v3.26.1
Notes Payable, Related Party Notes Payable, and Revenue Financing Arrangements
 12 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Notes Payable, Related Party Notes Payable, and Revenue Financing Arrangements

Note 4 – Notes Payable, Related Party Notes Payable, and Revenue Financing Arrangements

 

Notes payable are generally nonrecourse and secured by all Company owned assets.

 

               
   Interest
Rate		  December 31,
2025		  December 31,
2024
Notes Payable and Convertible Notes Payable               
                
In December 2020, the Company entered into a 56- month loan with a company in the amount of $1,578,237. The loan requires payments of 3.75% through November 2022 and 4.00% through September 2025 of the previous month’s revenue. Note was due September 2025. Note is guaranteed by a related party see note 6.   17%  $188,839   $195,927 
                
In April 2021, the Company entered into two six-month loans in the amount of $84,000 each. The loan had an original maturity of October 2021 with principal and interest due at maturity. The loan was exchanged to Series B Preferred stock in June 2025.   7%   —    168,000 
                
In May 2021, the Company entered into a six-month loan with an individual in the amount of $50,000. The loan had an original maturity of October 2021 with principal and interest due at maturity. The loan was exchanged to Series B Preferred stock in June 2025.   7%   —    50,000 
                
In May 2021, the Company entered into a six-month loan with an individual in the amount of $10,000. The loan had an original maturity of October 2021 with principal and interest due at maturity. The loan due date was extended to October 31, 2024. .   7%   10,000    10,000 
                
In August 2022, the Company entered into a 56-months auto loan in the amount of $45,420.   2.35%   13,514    23,372 
                
In December 2022, the Company entered into various eighteen-month loans with individuals totaling $4,000,000. The notes included 100% warrant coverage. The loans mature in June 2024 with principal and interest due at maturity with conversion price of $40.00 per share. The loans were exchanged to Series B Preferred stock in June 2025.   12%   —    2,600,000 
                
In December 2022, the Company entered into an eighteen-month loan with an individual in the amount of $1,000,000. The notes included 100% warrant coverage. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    1,000,000 

 

In May 2023, the Company entered into various eighteen-month loans with individuals totaling in the amount of $800,000. The notes included 50% warrant coverage. The loans mature in November 2024 with principal and interest due at maturity with conversion price of $40.00 per share. The loans were exchanged to Series B Preferred stock in June 2025.   12%   —    800,000 
                
In June 2023, the Company entered into various eighteen-month loans with individuals totaling in the amount of $350,000. The notes included 50% warrant coverage. The loans mature in December 2024 with principal and interest due at maturity with conversion price of $40.00 per share. The loans were exchanged to Series B Preferred stock in June 2025.   12%   —    100,000 
                
In July 2023, the Company entered into a twelve-month loan with an individual in the amount of $100,000. The note included 50% warrant coverage. The loan matures in January 2025 with principal and interest due at maturity with conversion price of $40.00 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    100,000 
                
In August 2023, the Company entered into a twelve-month loan with an individual in the amount of $300,000. The convertible note included the issuance of 150,000 shares of Common Stocks. The loan matured in August 2024 with principal and interest due at maturity with a conversion price of $34.00 per share and is non-interest bearing.   —%   43,000    43,000 
                
In October 2023, the Company entered into a three-month loan with an individual in the amount of $500,000. The loan matures in January 2024 with principal and interest due at maturity. The loan due date was extended to June 2025. The Required payment was not made.   10%   500,000    500,000 
                
In October 2023, the Company entered into a loan with an individual in the amount of $130,000. The loan requires payment of 17% of daily Shopify sales.   —%   58,612    66,278 
                
In October 2023, the Company entered into a eighteen-month loan with individuals totaling in the amount of $1,250,000. The note included 100% warrant coverage. The loan matured in April 2025 with principal and interest due at maturity with conversion price of $40.00 per share. The loan was fully converted to Common Stock in January 2025   12%   —    1,143,449 

 

 

In January 2024, the Company entered into a 18-month loan with an individual in the amount of $250,000. The note included 100% warrant coverage. The loan had a maturity of July 2025 with principal and interest due at maturity with conversion price of $20.00 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    250,000 
                
