| SCHEDULE OF WORKING CAPITAL |
SCHEDULE
OF WORKING CAPITAL
| | |
June 30, 2026 | | |
December 31, 2025 | |
| | |
| (Unaudited) | | |
| (Audited) | |
| Short-term borrowings | |
| - | | |
| 450,000 | |
| On May 27, 2025, the Company entered into five two year promissory notes with five accredited investors in the gross principal amount of $450,000. An original issue discount of $67,500 and guaranteed interest of $67,500 was applied on the issuance date, resulting in net loan proceeds to the Company of $315,000. The Notes are required to be paid in one lump sum payment of $450,000 on or before May 27, 2027. At any time after one hundred eighty days of the issuance date of the Notes, upon five (5) business days’ written notice to Lenders, the Company has the option of prepaying the outstanding principal amount of the Notes, in whole or in part, by paying to the Lenders a sum of money equal to one hundred twenty-five percent (125%) of the principal amount to be redeemed, together with any and all other sums due, accrued or payable to the Lenders arising under the Notes. During the notice period, Lenders shall have the option of converting the Notes, in whole or in part, pursuant to the terms set forth below. At any time after one hundred eighty days of the issuance date of the Notes, the Lenders may convert the outstanding unpaid principal amount of the Notes into restricted shares of Series D Convertible Preferred Stock of the Company at $7.50 per share (each share of Series D Convertible Preferred Stock in convertible into five shares of common stock). Each Lender agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock into which the Series D Convertible Preferred Stock is convertible into. There are no warrants or other derivatives attached to these Notes. The Company granted the Lenders piggy-back registration rights on the shares of common stock issuable upon conversion of the Series D Convertible Preferred Stock. The Company agreed to reserve a number of shares of Series D Convertible Preferred Stock, and common stock issuable upon conversion thereof, equal to three times the number of shares of Series D Convertible Preferred Stock (153,000 shares of Series D Convertible Preferred Stock in total), and common stock issuable upon conversion thereof (765,000 shares of common stock in total), which may be issuable upon conversion of the Notes at all times. In January of 2026, the Company converted the remaining balance into 60,000 Series D preferred shares. | |
| - | | |
| 450,000 | |
| On June 26, 2025, the Company entered into a note purchase agreement (the “Purchase Agreement”) with Streeterville Capital, LLC (“Streeterville”), pursuant to which the Company issued and sold to Streeterville a secured promissory note (the “Note”) in the original principal amount of $5,470,000. The Note carries an original issue discount of $450,000, and the Company agreed to pay $20,000 to Streeterville to cover its legal fees, accounting costs, due diligence, monitoring, and other transaction costs, each of which were deducted from the proceeds of the Note received by the Company. On the closing date, Streeterville paid $375,000 to the Company, and $4,625,000 was sent to an account at Lakeside Bank owned by the Company’s newly formed wholly owned subsidiary, ARH Sub, to be held pursuant to a Deposit Account Control Agreement (“DACA”), which is presented as restricted cash in the accompanying condensed consolidated balance sheets. Interest under the Note accrues at 10% per annum. The unpaid amount of the Note, together with any accrued interest, fees, and late charges, is due twenty-four months following the date of issuance. The Company may prepay all or any portion of the outstanding balance of the Note after 120 days from issuance. Commencing six months after the date of issuance and at any time thereafter until the Note is paid in full, Streeterville has the right to redeem up to $950,000 under the Note per month, which amount will be due and payable in cash within two trading days of the Company’s receipt of a redemption notice from Streeterville. The Company’s obligations under the Note and related agreements are secured by the DACA, a guaranty from ARH Sub (the “Guaranty”), and a pledge by the Company of all membership interests in ARH Sub (the “Pledge”) (collectively, the “Security Agreements”). On September 10, 2025, the Company entered into a global amendment to the Purchase Agreement and Note, pursuant to which Streeterville agreed to release $2,000,000 of funds held in the DACA to repay the Company’s outstanding Bank of America loan. In connection with the amendment, the Company agreed to pay Streeterville a $1,000,000 funds release fee. The Company and Streeterville further agreed to exchange $1,300,000 of the outstanding principal balance of the Note for a new convertible note (the “Convertible Note”). The transaction was accounted for as a debt extinguishment and the Company recognized a loss on debt extinguishment of $747,461 during the year ended December 31, 2025. The Convertible Note bears interest at 10% per annum and matures twenty-four months from issuance, consistent with the original Note. At any time following 180 days from the issuance date, Streeterville may elect to convert all or a portion of the outstanding principal and accrued interest into shares of the Company’s common stock at a 25% discount to the five-day VWAP preceding the conversion date. The number of shares issuable upon conversion is subject to a beneficial ownership limitation of 4.99%. The Company agreed to reserve a sufficient number of shares of common stock to satisfy future conversion obligations. During the six months ended June 30, 2026, the Company converted $4,803,087 of the balance into 9,174,597 shares of common stock. | |
