(14) Equity / Capital Stock / Earnings per Share

Capital Structure 

The Company’s authorized capital stock consists of: 

As of December 31, 2025, and December 31, 2024, the following classes and series of capital stock were authorized and issued and outstanding. The table below also summarizes the par value, voting rights, and conversion terms applicable to each class and series.

Schedule of stockholders equity

Common Stock 

Each share of common stock entitles the holder to one vote on all matters submitted to shareholders. Holders of common stock are entitled to receive dividends when and if declared by the Board of Directors, subject to any preferential rights of outstanding preferred stock. In the event of liquidation, holders of common stock are entitled to share ratably in the Company’s assets remaining after payment of liabilities and satisfaction of any preferential rights of preferred stockholders. As of December 31, 2025, and December 31, 2024, there were 6,211,776,842 and 4,347,776,842 shares of common stock issued and outstanding, respectively.

Preferred Stock

Series A Preferred Stock 

The Series A Preferred Stock is non-convertible and entitles the holder to 3,000 votes per share on all matters submitted to shareholders. The Series A Preferred Stock does not carry dividend rights or liquidation preferences separate from common stock unless otherwise provided in its certificate of designation. As of December 31, 2025, and December 31, 2024, there were 105,000 shares of Series A Preferred Stock issued and outstanding.

Series B Preferred Stock 

Each share of Series B Preferred Stock is convertible into 1,000 shares of common stock. Each share carries 1,000 votes per share on matters submitted to shareholders. The Series B Preferred Stock does not have a mandatory redemption feature. As of December 31, 2025, and December 31, 2024, there were 13,500 shares of Series B Preferred Stock issued and outstanding. The Series B Preferred Stock does not carry dividend rights or liquidation preferences separate from common stock unless otherwise provided in its certificate of designation.

Series C Preferred Stock 

Each share of Series C Preferred Stock is convertible into 400,000 shares of common stock. Each share carries 400,000 votes per share. Conversion terms are fixed and not subject to variable price adjustments. The Series C Preferred Stock does not contain a mandatory redemption provision. As of December 31, 2025, and December 31, 2024, there were 9,404 and 8,249 shares of Series C Preferred Stock issued and outstanding, respectively. The Series C Preferred Stock does not carry dividend rights or liquidation preferences separate from common stock unless otherwise provided in its certificate of designation.

Series D Preferred Stock 

Each share of Series D Preferred Stock is convertible into 25,000 shares of common stock and carries 25,000 votes per share. As of December 31, 2025, and December 31, 2024, there were 0 and 700 shares of Series D Preferred Stock issued and outstanding, respectively. The Series D Preferred Stock does not carry dividend rights or liquidation preferences separate from common stock unless otherwise provided in its certificate of designation.

Series NMC Preferred Stock

Each share of Series NMC Preferred Stock is convertible into 500 shares of common stock and carries 500 votes per share. As of December 31, 2025, and December 31, 2024, there were 6,900,000 shares of Series NMC Preferred Stock issued and outstanding. The Series NMC Preferred Stock does not carry dividend rights or liquidation preferences separate from common stock unless otherwise provided in its certificate of designation.

The Series NMC Preferred Stock includes a structured sinking fund repurchase mechanism pursuant to which the Company may, at its discretion, make repurchase offers to holders from time to time. The repurchase price accretes at a rate of 5% per annum, subject to a minimum repurchase price of $25.40 per share.

Upon the making of a repurchase offer, each holder must elect either to accept the repurchase price in cash or to convert such holder’s shares into common stock pursuant to the stated conversion ratio. The holder’s election is final with respect to that offer.

The Series NMC Preferred Stock does not contain a fixed redemption date and does not provide holders with the unilateral right to require cash redemption absent a Company-initiated offer. Accordingly, the Series NMC Preferred Stock is classified as equity in accordance with ASC 480.

Undesignated Preferred Stock 

The Company is authorized to issue 42,627,000 shares of undesignated preferred stock. The Board of Directors has the authority, without further shareholder approval, to issue such shares in one or more series and to determine the voting rights, dividend rights, conversion features, liquidation preferences, and other terms of each series. No shares of undesignated preferred stock were issued or outstanding as of December 31, 2025, or 2024.

