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| SHARE CAPITAL | NOTE 12 – SHARE CAPITAL
The Company is authorized to issue shares of its $ par value common stock and shares of its $ par value preferred stock. The shares of $ par value preferred stock were comprised of shares authorized and shares issued and outstanding of its Series A convertible preferred stock at June 30, 2026 and December 31, 2025, shares authorized and shares issued and outstanding of its Series B convertible preferred stock at June 30, 2026 and December 31, 2025, shares authorized and shares issued and outstanding of its Series C convertible preferred stock at June 30, 2026 and December 31, 2025, shares authorized and and shares issued and outstanding of its Series D convertible preferred stock at June 30, 2026 and December 31, 2025, respectively and shares authorized and and issued and outstanding of its Series E preferred stock at June 30, 2026 and December 31, 2025, respectively. As of June 30, 2026 and December 31, 2025, there were and shares of common stock issued and outstanding, respectively.
The share numbers and pricing information in this report have been adjusted to reflect the effects of the following reverse stock splits, which occurred during 2025 and 2026:
Silverback Conversions
During the three months ended June 30, 2026 and 2025, the Company issued and shares of common stock (Level 1 inputs) to Silverback Capital Corporation (“SCC”), representing total accounts payable settlements of approximately $0.1 and $1.1 million, resulting in a loss on conversion of $0.3 million and $1.7 million, respectively.
During the six months ended June 30, 2026 and 2025, the Company issued and shares of common stock (Level 1 inputs) to SCC, representing total accounts payable settlements of approximately $1.3 and $4.1 million, resulting in a loss on conversion of $0.8 million and $2.6 million, respectively.
Debt to Equity Conversions
The conversions occurred over multiple tranches throughout the year, during which the Company’s stock price experienced substantial volatility. The trading price of the Company’s common stock ranged from a low of approximately $ to a high of $ during the period. For the three months ended June 30, 2026 and 2025, the Company recognized a loss on extinguishment of debt of $0.3 million and $1.7 million due to the volatility of the Company’s common stock price, respectively. For the six months ended June 30, 2026 and 2025, the Company recognized a loss on extinguishment of debt of $1.1 million and $12.3 million due to the volatility of the Company’s common stock price, respectively.
Shares Issuances
On January 6, 2026, the Company issued Streeterville Capital, LLC (“Streeterville”) shares of common stock pursuant to an exchange of a partitioned note in the amount of $100,000.
On January 8, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $137,500.
On January 8, 2026, Boot Capital LLC converted $33,063 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 8, 2026, 1800 Diagonal Lending LLC converted $50,000 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 9, 2026, 1800 Diagonal Lending LLC converted $50,000 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 9, 2026, the Company authorized the issuance of share of common stock to James T. Porter pursuant to the Rescission Agreement set forth in Item 5.03 below.
On January 12, 2026, 1800 Diagonal Lending LLC converted $55,000 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 12, 2026, the Company issued Agile 30,240 shares of Series D Convertible Preferred Stock pursuant to the Securities Exchange Agreement.
On January 13, 2026, the Company issued Streeterville shares of common stock pursuant to an exchange of a partitioned note in the amount of $125,000.
On January 13, 2026, Boot Capital LLC converted $33,063 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 14, 2026, 1800 Diagonal Lending LLC converted $60,000 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 15, 2026, 1800 Diagonal Lending LLC converted $38,250 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 16, 2026, the Company issued Streeterville shares of common stock in an exchange for a partitioned note in the principal amount of $115,000.
On January 16, 2026, 1800 Diagonal Lending LLC converted $50,000 of the principal amount owed under the July 7, 2025 promissory note into shares of common stock. On the same day, 1800 Diagonal Lending LLC converted the remaining $59,581 of the amount owed under the July 7, 2025 promissory note into shares of common stock.
On January 20, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $125,258.
On January 21, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $143,438.
On January 22, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $145,700.
On January 22, 2026, the Company issued Streeterville shares of common stock pursuant to eighteen exchanges of partitioned notes in the amounts totaling $2,234,400.
On January 26, 2026, the Company issued Streeterville shares of common stock pursuant to an exchange of a partitioned note in the amount of $7,618.
On January 30, 2026, five holders of OID promissory notes dated May 27, 2025, in the gross principal amount of $450,000, converted the notes into shares of the Company’s Series D Convertible Preferred Stock.
