v3.26.1
DEBT
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
DEBT

NOTE 6 – DEBT

 

Notes Payable – Related Party

 

From 2023 to 2025, the Company borrowed a total of $1,325,000 from board member Chris Kneppers. The notes are now payable on the earliest of the date on which the Company (1) uplists to the Nasdaq or NYSE; (2) receives $5 million in equity financing; or (3) begins generating revenue from its first facility. During the three month period ended March 31,2026, the Company borrowed an additional $20,000 from Mr. Kneppers with the same terms. The total debt due as of March 31, 2026, is $1,345,000. In lieu of interest, the Company will pay Mr. Kneppers 100% of the outstanding loan balance due him contingent upon the financing of the first plant. All interest and loan amounts automatically come due upon a change of control of the Company or if the Company files for bankruptcy under Chapter 11 or Chapter 7. At March 31, 2026 and December 31, 2025, accrued interest payable to Mr. Kneppers is $46,651, and $46,651, respectively.

 

Convertible Notes Payable – Related Party

 

In June and November 2023, the Company entered two long-term convertible notes with board member Edmund Burke with principal amounts of $25,000 and $15,000, respectively, to be repaid when the Company receives an equity investment of at least $3 million. The notes may convert into common stock at $0.13/share at the option of the holder for a total of 307,692 shares. Until repayment, the note agreement requires the Company to issue to Mr. Burke 80,000 warrants having a strike price of $0.15 and an expiration of 5 years every twelve months in lieu of interest. During the quarter ended March 31, 2026 and 2025, 30,000 and 0 warrants with a fair value of $4,303 and $0,respectively, were issued to Mr. Burke (see Note 7). The fair value of these warrants is included in interest expense – related parties on the statement of operations.

 

In April 2023, the Company entered a separate long-term convertible note with board member Mr. Burke, with a principal balance of $150,000, to be repaid when the Company receives an equity investment of at least $1.5 million. The notes may convert into common stock at $0.13/share at the option of the holder for a total of 1,153,846 shares. Until repayment, the note agreement requires the Company to issue to Mr. Burke 100,000 warrants having a strike price of $0.15 and an expiration of 5 years every six months in lieu of interest. During the three months ended March 31, 2026 and March 31, 2025, 0 and 0 warrants with a fair value of $0 and $0, respectively, were issued to Mr. Burke (see Note 7). The fair value of these warrants is included in interest expense – related parties on the statement of operations.

 

Pursuant to the Company’s Chapter 11 Plan of Reorganization confirmed on September 18, 2019, the Company restructured several outstanding notes payable and convertible debentures into fixed settlement obligations. Under the terms of the confirmed Plan, the original terms, interest rates, and conversion features were terminated in exchange for a combined settlement of $320,630, payable solely out of the Company’s future gross revenues or a percentage thereof. As of March 31, 2026 and December 31, 2025, the remaining aggregate balance of these obligations is $320,630.

 

A summary of all Notes that remain including those indicated in the Notes above is as follows:

 

 

Notes Payable  March 31, 2026   December 31, 2025 
Current Convertible Notes — Other  $-   $- 
Long Term Convertible Notes Payable – Related Party   190,000    190,000 
Long-Term Notes Payable – Related Party   1,345,000    1,325,000 
Long Term Notes Payable from future revenue   320,630    320,630 
TOTAL NOTES  $1,855,630   $1,835,630 

 

As of March 31, 2026, none of the $1,855,630 outstanding notes payable is due at a specific point in time. $320,630 will be paid from future gross revenues.

 

At March 31, 2026, there are $190,000 in convertible notes that, if converted, would convert into 1,461,538 shares.