PART I - FINANCIAL INFORMATION [Item 1. Unaudited Financial Statements](index=3&type=section&id=Item%201.%20Unaudited%20Financial%20Statements) Unaudited Q1 2025 financials show asset growth post-IPO, a 19% revenue decline, and increased net loss from public company costs [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets increased to **$8,455,666** and stockholders' equity to **$6,807,581**, driven by IPO proceeds and cash growth Condensed Consolidated Balance Sheet Highlights | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $5,219,929 | $2,097,945 | | Total Current Assets | $6,802,104 | $3,319,188 | | Total Assets | $8,455,666 | $5,082,549 | | **Liabilities & Equity** | | | | Total Current Liabilities | $1,048,896 | $1,274,315 | | Total Liabilities | $1,648,085 | $1,909,191 | | Total Stockholders' Equity | $6,807,581 | $3,173,358 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 revenue decreased **19%** to **$1,449,377**, while a **130%** surge in SG&A led to a **$1,240,590** net loss Q1 2025 vs. Q1 2024 Performance | Metric | Three months ended March 31, 2025 | Three months ended March 31, 2024 | | :--- | :--- | :--- | | Revenue | $1,449,377 | $1,790,521 | | Gross Profit | $615,940 | $717,583 | | Operating Loss | $(1,238,376) | $(87,459) | | Net Loss | $(1,240,590) | $(81,133) | | Net Loss per Share | $(0.32) | $(0.03) | [Condensed Consolidated Statement of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statement%20of%20Stockholders%27%20Equity) Stockholders' equity increased to **$6,807,581** by March 31, 2025, driven by **$4.54 million** IPO proceeds, offset by a **$1,240,590** net loss - The company issued **1,280,000** shares in its IPO and an additional **163,569** shares for the over-allotment option, raising a total of **$4.54 million** net of costs[16](index=16&type=chunk) - The net loss for the quarter was **$1,240,590**, which reduced retained earnings (accumulated deficit)[16](index=16&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) Q1 2025 cash increased by **$3,121,984**, with **$1,561,698** used in operations and **$4,698,682** provided by IPO financing activities Cash Flow Summary (Q1 2025 vs. Q1 2024) | Cash Flow Activity | For the three months ended March 31, 2025 | For the three months ended March 31, 2024 | | :--- | :--- | :--- | | Net cash (used in) operating activities | $(1,561,698) | $6,839 | | Net cash used in investing activities | $(15,000) | $(44,656) | | Net cash from (used in) financing activities | $4,698,682 | $(3,460,286) | | **Increase (decrease) in cash** | **$3,121,984** | **$(3,498,103)** | - The company received **$4,680,013** in net proceeds from its IPO and over-allotment during the quarter[20](index=20&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail reorganization, **$4.7 million** IPO proceeds, **56%** customer concentration, a **$240,800** legal settlement, and new lease agreements - The company was formed on January 24, 2024, to become a holding company for Coldchain Technology Services, LLC, its main operating subsidiary[21](index=21&type=chunk) - The company has significant customer concentration, with one customer representing **56%** of revenue in Q1 2025 and another representing **14%**[40](index=40&type=chunk) - In February 2025, the company completed its IPO, generating gross proceeds of approximately **$5.776 million** and net proceeds of approximately **$4.7 million**[68](index=68&type=chunk) - A legal matter with a vendor was settled in February 2025 for **$240,800**[80](index=80&type=chunk) - Subsequent to quarter end, on April 1, 2025, the company entered into two new leases: a five-year warehouse lease and a ten-year corporate office lease[82](index=82&type=chunk)[83](index=83&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20MANAGEMENT%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20AND%20RESULTS%20OF%20OPERATIONS) Management attributes Q1 2025 revenue decline to lower demand, with increased operating expenses and net loss from IPO and public company costs [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Q1 2025 revenue fell **19%** to **$1,449,377** due to lower demand, while SG&A surged **130%**, leading to a **$1,238,376** operating loss Q1 2025 vs. Q1 2024 Operational Results | Metric | 2025 | 2024 | Change | Change % | | :--- | :--- | :--- | :--- | :--- | | Revenue | $1,449,377 | $1,790,521 | $(341,144) | -19% | | Gross Profit | $615,940 | $717,583 | $(101,643) | -14% | | SG&A Expenses | $1,854,316 | $805,042 | $1,049,274 | 130% | | Income (loss) from operations | $(1,238,376) | $(87,459) | $(1,150,917) | 1316% | | Net income (loss) | $(1,240,590) | $(81,133) | $(1,159,457) | 1429% | - The decrease in revenue was due to the diminution in demand for our emergency preparedness services by certain states and local governments[94](index=94&type=chunk) - The increase in SG&A expenses was driven by