NOTE 7 - STOCKHOLDERS' DEFICIT
Preferred Stock
As of June 30, 2024, we had authorized 100,000,000 shares of Preferred Stock, of which certain shares had been designated as Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series E Preferred Stock, Series F Preferred Stock and Series G Preferred Stock. All Preferred Stock is classified as mezzanine equity as a result of the Company not having enough authorized common shares to be able to issue common
shares upon their conversion.
Series G Convertible Preferred Stock
On June 8, 2024, the Company designated 8,000,000 shares of Preferred Stock as Series G Convertible Preferred Stock. There are no shares of Series G Convertible Preferred Stock outstanding at this time. Series G Preferred shares have the following features: (i) 4% Cumulative Annual Dividends payable on the purchase value in cash or common stock of the Company at the discretion of the Board and payment is also at the discretion of the Board, which may decide to cumulate to future years; (ii) Any time after 12 months from issuance an option to convert to common stock at the election of the holder @ 75% of the 30 day average market closing price (for previous 30
business days) divided into $5.00. ; (iii) Automatic conversion of the Series G Preferred Stock shall occur without consent of holders upon any national exchange listing approval and the registration effectiveness of common stock underlying the conversion rights. The automatic conversion to common from Series G Preferred shall be @ 75% of the 30 day average market closing price (for previous 30 business days) divided into $5.00, which shall be post-reverse split as may be necessary for any Exchange listing (iv) Registration Rights – the Company has granted Piggyback Registration Rights for common stock underlying conversion rights in the event it files any other Registration Statement (other than an S-1 that the Company may file for certain conversion common shares for the convertible note financing that was arranged and funded in 2019). Further, the Company will file, and pursue to effectiveness, a Registration Statement or offering statement for common stock underlying the Automatic Conversion event triggered by an exchange listing. (v) Liquidation Rights - $5.00
per share plus any accrued unpaid dividends – subordinate to Series A, B, C, D, E and F Preferred Stock receiving full liquidation under the terms of such series. The Company has redemption rights for the first year following the Issuance Date to redeem all or part of the principal amount of the Series G Preferred Stock at between 115% and 140%.
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