preferred Stock [Member] | Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)
Series C Preferred Stock [Member] | Minimum [Member]
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)						150,000
Series C Preferred Stock [Member] | Maximum [Member]
Convertible Preferred Stock (Details) [Line Items]
Authorized shares (in Shares)						300,000
Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Dividends rate, percentage			8.00%
ZS Series A Preferred Stock [Member]
Convertible Preferred Stock (Details) [Line Items]
Dividends rate, percentage	8.00%		8.00%
Preferred stock			$ 68,333
Original issue price (in Shares)	83,334
Original issue price per share (in Dollars per share)	$ 3
Exercise per share (in Dollars per share)	$ 3
Expire term	3 years
Raised capital	$ 250,000

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Stockholders' Equity (Details)	Mar. 31, 2022
Consultant [Member]
Stockholders' Equity (Details) [Line Items]
Capital transaction percentage	6.00%

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Stock Options and Warrants (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Stock Options and Warrants (Details) [Line Items]
Exercise price (in Dollars per share)	$ 1.27
Warrant [Member]
Stock Options and Warrants (Details) [Line Items]
Exercise price (in Dollars per share)	$ 1.27
Share-based compensation	$ 0	$ 3
2008 Equity Incentive Plan [Member]
Stock Options and Warrants (Details) [Line Items]
Shares authorized under plan (in Shares)	25,000,000
Number of shares of common stock (in Shares)	1,250,000
2013 Equity Incentive Plan [Member]
Stock Options and Warrants (Details) [Line Items]
Shares authorized under plan (in Shares)	5,000,000
Number of shares of common stock (in Shares)	4,700,000
Shares available for grant (in Shares)	300,000
Subsidiaries [Member]
Stock Options and Warrants (Details) [Line Items]
Share-based compensation	$ 403,686	1,417,624
ZS [Member]
Stock Options and Warrants (Details) [Line Items]
Exercise price (in Dollars per share)	$ 4
Share-based compensation	$ 0
ZCS [Member]
Stock Options and Warrants (Details) [Line Items]
Exercise price (in Dollars per share)	$ 0.01
Share-based compensation	$ 0	$ 0
Various consultants and employees [Member]
Stock Options and Warrants (Details) [Line Items]
Number of shares purchase of common stock (in Shares)	3,725,000
Fair value of option	$ 1,991,450
Unrecognized compensation	$ 1,587,763

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Stock Options and Warrants (Details) - Schedule of Weighted-average Assumptions Used to Estimate the Fair Values of Stock Options Granted - Share-Based Payment Arrangement, Option [Member]	3 Months Ended
	Mar. 31, 2022 $ / shares
Stock Options and Warrants (Details) - Schedule of Weighted-average Assumptions Used to Estimate the Fair Values of Stock Options Granted [Line Items]
Risk Free Interest Rate	1.50%
Expected Volatility	112.90%
Expected Life (in years)	2 years 10 months 24 days
Dividend Yield	0.00%
Weighted average estimated fair value of options during the period (in Dollars per share)	$ 0.53

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Stock Options and Warrants (Details) - Schedule of Stock Option Activity - Share-Based Payment Arrangement, Option [Member] $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) $ / shares shares
Stock Options and Warrants (Details) - Schedule of Stock Option Activity [Line Items]
Number of Shares Balance, | shares	11,317,500
Weighted- Average Exercise Price Balance, | $ / shares	$ 0.57
Weighted - Average Remaining Contractual Term in years Balance,	2 years 1 month 6 days
Aggregate Intrinsic Value Balance, | $	$ 2,145	[1]
Number of Shares Granted | shares	3,725,000
Weighted- Average Exercise Price Granted | $ / shares	$ 0.9
Weighted - Average Remaining Contractual Term in years Granted	2 years 9 months 18 days
Aggregate Intrinsic Value Granted | $	$ 1,378	[1]
Number of Shares Expired/Cancelled | shares	(200,000)
Weighted- Average Exercise Price Expired/Cancelled | $ / shares	$ 0.9
Aggregate Intrinsic Value Expired/Cancelled | $		[1]
Number of Shares Exercisable at March 31, 2022 | shares	14,842,500
Weighted- Average Exercise Price Exercisable at March 31, 2022 | $ / shares	$ 0.65
Weighted - Average Remaining Contractual Term in years Exercisable at March 31, 2022	2 years 1 month 6 days
Aggregate Intrinsic Value Exercisable at March 31, 2022 | $	$ 9,192	[1]
Number of Shares, Exercisable at March 31, 2022 and expected to vest thereafter | shares	14,842,500
Weighted- Average Exercise Price Exercisable at March 31, 2022 and expected to vest thereafter | $ / shares	$ 0.65
Weighted - Average Remaining Contractual Term in years Exercisable at March 31, 2022 and expected to vest thereafter	2 years 1 month 6 days
Aggregate Intrinsic Value Exercisable at March 31, 2022 and expected to vest thereafter | $	$ 9,192	[1]

