v3.26.1
Convertible Notes Payable
 3 Months Ended
Mar. 31, 2026
Convertible Notes Payable [Abstract]  
CONVERTIBLE NOTES PAYABLE

7. CONVERTIBLE NOTES PAYABLE

 

Lind Notes Payable

 

On November 17, 2023, the Company entered another securities purchase agreement with Lind, pursuant to which the Company issued Lind a secured, convertible note (the “2nd Lind Note”) in the principal amount of $1,200,000, for a purchase price of $1,000,000, that is convertible into shares of the Company’s common stock at a conversion price, which shall be the lesser of (i) $3.50 and (ii) 90% of the average of the three lowest VWAPs during the 20 trading days prior to conversion. The 2nd Lind Note shall be due and payable on May 19, 2025 and bears no interest. The Company may prepay all, but not less than all, outstanding principal amount prior to maturity, and Lind shall have the right to convert up to one third of the principal amount when the Company prepays. Upon the occurrence of any Event of Default (as defined in the 2nd Lind Note), the Company must pay Lind an amount equal to 120% of the then outstanding principal amount of the Lind Note, in addition to any other remedies under the Note or the other transaction documents. Lind also received a 5-year common stock purchase warrant to purchase up to 1,000,000 shares of the Company’s common stock at an initial exercise price of $2 per share for a period of 5 years. The warrants were valued using the Black-Scholes model. The fair value of the warrants was determined to be $480,795, which was recorded to debt discount. An amendment was filed with the SEC on February 29, 2024 to disclose that due to Nasdaq requirements, the parties entered into an amendment to the Note, pursuant to which the conversion price shall have a floor price of $1.00. Additionally, the amendment requires the Company to make a cash payment to Lind if in connection with a conversion, the conversion price is deemed to be the floor price. During the year ended December 31, 2024, Lind converted $800,000 of 2nd Lind Note principal amounts into the Company’s common stocks. Refer to the common stock issuance details in Note 12, Equity. As of April 1, 2025, Lind has converted the remaining $400,000 principal balance into the Company’s common stocks.

 

On January 17, 2024, the Company entered another securities purchase agreement with Lind, pursuant to which the Company issued Lind a secured, convertible note (the “3rd Lind Note”) in the principal amount of $1,000,000, for a purchase price of $833,333, that is convertible into shares of the Company’s common stock at a conversion price, which shall be the lesser of (i) $3.50 and (ii) 90% of the average of the three lowest VWAPs during the 20 trading days prior to conversion. The 3rd Lind Note shall be due and payable on July 17, 2025 and bears no interest. The Company may prepay all, but not less than all, outstanding principal amount prior to maturity, and Lind shall have the right to convert up to one third of the principal amount when the Company prepays. Upon the occurrence of any Event of Default (as defined in the 3rd Lind Note), the Company must pay Lind an amount equal to 120% of the then outstanding principal amount of the Lind Note, in addition to any other remedies under the Note or the other transaction documents Lind also received a 5-year, common stock purchase warrant to purchase up to 1,000,000 shares of the Company’s common stock at an initial exercise price of $2 per share. The warrants were valued using the Black-Scholes model. The fair value of the warrants was determined to be $394,071, which was recorded to debt discount. An amendment was filed with the SEC on February 29, 2024 to disclose that due to Nasdaq requirements, the parties entered into an amendment to the Note, pursuant to which the conversion price shall have a floor price of $1.00. Additionally, the amendment requires the Company to make a cash payment to Lind if in connection with a conversion, the conversion price is deemed to be the floor price.

On March 3, 2025, April 1, 2025, May 14, 2025, June 5, 2025, and July 9, 2025, Lind converted $1,000,000 ($200,000 in each conversion) principal balance on 3rd Lind Note into 1,000,000 shares of the Company’s common stocks. The 3rd Lind Note balance was fully converted by July 9, 2025.

