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Subsequent Events
12 Months Ended
Dec. 31, 2024
Subsequent Events [Abstract]  
Subsequent Events

20. Subsequent Events

 

The Company has evaluated all events subsequent to December 31, 2024 and through December 9, 2025, which represents the date these consolidated financial statements were available to be issued.

 

Forward Purchase Agreement

 

In June 2025, the Company satisfied its obligations of $2,436 under the Forward Purchase Agreement through the issuance of 6,591,000 shares of the Company’s common stock to Sandia.

 

Convertible Promissory Notes and Warrants

 

In June 2025 the Company entered into a securities purchase agreements (the “Purchase Agreements”) with accredited investors pursuant to which the Company sold and issued secured convertible promissory notes (“Convertible Promissory Notes”) and warrants to purchase 37,500,000 shares of Common Stock (“Warrants”) for total gross proceeds of $3,000.

 

The Convertible Promissory Notes have a principal amount equal to the loan amount, mature on the one-year anniversary of the issuance date (subject to acceleration upon the occurrence of certain customary events of default or a change of control), and bear 10% per annum interest. The Convertible Promissory Notes are convertible into 75,000,000 shares of the Company’s common stock at the option of the holder based on a conversion price of $0.04 per share, subject to certain adjustments. The Convertible Promissory Notes convert automatically upon the Company’s completion of a securities offering resulting in gross proceeds of at least $5,000.

 

The Warrants have a term of five years. The Warrants have an exercise price of $0.04 per share, subject to certain adjustments. At any time when a registration statement registering the resale of shares issuable upon exercise of the Warrants is not effective, the Warrants can be exercised on a cashless basis by the holders.

 

Senior Secured Note Transfer

 

In January 2025, the senior secured note and related accrued and unpaid interest was assigned from its original note holder to a third-party. The transfer did not modify the terms of the note or its accounting treatment.

 

Consent and Security Agreement and Intercreditor Agreement

 

On June 12, 2025, the Company entered into a consent agreement (the “Consent”) with one of its two Secured Senior Notes lenders (the “Existing Lender”). Under the Consent, the Existing Lender agreed to waive certain rights under its outstanding Senior Secured Note Agreement. The waiver covered any default or event of default under the Senior Secured Note Agreement arising from, or in connection with, the transactions contemplated by the Purchase Agreement described above, as well as any defaults existing as of the date of the Consent. In consideration for the waiver, the Company issued 34,000,000 shares of common stock to the Existing Lender.

 

In addition, the Company entered into an Intercreditor Agreement with the collateral agent and the Existing Lender providing for the relative rights with respect to the secured obligations of the Company.

 

Conversion Agreements and Universal Resale and Registration Provisions

 

In 2025, the Company entered into a series of conversion agreements (the “Conversion Agreements”) with certain of its creditors. Pursuant to the Conversion Agreements: (i) certain creditors agreed to exchange an aggregate of approximately $5,380 of accounts payable and accrued expenses, including the settlement obligation under the Forward Purchase Agreement, for the issuance of 14,559,000 shares of the Company’s common stock; (ii) Notes Payable – Related Parties with an aggregate principal amount of $1,998 were converted into 5,407,000 shares of the Company’s common stock; and (iii) the Company issued 11,983 shares of its Series C Convertible Preferred Stock (convertible into up to 11,983,000 shares of common stock) to two creditors in settlement of an aggregate of $4,429 of accounts payable and accrued expenses.

 

Universal Resale and Registration Provisions

 

In connection with each of the transactions described above, the Company and counterparties who received common stock or preferred stock entered into certain Universal Resale and Registration Provisions pursuant to which such recipients agreed to certain lock-up provisions restricting and limiting their sale, transfer, pledge, or disposal of any shares of common stock held by or issuable to such recipients.

 

Termination of a Material Definitive Agreement

 

In June 2025 the Company used approximately $1,343 of the proceeds from the Convertible Promissory Note described above to repay one of the Senior Secured Notes in the original principal amount of $1,000 and accrued interest of $343 issued to the Company on February 8, 2024. The Senior Secured Note is no longer outstanding.

 

Compensatory Arrangements of Certain Officers

 

On June 13, 2025, the Board of Directors approved and the Company granted to each of Sumit Kapur, the Company’s Chief Executive Officer and Clark Golestani, the Company’s sole director, a grant of 32,500,000 shares of restricted common stock. The restricted common stock vest in equal monthly installments for a two-year period beginning on the grant date, provided that if the Mr. Kapur is terminated by the Company other than for cause or Mr. Golestani is not re-elected by the shareholders, such vesting will accelerate and all unvested restricted common stock shall become fully vested.

 

Series C Convertible Preferred Stock

 

On July 18, 2025, the Company filed the Certificate of Designations of Preferences, Rights and Limitations of the Series C Convertible Preferred Stock of the Company with the Delaware Secretary of State designating and authorizing the issuance of up to 13,000 shares of Series C Convertible Preferred Stock. Subsequently, on November 4, 2025, the Company filed a Certificate of Amendment to the Certificate of Designations (the “Certificate of Amendment”) to increase the number of authorized and designated shares of Series C Convertible Preferred Stock to 23,000 shares.

 

Each share of Series C Convertible Preferred Stock is convertible into 1,000 shares of common stock of the Company at the election of the holder, subject to certain adjustments and to beneficial ownership limitations. Each share of Series C Convertible Preferred Stock shall be entitled to vote with the Company’s common stock on an as-converted basis, subject to beneficial ownership limitations. The holders of Series C Convertible Preferred Stock shall rank pari passu with the holders of common stock with respect to any liquidation, dissolution or winding up of the Company.