| 2,744,574 | | |
| 6,480,000 | |
| On July 7, 2025, the Company entered into a Securities Purchase Agreement with 1800 Diagonal, pursuant to which 1800 Diagonal made a loan to the Company, evidenced by a promissory note in the principal amount of $296,700 (the “1800 Note”). An original issue discount of $38,700 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $250,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in ten payments, with the first payment of $229,015.15 due on January 15, 2026, and remaining nine payments of $13,701.76 on the fifteenth day of each month thereafter (a total payback to 1800 of $352,331). Upon the occurrence and during the continuation of any Event of Default, the 1800 Note shall become immediately due and payable and the Company will be obligated to pay to 1800 Diagonal, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the 1800 Note plus (x) accrued and unpaid interest on the unpaid principal amount of the 1800 Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to 1800 pursuant to the conversion rights referenced below. Only upon an occurrence of an event of default under the 1800 Note, 1800 Diagonal may convert the outstanding unpaid principal amount of the 1800 Note into restricted shares of common stock of the Company at a discount of 25% of the market price. 1800 Diagonal agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to the 1800 Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the 1800 Note at all times. In January of 2026, the Company converted the remaining balance into 830,901 shares of common stock. | |
| - | | |
| 296,700 | |
| On July 7, 2025, the Company entered into a Securities Purchase Agreement with Boot Capital LLC, an accredited investor (“Boot”), pursuant to which Boot made a loan to the Company, evidenced by a promissory note in the principal amount of $57,500 (the “Boot Note”). An original issue discount of $7,500 was applied on the issuance date, resulting in net loan proceeds to the Company of $50,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in ten payments, with the first payment of $44,382.65 due on January 15, 2026, and remaining nine payments of $2,655.38 on the fifteenth day of each month thereafter (a total payback to Boot of $68,281.00). Upon the occurrence and during the continuation of any Event of Default, the Boot Note shall become immediately due and payable and the Company will be obligated to pay to Boot, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the Boot Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Boot Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to Boot. Only upon an occurrence of an event of default under the Boot Note, Boot may convert the outstanding unpaid principal amount of the Boot Note into restricted shares of common stock of the Company at a discount of 25% of the market price. Boot agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to the Boot Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the Boot Note at all times. In January of 2026, the Company converted the remaining balance into 134,267 shares of common stock. | |
| - | | |
| 57,500 | |
| On August 25, 2025, the Company entered into a note agreement with 1800 Diagonal for a principal amount of $152,950, resulting in net proceeds of $125,000 after accounting for a $19,950 original issue discount and $8,000 in fees. The loan terms include a repayment schedule totaling $181,637, with the first payment of $118,064.05 due on February 28, 2026, followed by monthly payments of $7,063.67 and a final payment of $7,063.59 on November 30, 2026. In the event of default, the outstanding balance becomes immediately due, with an additional 22% annual interest and potential conversion rights into common stock at a 25% discount, subject to a 4.99% ownership cap. During the six months ended June 30, 2026, the Company converted the remaining balance into 1,790,514 shares of common stock. | |
| - | | |
| 152,950 | |
| The Company entered into a Membership Interest Purchase Agreement (“MIPA”) on September
15, 2025, to acquire all of the outstanding membership interests in 218 LLC, whose sole asset is a 20,829
square foot commercial retail building located at 218 3rd Avenue North, Nashville, Tennessee, for a total purchase price of $14.1
million. The purchase price is payable over twelve months, including the issuance of 280,000
shares of Series D Convertible Preferred Stock valued at $2.1
million for 30%
of the membership interests, three non-refundable cash installments of $100,000
each to acquire an additional 3%
of membership interests, and a 12-month promissory note of $11.7
million bearing 6%
interest. The Seller may convert portions of principal and interest under the note into Series D Convertible Preferred Stock and
subsequently into common stock, subject to a 4.99% beneficial ownership limitation. Each seller conversion is the equivalent to the Company purchasing an
additional 1% ownership interest in 218 LLC. During the six months ended June 30, 2026, the Company converted a portion of the
balance into 33,335
Series D preferred shares. | |
| 11,599,000 | | |
| 11,700,000 | |
| On October 14, 2025, the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending, LLC, an accredited investor (the “Lender”), pursuant to which the Lender made a loan to the Company, evidenced by a promissory note in the principal amount of $183,280 (the “Note”). An original issue discount of $25,280 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $158,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in fifteen payments. During the six months ended June 30, 2026, the Company converted the remaining balance into 420,021 shares of common stock. | |
| - | | |
| 152,868 | |
| On December 4, 2025, the Company, and two of its subsidiaries (American Rebel, Inc. and
Champion Safe Company, Inc.) entered into a commercially reasonable working capital line for Champion Safe Company, Inc. in the form
of a subordinated business loan and security agreement (“Loan”) with Agile Lending, LLC and Agile Capital Funding, LLC as
collateral agent, which provides for a term loan in the amount of $787,500,
which principal and interest is due on June 25, 2026. Commencing December 18, 2025, the Company is required to make weekly payments of
$40,500
until the due date, for a full repayment of $1,134,000.
The loan may be prepaid subject to a prepayment fee. An administrative agent fee of $37,500
was paid on the loan. A default interest rate of an additional 5%
will become effective upon the occurrence of an event of default. Funds were received by the Company on December 11, 2025. In connection
with the Loan, Agile was issued a subordinated secured promissory note, dated December 4, 2025, in the principal amount of $787,500
(the “Note”), which Note is secured by a second lien against all of the Borrower’s assets, including receivables, subject
to certain outstanding liens and agreements. As part of the Note and Loan, the Company reserved 2,893,010
shares of common stock for issuance upon conversion of the Loan. During the six months ended June 30, 2026, the Company converted a portion
of the balance into 128,240
Series D preferred shares. | |
| 255,385 | | |
| 748,681 | |
| On December 15, 2025, the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending, LLC, an accredited investor (“1800”), pursuant to which 1800 made a loan to the Company, evidenced by a promissory note in the principal amount of $152,950 (the “1800 Note”). An original issue discount of $19,950 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $125,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in ten payments, with the first payment of $90,814 due on June 15, 2026, eight payments of $10,090.45 on the fifteenth day of each month thereafter and a final payment of $10,090.40 due on March 15, 2027 (a total payback to 1800 of $181,628). Upon the occurrence and during the continuation of any Event of Default, the 1800 Note shall become immediately due and payable and the Company will be obligated to pay to 1800, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the 1800 Note plus (x) accrued and unpaid interest on the unpaid principal amount of the 1800 Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to 1800 pursuant to the conversion rights referenced below. Only upon an occurrence of an event of default under the 1800 Note, 1800 may convert the outstanding unpaid principal amount of the 1800 Note into restricted shares of common stock of the Company at a discount of 25% of the market price. 1800 agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to the 1800 Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the 1800 Note at all times. During the six months ended June 30, 2026, the Company converted the remaining balance into 1,718,693 shares of common stock. | |
| - | | |
| 152,950 | |
| On December 15, 2025, the Company entered into a Securities Purchase Agreement with Boot Capital LLC, an accredited investor (“Boot”), pursuant to which Boot made a loan to the Company, evidenced by a promissory note in the principal amount of $86,250 (the “Boot Note”). An original issue discount of $11,250 was applied on the issuance date, resulting in net loan proceeds to the Company of $75,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in ten payments, with the first payment of $51,210.50 due on June 15, 2026, eight payments of $5,690.06 on the fifteenth day of each month thereafter and a final payment of $5,690.02 due on March 15, 2027 (a total payback to Boot of $102,421). Upon the occurrence and during the continuation of any Event of Default, the Boot Note shall become immediately due and payable and the Company will be obligated to pay to Boot, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the Boot Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Boot Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to Boot pursuant to the conversion rights referenced below. Only upon an occurrence of an event of default under the Boot Note, Boot may convert the outstanding unpaid principal amount of the Boot Note into restricted shares of common stock of the Company at a discount of 25% of the market price. Boot agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to the Boot Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the Boot Note at all times. | |
