Debt |
3 Months Ended | |||
|---|---|---|---|---|
Mar. 31, 2026 | ||||
| Debt [Abstract] | ||||
| Debt |
Convertible Promissory Notes Payable – Related Party
On March 16, 2020, the Company entered into a Line of Credit (“LOC”) agreement with Granite Peak Resources, LLC (“GPR”), a related party and the Company’s majority stockholder. The LOC, as amended from time to time, provided for borrowings of up to $52.5 million, accrued interest at 10% per annum, was secured by substantially all of the Company’s assets, and was convertible into common stock at a conversion price of $1.05 per share, and had a final contractual maturity date of March 16, 2027
On December 31, 2025, GPR converted the remaining $1,727,152 of principal and accrued interest into 1,644,906 shares of restricted common stock at the contractual conversion price of $1.05 per share.
For the three months ended March 31, 2026 and 2025, the Company received cash proceeds of $272,114 and $239,203, respectively, under the LOC. As of March 31, 2026, outstanding principal and accrued interest owed to GPR under the LOC totaled $272,114 and $2,742, respectively. As of December 31, 2025, there was outstanding principal or accrued interest under the LOC.
Promissory Note – LaunchIT
In November 2025, the Company entered into a Share Return, Payment, and SWIS LLC Transfer Agreement (the “LaunchIT Agreement”) with LaunchIT LLC (“LaunchIT”), pursuant to which the Company rescinded its prior acquisition of SWIS LLC. Total consideration payable to LaunchIT under the LaunchIT Agreement was $230,000, consisting of an advance payment of $125,000 (the “Advance”) and a promissory note dated November 21, 2025 in the original principal amount of $105,000 (the “LaunchIT Note”). The LaunchIT Note bore stated interest unless in default and was originally payable in four equal monthly installments of $26,250, due January 1 through April 1, 2026. Upon default, overdue amounts accrue interest at 15% per annum and a late fee of $2,500 per missed installment is payable.
The Company and LaunchIT engaged in good-faith discussions during the quarter regarding the restructuring of the obligation under the LaunchIT Note. The scheduled installment payments due January 1, February 1, March 1, and April 1, 2026 were not made on their original due dates, and the LaunchIT Note was therefore in default as of March 31, 2026. These discussions culminated in the execution of a First Amendment to Promissory Note and Waiver of Default on May 19, 2026 (described under “Subsequent Amendment and Waiver of Default” below). As of March 31, 2026, the LaunchIT Note principal of $105,000 is classified as a current liability, the outstanding Advance balance of $75,000 is included within accounts payable, and accrued late fees and default interest of $9,272 are included within accrued interest on the condensed consolidated balance sheet. LaunchIT has not declared acceleration, commenced any enforcement action, or filed any lien against the Company in connection with the obligation. Subsequent Amendment and Waiver of Default
On May 19, 2026, the Company and LaunchIT entered into a First Amendment to Promissory Note and Waiver of Default (the “Amendment”). Pursuant to the Amendment, the Company paid LaunchIT $15,000 and the parties agreed to consolidate the outstanding obligations under the LaunchIT Agreement into an amended principal balance of $165,000. LaunchIT conditionally waived the existing defaults and suspended accrued default interest through the amendment effective date, in each case subject to reinstatement upon a “Springing Default” as described below. Late fees of $2,500 per month continue to accrue under the original terms of the LaunchIT Note. A conditional resolution discount of $10,000 will be applied upon full and timely payment of all amounts due, subject to clawback upon a Springing Default.
Under the amended payment schedule, the Company is required to make six monthly installments of $5,000 each, payable on the last day of each calendar month from June 30, 2026 through November 30, 2026, with a final payment of $162,500 due on or before December 31, 2026 (the “Amended Maturity Date”). A Springing Default occurs if the Company fails to pay two consecutive monthly installments or fails to pay the remaining balance by the Amended Maturity Date. Upon a Springing Default, all waivers and interest suspensions terminate, the suspended default interest retroactively reinstates at 15% per annum from the original default dates, and the resolution discount is clawed back. As of the amendment effective date, no event of default exists under the LaunchIT Note as amended.
The LaunchIT Note and related Advance balances remain classified as current liabilities as of March 31, 2026. The Amendment is a non-recognized subsequent event; accordingly, no adjustments have been made to the March 31, 2026 financial statements. |