Arizona Tribune - Kultura Brands Establishes Authorized Share Ceiling and Next Phase of Capital Structure Reform

LAKEWOOD, CO / ACCESS Newswire / August 14, 2026 / Kultura Brands, Inc., formerly Labor Smart (OTCID:LTNC) today announced additional components of its Board-approved capital structure initiative, including the establishment of 50 billion authorized shares of common stock and the Company's intention to continue evaluating opportunities to reduce that authorization as its broader restructuring progresses.

The action follows a series of steps undertaken by the Company to address legacy convertible obligations, reduce potential future dilution and create a more disciplined framework governing securities that may ultimately convert into common shares.

Under the Company's recently filed Articles of Amendment with the Wyoming Secretary of State, the Company's authorized common stock has been established at 50 billion shares.

A Ceiling, Not a Target

Management emphasized that the 50 billion authorized share amount is intended to provide the Company with appropriate flexibility while it continues addressing legacy obligations and completing other capital structure initiatives.

"This is a ceiling, not a target," said Brad Wyatt, CEO of Kultura Brands.

"We recognize that 50 billion authorized shares is more capacity than we anticipate needing over the long term. At the same time, we are in the middle of restructuring obligations and creating a new framework around future securities issuance. We believe it is important to maintain sufficient flexibility while that work is being completed."

Wyatt continued:

"As additional pieces of the restructuring are resolved, we expect to evaluate the authorized share count again. Our objective is not simply to establish a number and leave it there. We intend to continue tightening the capital structure as circumstances permit."

Changing How Future Share Issuance Is Managed

The Company's broader capital structure initiative is designed to address not only the number of shares authorized, but also the mechanisms through which potential future common shares may be created.

The Company has substantially modified the terms of its Series H Preferred Stock.

The Series H conversion ratio was changed from 100,000,000 common shares for each Preferred H share to 200,000 common shares for each Preferred H share.

The amended Series H designation also establishes a graduated quarterly conversion limitation beginning at 1% per quarter in Year 1, followed by 2% in Year 2, 3% in Year 3, 8% in Year 4 and 10% in Year 5 and thereafter.

Management's objective, where legally and contractually appropriate, is to utilize the Preferred H structure as an intermediate step for qualifying future securities issuances rather than allowing those securities to immediately become common shares.

"We have spent considerable time looking at how shares actually make their way into the common structure," Wyatt said.

"If we want a more disciplined capital structure, we can't focus only on what happens at the end of the process. We have to build controls into the beginning of the process."

Creating a More Predictable Path to Common Stock

The Company believes the revised Preferred H structure can provide greater predictability regarding the timing and rate at which qualifying securities may eventually convert into common shares.

Wyatt compared the approach to a metered entrance ramp onto a freeway.

"When too many cars enter a freeway at once, you create congestion," Wyatt said. "A metered ramp controls the rate at which cars are admitted."

"That is the concept behind what we are building. We want future securities, where appropriate, to move through a defined process rather than having potentially large quantities of shares become common stock over a compressed period."

Additional Reductions Remain Under Consideration

Management believes the 50 billion authorized share ceiling provides sufficient flexibility for the current phase of the restructuring.

However, the Company expects to continue evaluating that authorization as additional obligations are addressed.

"We're not finished," Wyatt said.

"The 50 billion figure reflects where we are today, not necessarily where we intend to remain."

"As we continue addressing legacy debt, restructuring securities and gaining greater visibility into future capital requirements, the Board will evaluate additional appropriate reductions."

A Multi-Step Capital Structure Strategy

The Company's Board-approved initiative is centered around several complementary objectives:

• addressing legacy convertible obligations;

• reducing potential future common-share dilution;

• limiting the rate at which qualifying securities may convert into common stock;

• utilizing a more controlled Preferred H structure where appropriate;

• maintaining sufficient flexibility to support operations and growth; and

Wyatt concluded:

"We understand that shareholders are looking for actions, not promises."

"We have been working through the structure piece by piece - negotiating legacy obligations, changing conversion mechanics and establishing greater controls around how securities can ultimately become common shares."

"Our goal is to build a capital structure that is more disciplined, more understandable and better aligned with the long-term interests of the Company and its shareholders."

The Company intends to continue providing updates as additional material components of its capital structure initiative are completed.

Forward-Looking Statements

This press release contains forward-looking statements regarding the Company's plans, intentions and expectations concerning its authorized share structure, Series H Preferred Stock, convertible obligations, future securities issuances and potential additional corporate actions. Forward-looking statements are based upon management's current expectations and assumptions and are subject to risks, uncertainties, contractual obligations, financing requirements, regulatory requirements and other factors that could cause actual results or future actions to differ materially from those expressed or implied. The Company undertakes no obligation to update forward-looking statements except as required by applicable law.

Investor and Media Inquiries

SOURCE: Kultura Brands, Inc.

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