NOTE 9 – STOCKHOLDERS’ EQUITY

12 Months Ended

Aug. 31, 2025

Equity [Abstract]

NOTE 9 – STOCKHOLDERS’ EQUITY

NOTE 9 – STOCKHOLDERS’ EQUITY

Common shares

The Company had the following activities for the year ended August 31, 2025:

Issuance of common shares

On February 21, 2025, the Company entered into a stock purchase agreement with Anyone Pictures Limited. Under the terms of this agreement, the Company issued 2,000,000,000 shares of the Company’s common stock at a value of $0.00015 per share for gross proceeds of $300,000 (See Note 8).

On March 14, 2025, the Company issued 2,000,000,000 shares of the Company’s common stock valued at market price of $0.0002 per share for a total amount of $400,000 to Mr. Chiyuan Deng, the Chief Executive Office. (See Note 8).

On May 15, 2025, the Company entered into another stock purchase agreement with Anyone Pictures Limited. Under the terms of this agreement, the Company issued 1,750,000,000 shares of the Company’s common stock at a value of $0.0002 per share for total gross proceeds of $350,000 (See Note 8).

AB INTERNATIONAL GROUP CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 – STOCKHOLDERS’ EQUITY (continued)

Common shares (continued)

The Company had the following activities during the year ended August 31, 2024: 

Issuance of restricted common shares

On October 5, 2023, the Board of Directors resolved to issue 225,000,000 shares of the Company’s restricted common stock, par value $0.001 per share, to Mr. Chiyuan Deng, the Chief Executive Officer, as settlement of his accrued executive salaries totaling $45,000.

Conversion of Series C preferred shares to common shares

During the year ended August 31, 2024, the Company issued total 1,056,681,936 common shares as the result of the conversion of total 174,421 Series C preferred shares.

Reverse Stock split

On June 12, 2023, the Board of Directors approved a reverse split for the Company’s issued and outstanding common stock, at a ratio of 1 share for every 10,000 shares, contingent upon receiving a market effectiveness date from FINRA. On September 8, 2023, however, the Board of Directors voted to cancel the proposed 1-for-10,000 reverse split, determining that it would not be in the best interest of the stockholders or the Company.

On April 22, 2024, the Board of Directors approved another reverse split of the Company’s issued and outstanding common stock, at a ratio of 1-for-2,000, also contingent upon FINRA approval. On August 19, 2024, the Board of Directors voted to cancel the planned 1-for-2,000 reverse split, concluding that proceeding with the action would not serve the best interests of the stockholders or the Company.

On June 5, 2025, the Company obtained the written consent of majority stockholders to grant discretionary authority to the Board of Directors of the Company, at any time or times for a period of 12 months after the date of the written consent, to adopt an amendment to the articles of incorporation to effect a reverse split of the issued and outstanding common stock within a range of 1-for-2,000 to 1-for-20,000. The exact ratio to be determined by the Board at a later date and is contingent upon receiving a market effectiveness date from FINRA.

Cancellation of Common shares

On February 5, 2024, the Board of Directors authorized the cancellation of 235,000,000 shares of the Company’s common stock.

Repurchase of common shares

On July 20, 2024, the Board of Directors approved the repurchase of 50,699,000 shares of the Company’s common stock from several shareholders for an aggregate purchase price of $50,699, or $0.001 per share. The repurchased shares are subsequently cancelled on August 26, 2024. The purchase price was settled in tranches. As of August 31, 2024, $38,485 of the purchase price has been paid. The remaining amount was settled in November 2024.

AB INTERNATIONAL GROUP CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 – STOCKHOLDERS’ EQUITY (continued)

Subscription of Common shares

On June 13, 2024, the Company entered into a Common Stock Purchase Agreement with Alumni Capital LP (“Alumni Capital”), a Delaware limited partnership. Pursuant to the Purchase Agreement, the Company has the right, but not the obligation to cause Alumni Capital to purchase up to $5 million of our common stock at the Investment Amount during the period beginning on the execution date of the Purchase Agreement and ending on the earlier of (i) the date on which Alumni Capital has purchased $5 million of our common stock shares pursuant to the Purchase Agreement or (ii) June 30, 2025.

Pursuant to the Purchase Agreement, the Investment Amount means seventy percent (70%) of the lowest daily Volume Weighted Average Price (“VWAP”) of the Common Stock five business days prior to the Closing of a Purchase Notice. No Purchase Notice will be made without an effective registration statement and no Purchase Notice will be in an amount greater than (i) $250,000 or (ii) three hundred percent (300%) of the Average Daily Trading Volume during the five business days prior to a Purchase Notice.

The Purchase Agreement provides that the number of our common stock shares to be sold to Alumni Capital will not exceed the number of shares that, when aggregated together with all other shares of our common stock which the investor is deemed to beneficially own, would result in the investor owning more than 4.99% of our outstanding common stock. The percentage may be increased to no more than 9.99% upon notice under the Purchase Agreement.

The Purchase Agreement contains certain representations, warranties, covenants and events of default. The Closing occurred following the satisfaction of customary closing conditions.   