higher personnel costs (**$100,795**), professional fees for the IPO (**$212,677**), marketing and investor relations (**$189,707**), and stock-based compensation (**$330,825**)[97](index=97&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity strengthened with cash reaching **$5,219,929** due to **$4.7 million** IPO proceeds, despite **$1,561,698** cash used in operations - As of March 31, 2025, the company had **$5,219,929** in cash and cash equivalents[99](index=99&type=chunk) Cash Flow Changes (Q1 2025 vs. Q1 2024) | Cash Flow Activity | For Three Months Ended March 31, 2025 | For Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Cash (used in) operating activities | $(1,561,698) | $6,839 | | Cash (used in) investing activities | $(15,000) | $(44,656) | | Cash from (used in) financing activities | $4,698,682 | $(3,460,286) | - The increase in cash from financing activities was primarily due to **$4.68 million** in net proceeds from the IPO and over-allotment[103](index=103&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=Item%203.%20QUANTATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is a "smaller reporting company" and is therefore not required to provide information for this item - As a "smaller reporting company," the company is exempt from providing quantitative and qualitative disclosures about market risk[108](index=108&type=chunk) [Item 4. Controls and Procedures](index=26&type=section&id=Item%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded disclosure controls were ineffective as of March 31, 2025, due to material weaknesses like lack of documentation and incomplete segregation of duties - The CEO and CFO concluded that as of March 31, 2025, the company's disclosure controls and procedures were not effective at a reasonable assurance level[109](index=109&type=chunk) - Identified control deficiencies include the lack of written documentation for some internal control policies and procedures[112](index=112&type=chunk) - Another deficiency is the lack of complete segregation of duties within accounting functions, though management notes this may not be economically feasible for a company of its size[112](index=112&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=27&type=section&id=Item%201.%20LEGAL%20PROCEEDINGS) The company reports that it is not currently a party to any material legal proceedings - The company is not currently a party to any material legal proceedings[114](index=114&type=chunk) [Item 1A. Risk Factors](index=27&type=section&id=Item%201A.%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's Form 10-K for the year ended December 31, 2024 - As of the date of this report, there have been no material changes to the risk factors disclosed in the Form 10-K for the year ended December 31, 2024[115](index=115&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=27&type=section&id=Item%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) The company reported no unregistered sales of equity securities during the quarter ended March 31, 2025 - During the quarter ended March 31, 2025, no unregistered sales of equity securities occurred[116](index=116&type=chunk) [Item 6. Exhibits](index=27&type=section&id=Item%206%20EXHIBITS) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and Inline XBRL data files - Exhibits filed include CEO and CFO certifications (31.1, 31.2, 32.1, 32.2) and Inline XBRL documents[120](index=120&type=chunk)

[First Quarter 2025 Results and Business Update](index=1&type=section&id=First%20Quarter%202025%20Results%20and%20Business%20Update) [Management Commentary](index=1&type=section&id=Management%20Commentary) The CEO highlighted the company's strategy to scale its business model into high-growth sectors by leveraging its core strengths in advanced logistics - The company is strategically expanding into new, high-growth markets including GLP-1 pharmaceutical transportation, specialized compounding pharmacy logistics, and premium food packaging services[2](index=2&type=chunk) - A national expansion of emergency preparedness and response operations is underway, with a focus on untapped metropolitan areas and states[2](index=2&type=chunk) - The appointment of Christopher Shields as Senior Vice President of Emergency Preparedness & Response/Government Affairs is intended to accelerate geographic expansion[2](index=2&type=chunk) [Business Highlights](index=1&type=section&id=Business%20Highlights) In early 2025, Callan JMB successfully completed its IPO, raising approximately $5.7 million, strengthened its emergency response division, and secured significant state-level contracts - Completed its Initial Public Offering (IPO) on February 6, 2025, raising gross proceeds of approximately **$5.7 million**[1](index=1&type=chunk)[3](index=3&type=chunk) - Secured a new five-year contract with the Oregon Health Authority and renewed its arrangement with