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NOTES PAYABLE
 3 Months Ended
Mar. 31, 2025
NOTES PAYABLE  
NOTES PAYABLE

NOTE 10 – NOTES PAYABLE

 

On January 4, 2024, the Company entered into a promissory note as part of the acquisition of RevenueZen (the “RevenueZen Note”). The RevenueZen Note has the principal sum of $440,000, matures on December 31, 2025, and interest on the outstanding principal balance of, and all other sums owing under the loan amount, is 11%. Upon the occurrence of an Event of Default (as defined in the RevenueZen Note), the interest rate automatically increases to the rate of 16% per annum. The loan amount is payable as follows: (i) commencing on the date that was thirty (30) days from the date of the RevenueZen Note and continuing monthly on such same day thereafter, the Company shall make an interest only payment equal to $4,033 per month and commencing on July 31, 2024 the Company shall make an interest only payment of $3,575 per month (ii) no later than June 30, 2024, the Company must make a payment of $50,000; and (iii) the entire loan amount, together with all accrued but unpaid interest thereon, shall be due and payable on December 31, 2025. The required $50,000 payment was made on July 2, 2024. As of March 31, 2025 the balance due on the RevenueZen Note was $390,000.

 

In January 2024, the Company entered into three separate promissory notes for aggregate principal of $250,000 and received cash proceeds of $250,000. The notes mature on the two-year anniversary of the Company using the funds received for the acquisition of a business, which occurred in January 2024, and carry a 15% interest rate on the outstanding principal balance of, and all other sums owing under, the loan amounts of the notes. As of March 31, 2025 the balance due on the notes was $250,000.

 

On April 1, 2024 the Company received proceeds of $200,000 under note payable agreements from OA SPV, under note payable agreements from OA SPV, a related party as described under Note 2. The notes are unsecured and mature three years from the date of the advances, which is April 1, 2027. On February 26, 2025 the notes payable was modified to bear a 15% interest rate, calculated on the outstanding principal amount. Interest shall accrue annually and be payable at the end of each fiscal quarter in accordance with the profitability and cash flow of the Company’s wholly-owned subsidiaries, as agreed upon by both parties. The Company repaid $1,000 of the funds advanced. As of March 31, 2025 the balance due on the advance was $199,000 and is classified under Notes payable – related parties, on the balance sheet.

 

On June 6, 2024, the Company entered into a promissory note as part of the acquisition of DDS Rank (the “DDS Rank Note”). The DDS Rank Note has the principal sum of $200,000, matures on June 6, 2026, and interest on the outstanding principal balance of, and all other sums owing under the loan amount, is 7%. The loan amount is payable as follows: (i) commencing on the date that was thirty (30) days from the date of the DDS Rank Note and continuing monthly on such same day thereafter, the Company shall make an interest only payment equal to $1,167 per month (ii) the entire loan amount, together with all accrued but unpaid interest thereon, shall be due and payable on June 6, 2026. As of March 31, 2025 the balance due on the DDS Rank Note was $200,000.

 

On October 1, 2024, the Company entered into a promissory Note as part of the acquisition of Eastern Standard (the “Eastern Standard Short-Term Note”). The Eastern Standard Short-Term Note has the principal sum of $400,000, matures on February 1, 2025, and interest on the outstanding principal balance of, and all other sums owing under the loan amount, is 8%. The loan amount is payable as follows: (i) commencing on the date that was thirty (30) days from the date of the Eastern Standard Short Term Note and continuing monthly on such same day thereafter, the Company shall make an interest only payment equal to $2,667 per month (ii) the entire loan amount, together with all accrued but unpaid interest thereon, shall be due and payable on February 1, 2025. On February 1, 2025, OA SPV repaid the balance owed on the Eastern Standard Short-Term Note in exchange for an additional equity interest of 16% in Eastern Standard.

 

In addition, on October 1, 2024, the Company entered into a promissory note as part of the acquisition of Eastern Standard (the “Eastern Standard Note”). The Eastern Standard Note has the principal sum of $850,000, matures on October 1, 2026, and interest on the outstanding principal balance of, and all other sums owing under the loan amount, is 8%. The loan amount is payable as follows: (i) commencing on the date that was thirty (30) days from the date of the Eastern Standard Note and continuing monthly on such same day thereafter, the Company shall make an interest only payment equal to $5,667 per month (ii) the entire loan amount, together with all accrued but unpaid interest thereon, shall be due and payable on October 1, 2026. As of March 31, 2025, the balance due on the Eastern Standard Note was $850,000, which is classified under Notes payable – related parties, on the balance sheet.

 

On February 28, 2025, the Company issued a promissory note for $340,000 to the RevenueZen Sellers in connection with the earn-out payment as discussed in Note 13. The promissory note has a term of 60 months and accrues interest at 19%.

At various times the Company enters into short-term financing agreements with payment service providers who provide cash proceeds. The Company will repay the principal balance based on a percentage of its daily sales processed through the service provider until the total principal is repaid, based on the repayment terms in the agreement which is generally less than one year. The following table shows the outstanding balances of these lenders as of March 31, 2025:

 

Borrowing Entity

 

Origination

Date

 

Interest rate

 

 

Original

cash advanced

 

 

Balance as of

March 31, 2025

 

Proofread Anywhere

 

August 24, 2024

 

 

13.4%

 

$250,000

 

 

$15,297

 

Vital Reaction

 

October 31, 2024

 

 

13%

 

$83,000

 

 

$67,919

 

Contentellect

 

November 18, 2024

 

 

9.79%

 

$44,700

 

 

$26,594

 

SEO Butler

 

November 18, 2024

 

 

9.91%

 

$21,650

 

 

$8,877

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total balance as of March 31, 2025

 

 

 

 

 

 

 

 

 

 

 

$118,687

 

 

The following summarizes the Company’s maturities of debt instruments:

 

 

 

Principal

 

Fiscal year ended:

 

 

 

December 31, 2025

 

$558,971

 

December 31, 2026

 

 

1,351,863

 

December 31, 2027

 

 

261,622

 

December 31, 2028

 

 

75,613

 

December 31, 2029 and thereafter

 

 

116,941

 

Total

 

$2,365,010