8. Current and Non-current financial liabilities, net

The Company's Financial liabilities consisted of the following.

The table below shows the amounts recorded as Interest expense, net from continuing operations on the statements of operations for the years ended on December 31, 2024, and 2023.

Related-Party Secured convertible loan

On December 8, 2023, the Company entered into a Secured Loan Agreement with YA II PN, Ltd. (the “Note holder”). The secured loan has a principal amount of $5,750, with 37.5% issuance discount, December 8, 2024, as maturity date, 9.25% as annum interest rate and 13.25% as annum default interest rate. The secured loan shall be convertible into shares of the Company’s Class A common stock at the option of the Note Holder, who could convert any portion of the outstanding and unpaid conversion amount into fully paid and nonassessable shares of Common Stock in accordance with the Conversion Price defined as $1.25.

On December 9, 2024, YA II PN, Ltd. sold the Secured Loan agreement to Palella Holdings LLC, which is qualified as a related party because it is the Company’s major shareholder, and it is fully owned by the former Company’s Chief Executive Officer.

As of December 31, 2024, the Company has $6,298 outstanding as principal and accrued interests. In detail, the Company was in default for non-payment under the terms of the Secured Loan Agreement.

Related-Party Convertible debt

On November 13, 2023, the Company issued a Convertible note to YA II PN, Ltd. (the “Note holder”). The convertible note has a principal amount of $4,000, with 15% issuance discount, 5% as annum interest rate, 15% as annum default interest rate and December 31, 2024, as amended maturity date. The debt was convertible into shares of the Company’s Class A common stock at the option of the Note Holder, who could convert any portion of the outstanding and unpaid conversion amount into fully paid and non-assessable shares of Common Stock in accordance with the Conversion Price defined as $37.50.

On December 9, 2024, YA II PN, Ltd. sold the Convertible Note to Palella Holdings LLC, which is qualified as a related party because it is the Company’s major shareholder, and it is fully owned by the former Company’s Chief Executive Officer.

During the year ended December 31, 2024, the Company fully repaid in cash the convertible debt. In detail, a cumulative payment of $122 (of which $116 was principal, and $6 was payment premium) was paid to YA II PN, Ltd. while the remaining $3,619 (of which $3,447 was principal, and $172 was payment premium) was paid to the new creditor.

Related-Party Promissory Notes

During the year ended December 31, 2024, Palella Holdings LLC, which is qualified as a related party because it is the Company’s major shareholder, and it is fully owned by the former Company’s Chief Executive Officer, provided to the Company $3,181, on an interest free basis with maturity date January 31, 2025.

During the year ended December 31, 2024, the Company repaid $2,248 in cash and $705 by issuing 47,029,465 shares of the Company’s Class A Common Stock. In detail, on June 10, 2024, the Company and Palella Holdings LLC agreed to convert a portion of the Promissory Note amounting to $705 into 47,029,465 shares of the Company’s Class A Common Stock using a conversion price of $0.015, the Company recorded a gain of $94 using the closing market price on the issuance date. The conversion price applied for the aforementioned issuance is not applicable for further conversions.

As a result of the above repayment and conversion, on December 31, 2024, the Company has $228 as outstanding principal.

Unsecured loans

2022 unsecured note

On July 15, 2022, the Company issued an Unsecured Note to an investor in exchange for 2,000 Euro (approximately $2,210) with 6.75% as interest on an annual basis. In March 2024, the Company entered into a Settlement Agreement with the Note holder pursuant to which the Company’s obligations under the original agreements, amounting to $2,381 (2,202 Euro), would be satisfied in exchange of a payment of $1,102 (995 Euro), to be paid by June 30, 2024.

As a result on December 31, 2024, the Company has $2,454 as outstanding principal and accrued interest recorded as Short-term financial liabilities. In detail, the Company was in default for non-payment under the terms of the Settlement Agreement. On October 30, 2024, the Company received a judgment against it from the Supreme Court of the State of New York for the payment of the full principal, interest and costs and disbursements in connection with the 2022 unsecured note that the Company issued to a third-party to an investor on July 15, 2022 in exchange for 2,000 Euro (approximately $2,070, using December 31, 2024 exchange rate) with 6.75% as interest on an annual basis. The Company is currently identifying and evaluating the alternative paths for facing the judgement.

Unsecured debts – assumed from previous business combination

On December 28, 2023, the Company entered into a second Loan Amendment which restructured the loan with the following terms and conditions:

The Company issued the 928,942 shares of Class A Common Stock on March 26, 2024, recording a gain amounted to $728 for the reduction of the Company’s share price from the Amendment date to the issuance date. 

As of December 31, 2024, the Company has $1,400 outstanding as principal and accrued interests. In detail, the Company was in default for non-payment under the terms of the Loan Amendment. The Company is currently negotiating with the holders of the debts for and evaluating the alternative paths for facing the judgement.