Common Stock Activity 

During the year ended December 31, 2024, the Company reclaimed and cancelled 9,544,690 shares of common stock pursuant to the Final Judgment in SEC v. Keener (1:20-cv-21254-BB), reducing the number of shares outstanding. As of December 31, 2024, the Company had 4,347,776,842 shares of common stock issued and outstanding.

During the year ended December 31, 2025, the Company issued an aggregate of 1,864,000,000 shares of common stock, increasing the total shares outstanding from 4,347,776,842 at December 31, 2024, to 6,211,776,842 at December 31, 2025.

Significant issuances during the year included: 

All issuances were recorded at fair value on the respective issuance dates, with corresponding amounts recognized in additional paid-in capital.

Preferred Stock Activity

Series A Preferred Stock Activity During the Period 

There were 105,000 shares of Series A Preferred Stock issued and outstanding as of December 31, 2025, and December 31, 2024, and no issuances, conversions, or other changes occurred during the period.

Series B Preferred Stock Activity During the Period 

There were 13,500 shares of Series B Preferred Stock issued and outstanding as of December 31, 2025, and December 31, 2024, and no issuances, conversions, or other changes occurred during the period.

Series C Preferred Stock Activity During the Period 

During the year ended December 31, 2024, the Company issued shares of Series C Preferred Stock for aggregate recorded consideration of $429,480, consisting of a combination of cash and non-cash asset contributions, resulting in 8,249 shares issued and outstanding, represented by a balance of $499,485 at December 31, 2024.

During the year ended December 31, 2025, the Company issued 2,010 shares of Series C Preferred Stock for aggregate recorded consideration of $431,700. During the same period, 855 shares of Series C Preferred Stock were converted into 342,000,000 shares of common stock at the stated conversion rate of 400,000 common shares per preferred share, and the carrying value of $102,600 associated with those shares was reclassified to additional paid-in-capital. As a result, Series C Preferred Stock increased from 8,249 shares, represented by a balance of $499,485 at December 31, 2024, to 9,404 shares, represented by a balance of $828,585 at December 31, 2025.

Series D Preferred Stock Activity During the Period 

During the year ended December 31, 2024, the Company issued 700 shares of Series D Preferred Stock for aggregate recorded consideration of $17,500, consisting of a combination of cash and non-cash asset contributions, resulting in 700 shares issued and outstanding at December 31, 2024.

During the year ended December 31, 2025, the Company issued 59,300 shares of Series D Preferred Stock for aggregate recorded consideration of $1,482,500, consisting of a combination of cash and non-cash asset contributions, recorded at fair value on the issuance dates.

During the same period, 60,000 shares of Series D Preferred Stock, including the 700 shares outstanding at December 31, 2024, were converted into 1,500,000,000 shares of common stock at the stated conversion rate of 25,000 common shares per preferred share, and the related carrying value of $1,500,000 was reclassified to additional paid-in capital.

As a result, Series D Preferred Stock decreased from 700 shares, represented by a balance of $17,500 at December 31, 2024, to zero shares outstanding at December 31, 2025.

Series NMC Preferred Stock Activity During the Period 

There were 6,900,000 shares of Series NMC Preferred Stock issued and outstanding as of December 31, 2025, and December 31, 2024, and no issuances, conversions, or redemptions occurred during the period.

Warrants and Contractual Purchase Rights 

As of December 31, 2024, the Company had outstanding contractual purchase rights and warrants exercisable into 5,847,900,000 shares of common stock, consisting of 3,201 Series C contractual purchase rights, 2,750 Series C warrants, 700 Series D warrants, and 6,900,000 Series NMC warrants. Changes during the year ended December 31, 2025, primarily reflect the exercise of certain Series C contractual purchase rights and the issuance of additional Series D warrants in connection with financing transactions. The net increase in shares issuable during 2025 was primarily attributable to the issuance of Series D warrants issued in connection with financing transactions involving Series D Convertible Preferred Stock, partially offset by the exercise of certain Series C contractual purchase rights.