the Texas Department of State Health Services (DSHS) for emergency preparedness[3](index=3&type=chunk) - Appointed former Chicago Department of Public Health Assistant Commissioner, Christopher Shields, as SVP, Emergency Preparedness & Response/Government Affairs[3](index=3&type=chunk) - Launched a comprehensive lease program for vaccine management to reduce the financial burden on government and private organizations[3](index=3&type=chunk) [Financial Results](index=2&type=section&id=Financial%20Results) [Financial Highlights for the First Quarter Ended March 31, 2025](index=2&type=section&id=Financial%20Highlights%20for%20the%20First%20Quarter%20Ended%20March%2031%2C%202025) For the first quarter of 2025, Callan JMB reported revenue of $1.45 million, a decrease attributed to lower demand for emergency preparedness services, and posted a net loss of $1.2 million due to increased SG&A expenses Q1 2025 Financial Summary | Metric | Value | Note | | :--- | :--- | :--- | | **Revenue** | $1.45 million | Decrease due to lower demand for emergency preparedness services | | **Gross Profit** | $0.6 million | - | | **Gross Margin** | 42.5% | - | | **SG&A Expenses** | $1.9 million | Increased due to IPO costs and senior staff hires | | **Operating Loss** | ($1.2) million | - | | **Net Loss** | ($1.2) million | - | [Condensed Consolidated Financial Statements](index=3&type=section&id=Condensed%20Consolidated%20Financial%20Statements) The consolidated financial statements detail the company's financial position and performance, reflecting a strengthened cash position post-IPO, a year-over-year revenue decline, and increased net loss due to higher operating expenses [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, the company's balance sheet strengthened significantly compared to December 31, 2024, with cash increasing to $5.2 million from $2.1 million, driven by IPO proceeds Balance Sheet Comparison | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash** | $5,219,929 | $2,097,945 | | **Total Current Assets** | $6,802,104 | $3,319,188 | | **Total Assets** | $8,455,666 | $5,082,549 | | **Total Liabilities** | $1,648,085 | $1,909,191 | | **Total Stockholders' Equity** | $6,807,581 | $3,173,358 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, revenue decreased to $1.45 million from $1.79 million in the prior-year period, and a sharp increase in SG&A expenses led to a significant widening of the net loss to $1.24 million Statement of Operations (YoY Comparison) | Metric | Three months ended Mar 31, 2025 | Three months ended Mar 31, 2024 | | :--- | :--- | :--- | | **Revenue** | $1,449,377 | $1,790,521 | | **Gross Profit** | $615,940 | $717,583 | | **Selling, general and administrative expenses** | $1,854,316 | $805,042 | | **Operating Loss** | ($1,238,376) | ($87,459) | | **Net Loss** | ($1,240,590) | ($81,133) | | **Net Loss per Share** | ($0.32) | ($0.03) | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In Q1 2025, net cash used in operating activities was $1.56 million, offset by $4.7 million from financing activities, primarily IPO proceeds, resulting in a net cash increase of $3.1 million Cash Flow Summary (YoY Comparison) | Cash Flow From | For the three months ended March 31, 2025 | For the three months ended March 31, 2024 | | :--- | :--- | :--- | | **Operating Activities** | ($1,561,698) | $6,839 | | **Investing Activities** | ($15,000) | ($44,656) | | **Financing Activities** | $4,698,682 | ($3,460,286) | | **Net Increase (Decrease) in Cash** | $3,121,984 | ($3,498,103) | | **Cash at End of Period** | $5,219,929 | $1,657,517 | - The primary source of cash in Q1 2025 was **$4.68 million** in net proceeds from the company's IPO and overallotment[13](index=13&type=chunk) [Company Information and Disclosures](index=2&type=section&id=Company%20Information%20and%20Disclosures) [About Callan JMB Inc.](index=2&type=section&id=About%20Callan%20JMB%20Inc.) Callan JMB Inc. is an integrative logistics company focused on the healthcare and emergency management sectors, providing specialized services for medical materials - The company specializes in integrative logistics for the healthcare industry and emergency management agencies[5](index=5&type=chunk) - Core services include fulfillment, storage, monitoring, and cold chain logistics for medical materials[5](index=5&type=chunk) [Forward-Looking Statement](index=2&type=section&id=Forward-Looking%20Statement) This press release includes forward-looking statements subject to risks and uncertainties, with actual results potentially differing materially from projections - The report contains forward-looking statements that are subject to risks and uncertainties, and actual results may differ[6](index=6&type=chunk) - Readers are advised to consult the company's Form S-1 Registration Statement for a full list of risk factors[6](index=6&type=chunk)

