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Debt
 3 Months Ended
Mar. 31, 2025
Debt [Abstract]  
DEBT

NOTE 10 —  DEBT

 

Convertible Notes

 

At various dates during the first quarter of 2024, the Company issued convertible notes of $527,500 to meet our working capital requirements. At various dates during September and October 2024, the Company and three separate investors amended their respective convertible notes, resulting in a total of approximately an additional 2,707 common shares due upon conversion. As of December 31, 2024, there were five separate outstanding convertible notes, which are convertible into an aggregate of approximately 70,000 common shares. The outstanding balance on convertible notes was $527,500 as of December 31, 2024.

 

During the three months ended March 31, 2025, holders converted an aggregate of $527,500 principal amount of convertible notes into 67,896 shares of common stock. As of March 31, 2025, convertible notes representing 1,800 shares remained outstanding and subject to conversion.

Short-term Notes Payable

 

EF Hutton LLC

 

On February 1, 2024, the Company executed a Promissory Note with EF Hutton, totaling $2,200,000, to cover underwriters’ fees associated with the closure of the Company’s Merger with HBC. In the case of an event of default, this Note shall bear interest at a rate of 24% per annum until such event of default is cured. The principal amount of this Promissory Note is payable on designated dates, with $183,333 scheduled on the first business day of each month until the final payment on March 1, 2025. As of March 31, 2025, the Company was in default of the Promissory Note due to non-payment of scheduled installments, and the Promissory Note is accruing interest at the default rate of 24% per annum. The Company is in the process of negotiating an amendment to the terms of the Promissory Note. The outstanding balance of the Promissory Note amounted to $1,283,335 as of March 31, 2025 and December 31, 2024.

 

Benesch Friedlander Coplan & Aronoff LLP

 

On April 29, 2024, the Company executed a Promissory Note with Benesch Friedlander Coplan & Aronoff in the amount of $670,000. The interest rate is 7% per annum, to be paid as a lump sum at the maturity date of November 1, 2024.

 

On November 12, 2024, the Company amended the terms of its Promissory Note with Benesch Friedlander Coplan & Aronoff. The amended terms include an updated principal balance of $694,061, which includes unpaid interest expense of $24,061 from earlier periods, an increase in the interest rate to 10% per annum, an upfront payment of $40,000 made at signing, and a requirement for minimum monthly payments of $25,000. Additionally, the maturity date has been extended to May 31, 2025. As of March 31, 2025, the outstanding balance of the Promissory Note was $595,259.

 

The outstanding balance of Short-term Notes Payable amounted to $1,875,290 and $1,917,962 as of March 31, 2025 and December 31, 2024, respectively.