As of June 30,2025, the agreement was expired and Alumni Capital LP did not purchase any shares.

As of August 31, 2025 and 2024, the Company had 8,031,266,321 and 2,281,266,321 shares of common stock issued and outstanding, respectively.

Preferred shares

The Company had no preferred share activities during the year ended August 31, 2025.

The Company had the following preferred share activities during the year ended August 31, 2024:

During the year ended August 31, 2024, the Company converted a total 174,421 Series C preferred shares into common shares.

On November 30, 2023, the Board of Directors approved the withdrawal of the Amended Certificate of Designation for the Company’s Series C and Series D Preferred Stock. On December 1, 2023, the Board of Directors approved the withdrawal of the Certificate of Designation for the Company’s Series B Preferred Stock. The Series B Preferred Stock was subsequently cancelled during the year ended August 31, 2024.

As of August 31, 2025 and 2024, the Company had 100,000 and 100,000 shares of Series A preferred stock issued and outstanding, respectively.

AB INTERNATIONAL GROUP CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 – STOCKHOLDERS’ EQUITY (Continued)

Warrants

2022 warrants

As a consideration of Common Stock Purchase Agreement signed with Alumni Capital on August 2, 2022, which resulted in Alumni Capital subscribing to a total of 200,000,000 shares of common stock for total proceeds of $146,475 as of August 31, 2023, Alumni Capital was granted the right to purchase up to 50,000,000 shares of the Company’s common stock (the “Warrant Shares”). The warrants have an exercise price of $0.02 per share and an exercise period commencing on August 2, 2022 and expiring on the fifth anniversary of the issuance date. The aggregate fair value of the warrants was estimated at $234,000 using the Black-Scholes pricing model with the following assumptions: market value of underlying common shares of $0.0048, risk-free interest rate of 2.85%, expected term of 5 years, exercise price of $0.02, expected volatility of 221.4%, and expected future dividends of nil.

2024 warrants

In connection with the Common Stock Purchase Agreement signed with Alumni Capital on June 13, 2024, the Company issued to Alumni a Common Stock Purchase Warrant dated the same day to purchase up to 1,943,304,434 shares of the Company’s common stock, representing (50%) of the commitment amount of $5 million, at an exercise price of $0.00129 per share, subject to adjustments, and ending on the 5 years anniversary of the issuance date. The number of shares under the Common Stock Purchase Warrant is subject to adjustment based on the following formula: (i) fifty percent (50%) of the Commitment Amount, less the exercise value of all partial exercises prior to the Exercise Date, divided by (ii) the Exercise Price on the Exercise Date. The exercise price per was calculated by dividing $3,000,000 by the total number of issued and outstanding shares of common stock as of June 13, 2024. The exercise price is subject to change based on a change in the number of our outstanding shares.

The aggregate fair value of the warrants was estimated at $970,945, using the Black-Scholes pricing model with the following assumptions: market value of underlying common shares of $0.0005; risk free rate of 4.24%; expected term of 5 years; exercise price of $0.0013; volatility of 310.94%; and expected future dividends of $0.

Management determined that these warrants meet the requirements for equity classification under ASC 815-40 because they are indexed to its own shares. The warrants were recorded at their fair value on the date of grant as a component of shareholders’ equity.

As of August 31, 2025, the Company was authorized to issue 10 billion shares of common stock. At that date, the Company had approximately 8.0 billion common shares issued and outstanding. If all outstanding common share warrants were exercised, the Company would be required to issue approximately 6.7 billion additional shares, which would exceed the number of authorized shares available. Because the Company did not have a sufficient number of authorized and unissued shares available for settlement, the warrants no longer met the equity classification criteria under ASC 815-40 and were reclassified as liabilities.

Upon reclassification, the warrants were measured at fair value, resulting in a warrant liability of $1,338,389, with $970,945 derecognized from equity and a loss of $367,444 recorded in earnings for the year ended August 31, 2025. The fair value was determined using the Black-Scholes option-pricing model

The aggregate fair value of the warrants was estimated at $1,338,389, using the Black-Scholes pricing model with the following assumptions: market value of underlying common shares of $0.0002; risk free rate of 3.67%; expected term of 3.79 years; exercise price of $0.0004; volatility of 402.11%; and expected future dividends of $0.

Following reclassification, the warrant liability is remeasured at fair value at each reporting date, with changes in fair value recognized in earnings in accordance with ASC 815-40.

As of August 31, 2025, 6,742,721,934 warrants in connection with two equity financings were outstanding, with weighted average remaining life of 3.77 years.    

A summary of the status of the Company’s warrants as of August 31, 2025 and 2024 is presented below:

	Number of warrants
	Original shares issued		Anti-dilution Adjusted
Warrants as of August 31, 2023		50,000,000		—
Warrants granted during the year		1,943,304,434		—
Warrants as of August 31, 2024		1,993,304,434		—
Adjustment		4,749,417,500		—
Exercisable as of August 31, 2025		6,742,721,934		—

AB INTERNATIONAL GROUP CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS