v3.26.1
Note 6 - Debt
6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Debt Disclosure [Text Block]

(6)        Debt

 

In December 2013, the Company entered into a promissory note agreement with its then Chairman of the Board and one of our major shareholders, pursuant to which we borrowed $500,000 (the 2013 Promissory Note) which has a current maturity date of March 31, 2031. The 2013 Promissory Note is unsecured and bears interest at 6% per annum and was originally due June 30, 2014. According to the terms of the 2013 Promissory Note, at any time, the lenders could settle any or all of the principal and accrued interest with shares of our common stock. Between 2014 and 2024, the 2013 Promissory Note was modified to extend the maturity date five times with the fifth modification extending the maturity date to March 31, 2026. In August 2025, the 2013 Promissory Note was modified again to extend the maturity date to March 31, 2028, with all remaining terms unchanged. On June 30, 2026, the 2013 Promissory Note was modified again to extend the maturity date to March 31, 2031, add a voluntary lender conversion right at $0.07 per share of the Company's common stock, and add a Company forced-conversion right exercisable up thirty (30) consecutive Trading Day at or above a VWAP of $0.12 per share. At June 30, 2026, accrued interest payable on the 2013 Promissory Note was $376,734.

 

In April 2018, the Company borrowed $120,000 from its then Chief Executive Officer and Chairman of the Board pursuant to a promissory note (the 2018 Promissory Note) which has a current maturity date of March 31, 2031. The 2018 Promissory Note accrues interest at 6% per annum, which is payable upon maturity of the 2018 Promissory Note. The 2018 Promissory Note was originally unsecured and originally matured on August 1, 2018. At any time, lenders could settle any or all of the principal and accrued interest with shares of our common stock. Between 2014 and 2024, the 2013 Promissory Note was modified to extend the maturity date six times with the sixth modification extending the maturity date to March 31, 2026. In August 2025, the 2018 Promissory Note was modified to extend the maturity date to March 31, 2028, with all remaining terms unchanged. On June 30, 2026, the 2018 Promissory Note was modified to extend the maturity date to March 31, 2031, add a voluntary lender conversion right at $0.07 per share of the Company's common stock, and add a Company forced-conversion right exercisable up thirty (30) consecutive Trading Day at or above a VWAP of $0.12 per share. At June 30, 2026, accrued interest on the 2018 Promissory Note totaled $58,970.

 

In December 2019 and February 2020, the Company borrowed an aggregate of $1,000,000 from four of the Company’s major shareholders pursuant to a promissory note (the 2019 Promissory Note) which has a current maturity date of March 31, 2031. The 2019 Promissory Note bears an interest rate of 4% annually and was originally due December 31, 2022. According to the terms of the 2019 Promissory Note, at any time, the lenders could settle any or all of the principal and accrued interest with shares of the Company’s common stock based on the average closing price of the Company’s common stock for the 20 days preceding the payment. In December 2022, the 2019 Promissory Note was modified to extend the maturity date to December 31, 2024, with all remaining terms unchanged. In February 2024, the 2019 Promissory Note was modified to extend the maturity date to March 31, 2026, with all remaining terms unchanged. In August 2025, the 2019 Promissory Note was modified to extend the maturity date to March 31, 2028, with all remaining terms unchanged. On June 30, 2026, the 2019 Promissory Note was modified to extend the maturity date to March 31, 2031, add a voluntary lender conversion right at $0.07 per share of the Company's common stock, and add a Company forced-conversion right exercisable up thirty (30) consecutive Trading Day at or above a VWAP of $0.12 per share. At June 30, 2026, the accrued interest on the 2019 Promissory Note totaled $259,130.

 

In June  2026, the Company borrowed $500,000 from Kershner Grosso & Co., which is managed by the Company's Chairman of the Board (the 2026 Promissory Note). 
The 2026 Promissory Note has a maturity date of June 30,  2031 with an interest rate of 5% per annum, and such interest shall be calculated and paid annually on each anniversary date of the Signing Date. For the first two years of the Note, the Company may elect to pay interest either in cash or in kind. However, following the two-year period, interest on the outstanding principal shall be payable only in cash to the Lender. The Lender has the right to convert the Note at any time to shares of Common Stock at a conversion price of $0.07, rounded down to the nearest share. Beginning six months after the Signing Date, the Company may call the outstanding Note, plus accrued interest, for conversion into Common Stock, so long as the volume weighted-average closing price of the Company stock over a 30 day period is greater than $0.12 per share.

 

In June 2023, the Company executed an asset purchase agreement with AMICI, Inc. for the purchase of medical devices and related assets and intellectual property rights. In connection with the asset purchase agreement, the Company issued a promissory note to AMICI, Inc. with a principal amount of $558,593. According to the terms of the note, the Company made an initial cash payment of $100,000 into escrow, issued the seller $25,000 in shares of the Company’s common stock, and paid the seller $6,493 in a closing cash reimbursement payment. For the remaining principal balance of the promissory note of $427,100, the Company is required to pay the seller a minimum of $10,000 per month for a period of 45 months. The amount due was not subject to interest until the 25th month after the anniversary of the closing of the transaction. At June 30, 2026, the balance of this promissory note was $67,100.