||Net Loss per Share of
The Company has adopted FASB Topic 260, “Earnings
per Share,” which requires presentation of basic and diluted EPS on the face of the income statement for all entities with complex
capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator
of the diluted EPS computation. In the accompanying financial statements, basic loss per share of common stock is computed by dividing
net loss by the weighted average number of shares of common stock outstanding during the year. Basic net loss per common share is based
upon the weighted average number of common shares outstanding during the period. Dilution is computed by applying the treasury stock method.
Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later),
and as if funds obtained thereby were used to purchase common stock at the average market price during the period.
Convertible debt that was convertible into 24,638,241
shares of the Company’s common stock is not included in the computation for the fiscal year ended June 30, 2020.
Convertible preferred equity, in the form of 4,665
of the Company’s Class B Preferred Stock, which is convertible into 23,325,000 shares of common stock, is not included in the computation
for the fiscal year ended June 30, 2021. Such conversions would also create 23,325,000 cash warrants with an exercise price of $.30. As
of June 30, 2021, none of the holders of Class B stock had exercised any conversions, so these warrants were not issued or outstanding
as of June 30, 2021.
Additionally, there are 8,050,000 and 1,075,000 warrants that are exercisable
into shares of stock as of June 30, 2021 and 2020, respectively.