Convertible Notes Payable |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Convertible Notes Payable | Note 5. Convertible Notes Payable
In December 2024, the Company issued convertible notes payable to three investors in exchange for $650,000. During the year ended December 31, 2025, the Company issued 0% interest convertible notes payable to three investors in exchange for $290,000. convertible notes mature six months following that date of issuance and do not accrue interest. The notes are convertible into common shares as follows: (i) on the next equity financing conversion: the principal balance on each note will convert into shares upon the closing of the next equity financing. The number of conversion shares the Company issues upon such conversion will equal the quotient obtained by dividing (x) the outstanding principal balance under each converting note on the closing date of the next equity financing by (y) the applicable conversion price of the product of (x) 100% less the discount of 25% and (y) the lowest per share purchase price of the equity securities issued in the next equity financing; and/or (ii) corporate transaction conversion: at the closing of a major corporate transaction, the note will convert into that number of conversion shares equal to the quotient obtained by dividing (x) the outstanding principal balance of such note on the closing of such corporate transaction by (y) the applicable conversion price of the product of (x) 100% less the discount of 25% and (y) the volume weighted average trading price on the date that is ten days immediately prior to the closing date of the corporate transaction; and/or (iii) at any time on or after the maturity date, each note will convert into that number of conversion shares equal to the quotient obtained by dividing (x) the outstanding principal balance of the note on the date of such conversion by (y) the applicable conversion price of the product of (x) 100% less the discount of 25% and (y) the volume weighted average trading price on the date that is ten days immediately prior to the maturity date.
During the period ended March 31, 2026, the Company and four noteholders amended the terms of the convertible note agreements to retroactively accrue interest on their notes from the effective date of the agreements on a rate of 10%. During the period ended March 31, 2026, the Company recorded and accrued interest expense on the convertible notes in the amount of $16,027.
Company evaluated the conversion feature and determined that no embedded derivative liability existed on the issuance dates of the convertible notes. As of March 31, 2026 and December 31, 2025, the convertible notes payable principal balance was $940,000 and $940,000, respectively, and the accrued interest was $16,027 and $0, respectively. The Company calculated imputed interest on the zero percent convertible notes using an interest rate of 14% and recorded to additional paid-in-capital. As of March 31, 2026 and December 31, 2025, the Company recorded imputed interest of $27,309 and $119,040, respectively.
The Company evaluated the conversion feature and determined that, since the conversion price is fixed, no embedded derivative liability existed as of March 31, 2026. As March 31, 2026, the matured convertible notes would potentially be converted into common shares.
On November 3, 2025, the Company entered into a Convertible Notes Agreement and a Warrant Purchase Agreements (the “Purchase Agreements”), dated as of October 31, 2025, with two investors (the “Holders”) for their purchase of (i) 14% convertible secured promissory notes of the Company in the aggregate original principal amount of $2,000,000 payable on October 31, 2028 (the “Notes”) with a fixed conversion price of $0.08 and (ii) 5-year warrants to purchase 6,000,000 shares of the Company’s common stock at an exercise price of $0.08. The proceeds are to used to repay all amounts outstanding under those certain 14% secured promissory notes and credit card balances to the former President of the Company in the amounts of $917,966 and $408,486, respectively. The remainder of the proceeds were used for working capital and general corporate purposes. The Company’s obligations under the Notes are secured by a security interest in certain property granted by the Company for the benefit of Holders pursuant to the terms of a Security Agreement dated October 31, 2025, between the Company and the Holders and a Patent Security Agreement dated October 31, 2025, between the Company and Holders.
On February 11, 2026, the Company entered into two Promissory Note Agreements (the “Additional Notes”) with the Holders for an additional $200,000. The interest on the promissory note shall equal to shares of common stock of the Company for each note. Both the principal balance and the shares are payable on February 26, 2026. Per the agreement, If the loans were note repaid when matured, the Company will issue an additional shares of common stock for each note and shares every three months thereafter.
On March 17, 2026, the Company entered into a First Amendment to Note and Warrant Purchase Agreement (the “Amendment” or “Amended and Restated Note”) with the Holders. Pursuant to the Amended and Restated Note, the Company and the Holders combined the Existing Notes and the Additional Notes in their entirety under the terms of the Amended and Restated Note. Under the Amended and Restated Note, the maturity date of the Existing Notes was amended on March 26, 2026.
The Company recognized amortization on the debt discount of $612,338 during the period ended March 31, 2026. As of March 31, 2026 and December 31, 2025, the principal balance of the notes was $2,200,000 and $2,000,000. As of March 31, 2026 The unamortized debt discount was $0.
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