Company: GEDC
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0001641172-25-002190
Chunk: 21

Company: CalEthos, Inc.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 1
Chunk 21
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 of $875,000 and fair value of the New Warrant of $3,197,000.

Loss on
extinguishment of debt

During the years ended December 31, 2024 and 2023, the Company extinguished convertible debentures
with the issuance of shares of the Company’s common stock. The fair value of the common stock issued exceeds the carrying amount
of the principal and accrued interest by approximately $6,468,000 and $986,000, which was recorded as a loss on extinguishment for the
year ended December 31, 2024 and 2023, respectively.

Liquidity
and Capital Resources

Our
working capital as of December 31, 2024 and 2023 was as follows.

    2024  
    2023 
  
    Current assets 
    $296,000  
    $318,000 
  
    Current liabilities 
     (514,000) 
     (1,022,000)
  
    Working capital deficit 
    $(218,000) 
    $(704,000)

Our
working capital deficit decreased from a $704,000 deficit as of December 31, 2023 to a deficit of $218,000 as of December 31, 2024 for
a decrease of $486,000. The decrease in our working capital deficit was due to a $22,000 decrease in our cash and cash equivalents, which
was offset by a decrease of $167,000 in our accounts payable and accrued expenses and a decrease of $341,000 in convertible promissory
notes, net.

Cash
Flows

    For the years ended December 31, 

    2024  
    2023 
  
    Net cash used in operating activities 
    $(859,000) 
    $(35,000)
  
    Net cash used in investing activities 
     (1,467,000) 
     (1,730,000)
  
    Net cash provided by financing activities 
     2,305,000  
     - 
  
    Effect of exchange rate changes 
     (1,000) 
     6,000 
  
    Change in cash and cash equivalents during the period 
     (22,000) 
     (1,759,000)
  
    Cash and cash equivalents, beginning of period 
     308,000  
     2,067,000