Core Insights - Callan JMB Inc. completed its Initial Public Offering (IPO) on February 6, 2025, at a price of $4.00 per share, raising approximately $5.7 million in gross proceeds, including a partial exercise of the over-allotment option [1][5]. Business Highlights - Callan JMB is positioning itself as a leading provider of advanced logistics and fulfillment services in high-growth sectors, including GLP-1 pharmaceutical transportation and specialized compounding pharmacy logistics [2]. - The company is expanding its emergency preparedness and response operations, targeting untapped metropolitan areas and states, with a new Senior Vice President appointed to accelerate this growth [2]. - Callan JMB has been requested by the Texas Department of Health and Human Services to assist with a measles outbreak response and has renewed its arrangement with the Texas Department of State Health Services [5]. Financial Highlights - For the first quarter of 2025, Callan JMB reported revenue of $1.45 million, a decrease from $1.79 million in the same quarter of the previous year, attributed to reduced demand for emergency preparedness services [5][13]. - The cost of revenue for the first quarter was $0.8 million, resulting in a gross profit of $0.6 million and a gross profit margin of 42.5% [5][13]. - Selling, general, and administrative (SG&A) expenses for the first quarter were $1.9 million, reflecting an increase due to consulting fees related to the IPO and new senior staff hires [5][13]. - The company reported a net loss of $1.24 million for the first quarter of 2025, compared to a net loss of $0.08 million in the same quarter of the previous year [11][14]. Balance Sheet Overview - As of March 31, 2025, Callan JMB's total assets were approximately $8.46 million, with current assets of $6.8 million, including cash of $5.22 million [10][12]. - Total liabilities stood at approximately $1.65 million, with current liabilities of $1.05 million [12]. - Stockholders' equity was reported at approximately $6.81 million, reflecting an increase from the previous period [12].

Core Insights - Callan JMB INC. is participating in the Aegis Capital Corp. Virtual Conference on May 21, 2025, highlighting its role in the healthcare logistics sector [1][2] Company Overview - Callan JMB is an integrative logistics company focused on empowering the healthcare industry and emergency management agencies through services such as fulfillment, storage, monitoring, and cold chain logistics [3] - The company aims to secure medical materials and protect patients and communities by providing compliant, safe, and effective medicines [3] - Callan JMB boasts unparalleled expertise in supply chain logistics, thermodynamics, biologics, inventory management, regulatory compliance, and emergency preparedness [3] - The company emphasizes a high standard of client experience with customizable interfaces, reliable shipping, and environmentally sustainable specialty packaging [3]

Part I [Business](index=5&type=section&id=Item%201.%20Business) Callan JMB Inc. is a vertically integrated logistics company providing thermal management solutions for the life sciences industry with high customer concentration - Callan JMB provides vertically integrated thermal management logistics solutions for the life sciences industry, utilizing proprietary packaging, IT, and specialized cold chain expertise as a disruptive alternative to dry ice and liquid nitrogen[19](index=19&type=chunk) - The company's strategy includes cross-selling its broad range of services, expanding into new markets such as GLP-1 drug transport, and fostering innovation through its **Ship2Q® and Sentry monitoring systems**[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk) - Key service offerings include emergency preparedness, specialty temperature-regulating reusable packaging, fulfillment services, and advanced monitoring through its **Sentry technology**[27](index=27&type=chunk)[28](index=28&type=chunk)[30](index=30&type=chunk) - The company has a high customer concentration, with its top three customers accounting for approximately **81.4% of revenue** as of December 31, 2024[32](index=32&type=chunk) - The company operates in a growing logistics segment focused on temperature-sensitive shipping for markets like cell-based therapies, vaccines, and clinical trials[41](index=41&type=chunk)[42](index=42&type=chunk)[43](index=43&type=chunk) - As of the report date, the company has **26 employees**, consisting of 10 full-time and 12 part-time or seasonal employees, supplemented by independent contractors[49](index=49&type=chunk) [Risk Factors](index=10&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from its holding company structure, capital intensity, customer concentration, and identified material weaknesses in internal controls - The company has a holding company structure and depends on distributions from