 

In connection with above three Lind Note offerings, the Company and its subsidiaries: BioKey, BioLite, Biolite BVI, and American BriVision, jointly and severally guaranteed all of the obligations of the Company in connection with the offering with certain collateral, as set forth in the related transaction documents.

 

On May 22, 2024, November 19, 2024, January 9, 2025, July 1, 2025, and January 20, 2026 Lind exercised 1,000,000, 500,000, 1,029,167, 500,000, and 102,000 of the existing warrants to purchase shares of Common Stock at a reduced exercise price of $0.75, $0.42, $0.40, $1.0 and $1.0 per share, respectively. Refer to the details in Note 12, Equity.

 

Total interest expenses in connection with the above three Lind Notes were $0 and $209,372 for the three months ended March 31, 2026 and 2025, respectively.

 

Other Convertible Notes Payable

 

On November 1, 2024 and November 5, 2024, the Company’s subsidiary, AiBtl, issued two convertible notes payable, each with a principal amount of $30,000 to two separate individuals, for total consideration of $60,000. Each note has a 1-year term and an implied annual discount rate of 6.89%. These convertible notes bear 0% interest rate and are convertible by the holders into AiBtl’s common stock at $5 per share at any time before maturity. AiBtl reserves the right to repurchase the note in full at any time before maturity. AiBtl and the investors mutually agreed to renewed these convertible notes for another year, expiring on November 1, 2026 and November 5, 2026, respectively.

 

The convertible notes payable is accounted for in accordance with ASC 470-20, Debt with Conversion and Other Options. The Company evaluated the conversion feature and determined that it qualifies for equity classification as it meets the “fixed-for-fixed” criteria. The proceeds from the issuance were allocated to the present value of the liability component in aggregate for $56,132, and to debt discount for $3,867. The debt discount is recorded in additional paid-in capital in the statement of change in equity. The debt discount is being amortized over the 1-year term using the effective interest method. During the three months ended March 31, 2026 and 2025, the Company recognized $0 and $984 in interest expense related to the amortization of the debt discount.

 

On April 5, 2025, AiBtl issued a convertible note payable with a principal amount of $9,010 to an individual investor, for total consideration of $9,010. The note has a 1-year term and an implied annual discount rate of 6.89%. with a 0% stated interest rate and is convertible by the holders into AiBtl’s common stock at $5 per share at any time before maturity. AiBtl reserves the right to repurchase the note in full at any time before maturity.

 

On December 3, December 8, and December 26, 2025, AiBtl issued three convertible notes payable to an individual investor, with a principal amount of $240,000, $100,000, and $150,000, respectively, for total consideration equal to the principal amounts. These notes, with identical terms, have a 1-year term and state annual interest rate of 20%, and are convertible by the holders into AiBtl’s common stock at $7.5 per share at any time before maturity. AiBtl reserves the right to repurchase the note in full at any time before maturity.

 

For the three months ended March 31, 2026, the Company recognized $24,501 in total interest expense associated with the aforementioned convertible notes.

 

Convertible Notes Payable – Related Party

 

On July 8, 2025, AiBtl issued a convertible note payable with a principal amount of $150,000 to an employee of the Company, a related party, for total consideration of $150,000. The note has a 1-year term with a 0% interest rate and is convertible by the holders into AiBtl’s common stock at $10 per share at any time before maturity. AiBtl reserves the right to repurchase the note in full at any time before maturity. This note was repaid in December 2025.

 

On December 8 and December 30, 2025, AiBtl issued two convertible notes payable with principal amounts of $150,000 and $90,000, respectively, to an employee of the Company, a related party, for total consideration equal to the principal amounts. The notes have a 1-year term with a 20% interest rate and are convertible by the holders into AiBtl’s common stock at $7.5 per share at any time before maturity. AiBtl reserves the right to repurchase the note in full at any time before maturity.

 

For the three months ended March 31, 2026, the Company recognized $1,200 in total interest expense associated with the aforementioned convertible notes.

