Note 8. Shareholders’ Equity

At-The-Market Sales Agreement with Dawson James

On October 11, 2024, we entered into an At-the-Market Sales Agreement (the “ATM Agreement”) with Dawson James Securities Inc. (“Dawson James”) pursuant to which are allowed to issue and sell, from time to time, shares of our common stock (the “Shares”). Dawson James uses its commercially reasonable efforts to sell the Shares requested by us to be sold, consistent with their normal trading and sales practices. We may instruct Dawson James not to sell the Shares if the sales cannot be effected at or above the price designated by us and we may suspend sales pursuant to the ATM Agreement at any time. We pay Dawson James a commission of up to 3.0% of the gross proceeds from the sale of Shares under the ATM.

In February 2025, we sold 7.8 million shares pursuant to the ATM Agreement for net proceeds of $2.6 million after commissions and legal expenses totaling $0.11 million.

Series A Convertible Preferred Stock

On May 10, 2017, and on July 25, 2017, we issued 12,000,000 shares of convertible preferred stock designated as Series A Convertible preferred stock for an original purchase price and initial liquidation preference of $3.0 million. Each share of Series A Convertible preferred stock was issued for $0.25 per share. On March 9, 2018 and August 26, 2022, holders of a total of 6,583,000 shares of our Series A Convertible preferred stock converted their shares to common stock. In addition, in December 2024, the holders of the remaining 5,417,000 shares of our Series A Convertible preferred stock converted their shares into 9,028 shares of our common stock and, as a result of such conversions, no shares of Series A preferred stock remained outstanding at March 31, 2025 or December 31, 2024.

Series B Convertible Preferred Stock

On November 8, 2017, we issued 6,600,000 shares of convertible preferred stock designated as Series B Convertible preferred stock with an aggregate purchase price and initial liquidation preference of $3.3 million. Each share of Series B Convertible Preferred Stock was issued for $0.50 per share. On August 26, 2022, one holder of Series B Convertible preferred stock converted 1,950,000 shares to common stock. In addition, on December 2024, the remaining 4,050,000 shares of Series B Convertible preferred stock were converted into 13,500 shares of our common stock and, as a result of such conversions, no shares of Series B Convertible preferred stock remained outstanding at March 31, 2025 or December 31, 2024.

Series F Convertible Preferred Stock

In December 2023, we issued 8,000,000 shares of our Series F Convertible preferred stock in connection with our purchase of assets from Odyssey Health, Inc. (“Odyssey”) (see Note 9). The Series F Convertible preferred stock is convertible on a one-for-one basis into our common stock to the extent that Odyssey would not hold more than 19.9% of our outstanding common stock following the conversion. Upon issuance, 511,308 shares of Series F Convertible preferred stock were converted to 511,308 shares of our common stock and 7,488,692 shares of Series F Convertible preferred stock remained outstanding at March 31, 2025 and December 31, 2024.

Series G Mirroring Preferred Stock

In March 2025, in connection with our issuance of a $3.0 million promissory note (see Note 5), we designated and issued 1,000,000 shares of our authorized but unissued shares of preferred stock as Series G Mirroring preferred stock, no par value and a stated value of $0.10 per share. On May 2, 2025, upon our shareholders’ approval, at our annual shareholders meeting, of a proposal authorizing the Company’s Board of Directors, in its discretion at any time within one year after shareholder approval is obtained, to effect a reverse stock split of then-outstanding shares of the Company’s common stock, at a ratio of not less than one-for-five (1:5) and not greater than one-for-sixty (1:60), with the exact ratio to be determined by the Company’s Board and included in a public announcement (the “Reverse Split Proposal”), in accordance with the Certificate of Designation creating the Series G Mirroring Preferred Stock, all of the shares of Series G Mirroring Preferred Stock were transferred to the Company and cancelled and such shares have resumed the status of authorized but unissued shares of preferred stock and are no longer designated as Series G Preferred Stock.

Following is a summary of the principal terms of the Series G Mirroring Preferred stock:

Dividends

No dividends shall be paid on shares of the Series G Mirroring preferred stock.

Voting Rights

The Series G Mirroring preferred stock has no voting rights, except that each share entitles the holder thereof to 1,000 votes per share solely and exclusively with respect to the Reverse Split Proposal, the Amendment Proposal and any Adjournment Proposal (as such terms are defined in the Certificate of Designation creating the Series G Mirroring preferred stock) being voted on at our upcoming Annual Meeting, voting together with our common stock as a single class. The holder agreed to vote all 1,000,000 shares of Series G Mirroring preferred stock on any proposal presented to the shareholders for purposes of approving the Reverse Split Proposal, the Amendment Proposal and the Adjournment Proposal and has agreed that such shares of Series G Mirroring preferred stock, shall, to the extent voted in favor of such proposals, be automatically and without further action of the holder voted in the same proportions as shares of our common stock are voted on the Reverse Split Proposal, the Amendment Proposal and the Adjournment Proposal, as applicable.

Liquidation

The Series G Mirroring preferred stock ranked junior to the Series F preferred stock. Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary (a “Liquidation”), the holder was entitled to receive, out of the assets of the Corporation, an amount equal to the Stated Value for each share of Series G Mirroring preferred stock before any distribution or payment could be made to the holders of common stock but after any other class of stock than ranked senior to the Series G Mirroring preferred stock, including the Series F preferred stock.

Cancellation

Upon the approval of either the Reverse Split Proposal or the Proposal to Increase Authorized Shares, both of which were approved by the Company’s shareholders on May 2, 2025, each share of Series G preferred stock was automatically transferred to us and cancelled for no consideration with no action on behalf of the holders of Series G preferred stock, and such shares resumed the status of authorized but unissued preferred stock and no longer are designated as Series G Mirroring preferred stock.

Preemptive Rights

No holder of Series G Mirroring preferred stock has any preemptive rights to purchase or subscribe for our common stock or any of our other securities.

Trading Market

There is no established trading market for the Series G Mirroring preferred stock, and we do not expect a market to develop. We do not intend to apply for a listing for the Series G Mirroring preferred stock on any securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the Series G Mirroring preferred stock is limited.