its operating subsidiaries to meet obligations[54](index=54&type=chunk) - A significant concentration of revenue exists, with three customers accounting for **81.4% of total revenue in 2024**, and the loss of any of these customers could materially harm the business[68](index=68&type=chunk)[69](index=69&type=chunk) - The business is capital intensive, and a failure to generate sufficient cash flow may require selling assets, incurring debt, or selling equity on unfavorable terms[56](index=56&type=chunk) - The company faces risks associated with its cold chain logistics, including product contamination or spoilage, which could lead to liability and reputational damage[62](index=62&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) - The management team has **limited experience managing a publicly traded company**, which could divert attention from day-to-day operations[75](index=75&type=chunk) - **Material weaknesses and significant deficiencies** in internal controls over financial reporting have been identified, including insufficient staff for segregation of duties[84](index=84&type=chunk)[192](index=192&type=chunk) - The company is a **"controlled company"** as the CEO and CMO collectively control **70.6% of the voting power**, qualifying it for exemptions from certain Nasdaq corporate governance requirements[87](index=87&type=chunk) - The company is subject to extensive regulation from agencies like the FDA, and failure to comply could result in significant penalties or operational shutdowns[95](index=95&type=chunk)[96](index=96&type=chunk) [Unresolved Staff Comments](index=26&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - None[136](index=136&type=chunk) [Cybersecurity](index=26&type=section&id=Item%201C.%20Cybersecurity) A security risk management program, overseen by the Board's Audit Committee, is in place to protect technology assets and information - The company has implemented a security risk management program to protect its computer systems and data, which includes regular risk assessments and employee training[137](index=137&type=chunk)[139](index=139&type=chunk) - The Board of Directors oversees cybersecurity risk, delegating primary responsibility to the Audit Committee, with regular reports from management[140](index=140&type=chunk)[141](index=141&type=chunk) [Properties](index=27&type=section&id=Item%202.%20Properties) The company leases all its office and warehouse facilities, with an aggregate monthly rental expense of $34,798 - The company does not own any real property and leases all its office and warehouse facilities, with an aggregate current monthly rental expense of **$34,798**[143](index=143&type=chunk) Leased Properties | Address | Gross floor area (square feet) | Use of the property | | :--- | :--- | :--- | | 244 Flightline Drive, Spring Branch, Texas 78070 | 10,000 sq. ft. | Warehouse/Office | | 10130 SW North Dakota St., Tigard, Oregon 97223 | 4,800 sq. ft | Warehouse | | 1500 4 St., Unit 6, Blanco, Texas 78606 | 1,000 sq. ft. | Warehouse/Office | | 210 Kestral Drive, Spring Branch, Texas 78070 | 7,872 sq. ft. | Warehouse | | 16025 Farm to Market 32, Blanco, Texas 78606 | 6,500 sq. ft. | Warehouse | [Legal Proceedings](index=27&type=section&id=Item%203.%20Legal%20Proceedings) The company may be involved in ordinary course legal proceedings, with details referenced in the financial statement notes - The company may become involved in legal proceedings arising in the ordinary course of business, with details on current proceedings in Note 7 of the financial statements[145](index=145&type=chunk) [Mine Safety Disclosures](index=27&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - Not applicable[146](index=146&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=28&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq as "CJMB", and it does not plan to pay dividends - The company's common stock trades on the Nasdaq Capital Market under the symbol **"CJMB"**[148](index=148&type=chunk) - As of March 28, 2025, there were **480 holders of record** of the company's common stock[149](index=149&type=chunk) - The company has never declared or paid cash dividends and does not intend to in the foreseeable future, retaining earnings for business growth[150](index=150&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Revenue decreased 50% to $6.6 million in 2024, resulting in a net loss of $2.3 million due to lower demand and increased operating expenses Comparison of Operations for Years Ended December 31 | Year ended December 31, | 2024 | 2023 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | $6,563,412 | $13,202,459 | $(6,639,047) | (50)% | | Gross Profit | $2,563,263 | $5,649,121 | $(3,085,858) | -55% | | Income (loss) from operations | $(2,274,814) | $2,202,063 | $(4,476,877) | -203% | | Net income (loss) | $(2,293,648) | $2,181,108 | $(4,474,756) | -205% | - **Revenue