SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2024

Note 8 – Subsequent Events

SUBSEQUENT EVENTS

The Company evaluated all events that occurred after the balance sheet date through the date the financial statements were issued to determine if they must be reported. The management determined there are no reportable events except for the following:

On January 13, 2025 (“CSDO Termination Date”), the Company terminated the employment agreement with the Chief Strategy and Development Officer (“CSDO”) with an effective date of January 15, 2025. Based on the delays in the estimated milestone requirements for the development of the Company’s Data Center, it was determined that CSDO role was not required. As of the CSDO Termination Date, the CSDO non-qualified stock option agreement for 1,000,000 shares of the Company’s common stock was cancelled. Of the options shares of 1,000,000, the CSDO had vested 168,750 options shares, which are exercisable until the third anniversary date of the CSDO Termination Date.

On January 14, 2025 (“VPDCD Termination Date”), the Company terminated the employment agreement with the Vice President of Data Center Development (“VPCSD”) with an effective date of February 15, 2025. Based on the delays in the estimated milestone requirements for the development of the Company’s Data Center, it was determined that VPDCD role was not required. As of the VPDCD Termination Date, the VPDCD non-qualified stock option agreement for 350,000 shares of the Company’s common stock was cancelled. Of the options shares of 350,000, the CSDO had vested 43,750 options shares, which are exercisable until the third anniversary date of the CSDO Termination Date.

On January 15, 2025, the Company issued, to a consultant, a Non-Qualified Stock Option Agreement for the purchase of 350,000 shares of the Company’s common stock for an exercise price of $1.99, which was the fair value of the Company’s common stock on the grant date. The 350,000 options vest as follows:

	●	Become exercisable as to 43,750 Option Shares on January 16, 2026 and shall vest and become exercisable as to an additional 43,750 shares on each of January 16, 2027, January 16, 2028, and January 16, 2029 provided that the optionee is a consultant, an employee or a Board member in good standing with the Company on such applicable vesting date.
	●	The remaining 175,000 Option Shares based on the Employee or consultant completing the following milestones:

	○	will vest as to 20% of such Option Shares (35,000 shares) upon completion, with respect to the Company’s optioned real property in Imperial County, CA (the “Property”), of a general plan amendment, zone change, and approved use for data center and/or onsite power production use;
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of a development agreement with Imperial County, CA (the “County”) or similar land use and entitlement to memorialize the approval of a data center use for the Property;
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the Company receiving from the County permits necessary to start construction at the Property of either an onsite power production of a 50MW generation system or a 60MW critical load data center facility (including but not limited to power substations, on-site roads, water, power, fiber communications, buildings, perimeter walls, and security systems);
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of binding agreements for an external or onsite portfolio of power sources for a minimum of 500MW of power to support the data center load at the Property; and
	○	will vest as to 20% of such Option Shares (35,000 shares) upon the completion of the sale or lease of all or a portion of the Property for “powered dirt”, a “powered shell” or a built-to-suit data center facility.

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Vesting milestones can be altered or changed by the Company and the optionee mutually agreeing as the data center site development, building designs, and construction plans are further defined and timelines for permitting, construction, and customer contracts, occupancies, and operations’ milestones are established.

In January 2025, the Company issued a Debenture in the amount of $25,000, with a commission of $2,000 for net proceeds of $23,000.

In February 2025, the Company issued a Debenture in the amount of $100,000, with a commission of $4,000 for net proceeds of $96,000.

In March 2025, the Company issued a Debenture in the amount of $100,000, with a commission of $4,000 for net proceeds of $96,000.

CalEthos, Inc. 10-K