As previously reported in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 2, 2026, CID HoldCo, Inc. (the "Company") entered into that certain Loan Agreement dated December 4, 2025, including all associated Transaction Documents (the "Loan Agreement"), with J.J. Astor & Co. The obligations under the Loan Agreement are evidenced by that certain Senior Secured Convertible Note dated December 4, 2025 (the "Note"), which is secured by that certain Pledge and Security Agreement (the "Security Agreement"). Pursuant to that certain Note Purchase and Assignment Agreement dated June 22, 2026, by and between J.J. Astor & Co., as seller, and LHT I, LLC, an affiliate of Phillips Equities & Trust, LLC, as buyer (the "Assignment Agreement"), J.J. Astor & Co. sold, assigned, transferred, and conveyed to LHT I, LLC ("LHT I") all of its right, title, and interest in and to the Note, the Loan Agreement, and the related Transaction Documents, including all obligations, liens, security interests, and collateral rights arising thereunder.

 

On August 12, 2026, the Company received a Notice of Default and Demand to Assemble Collateral (the "Default Notice") from counsel to LHT I. The Default Notice states that, as a result of the Company’s numerous failures to make the required Minimum Monthly Installment Payments beginning in January 2026, coupled with the staff determination of delisting made by Nasdaq effective August 6, 2026, the Company is in default of its obligations under the Loan Agreement. Specifically, LHT I alleges that the Company is in breach of Sections 5(a)(i) and 5(a)(v) of the Note.

 

According to the Default Notice, as of August 12, 2026, the Default Amount owed under the Loan Agreement is $1,057,417.37, inclusive of attorneys’ fees and costs.

 

Pursuant to Section 4.5 of the Security Agreement, LHT I has demanded that the Company immediately assemble all Collateral (as defined in the Security Agreement) and make it available to LHT I or its representative. The Default Notice further stated that if the Company failed to respond or coordinate collection of the Collateral by 5:00 p.m. Eastern Time on August 13, 2026, LHT I would proceed to exercise all rights and remedies cumulatively available to it under the Loan Agreement and applicable law, including foreclosure on the Company’s assets.

 

The Company expects the LHT I to proceed with foreclosure on the Company’s assets, which will result in the transfer of a material portion of the Company’s operations and assets.