In February 2024, the Company entered into a 18-month loan with an individual in the amount of $150,000. The note included 100% warrant coverage. The loan had a maturity of August 2025 with principal and interest due at maturity with conversion price of $16.00 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    150,000 
                
In February 2024, the Company entered into a 6-month loan with an individual in the amount of $315,000. The note included 60% warrant coverage. The loan had a maturity of August 2024 with principal and interest due at maturity with conversion price of $15.20 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    315,000 
                
In February 2024, the Company entered into a 18-month loan with an entity in the amount of $250,000. The note included 100% warrant coverage. The loan matures in August 2025 with principal and interest due at maturity with conversion price of $18.40 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    250,000 
                
In April 2024, the Company entered into a commercial financing agreement in the amount of $815,000 and to be paid weekly until the loan is paid in full.   —%   331,335    357,127 
                
In May 2024, the Company entered into an eighteen-month loan with individuals totaling in the amount of $1,850,000. The note included warrant coverage. The loan matures in November 2026 with principal and interest due at maturity with conversion price of $16.00 per share. The loan was exchanged to Series B Preferred stock in June 2025   —%   —    1,850,000 
                
In June 2024, the Company entered into a revenue purchase agreement in the amount of $250,000. 4% of revenue will be paid weekly until the loan is paid in full.   —%   13,459    181,341 
                
In July 2024, the Company entered into a revenue purchase agreement in the amount of $178,250. The loan matures in April 2025. The loan was fully converted to Common Stock in January 2025.   22%   —    91,999 

 

In July 2024, the Company entered into a revenue purchase agreement in the amount of $120,750. The loan matures in May 30, 2025. The loan was fully converted to Common Stock in January 2025   22%   —    120,750 
                
In August 2024, the Company entered into a 5-year loan with individuals totaling in the amount of $500,000. The loan matures in September 2029 with principal and interest due at maturity with conversion price of $14.00 per share. The loans were exchanged to Series B Preferred stock in June 2025.   9%   —    500,000 
                
In August 2024, the Company entered into a eighteen-month loan with individuals totaling in the amount of $1,400,000. The loan matures in February 2026 with principal and interest due at maturity with conversion price of $0.38 per share. $800,000 was exchanged to Preferred stock in June 2025.   12%   —    1,400,000 
                
In August 2024, the Company entered into a eighteen-month loan with individuals totaling in the amount of $100,000. The loan matures in September 2025 with principal and interest due at maturity with conversion price of $15.20 per share. The loan was exchanged to Series B Preferred stock in June 2025.   12%   —    100,000 
                
In September 2024, the Company entered into a merchant cash advance agreement in the amount of $325,000 to be paid weekly until the loan is paid in full.   —%   10,861    82,261 
                
In September 2024, the Company entered into an agreement with individuals totaling in the amount of $590,000. There is no stated maturity, the proceeds of which are to be used for a future acquisition. $290,000 was exchanged to Series B Preferred stock in June 2025   —%   300,000    590,000 
                
In October 2024, the Company entered into an agreement with individuals totaling in the amount of $950,000. There is no stated maturity, the proceeds of which were to be used for a future acquisition which did not occur.   —%   950,000    950,000 
                
In November 2024, the Company entered into a merchant cash advance agreement in the amount of $340,000 to be paid weekly until the loan is paid in full.   —%   256,713    311,713 
                
In December 2024, the Company entered into a merchant cash advance agreement in the amount of $111,300 to be paid weekly until the loan is paid in full. The loan was fully converted to Common Stock.   —%   —    111,300 

 

In December 2024, the Company entered into a twelve-month loan with an individual in the amount of $225,000 . The loan matured in December 2025 with principal and interest due at maturity.   12%   225,000    225,000 
                
In January 2025, the Company entered into a 12-month loan with individuals in the amount of $350,000. The note included 100% warrant coverage. The loan had a maturity of January 2026 with principal and interest due at maturity with conversion price of $10.00 per share. The loans of $150,000 were exchanged to Series B Preferred stock in June 2025.   12%   200,000    — 
                