| 46,298 | | |
| 86,250 | |
| On April 23, 2025, the Company entered into a promissory note with a supplier. The note has a three year term, principal balance of $110,976.80, bears interest at 7% and requires 36 monthly payments of $3,426.64. | |
| 70,557 | | |
| 88,283 | |
| On January 15, 2026, the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending, LLC, an accredited investor (the “Lender”), pursuant to which the Lender made a loan to the Company, evidenced by a promissory note in the principal amount of $181,700 (the “Note”). An original issue discount of $23,700 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $150,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in fifteen payments (six payments of $21,576.80 and nine payments of $9,589.69) for a total payback of $215,768. Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Company will be obligated to pay to the Lender, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Lender pursuant to the conversion rights referenced below. Only upon an occurrence of an event of default under the Note, the Lender may convert the outstanding unpaid principal amount of the Note into restricted shares of common stock of the Company at a discount of 25% of the market price. The Lender agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to this Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the Note at all times. | |
| 94,376 | | |
| - | |
| On March 9, 2026, the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending, LLC, an accredited investor (the “Lender”), pursuant to which the Lender made a loan to the Company, evidenced by a promissory note in the principal amount of $124,200 (the “Note”). An original issue discount of $16,200 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $100,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in fifteen payments (six payments of $14,748.70 and nine payments of $6,555) for a total payback of $147,487. Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Company will be obligated to pay to the Lender, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the Lender pursuant to the conversion rights referenced below. Only upon an occurrence of an event of default under the Note, the Lender may convert the outstanding unpaid principal amount of the Note into restricted shares of common stock of the Company at a discount of 25% of the market price. The Lender agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to this Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the Note at all times. | |
| 89,774 | | |
| - | |
| On April 10, 2026, the Company entered into a two-year promissory note with an accredited investor (the “Lender”) in the gross principal amount of $270,000 (the “Note”). An original issue discount of $40,500 and guaranteed interest of $40,500 was applied on the issuance date, resulting in net loan proceeds to the Company of $189,000. The Notes are required to be paid in one lump sum payment of $270,000 on or before April 6, 2028. In addition, on the 150th day after the issuance date of the Note, the Company shall pay the Lender a monitoring fee of $10,000. At any time after one hundred eighty days of the issuance date of the Note, the Company and the Lender may mutually agree to allow the Lender to convert the outstanding unpaid principal amount of the Note into restricted shares of Series D Convertible Preferred Stock of the Company at $7.50 per share (each share of Series D Convertible Preferred Stock in convertible into five shares of common stock). The Lender agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock into which the Series D Convertible Preferred Stock is convertible into. There are no warrants or other derivatives attached to the Note. The Company granted the Lender piggy-back registration rights on the shares of common stock issuable upon conversion of the Series D Convertible Preferred Stock. The Company agreed to reserve a number of shares of Series D Convertible Preferred Stock, and common stock issuable upon conversion thereof, equal to three times the number of shares of Series D Convertible Preferred Stock (36,000 shares of Series D Convertible Preferred Stock in total), and common stock issuable upon conversion thereof (180,000 shares of common stock in total), which may be issuable upon conversion of the Note at all times. | |
| 270,000 | | |
| - | |
| On June 1, 2026, the Company entered into a one-year convertible promissory note with one of its
vendors in the gross principal amount of $215,345.75
(the “Note”) The note bears interest at a rate of 10%
or $19,576.89 (which is included in the principal amount), with four equal payments of $53,836.44
due in quarterly installments. The maturity date of the note is June 1, 2027. At any time after the 180th day after the Issuance
Date, the Holder and Borrower may mutually agree to allow Holder the ability to convert all or any part of the outstanding and
unpaid amount of this Note into fully paid and non-assessable shares of the Borrower’s Series D Convertible Preferred Stock.
