NOTES PAYABLE |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Debt Disclosure [Abstract] | |
| NOTES PAYABLE | NOTE 6 – NOTES PAYABLE
The Company has a 30-year unsecured note payable with the U.S. Small Business Administration. The note payable incurred a $100 fee upon issuance and incurs interest at 3.75% per annum. Payments totaling $4 are due each year through the maturity date of July 1, 2050.
As of June 30, 2026 and December 31, 2025, the balance of the note payable was $59 and $59, respectively.
Convertible Notes
In fiscal year 2025, the Company entered into three unsecured convertible note agreements with third-party lenders, with principal amounts ranging from approximately $300 to $360, bearing stated interest rates of 10%, and original issue discounts ranging from $50 to $60. The notes have terms of six to twelve months, with maturities between December 2025 and August 2026. As of June 30, 2026, one note was paid off and two others remained outstanding.
Each note may be converted into shares of the Company’s common stock at a fixed conversion price of $2.00 per share, subject to adjustment in the event of default, at which point the conversion price may be reduced to the lower of $2.00 and 80% of the volume-weighted average price (VWAP) of the Company’s common stock for a specified period preceding conversion. Certain notes include provisions for fixed monthly payments beginning after a defined period, and others permit early conversion at the lender’s discretion.
On April 3, 2026, AppTech Payments Corp. issued an aggregate of $1,000 principal amount of 18% convertible promissory notes to two lenders in a private placement. The notes were issued at a discount for aggregate proceeds of $877 and mature fourteen months from issuance, with amortization payments beginning May 2026.
The notes are convertible into shares of the Company’s common stock at a fixed conversion price of $2.00 per share, subject to customary adjustments and a beneficial ownership limitation. In connection with the financing, the Company granted warrants to purchase an aggregate of 1,000,000 shares of common stock at an exercise price of $1.00 per share, with a five-year term, subject to adjustment provisions for the exercise price. The relative fair value allocated to the warrants was approximately $270 and was recorded as a debt discount to the notes upon issuance. The debt discount is being amortized over the term of the notes.
As of June 30, 2026 and December 31, 2025, the aggregate principal balance of these notes was approximately $1,184 and $783, respectively, and accrued interest totaled approximately $11 at June 30, 2026 and $31 at December 31, 2025.
Related Party Liabilities
On October 21, 2025, the Company entered into a revenue participation agreement with a related party for an initial $1,500 investment, which increased to $2,000 in February 2026. The holder is entitled to 1.75% of gross contract revenue (subject to increase up to 10%) and minimum monthly payments ranging from $4 to $73 through December 31, 2029, based on the greater of the revenue share or contractual minimums. The obligation is secured by a pledge of 10% of intellectual property-related revenues and 10% of the issued and outstanding equity of Infinitus Pay, Inc. The Company is required to repay the investment over the final 18 months of the term. The agreement includes (i) a participant put option, exercisable beginning December 31, 2027, requiring repayment at an amount that provides a 20% internal rate of return, and (ii) a Company call option permitting early termination subject to payment of a premium designed to provide a 28% internal rate of return. As of June 30, 2026, the balance of the participation liability was $2,181 and interest paid during the six months ended June 30, 2026 was $42 thousand.
On October 29, 2025, we secured a $1,000 loan with an interest rate of 24% with a current investor and board member. The note is interest-only through March 2026, and thereafter will be paid in full with ten equal payments of principal and interest ending on December 2026. The note is secured by our accounts receivable and 10% of the Infinitus Pay, Inc stock. As of June 30, 2026, the balance of the loan is $850 and interest of $114 had been paid.
The former CEO is owed approximately $102 related to expense reimbursements. The payable was recorded in accounts payable at June 30, 2026, however, the full amount was paid in July 2026.
On June 26, 2026, we entered into a $500 promissory note with a family member of a current board member. The note bears interest at 9% per annum, with no principal or interest payments due prior to maturity. The outstanding principal balance, together with all accrued and unpaid interest, is due in full ninety days from the issuance date. As of June 30, 2026, the outstanding principal balance was $500 and accrued interest was immaterial.
See Note 9 – Subsequent Events for an update on the loan.
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