NOTE 10: PROPOSED ACQUISITION OF CONNEXUS AI AND OTHER TERMINATED TRANSACTION

Proposed Acquisition of ConnexUS AI

During fiscal 2026, the Company entered into a non-binding Letter of Intent and related agreements contemplating the acquisition of ConnexUS AI Inc. The proposed transaction was intended to expand the Company's artificial intelligence product offerings and remained subject to negotiation and execution of definitive agreements, satisfaction of customary closing conditions, and completion of due diligence.

In connection with the proposed transaction, the Company advanced $199,115 ($134,173 before and $64,942 after April 27, 2026, the date on which Cheddi Rai, the holder of approximately 25.5% of the equity of ConnexUS AI Inc., became the Company’s Chief Operating Officer and Chief Technology Officer; see Note 12) to support development activities and other operating expenditures associated with the contemplated business combination.

On June 8, 2026, the Board of Directors determined that the proposed acquisition would not be consummated, and the parties entered into a Mutual Release, Settlement and Termination Agreement terminating all transaction documents and providing mutual releases. Under the settlement, the Company retained no ownership interest in ConnexUS AI or its intellectual property, and no reimbursement of the advances was required.

Accordingly, the Company recognized a charge of $199,115 during the year ended June 30, 2026, representing the write-off of amounts advanced in connection with the terminated transaction, presented as “Loss on terminated strategic acquisition initiative” within Other Income (Expense) in the consolidated statement of operations. No asset related to the proposed acquisition remained on the Company's balance sheet as of June 30, 2026.

No shares of Series E Convertible Preferred Stock or Series G Governing Preferred Stock were issued in connection with the proposed transaction. See Note 7 for the terms of

the Series E Convertible Preferred Stock designation, which remains on file with the Florida Department of State, and for the withdrawal of the Series G Governing Preferred Stock designation on September 11, 2026.

Write-off of Advance for Proposed Financing

Separately, and unrelated to the proposed acquisition of ConnexUS AI Inc. described above, during the year ended June 30, 2026, the Company paid a $10,000 fee to a prospective lender in connection with a proposed loan financing that was never consummated. Under the terms of the arrangement, the fee was refundable to the Company if the financing did not close; however, the prospective lender did not return the funds. Having determined that recovery of the $10,000 advance is not probable, the Company wrote off the related receivable and recognized a loss of $10,000 during the year ended June 30, 2026, presented as “Loss on write-off of advance for proposed financing” within Other Income (Expense) in the consolidated statement of operations. No asset related to this proposed financing remained on the Company's balance sheet as of June 30, 2026.