Company: GEDC
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-023834
Chunk: 17

Company: CalEthos, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 1
Chunk 17
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) 
     (2,355,000)
  
    Balance, end of the period 
     64,000  
     - 
  
    Net carrying amount 
    $197,000  
    $11,000 

In
April 2025, the Company issued a $250,000
note payable to related party. The note payable has an interest rate of 10%
and the outstanding principal and interest were initially  payable on August
31, 2025. See Note 7 - Subsequent Events. Also, the Company issued to the related party a warrant to purchase 500,000
shares of the Company’s common stock at $0.49
per per share. The warrant’s grant date fair
value of approximately $291,000
was calculated using the Black Scholes fair value option-pricing model with key input variables provided by management, as of the
date of issuance: volatility of 214.75%,
the fair value of common stock $0.59,
estimated life of 5.0
years, risk-free rate of 3.98%
and dividend rate of $0. In accordance with ASC 470 – Debt, the gross proceeds of $250,000 was allocated between the note payable and
the warrant on a relative fair value basis, therefore the warrant was recorded at $134,000.

Interest
expense for the notes payable amounted to $5,000 and $35,000 for the six months ended June 30, 2025 and 2024, respectively, of which
approximately nil and $21,000, respectively, were capitalized as data center development cost.

Note
4 – Convertible Debentures

 CONVERTIBLE DEBENTURES

Convertible
debentures transactions are summarized for the periods as follows:

 SCHEDULE OF CONVERTIBLE DEBENTURES

    Principal 
    Six months ended June 30,2025  
    Year Ended December 31, 2024 
  
    Balance, beginning of period 
    $1,410,000  
    $341,000 
  
    Additions 
     225,000  
     1,410,000 
  
    Conversions 
     -  
     (341,000)
  
    Balance, end of period 
     1,635,000  
     1,410,000 

    Debt issuance cost 

    Balance, beginning of period 
     97,