SEC Filing Document

Company: Ambitious Entertainment, Inc.
Ticker: 
CIK: 1900851
Filing Type: DRS
Document Type: DRS
Date Filed: 2025-07-17
Accession Number: 0001493152-25-011282
Exchange: 
SIC Code: 7812
SIC Description: Services-Motion Picture & Video Tape Production
URL: https://www.sec.gov/Archives/edgar/data/1900851/000149315225011282/filename1.htm

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3.17 Expected average volatility 66 % 64 % Expected dividend yield - - Risk-free interest rate 3.88 The following table summarizes the changes in the derivative liabilities during the year ended December 31, 2024, and 2023: Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Balance – January 1, 2023 $ 4,349,390 Addition of new derivatives recognized as warrants 1,101,262 Addition of new derivatives recognized as conversion feature 344,145 Loss on change in fair value of the derivative 2,113,633 Balance - December 31, 2023 $ 7,908,430 Addition of new derivatives recognized as warrants 277,578 Addition of new derivatives recognized as conversion feature 86,743 Loss on change in fair value of the derivative 201,422 Balance - December 31, 2024 $ 8,474,173 The aggregate loss on derivatives during the years ended December 31, 2024, and 2023 was as follows. December 31, Change in fair value of the derivative $ 211,422 $ 2,606,094

Day 1 loss due to derivative liabilities 354,321 952,946

NOTE
11 – EQUITY

Authorized
Capital Stock

Effective
October 2020, the Company filed a Certificate of Amendment to the Articles of Incorporation for authorized capital stock to authorize
the Company to issue 151,000,000 shares. The Company has authorized 150,000,000 shares of common stock with a par value of $0.0001 per
share and 1,000,000 shares of Preferred Stock with a par value of $0.0001 per share. The
Company shall have the authority to issue the shares of Preferred Stock in one or more series with such rights, preferences and designations
as determined by the Board of Directors of the Company.

Series
A Preferred Stock

Effective
October 2020, the Company filed a Certificate of Amendment to the Articles of Incorporation for authorized capital stock to authorize
the Company to issue 151,000,000 shares. The Company has authorized 150,000,000 shares of common stock with a par value of $0.0001 per
share and 1,000,000 shares of Preferred Stock with a par value of $0.0001 per share. The
Company shall have the authority to issue the shares of Preferred Stock in one or more series with such rights, preferences and designations
as determined by the Board of Directors of the Company.

Series
A Preferred Stock

The
Company has designated 1,000,000 preferred shares, par value $0.0001, as Series A Preferred Stock. Holders of Series A Preferred Stock
would have the right to vote with 1 vote per common share on any matters brought before the stockholders of the Company.

The
Series A Preferred Stockholders are not entitled to any dividends, mandatory conversion right, or liquidation preference, however, they
do have a voluntary conversion right.

Series
A Preferred stock is redemption shares upon the occurrence of Liquidity event. The Company shall purchase all shares of Series A preferred
stock at a price of $3.00 per share.

Holders
of the Company’s Series A Preferred Stock shall have the right to convert at a ratio of 1 (one) share of the Company’s common
stock for 1 (one) share of the Company’s Series A Convertible Preferred Stock (subject to adjustments relating to stock splits,
distributions, mergers, consolidation, exchange of shares, recapitalization, reorganization, or other similar event).

During
the year ended December 31, 2020, the Company issued 205,473 shares of preferred series A stock for cash of $205,474.

During
the year ended December 31, 2021, the Company issued 31,867 shares of preferred series A stock for cash of $31,867.

of December 31, 2024, and 2023, the Company has 237,340 shares of Series A Convertible Preferred Stock issued and outstanding.

Preferred
Stock

Each
share of Preferred Stock entitles the holder to one vote, in person or proxy, on any matter on which an action of the stockholders of
the Company is sought.

Common
Stock

Each
share of Common Stock entitles the holder to one vote, in person or proxy, on any matter on which an action of the stockholders of the
Company is sought.

During
the year ended December 31, 2020, the Company issued 3,100,000 shares of commons stock for cash of $31,000. The Company also issued 1,700,000
common shares related to $17,000 of services rendered.

During
the year ended December 31, 2021, the Company issued 700,000 shares to affiliates for $7,000.

During
the year ended December 31, 2022, the Company issued 800,000
shares to an affiliate for $8,000.

During
the year ended December 31, 2023, the Company issued 500,000
shares to an affiliate for $5,000 which is recorded as a subscription receivable on the Company’s balance sheet.