In July 2025, the Company entered into a convertible promissory note in the amount of $30,000. The loans was due on August 31, 2025   12%   30,000    — 
                
In August 2025, the Company entered into a convertible promissory note with individuals totaling in the amount of $241,280. The loan had a maturity of May 2026 with principal and interest due at maturity. The loans are convertible at 75% multiplied by the lowest trading price for the Company’s common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date, subject to a 4.99% equity blocker.   22%   241,280    — 

 

In August 2025, the Company entered into a convertible promissory note in the amount of $183,280. The loan had a maturity of June 2026 with principal and interest due at maturity. The loans are convertible at 75% multiplied by the lowest trading price for the Company’s common stock during the 10 trading day period ending on the latest complete trading day prior to the conversion date, subject to a 4.99% equity blocker   22%   183,280    — 
                
In September 2025, the Company entered into a twelve-month loan with individuals totaling in the amount of $2,200,000. The loan matures in September 2026 with principal and interest due at maturity and is convertible into the Company’s Common Stock at a conversion price equal to the lower of $1.75 and $0.01 above the closing price on the date of conversion.   0%   2,200,000    — 
                
In November 2025, the Company entered into a twelve-month loan with individuals totaling in the amount of $500,000. The loan matures in November 2026 with principal and interest due at maturity and is convertible into the Company’s Common Stock at a conversion price equal to the lower of $1.75 and $0.01 above the closing price on the date of conversion.   0%   500,000    — 
                
    Total notes payable    $

6,255,893

   $14,635,517 
                
    Less notes discount    (26,894)   (3,031,917)
    Less current portion    

(6,225,581

)   (9,632,505)
                
    Long-term notes payable   $3,418   $1,971,095 

 

Interest expense on notes payable was $2,253,260 and $3,702,611 for the years ended December 31, 2025 and 2024, respectively. Accrued interest was $2,282,528 and $3,610,329 at December 31, 2025 and December 31, 2024 , respectively. The Company’s effective interest rate was 22.85% and 20.53% for the years ended December 31, 2025 and December 31, 2024, respectively.

 

The Company’s convertible note balances are convertible into 944,685 and 505,257 shares of Common Stock for the years ended December 31, 2025 and 2024. These amounts are reflective of the 1 for 40 reverse split.

 

As of December 31, 2024, and December 31, 2023, the balance of the unamortized debt discount was $26,896 and 3,677,143 respectively. The Company adopted ASU 2020-06 on January 1, 2024, which resulted in the reversal of the original beneficial conversion feature (BCF) amount to additional paid in capital for $2,191,103, reversal of the unamortized debt discount related to the beneficial conversion feature (BCF) for $932,047 with the balance being recorded through retained earnings for $1,259,056.

 

Notes discount of $3,401,524 and $3,251,106 for the year ending December 31, 2025 and 2024 respectively is related to the discounted warrants and common shares issued in connection with the notes.

 

In June 2025, the Company exchanged approximately $16.4 million of outstanding promissory notes for newly issued preferred equity. The Company did this exchange as part of its effort to regain compliance with the stockholder equity requirements of the NYSE American. By exchanging debt for equity, the Company enhances balance sheet, reduces interest expense, and improves stockholder equity position in furtherance of its goal of complying with exchange requirements. The exchange was the result of an agreement between note holders and the Company. The Company is still assessing the accounting impacts of these exchanges.

 

             
   Interest Rate  December
31, 2025		  December
31, 2024
Stockholder Notes Payable             
              
In April 2024, revised Feb 2023 stockholder advance in the amount of $200,000. The annual interest rate is 12% with a conversion price of $0.35 per share. The revised note were exchanged to Series B Preferred stock in June 2025.  12%   —    200,000 
              
   Less current portion   —    (200,000)
              
   Long-term notes payable  $—   $— 

 

 

Interest expense on related party notes payable was $11,720 and $24,000 for the year ended December 31, 2025 and 2024, respectively.

 

As of December 31, 2025, the Company’s convertible note balances are convertible into 6,126,419 shares of Common Stock