NOTE 3 – NOTES PAYABLE

Convertible Note Payable

On September 9, 2024, the Company and an investor entered into a convertible promissory note agreement, providing for the issuance of a note in the principal amount of $20,000. The note was due on September 9, 2025. The principal amount was convertible into shares of common stock of the Company at a conversion price of $1.00 per share. In addition, the Company issued the investor a stock purchase warrant to acquire 40,000 shares of common stock of the Company at a per share price of $0.01. The warrants were immediately exercisable.

In accordance with ASC 470-20-25-2, proceeds from the sale of a debt instrument with stock purchase warrants are allocated to the two elements based on the relative fair values of the debt instrument without the warrants and of the warrants themselves at time of issuance. The portion of the proceeds so allocated to the warrants are accounted for as additional paid-in capital. The remainder of the proceeds are allocated to the debt instrument portion of the transaction. The fair value of the warrants issued to the investor was $40,000. Therefore, the Company recorded debt discount of $13,333 related to the relative fair value of the warrants issued to the investor, which was amortized over the term of the note.

In October 2025, the convertible note and all accrued interest of $22,092 was converted into 22,092 shares of common stock (see Note 4) at the stated conversion price of $1.00.

The convertible note payable and unamortized debt discount as of March 31, 2026 and September 30, 2025 was as follows:

For the three and six months ended March 31, 2026 and 2025, amortization of debt discount related to this convertible note payable amounted to $0 and $3,333 and $0 and $6,666, respectively, which has been included in interest expense on the accompanying condensed consolidated statements of operations.

Notes Payable

On May 15, 2025, the Company and Brent Lilienthal entered into a settlement agreement, pursuant to which, the Company settled $217,000 debt owed by the issuance of 120,000 shares of common stock of the Company. As of March 31, 2026 and September 30, 2025, no amounts were owed to Brent Lilienthal.

During the year ended September 30, 2025, the Company recognized a gain on the extinguishment of a $680,000 note payable with Mr. Wentz. The Company obtained a legal opinion documenting the law in the state in which the debt originated. Based on such state law, the Company has been judicially released from this obligation as the statute of limitations has lapsed on any breach of contract claims.

Interest expense related to convertible note payable and notes payable totaled $0 and $3,833 and $0 and $7,663 for the three and six months ended March 31, 2026 and 2025, respectively.

Commercial Loan

On April 9, 2020, the Company received a loan from the Small Business Administration pursuant to the Paycheck Protection Program (“PPP”) in the principal amount of $48,750. The note bears interest at a variable rate of approximately 1% and matured in April 2022. The Company applied for loan forgiveness, and the Company is waiting on confirmation that the loan has been forgiven.

Financed liability

During the three months ended March 31, 2026, we entered into a financing agreement to finance $45,144 of insurance premiums due on various policies. The financed amount is due in fixed monthly payments of $4,807 for a period of eight months and bears interest at 13.9%. The balance of $31,602 remaining on this financing liability has been presented within current liabilities on the accompanying condensed consolidated balance sheets as of March 31, 2026.