On February 2, 2026, the Company effectuated a 1-for-20 reverse stock split of its outstanding shares of common stock.
On February 2, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 2, 2026, Streeterville converted $60,000 of the Exchange Note dated September 10, 2025 (the “Note”) into shares of the Company’s Series D Convertible Preferred Stock, which were immediately converted into shares of the Company’s common stock.
On February 3, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 3, 2026, Streeterville converted $389,888 of the Exchange Note dated September 10, 2025 (the “Note”) into shares of the Company’s Series D Convertible Preferred Stock, which were immediately converted into shares of the Company’s common stock.
On February 4, 2026, SCC, pursuant to the Settlement Agreement and Stipulation dated as of October 28, 2025, as amended, requested the issuance of shares of Common Stock to SCC, representing a payment of approximately $126,359.
On February 5, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 5, 2026, SCC, pursuant to the Settlement Agreement and Stipulation dated as of October 28, 2025, as amended, requested the issuance of shares of common stock to SCC, representing a payment of approximately $229,814.
On February 6, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 6, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $111,567.
On February 9, 2026, a holder of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 9, 2026, SCC requested the issuance of shares of common stock to SCC, representing a payment of approximately $111,195.
On February 10, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 11, 2026, in connection with the round lot share rounding associated with the reverse stock split, the Company issued shares of common stock to CEDE & Co. for distribution to stockholders effected by the rounding.
On February 13, 2026, the Company issued Streeterville shares of common stock pursuant to three exchanges of partitioned notes totaling $304,000.
On February 13, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On February 18, 2026, the Company issued Streeterville shares of common stock pursuant to two exchanges of partitioned notes totaling $130,000.
On February 25, 2026, the Company issued Streeterville shares of common stock pursuant to five exchanges of shares of Series E Preferred Stock.
On March 4, 2026, 1800 Diagonal Lending LLC converted $152,950 of the principal amount owed under the August 25, 2025 promissory note into shares of common stock.
On March 12, 2026, the Company sold shares of Series D Convertible Preferred Stock at $ per share to an accredited investor for cash consideration of $525,000.
On March 19, 2026, the Company issued shares of Series D Convertible Preferred Stock to an investor pursuant to a Purchase and Exchange Agreement.
On March 23, 2026, the Company effectuated a 1-for-100 reverse stock split of its outstanding shares of common stock.
On March 23, 2026, holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On March 24, 2026, the Company issued shares of Series D Convertible Preferred Stock to a strategic advisor for services to be rendered pursuant to a strategic advisory agreement for the period from March 24, 2026 through March 31, 2028.
On March 24, 2026, the Company issued shares of Series D Convertible Preferred Stock to Agile Capital Funding LLC pursuant to an Exchange and Settlement Agreement.
On March 27, 2026, a holder of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On March 30, 2026, we entered into an agreement to purchase two additional primary sponsorships for the 2026 NHRA Tony Stewart Racing Nitro team racing season. Whereby the Company issued shares of our Series D Convertible Preferred Stock.
On April 13, 2026, two holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On April 17, 2026, two holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On April 27, 2026, seven holders of shares of Series D Convertible Preferred Stock converted such shares into shares of common stock.
On April 28, 2026, SCC, pursuant to the Settlement Agreement and Stipulation dated as of October 28, 2025, as amended, requested the issuance of shares of Common Stock to SCC, representing a payment of approximately $75,000.
On April 28, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On April 29, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On April 30, 2026, the Company issued Streeterville shares of common stock pursuant to the agreement at a per share price of $.
On May 1, 2026, the Company issued Streeterville shares of common stock pursuant to the agreement at a per share price of $.
On May 4, 2026, the Company issued Streeterville shares of common stock pursuant to the agreement at a per share price of $.
On May 5, 2026, the Company issued Streeterville shares of common stock pursuant to the agreement at a per share price of $.
On May 5, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On May 6, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On June 15, 2026, 1800 converted a portion of the principal amount owed under the December 15, 2025 promissory note into shares of common stock at a per share price of $0.0563.
On June 16, 2026, 1800 converted a portion of the principal amount owed under the December 15, 2025 promissory note into shares of common stock at a per share price of $0.0563.
On June 17, 2026, the Company issued Streeterville shares of common stock pursuant to the Series E Preferred exchange agreement at a per share price of $.
On June 17, 2026, 1800 Diagonal Lending LLC converted $21,814 of the remaining principal amount owed under the December 15, 2025 promissory note into shares of common stock at a per share price of $0.05633.
