Hypha Labs, Inc. (FUNI) is a pre-revenue development-stage company as of March 31, 2026, having divested its cannabis testing laboratory assets in February 2024. The company is now developing a consumer bioreactor device (Hypha Micropearl) with no commercial sales. Under a liquidation lens, recovery to equity is deeply negative and deteriorating. The MFFAIS-computed liquidation value is negative $2.56M as of the current period. The asset base is minimal: cash on hand of $82,200 (100% recovery), a right-of-use asset of $6,678 (near-zero liquidation value as the lease expires May 31, 2026), and no tagged inventory, PP&E, or intangibles of substance. Against these assets, the liability stack is substantial and growing. Total notes payable (gross face value) stand at $453,272 as of March 31, 2026, up from $354,391 at September 30, 2025, driven by a new $94,300 promissory note issued December 5, 2025. Total convertible notes payable (gross carrying amount) stand at $1,386,582, up from $1,306,582, driven by a new $150,000 8% senior secured convertible note issued March 24, 2026. Aggregate gross debt (notes plus convertible notes before discounts) totals approximately $1.84M. The debt maturity schedule clusters heavily in fiscal year 2027 ($1.30M), compressing the effective demand on liquidity well within the next 18 months. Under liquidation, all debt instruments are held at face value regardless of discount amortization, meaning the $36,659 remaining discount on notes and $2,000 on convertibles provides no economic relief in a wind-down scenario. One note (September 2025 promissory note) went into default in March 2026 and triggered a $44,765 default penalty added to principal, plus a conversion of $20,000 of principal into shares at a distressed 65% of lowest 10-day trading price. The filing also discloses multiple preferred stock series with liquidation preferences senior to common equity: Series B Preferred (mezzanine, classified as temporary equity, carries priority over common and Series A in liquidation), Series A Preferred (100% of purchase price per share preference), and Series C Preferred ($0.10 per share stated value preference). Series D Preferred ($0.20 per share liquidation preference, 700,313 shares outstanding) ranks junior to Series B and senior to common. Accumulated deficit stands at $24.7M. The company has negative working capital of $1.34M and a going concern qualification. Filing discusses the Invictus Note in the context of the 2025 Secured Credit Facility repayment trigger but does not separately tag it in XBRL. Filing does not separately tag total assets, total liabilities, or stockholders' deficit as XBRL facts in the TAG_CONTEXT provided, limiting direct balance-sheet reconstruction from tags alone. Six-month total interest expense of $147,339 (versus $45,034 in the prior-year period) reflects rapid debt stack expansion and the default penalty accrual. No revenue is reported in either period compared.
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