The Conversion Price for conversion into Preferred Stock shall mean $7.50
per share. | |
| 215,346 | | |
| - | |
| On June 9, 2026, the Company entered into a securities purchase agreement (the “SPA”) and a fifteen month promissory note with Quick Capital, LLC (the “Lender”) in the gross principal amount of $155,294.12 (the “Note”). An original issue discount of $23,294.12 and Lender legal fees of $7,000.00 were applied on the issuance date, resulting in net loan proceeds to the Company of $125,000. The Note is required to be paid in fifteen equal payments of $12,294.12 commencing on July 9, 2026 and continuing through September 9, 2027. The Note bears a one-time interest charge of $29,117.65, which represents an 18.75% guaranteed interest. At any time prior to the six month anniversary date of the issuance date of the Note, upon three trading days’ written notice to Lender, the Company has the option of prepaying the outstanding principal amount of the Note and any accrued and unpaid interest due thereon, in whole or in part, by paying to the Lender a sum of money equal to ninety-five percent (95%) of the principal amount to be redeemed, together with any and all other sums due, accrued or payable to the Lender arising under the Note. At any time following an occurrence of any Event of Default, the Lender may convert all or any part of the outstanding and unpaid principal, interest, fees, or any other obligation owed pursuant to the Note into fully paid and non-assessable shares of the Company’s common stock at a conversion price equal to 75% of the Company’s lowest traded price for the proceeding 5 trading days prior to conversion. The Lender agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to the Note. The Company granted the Lender piggy-back registration rights on the shares of common stock issuable upon conversion of the Note. The Company agreed to reserve a number of shares of common stock issuable upon conversion of the Note equal to four times the number of shares of common stock issuable upon conversion of the Note (10,955,493 shares of common stock as of the issuance date of the Note). | |
| 155,294 | | |
| - | |
| On June 12, 2026, the Company entered into a Securities Purchase Agreement with 1800 Diagonal
Lending, LLC (“1800”), pursuant to which 1800 made a loan to the Company, evidenced by a promissory note in the
principal amount of $124,200
(the “Note”). An original issue discount of $16,200
and fees of $8,000
were applied on the issuance date, resulting in net loan proceeds to the Company of $100,000.
Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in ten payments (nine payments of
$8,193.72
and one payment of $73,743.52)
for a total payback of $147,487.
Only upon an occurrence of an event of default under the Note, 1800 may convert the outstanding unpaid principal amount of the Note
into restricted shares of common stock of the Company at a discount of 25%
of the market price. 1800 agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock.
There are no warrants or other derivatives attached to this Note. The Company agreed to reserve a number of shares of common stock
equal to four times the number of shares of common stock which may be issuable upon conversion of the Note at all times. | |
| 124,200 | | |
| - | |
| On June 23, 2026, the Company entered into a Securities Purchase Agreement with 1800 Diagonal Lending, LLC (“1800”), pursuant to which 1800 made a loan to the Company, evidenced by a promissory note in the principal amount of $152,950 (the “Note”). An original issue discount of $19,950 and fees of $8,000 were applied on the issuance date, resulting in net loan proceeds to the Company of $125,000. Accrued, unpaid interest and outstanding principal, subject to adjustment, is required to be paid in fifteen payments ( six payments of $15,135.67 and nine payments of $10,090.44) a total payback to 1800 of $181,628. Upon the occurrence and during the continuation of any Event of Default, the Note shall become immediately due and payable and the Company will be obligated to pay to 1800, in full satisfaction of its obligations, an amount equal to 150% times the sum of (w) the then outstanding principal amount of the Note plus (x) accrued and unpaid interest on the unpaid principal amount of the Note to the date of payment plus (y) default interest, if any, at the rate of 22% per annum on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to 1800 pursuant to the conversion rights. Only upon an occurrence of an event of default under the Note, 1800 may convert the outstanding unpaid principal amount of the Note into restricted shares of common stock of the Company at a discount of 25% of the market price. 1800 agreed to limit the amount of stock received to less than 4.99% of the total outstanding common stock. There are no warrants or other derivatives attached to this Note. The Company agreed to reserve a number of shares of common stock equal to four times the number of shares of common stock which may be issuable upon conversion of the Note at all times. | |
| 152,950 | | |
| - | |
| Short
term borrowings | |
| 152,950 | | |
| - | |
| Less: unamortized note discount and fees | |
| (1,204,935 | ) | |
| (749,796 | ) |
| Total
recorded as a current liability | |
$ | 14,612,819 | | |
$ | 19,616,386 | |
|