On June 17, 2026, the Company authorized the issuance of shares of common stock to Streeterville pursuant to the exchange agreement at a per share price of $.
On June 18, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On June 22, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On June 25, 2026, the Company issued Streeterville shares of common stock pursuant to the exchange agreement at a per share price of $.
On June 29, 2026, SCC, pursuant to the Settlement Agreement and Stipulation dated as of October 28, 2025, as amended, requested the issuance of shares of Common Stock to SCC, representing a payment of approximately $73,000.
LTIP Shares
On April 9, 2025, the Company registered an aggregate of shares of common stock pursuant to the 2021 Long-Term Incentive Plan and the 2025 Stock Incentive Plan. shares have been issued under the 2025 Stock Incentive Plan through June 30, 2026.
New Preferred Stock Series and Designations and Reg. A+ Offering
On May 10, 2024, the Company’s board of directors approved the designation of a new Series D Convertible Preferred Stock (the “Series D Designation”). The Series D Designation was filed by the Company with the Secretary of State of Nevada on May 10, 2024, and designated shares of Series D Preferred Stock, $ par value per share. The Series D Preferred Stock has the following rights:
Stated Value. Each share of Series D Preferred Stock has an initial stated value of $.
Conversion at Option of Holder. Each share of Series D Preferred Stock shall be convertible into shares of Common Stock at a fixed ratio of 1:5 ( share of Series D Preferred Stock converts into shares of Common Stock), at the option of the holder thereof, at any time following the issuance date of such share of Series D Preferred Stock at the Company’s office or any transfer agent for such stock. The conversion ratio shall not be adjusted for stock splits, stock dividends, recapitalizations or similar events.
Forced Conversion – If the closing price of the Company’s Common Stock during any ten consecutive trading day period has been at or above $ per share (as adjusted for stock splits, stock dividends recapitalizations and similar events), then the Company shall have the right to require the holder of the Series D Preferred Stock to convert all, or any portion of, the shares of Series D Preferred Stock held by such holder for shares of Common Stock. If the Company elects to cause a forced conversion of the shares of Series D Preferred Stock, then it must simultaneously take the same action with respect to all of the other shares of Series D Preferred Stock then outstanding on a pro rata basis.
Voting Rights. The Series D Preferred Stock has no voting rights relative to matters submitted to a vote of the Company’s stockholders (other than as required by law). The Company may not amend its articles of incorporation or the Series D Designation (whether by merger, consolidation, or otherwise) to materially and adversely change the rights, preferences or voting power of the Series D Preferred Stock without the affirmative vote of at least two-thirds of the votes entitled to be cast on such matter by holders of the Company’s outstanding shares of Series D Preferred Stock, voting together as a class.
On August 22, 2025 (as amended on March 29, 2026), the Company’s board of directors approved the designation of a new Series E Preferred Stock (the “Series E Designation”). The Series E Designation was filed by the Company with the Secretary of State of Nevada on August 22, 2025 and designated shares of Series E Preferred Stock, $ par value per share. Each share of Series E Preferred Stock shall have an initial stated value of $1,000.00. The Series E Preferred Stock has the following rights:
Ranking. Except to the extent that the holders of at least a majority of the outstanding Series E Preferred Stock (the “Required Holders”) expressly consent to the creation of Parity Stock (as defined below), all shares of capital stock of the Company shall be junior in rank to all Series E Preferred Stock with respect to the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (such junior stock is referred to herein collectively as “Junior Stock”). The rights of all such shares of capital stock of the Company shall be qualified by the rights, powers, preferences and privileges of the Series E Preferred Stock. Without limiting any other provision of the Certificate of Designations, without the prior express consent of the Required Holders, voting separately as a single class, and with each share of Series E Preferred Stock having one vote on such matter, the Company shall not hereafter authorize or issue any additional or other shares of capital stock that is (i) of senior rank to the Series E Preferred Stock in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Senior Preferred Stock”), or (ii) of pari passu rank to the Series E Preferred Stock in respect of the preferences as to dividends, distributions and payments upon the liquidation, dissolution and winding up of the Company (collectively, the “Parity Stock”). In the event of the merger or consolidation of the Company with or into another corporation wherein the Company is the surviving entity, the shares of Series E Preferred Stock shall maintain their relative rights, powers, designations, privileges and preferences provided for herein and no such merger or consolidation shall provide for a result inconsistent therewith, subject to the other terms and conditions herein.
