v3.26.1
10% Secured Convertible Notes Payable - Stockholders
12 Months Ended
Dec. 31, 2025
10% Secured Convertible Notes Payable - Stockholders [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. In June 2025, the Company issued an additional $2,000,000 of Notes to stockholders. In August and September 2025, the Company issued an additional $1,305,000 of Notes to stockholders. The maturity dates of the Notes have been extended most recently from December 31, 2024 to April 30, 2025, with the consent of the Note holders. An additional extension was provided by the Note holders on April 30, 2025. This extended the maturity date until May 31, 2025, with a provision stipulating that unless previously repaid in full such date shall be automatically extended on a month-to-month basis thereafter unless the Note holder submits notification in writing to the contrary.

 

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 Investors and a collateral agent acting on behalf of the Investors (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, in the amount of $6,141,237 and $3,036,237 as of December 31, 2025 and 2024. Interest accrued on the notes was $3,306,659 and $2,940,724 as of December 31, 2025 and 2024. Interest expense related to these notes payable was $365,935 and $97,851 for the years ended December 31, 2025 and 2024.

 

During the year ended December 31, 2025, a 10% Secured Convertible Noteholder converted $200,000 of principal plus $104,468 of accrued interest into 3,383 shares of Series B Preferred Stock.