NOTE 12: RELATED PARTY TRANSACTIONS

Equity transactions with related parties are described in Note 7, including the sale of 500,000,000 shares of common stock to PT Smart Green Technologies for $375,000 during fiscal 2026; the sale of three Series AA Convertible Preferred Stock shares to PT Smart Green Technologies for $300,000; the issuance of Series D Convertible Preferred Stock to an officer and two former directors; and, as described in Note 16 — Subsequent Events, the August 2026 sale of common stock to PT Smart Green Technologies. PT Smart Green Technologies is an affiliate of the Company by virtue of its ownership interest and is controlled by Dr. Niclas Adler.

In April 2026, the Company settled $1,526,096 of accrued salary owed to Mark B. Lucky, the Company’s Chief Financial Officer and a director, through the issuance of 21,623,056 shares of common stock with a fair value of $71,356; the $1,454,740 excess of the accrued salary settled over the fair value of the shares was recorded as a capital contribution to additional paid-in capital (see Note 13). On April 2, 2026, the Company paid Mr. Lucky a $10,000 deal fee and paid Paul R. Taylor, before his appointment as Chairman and Chief Executive Officer, a $25,000 reorganization fee, each of which was recorded as consulting expense. During the three months ended June 30, 2026, the Company paid Mr. Taylor $60,000 of salary, which exceeded the $52,468 of salary earned under his employment agreement through June 30, 2026 by $7,532. The $7,532 excess was recognized as compensation expense for the year ended June 30, 2026. Mr. Taylor’s July 2026 salary was reduced by the same amount.

In April 2026, the Company issued 363,359 shares of Series D Convertible Preferred Stock to an officer and two former directors in settlement of amounts due to them for working capital advances and unreimbursed out-of-pocket expenses (Thomas Grbelja, 351,159 shares; Paul Favata, 8,000 shares; and Mark Lucky, 4,200 shares) (see Note 6 – Accrued Interest Payable and Note 7 – Stockholders’ Deficit). The $3,956 excess of the $4,200 owed to Mr. Lucky over the fair value of the Series D Convertible Preferred Stock issued to him was recognized as a capital contribution to additional paid-in capital. Because Messrs. Grbelja and Favata had resigned as directors on April 7, 2026 and were not related parties of the Company on April 16, 2026, the date on which the terms of their exchanges were agreed and the exchange agreements were signed, the $338,328 excess of the $359,159 owed to them over the $20,831 fair value of the Series D Convertible Preferred Stock issued to them was recognized as a gain on extinguishment of debt (see Note 7 and Note 9). Because Messrs. Grbelja and Favata served as directors during fiscal 2026, these transactions are also described in Item 13.

From time to time we have borrowed operating funds from Mr. Mark Lucky, our Chief Financial Officer and from certain Directors, for working capital. The advances were payable upon demand and were interest free. $0 in advances remain outstanding as of June 30, 2026. Mr. Lucky is owed $3,754 for out-of-pocket expenses as of June 30, 2026, which is included on the balance sheet in Accounts payable and accrued expenses.

Between April 27, 2026 and June 8, 2026, while Cheddi Rai, the holder of approximately 25.5% of the equity of ConnexUS AI Inc., served as the Company’s Chief Operating Officer and Chief Technology Officer, the Company advanced $64,942 to ConnexUS AI Inc. in connection with the proposed acquisition described in Note 10. These advances, together with $134,173 advanced before Mr. Rai’s appointment, were written off upon termination of the proposed transaction on June 8, 2026.