As of December 31, 2025, the Company had outstanding contractual purchase rights and warrants exercisable pursuant to fixed contractual terms as defined in the respective agreements. These instruments are classified as equity in accordance with ASC 815-40 and ASC 480, as they are indexed to the Company’s own stock and do not require net cash settlement or otherwise meet the criteria for liability classification.

The following table summarizes these instruments as of December 31, 2025:

 Schedule of instruments

If exercised in full, these contractual purchase rights and warrants would result in the issuance of up to 6,794,400,000 additional shares of the Company’s common stock, resulting in substantial dilution to existing common shareholders.

Convertible Preferred Stock 

As of December 31, 2024, the Company had outstanding convertible preferred stock that was convertible into 6,780,600,000 shares of common stock pursuant to fixed conversion ratios.

As of December 31, 2025, the Company had outstanding shares of convertible preferred stock that were convertible into shares of the Company’s common stock pursuant to fixed conversion ratios defined in the respective certificates of designation. These preferred shares are classified as equity in accordance with ASC 480 and ASC 815-40.

The following table summarizes the preferred stock outstanding and the number of common shares issuable upon conversion as of December 31, 2025:

 Schedule of preferred stock outstanding

If fully converted, these preferred shares would result in the issuance of up to 7,225,100,000 additional shares of common stock.

Equity Classification of Convertible Instruments, Contractual Purchase Rights, and Warrants 

All outstanding convertible preferred stock, contractual purchase rights, and warrants are classified as equity instruments in accordance with ASC 480, Distinguishing Liabilities from Equity, and ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity. These instruments are indexed to the Company’s own common stock and provide for settlement through the issuance of a fixed or determinable number of shares. None of these instruments require or permit net cash settlement, and the Company does not have an obligation to repurchase or redeem the instruments for cash or other assets. Accordingly, these instruments meet the criteria for equity classification and are presented as components of shareholders’ equity in the accompanying consolidated balance sheets.

Shares Reserved for Future Issuance 

As of December 31, 2025, approximately 14,019,500,000 shares of the Company’s common stock were potentially issuable upon conversion of outstanding convertible preferred stock and the exercise of outstanding contractual purchase rights and warrants. The Company had 13,788,223,158 authorized but unissued shares of common stock available as of that date. Accordingly, the number of shares issuable upon conversion and exercise exceeded the number of authorized but unissued shares available as of December 31, 2025. The Company does not have a present obligation to issue shares in excess of its authorized share capital, and issuance of any additional shares beyond the authorized amount would require shareholder approval to amend the Company’s Certificate of Formation. No liability has been recorded in connection with these instruments, as settlement in shares in excess of authorized amounts is not presently required and remains subject to corporate authorization.

Earnings Per Share 

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Net income attributable to common stockholders reflects the deduction of cumulative dividends on the Company’s Series A Preferred Stock totaling $10,500 for the year ended December 31, 2024. For the year ended December 31, 2025, the Company reported a net loss and therefore the Series A preferred dividend was not deducted in computing loss per share.  

Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The Company applies the if-converted method for convertible preferred stock and the treasury stock method for warrants and contractual rights, in accordance with ASC 260.

The following table sets forth the computation of earnings (loss) per share:

 Schedule of earnings per share 

During the year ended December 31, 2024, diluted earnings per share reflects the inclusion of incremental shares resulting from in-the-money Series C contractual purchase rights and Series C warrants, calculated using the treasury stock method in accordance with ASC 260-10-45-11. The weighted average shares outstanding were increased by 501,160,000 shares related to contractual purchase rights and 1,100,000,000 shares related to warrants, resulting in total diluted weighted average shares outstanding of 5,953,338,005.

For the year ended December 31, 2025, the Company reported a net loss. Accordingly, all potentially dilutive securities were excluded from the calculation of diluted net loss per share because their inclusion would have been anti-dilutive.

Potentially dilutive securities excluded for 2025 included: 

For the year ended December 31, 2024, diluted earnings per share reflects the inclusion of dilutive contractual purchase rights and warrants calculated using the treasury stock method. Convertible preferred stock was excluded because its inclusion would have been anti-dilutive.