NOTE 10 – RELATED PARTY TRANSACTIONS

Founder’s Shares

On March 2, 2017, the Company issued an aggregate of 175,000,000 shares of its common stock, $0.001 par value, as Founder’s Shares with $-0- value.  

Of these Founder’s Shares, 80,000,000 were issued to the Company’s officers, 75,000,000 to an entity controlled by one of the Company’s directors, and 20,000,000 to outside consultants who assisted with the Company’s formation and early organization.

As of September 30, 2025, an aggregate of 100,100,000 Founder’s Shares have been returned to the Company and cancelled, including 67,100,000 pursuant to a series of Share Exchange Agreements described below.

Share Exchange and Cancellations

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During the fiscal year ended December 31, 2023, the Company entered into a Share Exchange Agreement with one of its Founders, Kao Lee, whereby it issued 2,500 shares of its Series A Preferred Stock in exchange for an aggregate of 25,000,000 shares of its common stock.

During the nine months ended September 30, 2025, the Company entered into Share Exchange Agreements with two of its Founders, Kao Lee and Abdikarim Farah, whereby it issued an aggregate of 4,210 shares of its Series A Preferred Stock in exchange for an aggregate of 42,100,000 shares of its common stock.

All shares of common stock received in these stock exchanges were subsequently canceled. No consideration was paid or received in connection with the share exchanges.

Accrued Payroll

During the nine months ended September 30, 2025, the Company issued 322,448 shares of common stock as payment in place of cash to settle $322,448 in unpaid wages and commissions owed to employees and an independent sales representative. The value of the common stock issued was based on the closing price of the Company’s common stock on the date of issuance, which was $1.00 per share, and no gain or loss was recognized as a result.

As of September 30, 2025, the Company had aggregated $70,331 in related party accrued payroll, consisting solely of accrued payroll.

As of September 30, 2024, the Company had aggregated $215,150 in related party accrued payroll, consisting of $207,500 in accrued payroll and $7,650 in accrued employer taxes.

Amounts Due to Related Parties and Imputed Interest

As of September 30, 2025, the Company had outstanding amounts due to related parties aggregating $188,914 with stated interest rates between 0% and 10% per annum. For the nine months ended September 30, 2025, the Company recorded imputed interest expense of $5,152 and accrued interest payable of $7,303 on notes with below‑market or no stated interest. The related parties have agreed to suspend stated maturity dates without penalty until the Company raises sufficient funds.

As of September 30, 2024, the Company had outstanding notes payable to Kao Lee aggregating $14,042 for expenses paid on behalf of the Company, which has been accounted for as short-term notes payable to a related party.

Patent Royalties

On March 2, 2017, the Company entered into a Patent License Agreement with Shongkawh, LLC, which is controlled by our executive officers Kao Lee and Anthony Vang (and directly owned by Mr. Lee and his brother, Thao Lee). Under this agreement, ShongKawh is to receive a royalty of 2% of all products manufactured under this covered patent.

On March 13, 2024, the Company and Shongkawh amended the Patent License Agreement to adjust royalty payments due under this agreement to $1 per annum, payable within ten business days of the end of each fiscal year.

Amounts Due From Related Parties

During the nine months ended September 30, 2025, Aiultraprod Group Limited, a subsidiary acquired on June 23, 2025, advanced $69,900 to related parties for business expenditures paid on behalf of the Company. As of September 30, 2025, the receivable balance of $69,900 was reported as amounts due from related parties.