[1] The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the closing stock price of $1.27 for Rego’s common stock on March 31, 2022.

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Stock Options and Warrants (Details) - Schedule of Warrant Activity - ZPS [Member] $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) $ / shares shares
Class of Warrant or Right [Line Items]
Number of Shares Balance, December 31, 2021 | shares	1,500,000
Weighted- Average Exercise Price Balance, December 31, 2021 | $ / shares	$ 0.9
Weighted- Average Remaining Contractual Term (in years) Balance, December 31, 2021	6 months
Aggregate Intrinsic Value Balance, December 31, 2021 | $		[1]
Number of Shares Expired/Cancelled | shares	(500,000)
Weighted- Average Exercise Price Expired/Cancelled | $ / shares	$ 0.9
Aggregate Intrinsic Value Expired/Cancelled | $		[1]
Number of Shares Balance, March 31, 2022 | shares	1,000,000
Weighted- Average Exercise Price Balance, March 31, 2022 | $ / shares	$ 0.9
Weighted- Average Remaining Contractual Term (in years) Balance, March 31, 2022	2 months 12 days
Aggregate Intrinsic Value Balance, March 31, 2022 | $	$ 370	[1]
Number of Shares Exercisable at March 31, 2022 | shares	1,000,000
Weighted- Average Exercise Price Exercisable at March 31, 2022 | $ / shares	$ 0.9
Weighted- Average Remaining Contractual Term (in years) Exercisable at March 31, 2022	2 months 12 days
Aggregate Intrinsic Value Exercisable at March 31, 2022 | $	$ 370	[1]
Number of Shares Exercisable at March 31, 2022 and expected to vest thereafter | shares	1,000,000
Weighted- Average Exercise Price Exercisable at March 31, 2022 and expected to vest thereafter | $ / shares	$ 0.9
Weighted- Average Remaining Contractual Term (in years) Exercisable at March 31, 2022 and expected to vest thereafter	2 months 12 days
Aggregate Intrinsic Value Exercisable at March 31, 2022 and expected to vest thereafter | $	$ 370	[1]

[1] The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying warrants and the closing stock price of $1.27 for Rego’s common stock on March 31, 2022.

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Stock Options and Warrants (Details) - Schedule of Stock Option Activity - USD ($)		3 Months Ended
		Mar. 31, 2022	Dec. 31, 2021
Schedule of Stock Option Activity [Abstract]
Number of Shares Balance, December 31, 2021		1,600,000
Weighted- Average Exercise Price Balance, December 31, 2021		$ 5
Weighted - Average Remaining Contractual Term (in years) Balance, December 31, 2021		2 years
Aggregate Intrinsic Value Balance, December 31, 2021	[1]
Number of Shares Balance, March 31, 2022		1,600,000
Weighted- Average Exercise Price Balance, March 31, 2022		$ 5
Weighted - Average Remaining Contractual Term (in years) Balance, March 31, 2022		1 year 8 months 12 days
Aggregate Intrinsic Value Balance, March 31, 2022	[1]
Number of Shares Exercisable at March 31, 2022		1,600,000
Weighted- Average Exercise Price Exercisable at March 31, 2022		$ 5
Weighted - Average Remaining Contractual Term (in years) Exercisable at March 31, 2022		1 year 8 months 12 days
Aggregate Intrinsic Value Exercisable at March 31, 2022	[1]
Number of Shares Exercisable at and March 31, 2022 and expected to vest thereafter		1,600,000
Weighted- Average Exercise Price Exercisable at and March 31, 2022 and expected to vest thereafter		$ 5
Weighted - Average Remaining Contractual Term (in years) Exercisable at and March 31, 2022 and expected to vest thereafter		1 year 8 months 12 days
Aggregate Intrinsic Value Exercisable at and March 31, 2022 and expected to vest thereafter	[1]

[1] The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $0.01 for ZCS’s common stock on March 31, 2022.

