Related Party Transactions |
9 Months Ended |
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Sep. 30, 2025 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions | Related Party Transactions ATW I, ATW II, ATW III, MIF and SLS are considered related parties as they can significantly influence the management of the Company, and we require their consent on all material transactions. Further, MIF is considered a related party as Adam Sharkawy is a member of the Board of Directors of the Company and the founder and managing partner of MIF.
SPA Warrants – The SPA Warrants are held by related parties ATW I, MIF and SLS Family Irrevocable Trust (see Note 14 – Warrants).
Exchanged Senior Secured Convertible Debenture - On January 30, 2024, the Company and certain of its subsidiaries and ATW I entered into the Amendment and Exchange Agreement, pursuant to which ATW I transferred its existing 5% Original Issue Discount Senior Secured Convertible Debenture to the Company in exchange for a new Original Issue Discount Exchanged Senior Secured Convertible Debenture due September 9, 2026 (the “New Convertible Debentures”) in the aggregate principal amount of $29,591,600. In addition, on January 30, 2024, the Company and certain of its subsidiaries entered into additional Amendment and Exchange Agreements with MIF and SLS on substantially similar terms, pursuant to which MIF and SLS transferred their existing 5% Original Issue Discount Senior Secured Convertible Debentures to the Company in exchange for New Convertible Debentures in the aggregate principal amount of $5,102,000 and $1,836,720, respectively. The fair value of the New Convertible Debentures was $99,195,791 upon issuance on January 30, 2024.
During the year ended December 31, 2024, ATW I and SLS converted Senior Secured Convertible Debentures with a principal value of $12,869,231 and $1,836,720 and interest of $442,140 and $4,785 into 535,427 and 77,673 shares of Common Stock, respectively. The fair value of the conversion was $29,741,859.
Second Amendment and Exchange Agreement - On November 4, 2024, the Company entered into the Second Amendment and Exchange Agreement by and among the Company and ATW I, SLS and MIF pursuant to which such
investors would exchange the remaining portion of the amount outstanding under the New Convertible Debentures and certain other amounts outstanding with respect thereto, into shares of Series A Preferred Stock.
On December 27, 2024, the Company and ATW I closed the exchange transaction, and the Company issued 27,588 shares of Series A Preferred Stock to ATW I. On December 31, 2024, the Company issued 2,504 and 5,342 shares of Series A Preferred Stock to SLS and MIF, respectively, (see Note 13, “Equity”).
Series A Convertible Preferred Stock - During the nine months ended September 30, 2025, ATW I and SLS converted 19,038 and 2,300 shares of Series A Preferred Shares into 2,789,635 and 310,748 shares of Common Stock respectively. During the year ended December 31, 2024, ATW I converted 400 shares of Series A Preferred Shares into 61,659 shares of Common Stock.
Series B Convertible Preferred Stock - On August 6, 2025, the “Company, entered into a Securities Purchase Agreement (the “Purchase Agreement”), by and among the Company and ATW pursuant to which the Company agrees to issue and sell in a private offering to ATW 3,000 shares of Series B Convertible Preferred Stock of the Company, $0.0001 par value (the “Series B Preferred Stock”), at a price per share of $980 (the “Preferred Offering”) for an aggregate purchase price of $2,940,000. The Preferred Offering also relates to the offering of the shares of the Company’s common stock issuable upon the conversion of or otherwise pursuant to the terms of the Series B Preferred Stock. During the nine months ended September 30, 2025, ATW has made not converted any shares of Series B Preferred Shares into shares of Common Stock.
November 2024 Debentures - On November 4, 2024, the Company entered into a Securities Purchase Agreement with ATW I, pursuant to which ATW I purchased, in a private placement, $1,150,000 in principal amount of debentures, with an option to purchase up to an additional aggregate of $20,000,000 in principal amount of original issue discount senior secured convertible debentures (the “November 2024 Debentures”). On December 11, 2024, ATW I purchased, in a private placement, $1,000,000 in principal amount of debentures. The principal amount outstanding on the November 2024 Debentures at September 30, 2025 and December 31, 2024 was $2,150,000 and the fair value was $2,711,954 and $2,583,832, respectively.
Convertible Senior Secured Term Loans – In the third quarter of 2023, the Company entered into a convertible senior secured term loan with related parties ATW II, ATW I, MIF and other non-related party lenders. The loan was subsequently amended in the fourth quarter of 2023 and the first quarter of 2024 (see Note 7, “Notes Payable”).
On January 30, 2024, the Company also entered into the 2024 Term Loan Agreement with related parties ATW Management, as collateral agent and lender, and ATW III, ATW II, ATW I, MIF and another non-related party lenders. On May 1, 2024, the Company entered into an amendment to the 2024 Term Loan Agreement with ATW I.
During the nine months ended September 30, 2025, ATW I and ATW II converted 2024 Term Loan notes with principal amount of $2,551,855 and interest payable of $318,718 into 200,600 shares of Common Stock.
The principal amounts outstanding on the convertible senior term loans to related parties ATW I, ATW II, ATW III and MIF at September 30, 2025 were $1,643,933, $4,404,211, $1,177,311 and $4,353,665, respectively. The principal amount outstanding on the convertible senior term loans on December 31, 2024 to ATW I, ATW II, ATW III and MIF was $2,933,362, $5,666,638, $1,112,943 and $4,224,983, respectively. For the three and nine months ended September 30, 2025, interest expense attributable to ATW I, ATW II, ATW III and MIF was $52,515, $140,690, $26,572 and $117,011 and $155,831, $417,483, $71,116 and $331,772, respectively. For the three and nine months ended September 30, 2024, interest expense attributable to ATW I, ATW II, ATW III and MIF was $103,635, $192,216, $40,815, and $146,845, and $251,674, $524,531, $105,544 and $390,339, respectively.
Flexible Consulting, LLC - On December 1, 2023, the Board appointed Victoria Hay as the Interim Chief Financial Officer and principal financial officer of the Company. Victoria Hay is the co-owner and President of Flexible Consulting, LLC, a financial and accounting consulting firm, with which the Company has engaged with since January 2023 to provide it with accounting and finance services relating to its quarterly reporting and mergers/acquisition activity. On July 25, 2025, the Board appointed Jimena Begaries, also a Flexible Consulting LLC employee, as the Interim Chief Financial Officer succeeding Victoria Hay. Flexible Consulting, LLC is considered to be a related party from December 1, 2023. The total value of services provided by Flexible Consulting, LLC to the Company for the three and nine months ended
September 30, 2025 and 2024 was $275,000 and $907,684, and $270,000 and $758,000 respectively. Accounts payable included $45,000 and $160,366 due to Flexible Consulting, LLC at September 30, 2025 and December 31, 2024, respectively.
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