Note Payable

6 Months Ended

Jun. 30, 2024

NOTE 7 – Note Payable

On May 9, 2023 (“Issue Date”), the Company entered into a senior promissory note with Firstfire Global Opportunities Fund, LLC (“Firstfire”), a Delaware limited liability company for the principal sum of $162,750 (the “Principal Amount”). This Note was issued with an original issue discount in the amount of $12,750 (the “OID”) such that the actual amount of the purchase price is $150,000. The Company pays interest on the unpaid Principal Amount at the rate of nine percent (9%) (the “Interest Rate”) per annum from the Issue Date until the note becomes due and payable. The maturity date is twelve (12) months from the Issue Date (the “Maturity Date”) and is the date upon which the Principal Amount (which includes the OID) and any accrued and unpaid interest and other fees, will be due and payable.

Firstfire has the right, on any calendar day, at any time on or following the date that is six (6) calendar months after the Issue Date to convert all or any portion of the then outstanding and unpaid Principal Amount and interest into fully paid and non-assessable shares of Common Stock at a conversion price of $0.225 per share.

Under the terms of the note, the Company is required to comply with certain financial and nonfinancial covenants. Any failure by the Company to comply with these covenants and any other obligations under the agreement could result in an event of default, which allows Firstfire to accelerate the repayments of the amounts owed. As of June 30, 2024, the Company is compliant with its financial covenants.

At June 30, 2024, interest accrued for this note was $16,814, the amount of OID expensed was $4,471, and with nil remaining discount on this note to be expensed. On May 3, the Company extended the note until August 9, 2024, amending the conversion price to the current market price with a floor of $0.10 and a cap of $0.30. On May 14, 2024 and June 18, 2024, the Company repaid principal of $37,500, respectively. On May 16, 2024, First Fire converted $30,206 of principal to 220,000 shares of common stock at a conversion price of $0.1373 per share. At June 30, 2024, the outstanding balance of the note was $57,544.

On January 1, 2024, VinHMS Pte. Ltd. entered into an agreement to purchase the hospitality suite of software products including:

	·	CiHMS, a hospitality management solution;
	·	CiAMS, a hospitality asset management;
	·	CiTMS, a theme park management; and,
	·	CiTravel, a digital transformation solution for small hotels.

The total amount for the purchase of the suite of products was $10,000,000 to be paid over a three-year period. The Company has calculated the initial fair value of the loan to be $8,484,687. The loan was discounted over a 3-year period using an interest rate of Prime + 2.5% (8.50% + 2.50%) or 11.00%. The total discount for the loan is $1,515,312 which will be amortized over three years and added to the present value of the loan. At June 30, 2024, the discount amortization for the loan was $370,379, the net discount remaining is $1,144,933 and no principal payments have been made.

Vemanti Group, Inc. 10-Q/A