The carrying amounts of the liability component are summarized as follows:

 

March 31, 2026  Issuance
Entity		  Issuance
Date		  Maturity
Date		  Principal
Amount at
Issuance		   Stated
Interest
Rate		   Conversion
Price		   Common
Stock
to be
converted		  Principal
Amount at
Balance
Sheet Date		   Carrying
Value		   Fair
Value		 
Other Note  AiBtl  November 1, 2024  November 1, 2026  $30,000    0%  $5.00   AiBtl  $30,000    30,000    30,000 
Other Note  AiBtl  November 5, 2024  November 5, 2026   30,000    0%  $5.00   AiBtl   30,000    30,000    30,000 
Other Note  AiBtl  April 6, 2025  April 6, 2026   9,010    0%  $5.00   AiBtl   9,010    9,010    9,010 
Other Note  AiBtl  December 3, 2025  December 3, 2026   240,000    20%  $7.50   AiBtl   240,000    240,000    240,000 
Other Note  AiBtl  December 8, 2025  December 8, 2026   100,000    20%  $7.50   AiBtl   100,000    100,000    100,000 
Other Note  AiBtl  December 26, 2025  December 26, 2026   150,000    20%  $7.50   AiBtl   150,000    150,000    150,000 
            $559,010                $559,010   $559,010   $559,010 

 

March 31, 2026  Issuance
Entity		  Issuance
Date		  Maturity
Date		  Principal
Amount at
Issuance		   Stated
Interest
Rate		   Conversion
Price		   Common
Stock
to be
converted		  Principal
Amount at
Balance
Sheet Date		   Carrying
Value		   Fair
Value		 
Convertible note – related party  AiBtl  December 8, 2025  December 8, 2026  $150,000    20%  $7.50   AiBtl  $150,000   $150,000   $150,000 
Convertible note – related party  AiBtl  December 30, 2025  December 30, 2026   90,000    20%  $7.50   AiBtl   90,000    90,000    90,000 
            $240,000                $240,000   $240,000   $240,000 

 

December 31, 2025  Issuance
Entity		  Issuance
Date		  Maturity
Date		  Principal
Amount at
Issuance		   Stated
Interest
Rate		   Conversion
Price		   Common
Stock
to be
converted		  Principal
Amount at
Balance
Sheet Date		   Carrying
Value		   Fair
Value		 
Other Note  AiBtl  November 1, 2024  November 1, 2025*  $30,000    0%  $5.00   AiBtl  $30,000    30,000    30,000 
Other Note  AiBtl  November 5, 2024  November 5, 2025*   30,000    0%  $5.00   AiBtl   30,000    30,000    30,000 
Other Note  AiBtl  April 6, 2025  April 6, 2026   9,010    0%  $5.00   AiBtl   9,010    9,010    9,010 
Other Note  AiBtl  December 3, 2025  December 3, 2026   240,000    20%  $7.50   AiBtl   240,000    240,000    240,000 
Other Note  AiBtl  December 8, 2025  December 8, 2026   100,000    20%  $7.50   AiBtl   100,000    100,000    100,000 
Other Note  AiBtl  December 26, 2025  December 26, 2026   150,000    20%  $7.50   AiBtl   150,000    150,000    150,000 
            $559,010                $559,010   $559,010   $559,010 

 

December 31, 2025  Issuance
Entity		  Issuance
Date		  Maturity
Date		  Principal
Amount at
Issuance		   Stated
Interest
Rate		   Conversion
Price		   Common
Stock
to be
converted		  Principal
Amount at
Balance
Sheet Date		   Carrying
Value		   Fair
Value		 
Convertible note – related party  AiBtl  December 8, 2025  December 8, 2026  $150,000    20%  $7.50   AiBtl  $150,000   $150,000   $150,000 
Convertible note – related party  AiBtl  December 30, 2025  December 30, 2026   90,000    20%  $7.50   AiBtl   90,000    90,000    90,000 
            $240,000                $240,000   $240,000   $240,000