Preferred Return. Each share of Series E Stock shall accrue a rate of return on the Stated Value at the rate of 10% per year, compounded daily to the extent not paid as set forth herein, and to be determined pro rata for any fractional year periods (the “Preferred Return”). The Preferred Return shall accrue on each share of Series E Stock from the date of its issuance and shall be payable or otherwise settled as set forth herein. Accrued and unpaid Preferred Return shall be cumulative and shall remain payable in cash or additional shares of Series E Stock, in each case at the Corporation’s election. Failure to pay Preferred Return on any quarterly date shall not give any holder the right to require redemption, repurchase or other settlement of the Series E Stock. In the event that the Corporation elects to pay any Preferred Return via the issuance of shares of Series E Stock, no fractional shares of Series E Stock shall be issued, and the Corporation shall round the number of shares of Series E Stock to be issued to the nearest whole share.
Voluntary Liquidation, Dissolution or Winding Up. In the event of any voluntary liquidation, dissolution or winding up of the Corporation, each share of Series E Stock shall be entitled to be paid out of the assets of the Corporation available for distribution to its shareholders, before any payment shall be made to the holders of Common Stock or any other class or series of capital stock junior to the Series E Stock with respect to liquidation, an amount per share equal to the Stated Value then in effect plus any accrued but unpaid Preferred Return (the “Series E Preferred Liquidation Amount”). If upon any such voluntary liquidation, dissolution or winding up of the Corporation the assets of the Corporation available for distribution to its shareholders shall be insufficient to pay in full the Series E Preferred Liquidation Amount, the Series E Holders shall share ratably in any distribution of the assets available for distribution in proportion to the respective amounts that would otherwise be payable in respect of the shares held by them if all amounts payable thereon were paid in full. Following payment of the Series E Preferred Liquidation Amount, the Series E Stock shall not participate in any further distributions. For the avoidance of doubt, no merger, consolidation, recapitalization, Fundamental Transaction, sale or disposition of assets, change of control, reverse split, delisting, covenant breach, insolvency event or similar transaction or occurrence shall constitute a liquidation, dissolution or winding up of the Corporation or otherwise entitle any Series E Holder to require the redemption, repurchase or other settlement of any shares of Series E Stock.
No Conversions. The Series E Preferred Stock shall not be convertible into shares of common stock or into any other class or series of stock of the Company.
Company Optional Redemption. Subject to the terms and conditions herein, at any time the Corporation may elect, in the sole discretion of the Board, to redeem all or any portion of the Series E Stock then issued and outstanding from all of the Series E Holders (a “Corporation Optional Redemption”) by paying to the applicable Series E Holders an amount in cash equal to the Series E Preferred Liquidation Amount then applicable to such shares of Series E Stock being redeemed in the Corporation Optional Redemption (the “Redemption Price”). Redemption of the Series E Stock shall at all times remain solely at the election of the Corporation, and no Series E Holder shall have any right to require, accelerate or condition any redemption, repurchase or other settlement of the Series E Stock. The Corporation shall provide written notice of any Corporation Optional Redemption to the applicable Series E Holder(s) within five (5) Business Days following the determination of the Board to consummate the applicable Corporation Optional Redemption, and thereafter such Corporation Optional Redemption shall be completed within five days following the delivery of such notice, and at such time the Corporation shall deliver to the applicable Series E Holder(s) the Redemption Price in valid funds. Each applicable Series E Holder agrees to execute and deliver to the Corporation such instruments and documents, and to take such actions, as reasonably required to consummate the Corporation Optional Redemption. Failure of any Series E Holder to execute any instrument or deliver any certificate shall not delay or prevent a Corporation Optional Redemption.
Dividends and Distributions. The Series E Preferred Stock shall not participate in any dividends, distributions or payments to the holders of the common stock.
Vote/Amendment. Other than as set forth in Section 10(b), the Series E Stock shall not have any voting rights and shall not vote on any matter submitted to the holders of the Common Stock, or any class thereof, for a vote. The Corporation may not, and shall not, amend or repeal this Certificate of Designations without the prior written consent of Series E Holders holding a majority of the Series E Stock then issued and outstanding, in which vote each share of Series E Stock then issued and outstanding shall have one vote, voting separately as a single class, in person or by proxy, either in writing without a meeting or at an annual or a special meeting of such Series E Holders, and any such act or transaction entered into without such vote or consent shall be null and void ab initio, and of no force or effect.
