Company: GEDC
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0001641172-25-002190
Chunk: 752

Company: CalEthos, Inc.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 7
Chunk 752
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accordance with ASC 470 - Debt, the Company has allocated $1,000,000 of cash proceeds on a relative fair value to the Promissory
Note and the Finance Warrant. The Finance Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately
$1,389,000 based on a 2.5-year term, volatility of 159%, a risk-free equivalent yield of 4.1%, and a stock price of $7.21. The Finance
Warrant was ascribed a relative fair value of approximately $581,000.

    F-12

On
the Maturity Date, the holder of the Promissory Note agreed to extend the Maturity Date to August 31, 2024 (“Extension Maturity”).
As consideration for the Extension, the Company issued to the holder a warrant to purchase 300,000 shares of the Company’s common
stock with an initial exercise price of $3.50 per share (“Extension Warrant”).

The
Extension Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $853,000 based on a
2.5-year term, volatility of 163%, a risk-free equivalent yield of 4.3%, and a stock price of $3.5. The fair value of $853,000 was recorded
as a debt discount to be amortized over the Extension period of three months. As of December 31, 2024, the Company had amortized approximately
$853,000 of the value of the Extension Warrant.

On
the Extension Maturity date, the holder of the Promissory Note agreed to extend the Extension Maturity to December 31, 2024 (“Additional
Extension”). As consideration for the Additional Extension date, the Company issued to the holder a warrant to purchase 300,000
shares of the Company’s common stock with an initial exercise price of $3.80 per share (“Additional Extension Warrant”).

The
Additional Extension Warrant was valued using the Black Scholes option pricing model for a total fair value of approximately $921,000
based on a 2.5-year term, volatility of 162%, a risk-free equivalent yield of 3.8%, and a stock price of $3.80. The fair value of $921,000
was recorded as a debt discount to be amortized over the Additional Extension period of four months. As of December