Note 10 – Stockholders’ Deficit

At June 30, 2025 and December 31, 2024, respectively, the Company had three (3) classes of stock:

Preferred Stock

Preferred Stock – Series A

Preferred Stock – Series B

Common Stock

Equity Transactions for the Six Months Ended June 30, 2025

Stock Issued for Cash – Common Stock

The Company issued 135,000 shares of common stock for $135,000 ($1/share).

Stock Issued for Services – Series B, Preferred Stock

The Company’s Class B Preferred Stock is not traded on a public exchange, and therefore lacks an observable market price. As a result, the Company determined its fair value to be $1/share, based on the most recent third-party cash offerings, which provide the best available evidence of fair value.

In accordance with ASC 470, Debt, this valuation also aligns with the preferred stock’s as-converted value, as each Class B Preferred Share converts into 50 shares of common stock. The $1/share valuation thus represents the most reliable measure of fair value on the acquisition date.

On June 24, 2025, the Company issued 15,000 shares of Class B Preferred Stock, with an aggregate fair value of $750,000. This valuation was also based on the most recent third-party cash offering price for the Company’s common stock, supporting its use as the best indicator of fair value.

The Company determined the valuation of this transaction as follows:

Equity Transactions for the Year Ended December 31, 2024

Stock and Warrants Issued for Cash

On December 9, 2024, the Company issued 50,000 shares of common stock at $1/share for gross proceeds of $50,000.

On November 4, 2024, the Company issued 250,000 units consisting of one share of common stock and a warrant to purchase two shares of stock. The units were sold at $1/unit for gross proceeds of $250,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2026.

On October 30, 2024, the Company issued 20,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for gross proceeds of $20,000. The warrants are exercisable immediately at $3.50/share and expire on October 30, 2026.

On August 26, 2024, the Company issued 17,500 shares of common stock at $1/share for gross proceeds of $17,500.

On August 26, 2024, the Company issued 17,500 shares of common stock at $1/share for gross proceeds of $17,500.

On August 12, 2024, the Company issued 50,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for gross proceeds of $50,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2026.

On July 26, 2024, the Company issued 125,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for gross proceeds of $125,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2026.

On July 25, 2024, the Company issued 100,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for gross proceeds of $100,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2026.

On June 28, 2024, the Company issued 100,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for a subscription amount of  $100,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2026. 

On June 18, 2024, the Company issued 75,000 units consisting of one share of common stock and one warrant. The units were sold at $1/unit for gross proceeds of $75,000. The warrants are exercisable immediately at $3.50/share and expire on December 31, 2025.

Stock Issued for Services – Related Party

The Company’s Class B, Preferred Stock is not traded in an observable public market and there were no other third-party cash offerings to establish a fair value for these preferred shares.  However, in accordance with ASC 470 “Debt”, under its parity value (as-converted value), this represented the best evidence of fair value on the acquisition date as these preferred shares convert on a 50 for 1 basis (see above) into common stock.

On September 6, 2024, the Company issued 50,000 shares of Class B preferred stock, having a fair value of $2,500,000 ($1/share) as a consulting fee to its majority shareholder, based upon the most recent third-party cash offering price for common stock, which represents the best value of fair value.

The Company determined the valuation of this transaction as follows:

Stock Issuance and Related Cancellation – Gladiator Stock Purchase

Pursuant to the terms of the Gladiator Stock Purchase Agreement dated December 19, 2021, JMTM acquired 87% of the issued and outstanding stock for 866,667 JMTM common shares, with an “Earnout / Share Adjustment” clause offering additional shares for reaching certain revenue and earning benchmarks and a claw-back of the original shares for low performance.   Accordingly, due to a lack of performance the Company caused 368,967 shares to be returned and cancelled during the 1^st quarter ended March 31, 2024. We recorded a debit to common stock and credit to additional paid-in capital at par value $0.001 for $498. The Company applied by analogy the guidance in ASC 505-30 – Treasury Stock under the par value method.  The shares were not repurchased, rather in this transaction they were immediately cancelled pursuant to the terms of the agreement, and deemed to have been retired.

Warrants Issued for Services

On April 8, 2024, the Company issued 550,000, fully vested two-year (2) warrants for services rendered, having a fair value of $1,138,500. These warrants had an exercise price of $3.50/share.

Warrant Valuation Assumptions – 2024 Grants

The fair value of all warrants granted during the year ended December 31, 2024 were determined using a Black-Scholes option pricing model with the following inputs:

Warrants

Warrant activity for the six months ended June 30, 2025, and the year ended December 31, 2024 are summarized as follows: