CJMB 10-K & 10-Q changes, risk factors and insider trading

Historically, we have incurred significant losses and we may continue to incur losses in the future.

We generated a net loss of $(7,966,366) for the year ended December 31, 2025 and have historically incurred significant losses, including losses of $(2,293,648) for the year ended December 31, 2024. As of December 31, 2025, we had an accumulated deficit of $(10,260,014). In order to achieve and sustain revenue growth in the future, we must expand our market presence and revenues from existing and new customers. We may continue to incur losses in the future and may never generate revenues sufficient to become profitable or to sustain profitability. Continuing losses may impair our ability to raise the additional capital required to continue and expand our operations.

We depend on the availability of certain component products used in our solutions; delays or increased costs in the procurement of components manufactured by third parties could adversely affect our business operations, financial performance and results of operations, and we may experience customer dissatisfaction and harm to our reputation.

If we fail to procure sufficient components used in our products from our third-party manufacturers, we may be unable to deliver our solutions to our customers on a timely basis, which could lead to customer dissatisfaction and could harm our reputation and ability to compete. We currently acquire various component parts for our solutions from various independent manufacturers, some of which are sole sourced. We would likely experience significant delays or cessation in producing some of these components if a labor strike, natural disaster, public health crisis, act of war or other supply disruption were to occur. If we are unable to procure a component from one of our manufacturers, we may be required to enter into arrangements with one or more alternative manufacturing companies, which may cause delays in producing components or result in significant increases in costs. To date, we have not experienced any material delay that has adversely impacted our operations, but this does not mean that we will continue to have timely access to adequate supplies of essential materials and components in the future or that supplies of these materials and components will be available on satisfactory terms when needed. If our vendors for these materials and components are unable to meet our requirements, fail to make shipments in a timely manner, or ship defective materials or components, we could experience a shortage or delay in supply or fail to meet our contractual requirements, which would adversely affect our results of operations and negatively impact our cash flow and profitability. Continued delay in our ability to produce and deliver our products and services could also cause our customers to purchase alternative products and services from our competitors and/or harm our reputation.

We will have difficulty increasing our revenues if we experience delays, difficulties or unanticipated costs in establishing the sales, marketing and distribution capabilities necessary to successfully commercialize our solutions.

We plan to further enhance our sales, marketing and distribution capabilities in the Americas, EMEA, and APAC. It will be expensive and time-consuming for us to develop and integrate our global marketing and sales network and thus we intend to further broaden our strategic alliances with domestic and international providers of shipping services and other solutions providers to the life sciences industry to incorporate use of our platform of solutions in their service offerings. We may not be able to provide adequate incentive to our sales force or to establish and maintain favorable distribution and marketing collaborations with others to promote our solutions. In addition, any third party with whom we have established a marketing and distribution relationship may not devote sufficient time to the marketing and sales of our solutions, thereby exposing us to potential expenses in exiting such distribution agreements. We, and any of our alliance partners, must also market our services in compliance with federal, state, local and international laws relating to the provision of incentives and inducements. Violation of these laws can result in substantial penalties. Therefore, if we are unable to successfully motivate and expand our marketing and sales force and further develop our sales and marketing capabilities, or if our alliance partners fail to promote our solutions, we will have difficulty increasing our revenues and the revenue may not offset the additional expense of expansion.

Our products and services may expose us to liability in excess of our current insurance coverage.

Our platform of products and services involve significant risks of liability, which may substantially exceed the revenues we derive from them. We cannot predict the magnitude of these potential liabilities. We currently maintain general liability insurance and product liability insurance. Claims may be made against us that exceed the limits of these policies.

Our liability policy is an “occurrence” based policy. Thus, our policy is complete when we purchased it and following cancellation of the policy it continues to provide coverage for future claims based on conduct that took place during the policy term. Our insurance coverage, however, may not protect us against all liability because our policies typically have various exceptions to the claims covered and also require us to assume some costs of the claim even though a portion of the claim may be covered. In addition, if we expand into new markets, we may not be aware of the need for, or be able to obtain insurance coverage for such activities or, if insurance is obtained, the dollar amount of any liabilities incurred could exceed our insurance coverage. A partially or completely uninsured claim, if successful and of significant magnitude, could have a material adverse effect on our business, financial condition and results of operations.

If we use biological and hazardous materials in a manner that causes injury, we could be liable for damages.