 

Stock Options Issued to Certain Advisors

 

On August 18, 2025, the Company granted 8,000,000 options each to two advisors with an exercise price of $0.002 per share. On August 27 and August 30, 2025, the Company granted an additional 8,500,000 options to two other advisors with an exercise price of $0.01 per share. The options vest as follows: (i) one-fourth of the options shall vest on the one-year anniversary of the grant date, and (ii) the remaining options shall vest monthly in equal monthly increments over the three-year period following the one-year anniversary of the grant date, provided that each vesting shall be subject to the recipient continuing to provide services to the Company as of the applicable vesting date. The options are also subject to accelerated vesting upon the occurrence of certain change of control events.

 

Change of the Company’s Name

 

On August 21, 2025, the Company changed its name to “Zapata Quantum, Inc.”.

 

August 2025 Warrants

 

In August 2025 the Company entered into a warrant purchase agreement (the “Warrant Purchase Agreement”) with accredited investor pursuant to which the Company sold and issued the warrants to purchase up to 1,200,000 shares of Common Stock (“August 2025 Warrants”). The August 2025 Warrants vests in equal monthly installments of 50,000 shares over a 24-month period beginning on the Commencement Date and subject to continued service to the Company on each vesting date. The August 2025 Warrants have an exercise price of $0.04 per share, subject to certain adjustments. The August 2025 Warrants cannot be settled in cash. The August 2025 Warrants may not be exercised to the extent that such exercise would cause the holder or its affiliates to beneficially own more than 4.99% of the Company’s outstanding common stock immediately following the exercise.

 

Appointment of Certain Officers and Compensatory Agreements of Certain Officers

 

On October 8, 2025, the Company appointed Mr. William Klitgaard to the Board of Directors and named him as the sole member of the Audit Committee. In connection with his appointment, the Company granted Mr. Klitgaard the following compensation: (i) a grant of 1,000,000 five-year stock options, vesting in equal monthly increments over a two-year period, subject to continued services to the Company as of each applicable vesting date, with an exercise price of $0.08, (ii) cash compensation of $100 per year for services as director, and (iii) additional cash compensation of $25 per year for services as a chair of the Audit Committee of the Company, with both cash grants subject to Mr. Klitgaard’s continued service to the Company as of each applicable payment date.

 

On October 9, 2025, the Company appointed Mr. Clark Golestani, a director, to serve as Chairman of the Board of Directors. In connection with his appointment, the Company granted Mr. Golestani 1,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly increments over a two-year period, subject to Mr. Golestani’s continued service to the Company as of each applicable vesting date.

 

On October 9, 2025, the Company appointed Mr. Sumit Kapur, Chief Executive Officer of the Company, to the Board of Directors. In connection with his appointment, the Company granted Mr. Kapur 1,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly increments over a two-year period, subject to Mr. Kapur’s continued service to the Company as of each applicable vesting date. On October 9, 2025, in connection with Mr. Kapur’s services as Chief Executive Officer, the Company also granted Mr. Kapur 5,000,000 five-year stock options with an exercise price of $0.08, vesting in equal monthly installments over four years, subject to his continued services to the Company as of each applicable vesting date.

 

Series A Convertible Preferred Stock

 

In October and November 2025, the Company entered into securities purchase Agreements with accredited investors, pursuant to which the Company offered and sold 15,000 shares of the Company’s Series A Convertible Preferred Stock at a purchase price of $100 per share for total gross proceeds of $1,500.

 

On October 23, 2025, the Company filed the Certificate of Designations of Preferences, Rights and Limitations (the “Certificate of Designations”) of the Series A with the Delaware Secretary of State designating and authorizing the issuance of up to 15,000 shares of Series A Convertible Preferred Stock.

 

Each share of Series A is convertible into 1,000 shares of common stock of the Company at the election of the holder, subject to certain adjustments and to beneficial ownership limitations. Each share of Series A shall be entitled to vote with the Company’s common stock on an as-converted basis, subject to beneficial ownership limitations. All shares of capital stock of the Company, both common stock and any other series of preferred stock, shall be junior in rank to all shares of Series A with respect to payments upon the liquidation, dissolution, and winding up of the Company.

 

Forbearance Agreement

 

On October 22, 2025, the Company entered into a forbearance agreement (the “Forbearance Agreement”) with a third-party creditor related to outstanding invoices totaling approximately $3,168 (the “Overdue Amount”). Pursuant to the Forbearance Agreement, 50% of the Overdue Amount (approximately $1,584) was extinguished and replaced with contingent obligations (the “Contingent Obligations”). The Company agreed to pay up to two contingent payments, each equal to 25% of the Overdue Amount (approximately $792), upon the completion of capital-raising transactions generating at least $45 million and $55 million, respectively, in aggregate proceeds. If the specified financing thresholds are not achieved, the corresponding contingent payments will not become due, and the related obligations will be permanently extinguished.

 

The remaining 50% of the Overdue Amount (approximately $1,584) (the “Remaining Overdue Amount,” and together with the Contingent Obligations, the “Obligations”) will continue to be owed, and the creditor has agreed to temporarily forbear from enforcing collection during the forbearance period.

 

Beginning May 1, 2025, any unpaid portion of the Obligations will accrue a late charge at a rate equal to the lesser of 0.8% per month or the maximum rate permitted by law. The forbearance period will terminate—and the Remaining Overdue Amount, together with any accrued late charges, will become immediately due and payable—upon the occurrence of certain “Forbearance Termination Events,” including specified capital-raising or asset-sale transactions, defaults, or insolvency events.