SEC Filing Document

Company: Ambitious Entertainment, Inc.
Ticker: 
CIK: 1900851
Filing Type: S-1
Document Type: S-1
Date Filed: 2026-05-15
Accession Number: 0001493152-26-023581
Exchange: 
SIC Code: 7812
SIC Description: Services-Motion Picture & Video Tape Production
URL: https://www.sec.gov/Archives/edgar/data/1900851/000149315226023581/forms-1.htm

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$25,000 per Unit purchased. Each Unit was immediately separable upon issuance. The Company received gross proceeds in the amount of $125,000 from the issuance of the convertible notes. During the year ended December 31, 2025, the Company issued seven convertible debt instruments with principal balances of $25,000. Each debt instrument had the following terms (i) a one year, 7% senior secured convertible promissory note in the aggregate amount of $25,000 per Unit purchased (the “Convertible Notes”) subject to an original issue discount of 10% (the “OID”), (ii) a five-year Series B warrant at an aggregate exercise price of $25,000 per Unit purchased, and (iii) a five-year Series C warrant at an aggregate exercise price of $25,000 per Unit purchased. Each Unit was immediately separable upon issuance. The Company received gross proceeds in the amount of $200,000 from the issuance of the convertible notes. NOTE 10 - WARRANT Series A Warrants

During
the year ended December 31, 2021, the Company issued 5,600,000 Series A warrants for $56,000. Subsequent to their issuance, these warrants
were amended to prefunded warrants. As part of the amendment, the number of warrants was reduced to 4,000,000, and the exercise terms
were revised. The Series A Warrants are five-year warrants that are immediately vested and exercisable at a nominal exercise price of
$0.001 per share.

of December 31, 2025, and 2024, the Company has 4,000,000 Series A warrants outstanding.

Series
B Warrants (Units)

The
Series B Warrants are five-year warrants that are immediately vested and exercisable at an exercise price equal to 110% of the Conversion
Price of the Convertible Notes with an aggregate purchase price of $25,000 per Unit.

of December 31, 2025, and 2024, the Company has 85 and 77 Series B warrants units outstanding, respectively.

Series
C Warrants (Units)

The
Series C Warrants are five-year warrants that are immediately vested and exercisable at an exercise price equal to 110% of the Conversion
Price of the Convertible Notes with an aggregate purchase price of $25,000 per Unit.

of December 31, 2025, and 2024, the Company has 85 and 77 Series C warrants units outstanding, respectively.

The
Series A, B, and C Warrants have been accounted for as a derivative liability, in accordance with ASC 815. The derivative liability related
to the Series A, B, and C was recorded at its fair value of $6.8M and $6.9M as of December 31, 2025, and 2024, respectively.

summary of activity of the warrants during the year ended December 31, 2025, and 2024, are as follows:

Warrants Outstanding Weighted Average

Number of Weighted Average Remaining life

Warrants Exercise Price (years)

Outstanding, December 31, 2023 5,766,132 $	2.06 2.42

Granted 125,000 2.20 -

Expired / cancelled - - -

Exercised - - -

Outstanding, December 31, 2024 5,891,132 $	2.06 1.48

Granted 200,000 2.20 4.49

Expired / cancelled - - -

Exercised - - -

Outstanding, December 31, 2025 6,091,132 $	2.07 0.62

The
warrants are exercisable at a price equal to 110% of the conversion price of the related convertible notes. The convertible notes are
convertible at 50% of the Company’s initial public offering (“IPO”) price. Although the IPO price has not yet been
determined, the Company currently anticipates an IPO price of approximately $4.00 per share. Based on this assumption, the implied conversion
price of the notes would be $2.00 per share and the related warrant exercise price would be $2.20 per share. As of December 31, 2025,
the Company’s estimated fair value of its common stock was $1.90 per share based on recent arm’s-length transactions. Because
the estimated fair value of the Company’s common stock was below the warrant exercise price, the intrinsic value of the warrants
as of December 31, 2025 was $0.

NOTE
11 – DERIVATIVE LIABILITY

Fair
Value Assumptions Used in Accounting for Derivative Liabilities

ASC
815 requires the Company to assess the fair market value of derivative liabilities at the end of each reporting period and recognize
any change in fair market value as other income or expense. The Company determined that our derivative liabilities are classified as
Level 3 fair value measurements and used the Black-Scholes pricing model to calculate the fair value as of issuance and at December 31,
2025, and 2024.

The
Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the
current stock price, the estimated volatility of the stock price in the future, and the dividend rate. Changes to these inputs could
produce significantly higher or lower fair value measurements.

Key
assumptions and methodologies used are as follows:

●	Stock
Price : Based on historical issuances.

●	Expected
Volatility : Estimated using historical stock price volatility of comparable companies,
as our stock does not have sufficient historical trading activity.

●	Risk-Free
Interest Rate : Derived from U.S. Treasury rates for the applicable periods.

Sensitivity
Analysis

The
fair value of derivative liabilities is sensitive to changes in key inputs:

●	Volatility :
A 5% increase (decrease) in volatility would increase (decrease) the fair value by nominal
amount.

●	Risk-Free
Rate : A 50-basis point increase (decrease) in the risk-free interest rate would increase
(decrease) the fair value by approximately $2,700.

The
inputs used to calculate the derivative values are as follows:

Years ended

December 31,

Stock price $	0.79

Expected term 0.16

Expected average volatility 50	% 66	%

Expected dividend yield - -

Risk-free interest rate 3.47

The
following table summarizes the changes in the derivative liabilities during the year ended December 31, 2025, and 2024:

Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)

Balance – January 1, 2024 $	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

Addition of new derivatives recognized as warrants 444,126

Addition of new derivatives recognized as conversion feature 138,785

Loss on change in fair value of the derivative (342,625	)

Balance - December 31, 2025 $	8,714,459

The
aggregate loss on derivatives during the years ended December 31, 2025, and 2024 was as follows.

Year ended Year ended

December 31, December 31,

Day 1 loss due to derivative liabilities $	582,912 364,321

Change in fair value of the derivative (342,626	) 201,422

NOTE
12 – 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 205,474 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, 2025, and 2024, the Company has 237,341 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