NOTES PAYABLE | NOTE 9 – NOTES PAYABLE The Company borrows funds from various creditors to finance its equipment, operations and acquisitions. The Company’s collateralized loans are secured by interest in the financed equipment. On December 15, 2022, Titan Trucking entered into a $ 170,000 7 The Company’s notes payables balance as of June 30, 2024 and December 31, 2023, consisted of the following: SCHEDULE OF LONG-TERM DEBT June 30, December 31, 2024 2023 Current Non-current Current Non-current Collateralized Installment Loans (a) 2,353,577 4,955,275 970,301 2,521,624 Note Payables: Keystone (b) 240,000 - - - Issued prior to Titan Merger: Michaelson Capital (c) 2,107,090 - 2,307,090 - Loanbuilder (d) 47,252 101,112 91,096 102,916 Individual (e) 25,000 - 25,000 - Kabbage Funding Loans (f) - - 9,344 - Related Parties: Standard Waste Promissory Note (1) (g) 500,000 - - - Standard Waste Promissory Note (2) (h) - 2,359,898 - - Titan Holdings 2 (i) 326,000 537,470 175,000 603,470 Titan Holdings 5 (j) 207,000 - 40,000 - Miller (k) 355,000 - 250,000 - J. Rizzo (l) 108,500 - 65,000 - C. Rizzo (m) 70,000 - - - Celli (n) 200,000 - - - Total outstanding principal 6,539,419 7,953,755 3,932,831 3,228,010 Less: discounts (1,104,187 ) (1,785,207 ) (21,385 ) (53,325 ) Total notes payable 5,435,232 6,168,548 3,911,446 3,174,685 Less: Notes payable – related parties 1,766,500 2,897,368 530,000 603,470 Notes payable $ 3,668,732 $ 3,271,180 $ 3,381,446 $ 2,571,215 Guarantee of Debt On May 31, 2024 the Company entered into a Guaranty Fee Agreement pursuant to which certain outstanding indebtedness owed by the Company to the sellers of Standard is guaranteed. Pursuant to the Guaranty Fee Agreement, Charles B. Rizzo personally guaranteed the obligations of Standard and the Company. In exchange for providing the guarantees, the Company agreed to provide compensation consisting of a deposit fee, a guarantee fee, and an annual fee. The guarantee fee consisted of 15,000,000 6,500,000 2.5 215,000 215,000 3,010,000 3,010,000 Collateralized Installment Loans: (a) The May 30, 2022 acquisition of Standard included the assumption of approximately $ 3.3 3,491,925 7.3 9.74 August 2024 to December 2030 1,611,969 Note Payables: (b) During the six months ended June 30, 2024, there were three note payable agreements executed between the Company and Keystone Capital Partners, LLC for an aggregate amount of $ 240,000 . The agreements were issued between May 30, 2024 and June 7, 2024. All notes mature in less than 12 months and accrue interest at a rate of 10 %. The outstanding balance of combined note as of June 30, 2024 was $ 240,000 . On July 2, 2024 Keystone Capital Partners, LLC and the Company agreed to cancel two promissory notes for a total of $ 150,000 15,134 warrants to purchase 100 15,134 shares of Series B Preferred Stock. The warrants each have an exercise price of $ 0.06 per share (Note 18 – Subsequent Events). Note Payables issued prior to Titan Merger: (c) On January 5, 2023, the Company completed its asset acquisition of the Recoup Digester Assets and as part of the consideration, assumed the liabilities of a $ 3,017,090 12 35,000 250,000 In October 2023, the Company and Michaelson agreed to forbear the principal payments owed to Michaelson during the three months ended September 30, 2023 until October 30, 2023. On December 28, 2023 the Company and Michaelson signed a Forbearance Agreement (the “December Michaelson Amendment”) that was accounted for as a debt modification in accordance with ASC 470 – Debt The December Michaelson Amendment established a period ending on March 31, 2024 during which Michaelson agreed to forbear from exercising its rights against the Company with respect to a default. Additionally, it set the following repayment terms: (1) on or before December 31, 2023, the Company was to make a $ 125,000 50,000 22,571 50,000 In April 2024, the Company and Michaelson agreed to extend the term of the Michaelson Note until June 30, 2024, and forbear all other terms until May 1, 2024. In exchange for such extension and forbearance, the Company agreed to: (1) pay $ 600,000 500,000 100,000 50,000 50,000 25 6.0 2,107,090 5,000 65,357 On July 31, 2024, the Company and Michaelson agreed to a Forbearance Agreement that amended the Michaelson Note Payable (the “July Michaelson Amendment”). As a result, the interest rate of the Michaelson Note was increased to 16 Additionally, the principal payment schedule of the Michaelson Note was amended to as follows: a payment of $750,000 is due on or by August 30, 2024, a payment of $457,089 is due on or by September 30, 2024, and a payment of the remaining outstanding principal is due on or by November 30, 2024. 