OTHER PAYABLE	3 Months Ended
Mar. 31, 2025
OTHER PAYABLE
OTHER PAYABLE	NOTE 5: OTHER PAYABLE In January 2025, the Company entered into a settlement agreement and stipulation (the “3(a)(10) Settlement Agreement”) with Last Horizon, LLC (“Last Horizon”), pursuant to which the Company agreed to issue shares of the Company’s common stock to Last Horizon in exchange for the settlement of approximately $8,908,000 (the “Claim”) to resolve outstanding overdue liabilities with a lender and certain of its vendors. The 3(a)(10) Settlement Agreement was subject to a fairness hearing pursuant to Section 3(a)(10) of the Securities Act of 1933 (the “Securities Act”) and on January 29, 2025, a Federal court in in Florida held a fairness hearing and granted approval of the 3(a)(10) Settlement Agreement in its order (the “Order”). Per the terms of the 3(a)(10) Settlement Agreement, the Company is required to issue freely trading securities pursuant to Section 3(a)(10) of the Securities Act equal to the total amount of the Claim divided by the lower of (i) the closing share price on the date of issuance or (ii) 85.0% multiplied by the lowest volume weighted average price (the “VWAP”) during the five day period preceding the share request inclusive of the day of the request (the “Valuation Period”), subject to a minimum price floor of $0.02 per share (the “Purchase Price”). In the event the shares are not delivered to Last Horizon’s brokerage account on the same date as the share request or conversion notice, the Valuation Period will be extended to the date the shares are delivered. The Company accounted for the 3(a)(10) Settlement Agreement as an extinguishment of the outstanding obligations and realized a loss on extinguishment of approximately $2,716,000, which is recorded as a component of other income (expense) on the accompanying unaudited condensed consolidated statements of operations and comprehensive loss. The Company recognized a new obligation to Last Horizon at fair value at issuance and each subsequent reporting period as there is a variable number of shares that will be issued to settle the fixed dollar amount of the Claim (see Note 10). As of issuance and at March 31, 2025, the fair value of the 3(a)(10) Settlement Agreement was determined to be approximately $11,624,000 and $7,941,000, respectively, and was recorded as other payable on the accompanying condensed consolidated balance sheets. In the event of a default event pursuant to (i) the trading of the Company’s shares of common stock shall have been halted, limited or suspended, (ii) minimum prices have been established for securities trading on the NASDAQ, (iii) any portion of the Company’s common stock is not eligible or is unable to be deposited or cleared through Last Horizon’s broker, brokerage account and/or clearing agent, the Company’s common stock is no longer eligible for book transfer delivery, or the Company has not made its required filings with the SEC, the multiplier to the VWAP used to determine the Purchase Price decreases from 85.0% to 75.0%. The Company triggered an event of default in April 2025 when it did not file its Form 10-K timely and in May 2025 when it was delisted from the NASDAQ. Per the terms of the 3(a)(10) Settlement Agreement, the Company is required to reserve at least 1.5 time the greater of the number of shares that could be issued pursuant to the terms of the Order and reserve at its transfer agent, at a minimum, 10,000,000 shares of the Company’s common stock during the Valuation Period. The shares of Company’s common stock may only be released once all Claims have been settled. At March 31, 2025, the Company had reserved 10,000,000 shares of the Company’s common stock for issuance in connection with this 3(a)(10) Settlement Agreement. During the three months ended March 31, 2025, the Company issued 3,674,558 shares of common stock with a fair value of $3,077,252, as determined by the closing price on the date the shares were issued, to partially settle the obligation owed to Last Horizon. From April 1, 2025 through the date these condensed consolidated financial statements were issued, the Company issued 10,069,573 shares of common stock with a fair value of $5,411,498, as determined by the closing price on the date the shares were issued, to partially settle the obligation owed to Last Horizon.

OTHER PAYABLE

3 Months Ended

Mar. 31, 2025

NOTE 5: OTHER PAYABLE

In January 2025, the Company entered into a settlement agreement and stipulation (the “3(a)(10) Settlement Agreement”) with Last Horizon, LLC (“Last Horizon”), pursuant to which the Company agreed to issue shares of the Company’s common stock to Last Horizon in exchange for the settlement of approximately $8,908,000 (the “Claim”) to resolve outstanding overdue liabilities with a lender and certain of its vendors. The 3(a)(10) Settlement Agreement was subject to a fairness hearing pursuant to Section 3(a)(10) of the Securities Act of 1933 (the “Securities Act”) and on January 29, 2025, a Federal court in in Florida held a fairness hearing and granted approval of the 3(a)(10) Settlement Agreement in its order (the “Order”).

Per the terms of the 3(a)(10) Settlement Agreement, the Company is required to issue freely trading securities pursuant to Section 3(a)(10) of the Securities Act equal to the total amount of the Claim divided by the lower of (i) the closing share price on the date of issuance or (ii) 85.0% multiplied by the lowest volume weighted average price (the “VWAP”) during the five day period preceding the share request inclusive of the day of the request (the “Valuation Period”), subject to a minimum price floor of $0.02 per share (the “Purchase Price”). In the event the shares are not delivered to Last Horizon’s brokerage account on the same date as the share request or conversion notice, the Valuation Period will be extended to the date the shares are delivered.

The Company accounted for the 3(a)(10) Settlement Agreement as an extinguishment of the outstanding obligations and realized a loss on extinguishment of approximately $2,716,000, which is recorded as a component of other income (expense) on the accompanying unaudited condensed consolidated statements of operations and comprehensive loss. The Company recognized a new obligation to Last Horizon at fair value at issuance and each subsequent reporting period as there is a variable number of shares that will be issued to settle the fixed dollar amount of the Claim (see Note 10). As of issuance and at March 31, 2025, the fair value of the 3(a)(10) Settlement Agreement was determined to be approximately $11,624,000 and $7,941,000, respectively, and was recorded as other payable on the accompanying condensed consolidated balance sheets.

In the event of a default event pursuant to (i) the trading of the Company’s shares of common stock shall have been halted, limited or suspended, (ii) minimum prices have been established for securities trading on the NASDAQ, (iii) any portion of the Company’s common stock is not eligible or is unable to be deposited or cleared through Last Horizon’s broker, brokerage account and/or clearing agent, the Company’s common stock is no longer eligible for book transfer delivery, or the Company has not made its required filings with the SEC, the multiplier to the VWAP used to determine the Purchase Price decreases from 85.0% to 75.0%. The Company triggered an event of default in April 2025 when it did not file its Form 10-K timely and in May 2025 when it was delisted from the NASDAQ.

Per the terms of the 3(a)(10) Settlement Agreement, the Company is required to reserve at least 1.5 time the greater of the number of shares that could be issued pursuant to the terms of the Order and reserve at its transfer agent, at a minimum, 10,000,000 shares of the Company’s common stock during the Valuation Period. The shares of Company’s common stock may only be released once all Claims have been settled. At March 31, 2025, the Company had reserved 10,000,000 shares of the Company’s common stock for issuance in connection with this 3(a)(10) Settlement Agreement.

During the three months ended March 31, 2025, the Company issued 3,674,558 shares of common stock with a fair value of $3,077,252, as determined by the closing price on the date the shares were issued, to partially settle the obligation owed to Last Horizon. From April 1, 2025 through the date these condensed consolidated financial statements were issued, the Company issued 10,069,573 shares of common stock with a fair value of $5,411,498, as determined by the closing price on the date the shares were issued, to partially settle the obligation owed to Last Horizon.