Company: GEDC
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023306
Chunk: 19

Company: CalEthos, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 19
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arrant’s grant date fair value of approximately $555,000
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 226.55%,
the fair value of common stock $0.28,
estimated life of 5.5
years, risk-free rate of 3.88%
and dividend rate of $0.
In accordance with ASC 470 – Debt, the gross proceeds of $500,000
was allocated between the July 20025 Note and the July 2025 Warrants on a relative fair value basis. Therefore, the July 2025
Warrants were recorded at $178,000.

In
July 2025, the Company and the Lender agreed to extend the maturity date of the April 2025 Note, which was accounted for as a modification
under ASC 470—Debt. In connection with this modification, the Company issued Modification Warrants to the Lender. The fair value
of the Modification Warrants, determined to be $277,000 as of the extension date, was recorded as a debt discount. This amount will be
amortized over the remaining term of the modified debt. 

Interest
expense for the notes payable amounted to $21,000 and $64,000 for the nine months ended September 30, 2025 and 2024, respectively, of
which approximately nil and $40,000, 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 
    Nine Months
                                                                               Ended
                                                                               September 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 
     97,000  
     - 
  
    Additions 
     10,000