Related Party Transactions

6 Months Ended

Jun. 30, 2024

Related Party Transactions [Abstract]

Related Party Transactions

Note 8 — RELATED PARTY TRANSACTIONS

Lease Agreement

The Company had a property lease agreement with its Chief Executive Officer as discussed in Note 7 – Leases. The lease agreement was terminated upon close of the Business Combination on March 14, 2024. As of June 30, 2024 and December 31, 2023, $0 and $2,000 were owing under this agreement and included in accounts payable on the condensed consolidated balance sheets.

Consultancy Agreement

On January 1, 2019, the Company entered into a consultancy agreement with a company affiliated with the Chief Executive Officer for a monthly payment of $20,000 in exchange for the Chief Executive Officer providing services in connection with the development and sales of Company technologies and products. For the three and six months ended June 30, 2024, $20,000 and $80,000, respectively was accrued and included in general and administrative expenses on the condensed consolidated statement of income. For the three and six months ended June 30, 2023, $60,000 and $120,000, respectively was accrued and included in general and administrative expenses on the condensed consolidated statement of income. As of June 30, 2024, $0 was owing under this agreement and included in accounts payable on the condensed consolidated balance sheets. On May 1, 2024, this consultancy agreement was terminated.

Office Services Agreement

On October 31, 2020, the Company entered into a consultancy agreement with an affiliate for a monthly payment of $5,000 to provide office services. For the three and six months ended June 30, 2024, $5,000 and $30,000, respectively was accrued and included in research and development expenses on the condensed consolidated statement of income. For the three and six months ended June 30, 2023, $15,000 and $30,000, respectively was accrued for these services and included in research and development expenses on the condensed consolidated statement of income. As of June 30, 2024 and June 30, 2023, $0 and $2,500, respectively, was owed under this agreement and included in accounts payable on the condensed consolidated balance sheets. On May 1, 2024, this office services agreement was terminated.

Due to related party

Commencing on December 9, 2021, through the consummation of the initial Business Combination, XPDB agreed to pay affiliates of the sponsor a total of $20,000 per month for office space, administrative and support services. Upon the close of the Business combination, the Company assumed $540,000 related to this agreement. The balance was repaid in May 2024.

In 2023, the sponsor contributed $900,000 to the XPDB trust account in connection with extending the XPDB’s termination date pursuant to the approval of the extension amendment proposal. Upon the closing of the Business Combination, the Company assumed this balance and it was subsequently repaid in May 2024.

Related Party Equity Transactions

As described in Note 9 – Stockholders’ Equity (Deficit), Legacy Montana sold shares of Class A common stock, as well as other preferred equity that subsequently converted into shares of Class A common stock, to TEP Montana, LLC (“TEP Montana”). The Executive Chairman of the Company is the managing partner of the managing member of TEP Montana.