10,000 (d) Between January 14, 2022 and July 6, 2022, the Company signed four loan agreements with the Loanbuilder Service of Paypal, Inc (the “Loanbuilder Notes”). Three of the four Loanbuilder Notes had entered into settlement agreements prior to May 19, 2023. The remaining note (“Loanbuilder – 3”) was in default on May 19, 2023. On May 19, 2023, the outstanding liabilities owed under all the Loanbuilder Notes was $ 299,710 50,599 On June 15, 2023, the Company entered into a settlement agreement on Loanbuilder – 3. In accordance with ASC 470-60, “ Troubled Debt Restructuring by Debtors, 25,299 6,325 Excluding the Loanbuilder - 3 repayments, and as of June 30, 2024, the Company had 22 remaining required monthly repayments of $ 6,046 1,545 (e) On May 16, 2022, the Company issued a $ 25,000 12 0.5 (f) On September 28, 2022 and September 29, 2022, the Company agreed to two Kabbage Funding Loan Agreements (together known as the “Kabbage Loans”) owed to American Express National Bank. The Kabbage Loans had an initial principal amount of $ 120,800 77,748 4,077 3,658 35,507 Related Parties: (g) On May 30, 2024 the Company entered into a promissory note agreement with Dominic and Sharon Campo for $ 500,000 July 15, 2024 13.75 18 500,000 5,651 245,469 122,734 Guarantee of Debt 122,734 100,000 200,000 (h) On May 31, 2024 the Company entered into a promissory note agreement with Dominic and Sharon Campo for $ 2,359,898 May 15, 2027 14.75 15.75 2,359,898 26,670 1,158,562 32,182 Guarantee of Debt 1,126,380 (i) On April 30, 2023, Titan Trucking signed a promissory note (the “Titan Holdings 2 Note”) with Titan Holdings 2, LLC (“Titan Holdings 2”), a stockholder of the Company. The promissory note matures on March 31, 2028. On November 10, 2023, Titan Trucking and Titan Holdings 2 agreed to a restated promissory note (together the two notes are the “Titan Holdings 2 Note”). The Titan Holdings 2 Note has a principal amount of $ 712,470 10.5 13.00 175,000 50,000 Titan has an informal agreement with Titan Holdings 2 to continually borrow from Titan Holdings 2 as working capital needs arise. These additional funds are to be repaid as funding becomes available. As of June 30, 2024, Titan had borrowed $ 180,000 (j) On December 31, 2023, Titan Trucking and a stockholder of the Company agreed to an informal agreement (the “Titan Holdings 5 Note”) to borrow funds from the stockholder as working capital needs arise. These additional funds are to be repaid as funding becomes available. As of June 30, 2024, Titan had borrowed $ 170,439 On May 30, 2024, the Company and the stockholder, agreed to a promissory note for a principal amount of $ 100,000 . The promissory note has an annual interest rate of 10 % and is to be repaid September 30, 2024. The note also features a provision stating the Company will pay a 10 10,091 10,091 100 10,091 shares of Series B Preferred Stock. The warrants each have an exercise price of $ 0.06 per share (Note 18 – Subsequent Events). (k) On October 30, 2023, Titan Trucking and the Company’s CEO, Glen Miller (“Miller”), agreed to a promissory note for a principal amount of $ 250,000 10 250,000 On February 23, 2024, the Company and Miller agreed to a promissory note for a principal amount of $ 55,000 5,000 10 55,000 On May 30, 2024, the Company and Miller agreed to a promissory note for a principal amount of $ 50,000 . The promissory note has a maturity date of June 28, 2024, and has an annual interest rate of 10 %. The note also features a provision stating the Company will pay a 10 % late fee in the event repayment is not made by more than 30 days past maturity. On July 2, 2024 Miller and the Company agreed to cancel the promissory note in exchange for 5,045 5,045 warrants to purchase 100 5,045 shares of Series B Preferred Stock. The warrants each have an exercise price of $ 0.06 per share (Note 18 – Subsequent Events). (l) On November 30, 2023, the Company and its COO, Jeff Rizzo (“Rizzo”), agreed to a promissory note for a principal amount of $ 65,000 10 10 Titan has an informal agreement with Rizzo to continually borrow from Rizzo as working capital needs arise. These additional funds are to be repaid as funding becomes available. As of June 30, 2024, Titan had borrowed $ 43,500 (m) Titan has an informal agreement with Charles B. Rizzo (“C. Rizzo”) to continually borrow from C. Rizzo as working capital needs arise. These additional funds are to be repaid as funding becomes available. As of June 30, 2024, Titan had borrowed $ 70,000 (n) On May 30, 2024, the Company and Frank Celli (“Celli”), agreed to a promissory note for a principal amount of $ 200,000 . The promissory note has an annual interest rate of 10 % and is to be repaid September 30, 2024. The note also features a provision stating the Company will pay a 10 % late fee in the event repayment is not made by more than 30 days past maturity. On July 2, 2024 Celli and the Company agreed to cancel the promissory note in exchange for 20,183 20,183 100 20,183 shares of Series B Preferred Stock. The warrants each exercisable have an exercise price of $ 0.06 per share (Note 18 – Subsequent Events). Interest expense on these notes for the six and three months ended June 30, 2024 was $ 505,461 270,040 213,720 136,367 Principal maturities for the next five years and thereafter as of June 30, 2024 were as follows: SCHEDULE OF PRINCIPAL MATURITIES OF NOTES PAYABLE Remainder of 2024 $ 5,403,861 2025 2,135,946 2026 1,669,482 2027 3,551,162 2028 928,610 Thereafter 804,113 Total principal payments $ 14,493,174 Less: debt discounts (2,889,394 ) Total notes payable $ 11,603,780 |