Related Parties |
3 Months Ended | |||
|---|---|---|---|---|
Mar. 31, 2026 | ||||
| Related Parties [Abstract] | ||||
| Related Parties |
The Company has entered into a number of transactions with related parties that have materially affected its liquidity, capital structure, and ownership. These related parties include Granite Peak Resources, LLC (“GPR”), entities affiliated with GPR, former significant stockholders, and executive consultants.
Granite Peak Resources, LLC
GPR is an entity controlled by the Company’s Chair and Chief Executive Officer, Tawana Bain, and is the Company’s controlling stockholder. As of March 31, 2026, GPR beneficially owned 11,476,572 shares of the Company’s common stock, representing approximately 81.4% of the Company’s outstanding common stock.
Line of Credit and Related-Party Financing
On March 16, 2020, the Company entered into a Line of Credit (“LOC”) agreement with GPR to provide working capital and fund operating expenses. Under the LOC, GPR also paid certain expenses directly on behalf of the Company to support its operations. The LOC was amended multiple times to increase borrowing capacity, extend maturity dates, modify conversion terms, and consolidate other outstanding obligations.
Pursuant to the Third Amendment, the LOC was increased to $52,500,000, the Senior Secured Promissory Note and the Flechner Judgment were consolidated into the LOC balance, and the Deed of Trust was increased to $250,000,000. The LOC bore interest at 10% per annum and was convertible into shares of ACRG common stock at $1.05 per share, as established under the Second Amendment, and was secured by the Company’s real and personal property and the equity interests of its subsidiary entities.
Debt-to-Equity Conversions
On December 31, 2025, GPR converted $1,727,152 of principal and accrued interest under the LOC into 1,644,906 shares of restricted common stock at a conversion price of $1.05 per share. Following this conversion, all outstanding principal and accrued interest under the LOC were fully extinguished.
For the three months ended March 31, 2026, the Company received cash proceeds of $272,114 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. Related-Party Operating Lease – Office Premises
The Company also leases its principal office space from SMS Lakewood, LLC, an affiliate of its majority stockholder. See Note 4 – Operating Lease – Related Party for a description of the lease terms, balances, and related-party considerations.
Sustainable Metals Solutions, LLC
On January 10, 2022, the Company entered into a definitive agreement to acquire a controlling interest in Sustainable Metals Solutions, LLC (“SMS”), a company majority-owned by GPR. SMS is an environmental development platform focused on producing carbon-neutral precious metals and minerals. The purchase price for the controlling interest will be determined based on the Company’s common stock price on the closing date, which will be mutually agreed upon once all closing conditions are satisfied. Additional details are provided in Note 8 – Commitments and Contingencies.
Related Party Transactions
The Company engages certain individuals as independent contractors to provide executive and strategic services. These individuals are considered related parties due to their roles as executive officers or their involvement in the Company’s strategic decision-making.
Accounts payable and accrued expenses include amounts due to related parties comprised primarily of fees for executive consulting services. As of March 31, 2026 and December 31, 2025, accounts payable to related parties totaled $58,190 and $45,155, respectively. Accrued expenses due to related parties totaled $5,000 as of March 31, 2026, and $7,500 as of December 31, 2025.
All related party balances are unsecured, non-interest bearing, and due on demand. |