11. MEZZANINE

Series C Preferred Stock

Effective January 14, 2021, the Company filed a Certificate of Designation of the Series C Preferred Stock with the Nevada Secretary of State. The Company had authorized the issuance of an aggregate of 3,000 shares of the Series C preferred stock. Each share of Series C preferred stock had a par value of $0.001 per share and a stated value of $1,100 per share. The shares of Series C preferred stock were convertible into shares of the Company’s common stock at a conversion price of $8.50 per share.

Each share of the Series C preferred stock was entitled to receive cumulative dividends of 12% per annum or 18% per annum in the event of default, payable monthly from the date of issuance of the shares. Starting one month after the issuance of the shares, they were in default due to the Company’s failure to pay the cumulative dividend monthly as required by the agreement. Dividends could have been paid in cash or in shares of Series C preferred stock at the discretion of the Company. Effective February 1, 2024, the sole owner of the Series C preferred stock agreed to stop accruing dividends.

The Company, at its sole discretion, has the right to redeem all, but not less than all, shares of the Series C preferred stock issued and outstanding upon 5 days’ notice at a defined redemption price.  The holders of the Series C preferred stock do not have a right to put the shares to the Company.

The holders of the Series C preferred stock shall have the right to vote together with holders of common stock, on an as “converted basis”, on any matter that the Company’s shareholders may be entitled to vote on, either by written consent or by proxy.

As of June 30, 2025, 1,125 shares of Series C preferred stock were issued and outstanding and recorded at stated value as mezzanine due to certain default provisions requiring mandatory cash redemption that are outside the control of the Company. On August 1, 2025 these Series C preferred stock were exchanged for Series C convertible preferred stock with new terms and agreement.

Series D Preferred Stock

On February 19, 2021, the Company filed a Certificate of Designation of the Series D Convertible Preferred Stock with the Nevada Secretary of State authorizing the issuance of an aggregate of 4,000 shares of the Series D preferred stock. Each share of Series D preferred stock had a par value of $0.001 per share and a stated value of $1,100 per share. The shares of Series D preferred stock were convertible into shares of the Company’s common stock at a conversion price of $37.50 per share.

Each share of the Series D preferred stock was entitled to receive cumulative dividends of 12% per annum or 18% per annum in the event of default, payable monthly from the date of issuance of the shares. Starting one month after the issuance of the shares, they were in default due to the Company’s failure to pay the cumulative dividend monthly as required by the agreement. Dividends could have been paid in cash or in shares of Series D preferred stock at the discretion of the Company.

Effective August 1, 2025, the Company amended and restated the Certificate of Designation for its Series C preferred stock and all 3,000 shares of Series D preferred Stock were exchanged for Series C convertible preferred stock including 1,500 shares of Series C preferred stock. As a result, as of March 31, 2026, and June 30, 2025, 0 and 3,000 shares of Series D preferred stock, respectively, were issued and outstanding and recorded as mezzanine due to certain default provisions requiring mandatory cash redemption that are outside the control of the Company.