Company: GEDC
Filing Date: 2025-04-02
Form Type: 10-K
Source: 0001641172-25-002190
Chunk: 1083

Company: CalEthos, Inc.
Filing Date: 2025-04-02
Form: 10-K
Item: Item 14
Chunk 1083
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6,468,000,
which was accounted for as a loss on liability settlement. The loss on the settlement was recorded as a loss on extinguishment of debt
on the statement of operations for the three months ended March 31, 2024.

Interest
expense on these convertible promissory notes amounted to $32,000
and $439,000
for the years ended December 31, 2024
and 2023, respectively, of which $21,000
and $203,000,
respectively, was capitalized as Data Center Campus Cost.

Note
5 – Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES 

Litigation

From
time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business.
The Company is not currently a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation
that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should
such litigation be resolved unfavorably.

Employment
Agreement

Chief
Operating Officer

In
June 2023, the Company executed an employment agreement (“Employment Agreement”) to employ an individual to be the Company’s
President and Chief Operating Officer (“Executive”). As compensation for services rendered, the Executive will be paid a
base salary of $250,000 per annum. The Executive’s base salary may be increased as certain milestones are met, such as 1) when
the necessary governmental permits are granted to start construction of the Company’s initial data center, 2) once the initial
data center is operational and at least 25% of the planned megawatts of collation capacity is leased. Also, at the discretion of the
Company, following each calendar year of continued employment, the Executive shall be eligible to receive a discretionary bonus of up
to fifty percent (50%) of Executive’s base salary during the first year of employment, up to seventy-five percent (75%) of Executive’s
then-current base salary during the second year of employment, and up to one-hundred percent (100%) of Executive’s then-current
base salary during Executive’s third year of employment. Payment of any bonus will be based on achieving certain goals and performance
criteria established by the Company. In addition, the Executive was granted options to purchase 600,000 and 1,900,000 shares of the Company’s
common stock.

    F-15