STOCKHOLDERS’ EQUITY |
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| STOCKHOLDERS’ EQUITY | NOTE 4 – STOCKHOLDERS’ EQUITY
Series A Preferred Stock
Based upon Board resolutions at the time the Company was re-domiciled in Nevada, the Company is authorized to issue shares of Preferred Stock, at a par value of $ of which shares of common stock were issued to our founders. Our Board has the authority, without further action by the stockholders, to issue up to shares of undesignated preferred stock with rights and preferences, including voting rights, designated from time to time by our Board. As of August 31, 2026, there are shares of Series A Preferred Stock authorized, of which shares are outstanding.
The holders of the Series A Preferred Stock shall have full voting rights and powers on all matters subject to a vote by the holders of the Corporation’s common stock and Series A Preferred Stock shall vote together as a single class with the holders of the Corporation’s common stock and the holders of any other class or series of shares entitled to vote with the common stock (collectively, the “Voting Capital Stock”), with the holders of Series A Preferred Stock being entitled to sixty eight percent (68%) of the total votes on all such matters regardless of the actual number of shares of Series A Preferred Stock then outstanding, and the holders of Voting Capital Stock and any other shares entitled to vote being entitled to their proportional share of the remaining 32% of the total votes based on their respective voting power.
The Company applies the guidance in ASC 480 – Distinguishing Liabilities from Equity, ASC 470 – Debt, and ASC 815 – Derivatives and Hedging to determine whether financial instruments should be classified as liabilities, equity, or temporary equity. preferred stock without redemption features, that meet the criteria for equity classification under ASC 815-40 are classified as equity. The Company determined the criteria for equity classification for the Series A preferred stock was met.
Unless otherwise declared from time to time by the Board of Directors, out of funds legally available thereof, the holders of shares of the outstanding shares of Series A Preferred Stock shall not be entitled to receive dividends. Holders of Series A Preferred Stock shall not be entitled, as a matter of right, to subscribe for, purchase or receive any part of any stock of the Corporation of any class whatsoever, or of securities convertible into or exchangeable for any stock of any class whatsoever, whether now or hereafter authorized and whether issued for cash or other consideration or by way of dividend by virtue of the Series A Preferred Stock nor shall the shares of Series A Preferred Stock be convertible into shares of the Corporation’s common stock. The shares of Series A Voting Preferred Stock being issued to the Holders are not transferable.
Common Stock
There are shares of Common Stock authorized and at August 31, 2026, there are shares of common stock outstanding. The holders of our Common Stock are: (i) are entitled to receive dividends out of funds legally available if our Board, in its discretion, determines to declare and pay dividends; (ii) are entitled to one vote for each share held, without any cumulative voting for the election of directors; (iii) not entitled to preemptive rights, and is not subject to conversion, redemption or sinking fund provisions; and (iv) if we become subject to a liquidation, dissolution or winding-up, are entitled to the assets legally available for distribution to the holders of our Common Stock and any participating preferred stock outstanding at that time, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights of and the payment of liquidation preferences, if any, on any outstanding shares of preferred stock.
During the three months ended August 31, 2026, the Company issued shares of common stock upon the conversion of certain outstanding convertible notes. Additional information regarding the conversion of the notes is disclosed in Note 5.
Warrants
On June 10, 2026 the Company issued 5,000,000 warrants in connection with a debt financing arrangement with a private investor. Each warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.25 per share. The warrants are exercisable at any time prior to July 8, 2031. The warrants were evaluated under ASC 470-20, Debt with Conversion and Other Options, and ASC 815, Derivatives and Hedging, to determine appropriate classification. Based on the terms of the warrants, including fixed exercise price and settlement in a fixed number of shares, the warrants were classified as equity instruments.
The fair value of the warrants at issuance was determined using the Black-Scholes option pricing model, which is considered an appropriate valuation technique under ASC 820, Fair Value Measurement. The following assumptions were used in the model:
Stock price at issuance: $ Exercise price: $.25 Expected term: 5 years Volatility: 113.43% Risk-free interest rate: 4.08%
On July 13, 2026 the Company issued 12,000,000 warrants in connection with a debt financing arrangement with a private investor. Each warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.25 per share. The warrants are exercisable at any time prior to July 13, 2031. The warrants were evaluated under ASC 470-20, Debt with Conversion and Other Options, and ASC 815, Derivatives and Hedging, to determine appropriate classification. Based on the terms of the warrants, including fixed exercise price and settlement in a fixed number of shares, the warrants were classified as equity instruments.
The fair value of the warrants at issuance was determined using the Black-Scholes option pricing model, which is considered an appropriate valuation technique under ASC 820, Fair Value Measurement. The following assumptions were used in the model:
Stock price at issuance: $ Exercise price: $.25 Expected term: 5 years Volatility: 111.45% Risk-free interest rate: 3.97% Dividend yield: none
On July 14, 2026 the Company issued 12,000,000 warrants in connection with a debt financing arrangement with a private investor. Each warrant entitles the holder to purchase one share of the Company’s common stock at an exercise price of $.25 per share. The warrants are exercisable at any time prior to July 14, 2031. The warrants were evaluated under ASC 470-20, Debt with Conversion and Other Options, and ASC 815, Derivatives and Hedging, to determine appropriate classification. Based on the terms of the warrants, including fixed exercise price and settlement in a fixed number of shares, the warrants were classified as equity instruments.
The fair value of the warrants at issuance was determined using the Black-Scholes option pricing model, which is considered an appropriate valuation technique under ASC 820, Fair Value Measurement. The following assumptions were used in the model:
Stock price at issuance: $ Exercise price: $.25 Expected term: 5 years Volatility: 113.43% Risk-free interest rate: 4.02% Dividend yield: none
Dividend yield: none
Based on these inputs, the fair value of the warrant was estimated to be $ per warrant, resulting in a total fair value of $707,812.. This amount was recorded as additional paid-in capital in the equity section of the balance sheet.
The total discount recorded for these warrants granted related to these notes was $. The Company recognized amortization of debt discounts in interest expense totaling $132,267 and $139,656 for the three months ended August 31, 2026 and August 31, 2025 respectively.
As of August 31, 2026, there were 37,570,000 warrants outstanding with a weighted average exercise price of $ weighted average remaining expiration period of approximately years and intrinsic value of . There were additional warrants issued and warrants expired during three months ended August 31, 2026.
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