v3.26.1
Related Party Transactions
 12 Months Ended
Dec. 31, 2025
Related Party Transactions [Abstract]  
Related Party Transactions

Note 12 – Related Party Transactions

 

The related parties that had material transactions for the years ended December 31, 2025 and 2024, consist of the following: 

 

Related Party   Nature of Relationship to the Company
A   An Ohio Corporation - a significant shareholder
B   Owner of A and our Chief Executive Officer of the Company from April 1, 2025 through September 30, 2025
C   A California Corporation owned by a related party D
D   Significant shareholder and our Chief Technology Officer
E   Director and Chief Executive Officer of GEVI Insurance Holdings Inc.
F   A Delaware limited liability company - Series A Preferred shareholder
G   A company controlled by our Chief Financial Officer

  

As of December 31, 2025 and 2024, amounts owing to related parties consists as follows: 

             
   December 31,   December 31,    
Related Party  2025   2024   Nature of transaction
A  $300   $–   Operating expense paid on behalf of the Company
F   167,671    –   Accrued interest related to convertible note related party
   $167,971   $–    

 

During the years ended December 31, 2025 and 2024, related party A advanced to the Company an amount of $0 and $2,000 for working capital proposes and $25,300 and $6,496 for operating expenses paid directly to vendors, on behalf of the Company, respectively. During the years ended December 31, 2025 and 2024, the Company repaid $25,000 and $330,000 owing to the related party A and $0 and $410,880 owing to the related party B, respectively. On December 31, 2024, the Company issued a $576,693 convertible note to related party A in exchange for the amount due to related party A and B of $576,693. During the year ended December 31, 2025, a company controlled by related party B was reimbursed $75,000 for expenses paid on behalf of the Company.

 

For the years ended December 31, 2025 and 2024, expenses to related parties and their nature consists of:

 

   Years Ended       
   December 31,       
Related Party  2025   2024   Nature of transaction  Financial Statement Line Item
A  $2,103,600   $–   150,000 Series C Convertible Preferred Stock for consulting fee  Professional fees - related party
C  $21,600   $77,600   Cash paid for consulting fees  Professional fees - related party
C  $4,000   $19,400   Cash paid for consulting and advisory fees  Cost of revenue - related party
D  $–   $163,654   Cash paid for management fee  Professional fees - related party
D  $56,290   $81,917   Cash paid for royalty and sales commissions  Cost of revenue - related party
E  $420,720   $–   30,000 Series C Convertible Preferred Stock for management compensation  Management compensation
E  $–   $348,000   20,000 shares of Series C Convertible Preferred Stock for advisory fee  Professional fees - related party
F  $2,511,855   $–   69,007 Series C Convertible Preferred Stock for services  Financing expense
G  $39,885   $–   Edgar filing expense  General and administrative
G  $51,174   $–   Professional service - accounting  Professional fees - related party

 

Convertible note – related party

 

The components of convertible notes as of December 31, 2025 and 2024, were as follows: 

                            
          Effective   Stated         
   Principal      Interest   Interest   December 31,   December 31, 
Payment date  Amount   Maturity date  Rate   Rate   2025   2024 
December 2024  $576,693   December 31, 2025   –    10%   $–   $576,693 
February 2025  $2,000,000   February 28, 2026   128%    10%    2,000,000    – 
Total Convertible notes                    $2,000,000   $576,693 
Less: Unamortized debt discount                     (714,600)   – 
                      1,285,400    576,693 
Less: Current portion                     (1,285,400)   (576,693)
Long-term portion                    $–   $– 

 

In February 2025, the Company entered into one (1) subscription agreement for convertible notes ($2,000,000) and warrants (416,667 shares of common stock) with a related party F. The convertible notes have a term of twelve (12) months, at an interest rate of 10% per annum and warrants are with a term of five (5) years, at exercise price of $3.00 per share. The outstanding principal amount of convertible notes and unpaid interest is convertible at a fixed conversion price of $2.40. The obligations of the Company under the convertible note are secured by a pledge of the Company’s membership interests in MFB Ohio. In the event of a default, related party F could proceed against the equity of MFB Ohio pledged to collateralize the convertible note. MFB Ohio owns the Company’s intellectual property portfolio. The Company paid 8% original discount of $160,000 and financing fee of $63,918 and recorded these financing costs as debt discount. The Company has accounted for the convertible debt at amortized cost under ASC 470-20. During the year ended December 31, 2025, the Company recognized the debt discount of $1,824,087 (Original Issued Discounts of discount and financing fee of $223,918 and warrants of $1,600,169).

 

On December 31, 2024, the Company issued a convertible note of $576,693, to related party A, in exchange for the amount due to related party. The convertible note has a term of twelve (12) months, at an interest rate of 10% per annum. The outstanding principal amount of convertible note and unpaid interest is convertible at a fixed conversion price of $2.16. The conversion price is a fixed price and the Company determined that conversion feature did not need to be bifurcated. The Company has accounted for the convertible debt at amortized cost under ASC 470-20.

 

During the year ended December 31, 2025, the Company recognized interest expenses of $223,128 and $0 and amortization of debt discount of $1,109,487 and $0, respectively. As of December 31, 2025 and 2024, the Company recorded accrued interest of $167,671 and $0, respectively.

 

Conversion

 

In December 2025, a note holder converted convertible note issued in December 2024 of $576,693 and accrued interest of $55,457 into 292,663 shares of common stock.