decreased by 50% in 2024** due to the waning COVID-19 pandemic and a significant customer temporarily suspending orders[160](index=160&type=chunk) - Selling, general and administrative expenses **increased by 40% ($1.39M) in 2024**, driven by increased personnel costs, IPO consulting fees, and higher marketing expenses[162](index=162&type=chunk) Cash Flow Summary | | Year Ended December 31, | | | | :--- | :--- | :--- | :--- | | | 2024 | 2023 | Change | | Cash provided by (used in) operating activities | $540,353 | $6,995,646 | $(6,455,293) | | Cash provided by (used in) investing activities | $(46,167) | $(490,020) | $443,853 | | Cash provided by (used in) financing activities | $(3,551,861) | $(7,543,725) | $3,991,864 | - Cash and cash equivalents **decreased from $5.2 million to $2.1 million** from the end of 2023 to the end of 2024[164](index=164&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a "smaller reporting company," this disclosure is not required - The company is not required to provide this information as it qualifies as a **"smaller reporting company"**[185](index=185&type=chunk) [Financial Statements and Supplementary Data](index=33&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) The company's financial statements and supplementary data are included following the report's signature page - The required financial statements and supplementary data are set forth following the signature page of the 10-K[186](index=186&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=34&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants - None[189](index=189&type=chunk) [Controls and Procedures](index=34&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management has identified material weaknesses in internal controls and does not yet have effective disclosure controls - Management has identified **material weaknesses and significant deficiencies** in internal controls[192](index=192&type=chunk) - Specific weaknesses include **insufficient staff for optimal segregation of duties** and reliance on a third-party accounting firm for GAAP compliance[192](index=192&type=chunk) - As an emerging growth company, the company is not currently required to provide a formal management report or an independent auditor's attestation on internal control effectiveness[194](index=194&type=chunk) [Other Information](index=34&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None[195](index=195&type=chunk) Part III [Directors, Executive Officers, and Corporate Governance](index=35&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%2C%20and%20Corporate%20Governance) The management team is led by CEO Wayne Williams, and the board includes three independent directors and has established key committees - The executive team includes Wayne Williams (CEO, President, Chairman), Eric L. Kash (EVP, Director), Jeffrey Appleman (CFO), and Dr. David J. Croyle (CMO)[200](index=200&type=chunk) - A family relationship exists between CEO Wayne Williams and CMO Dr. David J. Croyle, who are brothers-in-law[213](index=213&type=chunk) - The Board has established an **Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee**, each composed of independent directors[223](index=223&type=chunk)[224](index=224&type=chunk)[226](index=226&type=chunk) - Independent directors receive a cash fee of **$6,250 per fiscal quarter** and an award of **6,250 shares of common stock** each fiscal quarter[235](index=235&type=chunk) - The company has adopted a Code of Ethics applicable to all employees, which is available on its website[244](index=244&type=chunk) [Executive Compensation](index=42&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation includes guaranteed payments, remuneration, and significant LLC distributions, with a new equity incentive plan established in 2024 Summary Compensation Table | Name and Principal Position | Year | Guaranteed Payments | Remuneration | LLC Distributions | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Wayne Williams, CEO | 2024 | $25,000 | $453,085 | $2,496,191 | $2,974,276 | | | 2023 | $300,000 | - | $5,596,896 | $5,896,896 | | David J. Croyle, M.D., CMO | 2024 | - | - | $832,063 | $832,063 | | | 2023 | - | - | $1,800,000 | $1,800,000 | | Eric Kash, EVP | 2024 | - | $102,885 | - | $102,885 | | Jeffrey Appleman, CFO | 2024 | - | $171,739 | - | $171,739 | - CEO Wayne Williams' employment agreement includes a **$500,000 annual base salary**, a potential 40% incentive bonus, and 200,000 stock options[249](index=249&type=chunk)[250](index=250&type=chunk)[251](index=251&type=chunk) - Employment agreements for the EVP, CFO, and CMO include tiered base salaries, potential 30% incentive bonuses, and stock option grants[259](index=259&type=chunk)[260](index=260&type=chunk)[266](index=266&type=chunk) - The company adopted the **2024 Equity Incentive Plan**, initially authorizing **1,500,000 shares** of