CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

9 Months Ended

Sep. 30, 2025

Convertible Notes Payable Related Parties

CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

18. CONVERTIBLE NOTES PAYABLE – RELATED PARTIES

The convertible notes payable, related party were issued as part of consideration for the acquisition of Forever 8. The discount was calculated based on the fair value of the instrument as of October 1, 2022. Principal due under the convertible note payable – related parties was as follows at September 30, 2025 and December 31, 2024:

	September 30, 2025		December 31,2024
Notes payable, 12%	$	-	$	21,771,155
Less: current portion		-		11,500,000
Notes payable, long-term potion	$	-	$	10,271,155
Less: debt discount		-		750,000
Notes payable, long-term portion, net	$	-	$	9,521,155

For the three and nine months ended September 30, 2025, interest expense under convertible notes payable – related parties was $894,507 and $2,694,253, of which $250,000 and $750,000 was related to amortization of the debt discount, respectively. For the three and nine months ended September 30, 2024, interest expense under convertible notes payable – related parties was $1,225,473 and $2,262,635, of which $250,000 and $750,000 was related to amortization of the debt discount, respectively. For the three and nine months ended September 30, 2025, the Company recognized a capital contribution in additional paid in capital of $22,789,599 related to the forgiveness of debt and accrued interest. For the three and nine months ended September 30, 2024, the Company recognized a capital contribution in additional paid in capital of $5,400,000 and $8,406,896 related to the forgiveness of debt and accrued interest.