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Convertible Notes

9 Months Ended

12 Months Ended

Sep. 30, 2025

Dec. 31, 2024

Convertible Notes

Convertible Notes

Note 7 – Convertible Notes

The components of convertible notes as of September 30, 2025 and December 31, 2024, were as follows:

				Effective			Stated
	Principal		Maturity	Interest			Interest			September 30,			December 31,
Payment date	Amount		date	Rate			Rate			2025			2024
July 15, 2024	$	795,000	July 15, 2025		390	%		10	%	$	-		$	795,000
August 15, 2024	$	326,000	August 15, 2025		398	%		10	%		-			326,000
November 15, 2024	$	100,000	November 15, 2025		511	%		10	%		-			100,000
December 15, 2024	$	75,000	December 15, 2025		815	%		10	%		-			75,000
February 7, 2025	$	1,500,000	February 7, 2026		416	%		10	%		-			-
February 15, 2025	$	575,000	February 15, 2026		631	%		10	%		400,000			-
Total Convertible notes										$	400,000		$	1,296,000
Less: Unamortized debt discount											(336,880	)		(1,099,923	)
											63,120			196,077
Less: Current portion											(63,120	)		(196,077	)
Long-term portion										$	-		$	-

On July 15, 2024 and August 15, 2024, the Company entered into seventeen (17) convertible notes ($1,121,000) and warrants (233,550 shares of common stock). 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 conversion price of the lesser of (i) $2.40 or (ii) a 30% discount to the price of shares issued in connection with a qualified financing. In November and December, the Company entered into three (3) convertible notes ($175,000) and warrants (36,460 shares of common stock). The Company paid 8% financing fee of $89,680, accrued fee of $14,000 and recorded financing fee as debt discount.

In February 2025, the Company entered into eleven (11) convertible notes ($2,075,000) and warrants (432,296 shares of common stock). 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 conversion price of the lesser of (i) $2.40 or (ii) a 30% discount to the price of shares issued in connection with a qualified financing. The Company paid 8% financing fee of $166,000 recorded financing fee as debt discount.

During the nine months ended September 30, 2025, the Company recognized the debt discount of $2,075,000 (Original Issued Discounts of discount of $166,000, warrants of $882,000 and derivative liability of $1,027,000).

In June 2025, seventeen (17) note holders converted convertible notes issued in July and August 2024 of $1,121,000 and accrued interest of $97,353 into 507,661 shares of common stock. As a result, the Company settled convertible notes, accrued interest, debt discount of $381,522, and derivative liability of $2,127,000, and recorded loss on settlement of debt of $2,640,611.

On August 19, 2025, the Company withdrew its registration statement and decided not to proceed with qualified offering. The Company determined that the bifurcated conversion feature was no longer a liability and is now categorized as equity. As a result, the Company reclassified its derivative liability of $1,604,000 to additional paid-in capital.

In July and September 2025, six (6) note holders converted convertible notes issued in November and December 2024 and February 2025 of $1,850,000 and accrued interest of $114,897 into 818,709 shares of common stock. As a result, the Company settled convertible notes, accrued interest, debt discount of $1,324,787, and derivative liability of $354,000, and recorded loss on settlement of debt of $4,130,203.

During the nine months ended September 30, 2025 and 2024, the Company recognized interest expense of $186,405 and $21,014 and amortization of debt discount of $1,131,734 and $72,996, respectively. During the three months ended September 30, 2025 and 2024, the Company recognized interest expense of $49,473 and $20,879 and amortization of debt discount of $310,740 and $72,996, respectively. As of September 30, 2025 and December 31, 2024, the Company recorded accrued interest of $24,878 and $50,723, respectively.

The Company determined that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815-40, Derivatives and Hedging - Contracts in Entity's Own Stock and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability. The fair value of the conversion feature was recorded as a debt discount and “day 1” derivative loss for the excess amount of debt discount and amortized to interest expense over the term of the note.

Note 8 – Convertible Notes

The components of convertible notes as of December 31, 2024 and 2023, were as follows:

	Principal			Interest			December 31,			December 31,
Payment date	Amount		Maturity date	Rate			2024			2023
August 11, 2022	$	18,000	February 11, 2023		2	%	$	-		$	18,000
September 2, 2022	$	17,000	March 2, 2023		2	%		-			17,000
April 1, 2023	$	19,000	Due on demand		2	%		-			19,000
July 15, 2024	$	795,000	July 15, 2025		10	%		795,000			-
August 15, 2024	$	326,000	August 15, 2025		10	%		326,000			-
November 15, 2024	$	100,000	November 15, 2025		10	%		100,000			-
December 15, 2024	$	75,000	December 15, 2025		10	%		75,000			-
Total Convertible notes							$	1,296,000		$	54,000
Less: Unamortized debt discount								(1,099,923	)		-
								196,077			54,000
Less: Current portion								(196,077	)		(54,000	)
Long -term portion							$	-		$	-

On September 30, 2022, the Company entered into a convertible note agreement for the amount of $54,000, with term of six (6) months from the date of receipt of the funds, at interest rate of 2% per annum. At the sole option of the Lender, all or part of unpaid principal then outstanding may be converted into shares of common stock at any time starting 24 hours after payment at a fixed conversion price of $1.08 per share. During the year ended December 31, 2024, the Company settled liabilities of $23,400 and converted notes with principal amounts of $54,000 and accrued interest of $1,702 into 82,699 shares of common stock. The fair market value of the common shares converted was $126,655 at the issuance date, as a result, the Company recognized a loss on debt settled by common stock of $130,462.

On July 15, 2024 and August 15, 2024, the Company entered into seventeen (17) subscription agreements for convertible notes ($1,121,000) and warrants (233,550 shares of common stock). 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 conversion price of the lesser of (i) $2.40 or (ii) a 30% discount to the price of shares issued in connection with a qualified financing. In November and December, additionally, the Company entered into three (3) subscription agreements for convertible notes ($175,000) and warrants (36,460 shares of common stock). The Company paid 8% financing fee of $89,680, accrued fee of $14,000 and recorded financing fee as debt discount.

During the year ended December 31, 2024, the Company recognized the debt discount of $1,296,000 (Original Issued Discounts of $103,680, warrants discount of $546,863 and derivative liability of $645,457) and amortized debt discount of $196,077.

During the year ended December 31, 2024 and 2023, the Company recognized interest expenses of $50,723 and $1,311 and amortization of debt discount of $196,077 and $0, respectively. As of December 31, 2024 and 2023, the Company recorded accrued interest of $50,723 and $1,567, respectively.