[1]

On August 1, 2022, we closed a Membership Interest Purchase Agreement, (the “MIPA”), with Jorgan Development, LLC, (“Jorgan”) and JBAH Holdings, LLC (“JBAH”), as the equity holders of Silver Fuels Delhi, LLC (“SFD”) and White Claw Colorado City, LLC (“WCCC”) whereby, the Company acquired all of the issued and outstanding membership interests in each of SFD and WCCC, making SFD and WCCC wholly owned subsidiaries of the Company. The consideration for the membership interests included secured three-year promissory notes in the amount of $286,643 to JBAH and $28,377,641 to Jorgan, which accrue interest of prime plus 3% on the outstanding balance of the notes. Under the MIPA, the Company has committed to make a payment to Jorgan and JBAH on or before February 1, 2024 in the amounts of $16,306,754 to Jorgan and $164,715 to JBAH, whether in cash or unrestricted common stock. In the event of a breach of the terms of the notes, the sole and exclusive remedy of the holder of the notes will be to unwind the MIPA transaction. The principal amount of the notes, together with any and all accrued and unpaid interest thereon, will be paid on a monthly basis in an amount equal to the Monthly Free Cash Flow continuing thereafter on the twentieth (20^th) calendar day of each calendar month thereafter. Monthly Free Cash Flow means cash proceeds received by SFD and WCCC from its operations minus any capital expenditures (including, but not limited to, maintenance capital expenditures and expenditures for personal protective equipment, additions to the land/current facilities and pipeline connections) and any payments on the lease obligations of SFD and WCCC. In October 2022, we entered into an agreement amending the notes issued as consideration in the MIPA, whereby, as soon as is practical, following the approval of the Company’s shareholders (which was obtained in November 2023), the Company issued 7,042,254 restricted shares of the Company’s Common Stock (the “Exchange Shares”) in exchange for the forgiveness and cancellation of $10,000,000 of principal (the “Cancelled Debt Principal”) under the Note, reflecting a conversion price of $1.42 per share (the “Exchange”). The Company’s shareholders approved the Exchange and the Exchange Shares were issued on November 10, 2023 (the “Exchange Date”). As of the Exchange Date, the Exchange Shares had a fair value of approximately $5.6 million. The Exchange was accounted for as a troubled debt restructuring under ASC 470 – Debt (“ASC 470”), as (i) the Company was determined be experiencing financial difficulties as defined by ASC 470-60, and (ii) the Cancelled Debt Principal exceeded the fair value of the Exchange Shares by approximately $4.4 million, resulting in a lower effective borrowing rate on the Note as a result of the Exchange, and thus the Exchange was determined to result in a concession by the Lender. The Company performed a comparison of the undiscounted cash flows associated with the Note subsequent to the Exchange to the carrying value of the Note as of the Exchange date. The net carrying value of the Note was determined to exceed the undiscounted future cash flows by approximately $1.2 million (the “Excess Carrying Value”). The Note was thus written down to the amount of the undiscounted future cash flows on the Note from the Exchange Date to maturity. Further, as the Lender is a related party of the Company, the Excess Carrying Value was accounted for as a capital transaction and no gain or loss was recognized related to the restructuring. Once the registration statement is declared effective by the SEC, the note payment will count against the threshold payment amount, as defined in the notes and the MIPA, and no other material terms of the original note were changed as a result of the conversion. Upon the closing of our acquisition of the Endeavor Entities, the parties of that certain Membership Interest Purchase Agreement dated June 15, 2022, and the Amendment of Transaction Documents Related to Threshold Payment dated March 31, 2024 (together, the “2022 MIPA”), agreed that Section 8.7 Unwinding of the 2022 MIPA expired and is no longer enforceable. As a result, the selling entities in the 2022 MIPA no longer have the right to unwind our acquisitions of White Claw Colorado City and Silver Fuels Dehli.

[2]

On May 14, 2024, we issued a promissory note (the “Note”), to James Ballengee, in the principal amount of up to $1,500,000, for which loan advances will be made to the Company as requested. The Company will use the proceeds of the Note for general working capital purposes and to repay certain indebtedness. The intent of the Note is to be short term in nature and be repaid in 30 days. Any amounts that are not repaid in 30 days will bear interest thereafter at a rate of 11% per annum. Each advance matures after six months from the date the Company receives the funds. On May 23, 2024, we issued a promissory note to Ballengee Holdings, LLC, of which our Chief Executive Officer is the beneficial owner, which replaced and rescinded the above referenced note with James Ballengee effective back to May 14, 2024, under the same terms such that all obligations under the notes are the responsibility of Ballengee Holdings, LLC and the prior note with James Ballengee is no longer enforceable.

[3]

On June 13, 2024, the Company owed our Chief Financial Officer $1,167,750 in accrued salary and bonuses, plus interest (together, the “Accrued Compensation”), for serving as the Company’s Chief Financial, and executed a Settlement Agreement, where the Company and the CFO agreed the Accrued Compensation would be paid under of a straight promissory note in the principal amount of the Accrued Compensation (the “Note”). Under the terms of the Note, the amounts due will accrue interest at 8% per annum and will be paid by paying 5% of any money received by the Company from closed future financings or acquisition/merger/sale transactions until the Note has been paid in full. In the event the Note has not been paid in full by December 31, 2024, the Note will mature and any amounts due thereunder will be due and payable in full on such date. In February 2025, the parties agreed to extend this note to June 30, 2025.

[4]

Upon the Closing of our acquisition of the Endeavor Entities, the Company acquired a certain lending agreement dated September 27, 2024. Under the Agile Agreement, the listed borrowers received $1,420,000 in October 2024, and is required to make weekly payments of $126,000. The note matures on April 29, 2025.

[5]

Upon the Closing of our acquisition of the Endeavor Entities, the Company acquired a certain lending agreement dated August 2, 2023, which our Chief Executive Officer is the beneficial owner. Under this agreement, the we borrowed $1,182,193, which bears interest at 8.75%. The note matures in December 2028.