Covenants. Until such time as no shares of Series E Stock remain outstanding, the Corporation will at all times comply with the following covenants:
(a) The Corporation will use its best efforts to timely file on the applicable deadline all reports required to be filed with the SEC pursuant to Sections 13 or 15(d) of the Exchange Act, and will take all reasonable action under its control to ensure that adequate current public information with respect to the Corporation, as required in accordance with Rule 144 of the Securities Act, is publicly available, and will not terminate its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or the rules and regulations thereunder would permit such termination.
(b) Reserved.
(c) After six (6) months from the Initial Issuance Date, the Corporation will not have the right to repay any outstanding indebtedness owed to any Series E Holder or its Affiliates.
(d) The Corporation will not increase the authorized shares of Common Stock or Preferred Stock without the prior written consent of the Required Holders, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion.
(e) Reserved.
(f) The Corporation will not make any Restricted Issuance without the Required Holders’ prior written consent, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion.
(g) The Corporation shall not enter into any agreement or otherwise agree to any covenant, condition, or obligation that locks up, restricts in any way or otherwise prohibits the Corporation (a) from entering into a variable rate transaction with any Series E Holder or any Affiliate of any Series E Holder, or (b) from issuing Common Stock, Preferred Stock, warrants, convertible notes, other debt securities, or any other of the Corporation’s securities to any Series E Holder or any Affiliate of any Series E Holder without the Required Holders’ prior written consent, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion.
(h) The Corporation will not pledge or grant a security interest in any of its or its subsidiaries’ assets without the Required Holders’ prior written consent, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion, other than those security interests in effect for the benefit of the Series E Holders.
(i) The Corporation will not dispose of any of its or its subsidiaries’ assets or operations that are material to the Corporation’s or its subsidiaries’ operations without the Required Holders’ prior written consent, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion.
(j) Except in connection with satisfaction of a Nasdaq deficiency notice, the Corporation will not, and will not enter into any agreement or commitment to, undertake or complete any reverse split of the Common Stock or any class of Preferred Stock without the Required Holders’ prior written consent, which consent may be granted on withheld in the Required Holders’ sole and absolute discretion.
(k) The Corporation will not create, authorize, or issue any class of Preferred Stock (including additional issuances of Series E Stock, other than as set forth herein) without the Required Holders’ prior written consent, which consent may be granted or withheld in the Required Holders’ sole and absolute discretion.
(l) The Corporation will not consummate a Fundamental Transaction or enter into an agreement to consummate a Fundamental Transaction without the Required Holders’ prior written consent, which consent may be granted on withheld in the Required Holders’ sole and absolute discretion.
(m) For the avoidance of doubt, no breach of any covenant in this Section 11 shall constitute a redemption event or give any Series E Holder any right to require the Corporation to redeem, repurchase or otherwise settle any shares of Series E Stock in cash or other assets.
Remedies; No Holder Redemption.
(a) If the Corporation breaches any covenant, obligation or agreement in this Certificate of Designations, the Required Holders may deliver written notice specifying the breach and, if such breach is reasonably capable of cure, the Corporation shall have five (5) Business Days to cure.
(b) Upon the occurrence and during the continuance of an uncured breach, the Series E Holders may pursue only such remedies as are available at law or in equity to enforce the specific provision breached, including damages, specific performance and injunctive relief.
(c) Notwithstanding anything herein to the contrary, no breach, Event of Default, covenant default, bankruptcy event, change of control, Fundamental Transaction, delisting, reverse split, financing, asset sale or similar event shall give any Series E Holder any right to require the Corporation to redeem, repurchase, acquire or otherwise settle any share of Series E Stock in cash or other assets.
(d) Without limiting clause (c), no remedy available to the Series E Holders shall include the right to prohibit or condition any issuance of securities on the prior or simultaneous redemption of the Series E Stock.
(e) Redemption of the Series E Stock shall at all times remain solely at the option of the Corporation pursuant to Section 8.
Conversion of Revenue Interest Loan for Preferred Stock Series D and Potential Issuance of Common Stock Equivalents from the Conversion of Series D
Refer to Note 10 for additional information regarding the settlement of debt liabilities through the issuances of Series D Preferred Stock, common stock, pre-funded warrants and convertible notes during the three and six months ended June 30, 2026 and 2025.
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