Company: BLIS
Filing Date: 2025-10-09
Form Type: 10-Q
Source: 0001199835-25-000342
Chunk: 61

Company: NAPC Defense, Inc.
Filing Date: 2025-10-09
Form: 10-Q
Item: Part I, Item 8
Chunk 61
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 until sign off and final determination of certain contingent terms and conditions. The shares were valued based on the
closing price of the Company’s stock on the date of the agreement. Upon completion of due diligence and a verification of certain
terms and conditions, the deal closed and the shares issued to NAPC, LLC were reclassified from a prepaid asset to intellectual property.
NAPC Defense, Inc.’s management has determined that the intellectual property should be impaired based on the Company not having
closed sales and licensing deals for CornerShot and related products and services as of April 30, 2025. Accordingly, the Company elected
to write down the value of the intellectual property to $0 during the year ended April 30, 2025.

    10

Stock
Based Compensation to Employees and Service Providers

The
Company recognizes all share-based payments to employees and service providers, including grants of employee stock options, as compensation
expense in the consolidated financial statements based on their fair values. That expense will be recognized over the period during which
an employee or service provider is required to provide services in exchange for the award, known as the requisite service period (usually
the vesting period) or immediately if the share-based payments vest immediately.

Convertible
Debentures

The
Company adheres to the guidance in Accounting Standards Updated (“ASU”) 2020-06, Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 simplifies an issuer’s accounting for convertible instruments
and its application of the derivatives scope exception for contracts in its own equity. Additionally, ASU 2020-06 removes the requirements
for accounting for beneficial conversion features. 

Convertible
Notes

Given
that the Convertible Notes, Warrants and Common Stock (“Commitment Shares”) that were issued in a singular transaction are
not subject to subsequent fair value accounting treatment, Management determined the relative fair value method shall be used for allocating
the proceeds of the transaction. Under the relative fair value method, the instrument being analyzed is allocated a portion of the
proceeds based on its fair value to the sum of the fair value of all the instruments covered in the allocation. 

Customer
Deposits

Customer deposits are an amount paid by a customer
prior to the Company providing it with goods or services. The Company has an obligation to provide the goods or services to the customer
or to return the money. The Company had $