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COMMITMENTS AND CONTINGENCIES
 12 Months Ended
Dec. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES

NOTE 14. COMMITMENTS AND CONTINGENCIES

 

Legal Contingencies

 

The Company is subject to various legal proceedings and claims, either asserted or unasserted, arising in the ordinary course of business. While the outcome of these claims cannot be predicted with certainty, management does not believe the outcome of any of these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows, and accordingly, $0 legal contingencies are accrued as of December 31, 2024 and 2023. Litigation relating to the insurance brokerage industry is not uncommon. As such the Company, from time to time have been, subject to such litigation. No assurances can be given with respect to the extent or outcome of any such litigation in the future.

 

Earn-out liabilities

 

The Company has recognized several earn-out liabilities resulting from contingent consideration provisions included in business combination agreements. Earn-out consideration is normally earned by acquirees when they meet or exceed pre-agreed upon earnings targets.

 

 

The following outlines changes to the Company’s earn-out liability balances for the respective years ended December 31, 2024 and 2023:

 

   Fortman   Montana   Altruis   Kush   Barra   Total 
Ending balance December 31, 2023  $-   $159,867   $-   $-   $-   $159,867 
Payments   -    (190,000)   -    -    -    (190,000)
Estimate & fair value adjustments   -    47,761    -    -    -    47,761 
Payable in Common Stock   -    (17,628)   -    -    -    (17,628)
Ending balance December 31, 2024  $-   $-   $-   $-   $-   $- 
                               
   Fortman   Montana   Altruis   Kush   Barra   Total 
Ending balance December 31, 2022  $667,000   $500,001   $834,943   $147,534   $560,000   $2,709,478 
Payments   (1,433,700)   (750,001)   (929,168)   (147,534)   -    (3,260,403)
Estimate & fair value adjustments   1,612,914    569,734    94,225    -    (560,000)   1,716,873 
Payable in Common Stock   -    (159,867)   -    -    -    (159,867)
Reclassification to loans payable, related parties*   (846,214)   -    -    -    -    (846,214)
Ending balance December 31, 2023  $-   $159,867   $-   $-   $-   $159,867 

  

* As further described in the Note 16, Related Parties, the Company modified the Fortman contingent earn-out payable, entering into a fixed payment agreement, thus, the remaining open balance is reclassified to the loans payable, related parties account on the consolidated balance sheet as of December 31, 2023.