common stock for various equity awards[281](index=281&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters](index=52&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Shareholder%20Matters) Executive officers and directors beneficially own 68.5% of common stock, with CEO Wayne Williams holding a controlling 50.7% stake Beneficial Ownership as of March 28, 2025 | Name | Amount and Nature of Beneficial Ownership | Percent of Class | | :--- | :--- | :--- | | **Directors and Executive Officers** | | | | Wayne Williams | 2,338,125 | 50.7% | | David Croyle, M.D. | 822,375 | 17.8% | | Eric Kash | 37,500 | * | | Jeffrey Appleman | 27,500 | * | | All Executive Officers & Directors as a Group | 3,225,500 | 68.5% | *Represents beneficial ownership of less than 1%. - CEO Wayne Williams' ownership of **50.7%** gives him control over matters submitted to stockholders, including the election of directors and potential mergers[307](index=307&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=53&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The company engages in related-party transactions, primarily leases with entities controlled by its CEO and CMO - The company leases its headquarters and other warehouse space from Warehouse Asset Management, an entity majority-owned by Messrs. Williams and Croyle, for **$15,425 per month**[312](index=312&type=chunk) - The company has lease agreements and has received/paid funds on behalf of Outlaw Run Ranch ("ORR") and Cold Chain Delivery Systems, both related parties[310](index=310&type=chunk)[311](index=311&type=chunk) - In October 2024, the board adopted a written policy requiring the **Audit Committee to review and approve all material related-party transactions**[317](index=317&type=chunk) - The Board has determined that directors **Mark Meller, Liberty Duke, and Gerald Dial are independent** under Nasdaq rules[318](index=318&type=chunk) [Principal Accounting Fees and Services](index=55&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) The company incurred $200,000 in audit and audit-related fees from its independent accounting firm in fiscal 2024 Accounting Fees | | Fiscal Year Ended December 31, 2024 | | :--- | :--- | | Audit Fees | $160,000 | | Audit-Related Fees | $40,000 | | **Total** | **$200,000** | - The company's policy is to pre-approve all audit and permissible non-audit services performed by its independent accountants[320](index=320&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=55&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists the financial statements and exhibits filed as part of the Form 10-K - This section lists the financial statements, notes that financial statement schedules have been omitted, and provides a list of exhibits filed with the report[321](index=321&type=chunk)[322](index=322&type=chunk)[324](index=324&type=chunk) [Form 10-K Summary](index=57&type=section&id=Item%2016.%20Form%2010-K%20Summary) No summary is provided for this item - None[328](index=328&type=chunk) Financial Statements [Report of Independent Registered Public Accounting Firm](index=60&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor issued an unqualified opinion on the 2024 and 2023 consolidated financial statements - The auditor issued an **unqualified opinion**, stating the financial statements are presented fairly in all material respects in conformity with U.S. GAAP[338](index=338&type=chunk) - The audit was conducted in accordance with the standards of the Public Company Accounting Oversight Board (PCAOB)[340](index=340&type=chunk) [Notes to Consolidated Financial Statements](index=65&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's corporate reorganization, significant customer concentration, and the completion of its IPO in February 2025 - The company reorganized from a Texas LLC to a Nevada corporation on February 14, 2024[356](index=356&type=chunk)[357](index=357&type=chunk) - The company has significant customer and vendor concentration; in 2024, **one customer accounted for 51% of revenue**, and one vendor accounted for 60% of accounts payable[373](index=373&type=chunk) - As of December 31, 2024, the company had total operating lease liabilities of **$907,450**, primarily for warehouse space[404](index=404&type=chunk)[405](index=405&type=chunk) - In February 2025, the company settled a legal dispute with a vendor for **$240,800**, which was accrued for as of December 31, 2024[409](index=409&type=chunk)[431](index=431&type=chunk) - As of December 31, 2024, the company has federal net operating loss (NOL) carryforwards of **$2,354,213**, with a full valuation allowance provided against the related deferred tax assets[418](index=418&type=chunk)[419](index=419&type=chunk) - Subsequent to year-end, in February 2025, the company completed its IPO, raising net proceeds of approximately **$4.7 million**[428](index=428&type=chunk)