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Stock Options and Warrants (Details) - Schedule of Stock Option Activity - USD ($)		3 Months Ended
		Mar. 31, 2022	Dec. 31, 2021
Schedule of Stock Option Activity [Abstract]
Number of Shares Balance, December 31, 2021		1,600,000
Weighted- Average Exercise Price Balance, December 31, 2021		$ 5	$ 5
Weighted - Average Remaining Contractual Term (in years) Balance, December 31, 2021		2 years
Aggregate Intrinsic Value Balance, December 31, 2021	[1]
Number of Shares Balance, March 31, 2022		1,600,000
Weighted- Average Exercise Price Balance, March 31, 2022		$ 5	$ 5
Weighted - Average Remaining Contractual Term (in years) Balance, March 31, 2022		1 year 8 months 12 days
Aggregate Intrinsic Value Balance, March 31, 2022	[1]
Number of Shares Exercisable at March 31, 2022		1,600,000
Weighted- Average Exercise Price Exercisable at March 31, 2022		$ 5
Weighted - Average Remaining Contractual Term (in years) Exercisable at March 31, 2022		1 year 8 months 12 days
Aggregate Intrinsic Value Exercisable at March 31, 2022	[1]
Number of Shares Exercisable at and March 31, 2022 and expected to vest thereafter		1,600,000
Weighted- Average Exercise Price Exercisable at and March 31, 2022 and expected to vest thereafter		$ 5
Weighted - Average Remaining Contractual Term (in years) Exercisable at and March 31, 2022 and expected to vest thereafter		1 year 8 months 12 days
Aggregate Intrinsic Value Exercisable at and March 31, 2022 and expected to vest thereafter	[1]

[1] The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and the value of $0.01 for ZCS’s common stock on March 31, 2022.

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Noncontrolling Interests (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Noncontrolling Interest [Abstract]
Noncontrolling interests	$ (101)	$ (101)

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Operating Leases (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Disclosure Text Block [Abstract]
Total rent expense under leases	$ 800	$ 761

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Related Party Transactions (Details) - USD ($)	1 Months Ended		3 Months Ended
	Jan. 26, 2022	Jan. 20, 2022	Mar. 31, 2022	Feb. 22, 2022
Related Party Transactions (Details) [Line Items]
Cash bonus		$ 50,000
Nature of Common Ownership or Management Control Relationships		$100,000
Beneficial Owner [Member]
Related Party Transactions (Details) [Line Items]
Marketing services			$ 10,800
Chief Executive Officer [Member]
Related Party Transactions (Details) [Line Items]
Salary	$ 310,000
Secured note payable, percentage				4.00%
Secured note payable				$ 100,000

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Subsequent Events (Details) - Subsequent Event [Member] - USD ($)	1 Months Ended		2 Months Ended
	May 31, 2022	Apr. 30, 2022	May 16, 2022
Subsequent Events (Details) [Line Items]
Shares issued	200,000		1,556
Sold preferred stock value			$ 140,000
Exercise prices	$ 0.2595
June 15, 2023 [Member]
Subsequent Events (Details) [Line Items]
Shares issued	400,000
Exercise prices	$ 0.9
Chief Executive Officer [Member]
Subsequent Events (Details) [Line Items]
Received bonus		$ 50,000
Chief Financial Officer [Member]
Subsequent Events (Details) [Line Items]
Received bonus		$ 75,000
Consultant [Member]
Subsequent Events (Details) [Line Items]
Shares issued		225,000
Term period		2 years
Consultant [Member] | Minimum [Member]
Subsequent Events (Details) [Line Items]
Exercise prices		$ 1.28
Consultant [Member] | Maximum [Member]
Subsequent Events (Details) [Line Items]
Exercise prices		$ 1.31