During
the year ended December 31, 2024, the Company issued 640,000
shares of common stock for services rendered in connection with stock-based compensation expense of $1,216,000.

of December 31, 2024, and 2023, the Company had 7,440,000 and 6,800,000 shares of common stock issued and outstanding, respectively.

NOTE
12 - RELATED PARTY TRANSACTIONS

Promissory
Note

During
the year ended December 31, 2022, the Company issued promissory notes to our related parties, totaling $334,072. The promissory notes
mature (i) when the Company gets a financing with 25% of any financing going towards loan repayment until it is all paid or (ii) December
31, 2025, and bear interest at the rate of 10% per annum.

The
promissory notes are recorded on the Company’s balance sheet under Due to related parties.

Transactions

Prior
to the year ended December 31, 2023, the Company had a liability of $367,167 from related party advances. During the year ended December
31, 2023, the Company received related party advancements totaling $774,151 and made repayments of $171,529 to related parties. Additionally,
the Company reclassified a related party loan of $75,000 to convertible debt. As of December 31, 2023, the net increase in related party
obligations amounted to $527,622, which is recorded under due to related parties on the balance sheet. The reclassification of the related
party loan to convertible debt is a non-cash transaction and has been disclosed accordingly in the financial statements.

During
the year ended December 31, 2024, the Company received $217,005 in advances from related parties, the Company made repayments of $101,572
and the Company transferred $376,890 of related party obligations as a result of corporate and membership transfer interest agreements
(see Note 13).

of December 31, 2024, and 2023, the Company has a liability of $633,122 and $894,789 due to related parties, respectively.

NOTE
13 – TRANSFER OF INTEREST

Nature
of the Transaction

On March 31, 2024, the Company transferred its 100% interest in AMFAD and CD, to Press Play Productions, LLC, a related party for a total
consideration of $20 (see Note 12). The transferred subsidiaries owned the film rights to All My Friends are Dead and Cold
Deck.

Additionally,
on March 31, 2024, the Company transferred its 100% interest in Viper to an unrelated third party for total consideration of $10. The
transferred subsidiary owned the film rights to Viper.

August 14, 2024, the Company transferred 80% of its ownership interest in DMH Production LLC equally to two unrelated third parties for
total consideration of $10. The Company retained a 20% ownership interest in DMH post-transaction. The transferred subsidiary owned the
film rights to Dead Man’s Hand.

Finally,
on December 1, 2024, the Company transferred its 100% interest in GOR to an unrelated third party for total consideration of $10. The
transferred subsidiary owned the film rights to Guns of Redemption.

Related
Party Disclosure

Press
Play Productions, LLC, is a related party. The president of Press Play Productions is the son of the Company’s CEO. The transfer
of AMFAD and CD included provisions stipulating that the transferee assumes all contractual obligations and liabilities of the transferred
subsidiaries, and the transferor retains no further responsibility for these obligations.

Reason
for the Transfer

The transfers were part of the Company’s strategy to divest film projects once all anticipated revenue had been realized and the
Company determined that there would be no further significant benefit derived from retaining the films. This strategy aligns with the
Company’s focus on producing new film projects rather than managing completed ones.

Accounting
Treatment

The transfers of interest were accounted for as deconsolidation of a subsidiaries. As a result:

pre-tax gain of $1,933,261 was recognized in the consolidated statement of operations under
“Other Income (Expenses)” as a Gain on Transfer of Corporate and Member Interest.

The
results of operations of AMFAD, CD, and Viper were included in the consolidated financial statements through March 31, 2024.The results
of operations of DMH were included in the consolidated financial statements through August 14, 2024.The results of operations of GOR
were included in the consolidated financial statements through December 1, 2024.

Financial
Impact

The
following balances were removed from the consolidated balance sheet as of the respective transfer dates:

March
31, 2024 (AMFAD, CD, and Viper):

●	Total
assets: $6,361,903

●	Total
liabilities: $5,659,783

●	Net
assets: $692,120

August
14, 2024 (DMH):

●	Total
assets: $887,535

●	Total
liabilities: $2,290,423

●	Net
liabilities: $1,402,888

December
1, 2024 (GOR):

●	Total
assets: $2,278,857

●	Total
liabilities: $3,700,350

●	Net
liabilities: $1,421,493

Cash
Flow Statement Impact

The
transactions had no direct cash flow impact, as no cash was received.

Post-Transfer
Obligations