Our customers may ship potentially harmful biological materials in our dewars. We cannot eliminate the risk of accidental contamination or injury to employees or third parties from the use, storage, handling or disposal of these materials. In the event of contamination or injury, we could be held liable for any resulting damages, and any liability could exceed our resources or any applicable insurance coverage we may have. Additionally, we are subject to, on an ongoing basis, federal, state and local laws and regulations governing the use, storage, handling and disposal of these materials and specified waste products. In the event of an accident, we could be held liable for damages.

Changes in trade policy, tariff and import/export regulations may have a material adverse effect on our business, financial condition and results of operations.

Our international operations and transactions depend upon favorable trade relations between the United States and the foreign countries in which our customers and suppliers have operations. It may be time consuming and expensive for us to adapt to any changes in U.S. or international social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories or countries where we currently sell our products or conduct our business. If such changes occur, this could adversely affect our business and results of operations.

For example, beginning in 2025, the current Trump administration instituted changes in trade policies that included the imposition of higher tariffs on imports into the U.S. and other government regulations affecting trade between the U.S. and other countries where we conduct our business, such as China and the European Union (EU), among others. In response, several countries have imposed, or threatened to impose, reciprocal tariffs on imports from the U.S. and other retaliatory measures. Various modifications to the U.S. tariffs have been announced and further changes could be made in the future, which may include additional sector-based tariffs or other measures. The ultimate impact remains uncertain and will depend on several factors, including whether additional or incremental U.S. tariffs or other measures are announced or imposed, to what extent other countries implement tariffs or other retaliatory measures in response, and the overall magnitude and duration of these measures. If disputes and conflicts further escalate, actions by governments in response could be significantly more severe and restrictive.

Impairment loss on property and equipment

The Company recorded an impairment charge of $542,088 related to certain property and equipment after identifying the carrying amount of the asset was not recoverable.

Other income (expense) for the year ended December 31, 2025, was $(934,752) and for the year ended December 31, 2024, it was $6,532, resulting in observed changes of $(941,284). The key driver for the decrease relates to expenses related to the ELOC Facility. Refer to the discussion under “Liquidity and Capital Resources” for further information on the ELOC Facility. The Company accounted its ELOC Facility as a purchased put option and as a derivative liability under ASC 815 as it does not meet the scope exception, indexation guidance and equity classification criteria under ASC 815. As such, the Company recognized the purchased put option as a derivative liability wherein it is recognized at fair value at each reporting period and changes to fair value are charged against the Company’s statement of operations. The initial fair value of purchased put option of $974,309 is charged against the Company’s statements of operations for year ended December 31, 2025, and is offset by the “Change in the Fair Value of the Derivative Liability” between inception date and December 31, 2025, of $603,093. The Company also recognized other transaction expenses arising from the ELOC Facility of $569,552.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and other commitments in the normal course of business. As such, the financial statements do not include adjustments for the recoverability and classification of assets and their carrying amounts, or for the amount and classification of liabilities that may result should the Company be unable to continue as a going concern. The Company has incurred net losses of $ (7,966,366) and $(2,293,648) for the years ended December 31, 2025, and 2024, respectively, and an accumulated deficit of $(10,260,014) as of December 31, 2025.

The continuation of the Company as a going concern depends on continued financial support from its shareholders, the ability to raise equity or debt financing, and the attainment of profitable operations from the Company’s future business. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.

On July 24, 2025, CJMB, entered into a Purchase Agreement with a certain investor, whereby CJMB has the right, but not the obligation, to sell to the Investor, up to an aggregate of $25 million of shares of CJMB’s common stock, par value $0.001 per share, subject to the terms and conditions set forth therein.

The Purchase Agreement has a term ending on the earlier of (i) the first day of the month following the 18-month anniversary of the Commencement Date or (ii) the date the Investor has purchased the shares equal to the agreed investment amount. Upon effectiveness of the related registration statement, the Company will issue 15,000 shares of Common Stock to the Investor as Commitment Shares. During the term, CJMB may, at its discretion, deliver Regular Purchase Notices for $500,000 to $2,000,000 per notice. Each Regular Purchase is priced at 95% of the lowest daily VWAP during the applicable measurement period (or 80% if the Company’s stock is not trading on the Nasdaq Capital Market). In connection with each Regular Purchase, CMB will provide an estimate of the number of the shares deliverable, based on 90% of the prior day’s closing price.

The Company controls the timing and amount of sales under the ELOC Facility, which automatically terminates upon reaching $25.0 million or the maturity date. The Company may terminate at any time. If less than $7.5 million has been sold, a $250,000 termination fee applies, payable in cash or stock. On August 24, 2025, the Company filed a Form S-1 registration statement for up to 6,000,000 shares related to the ELOC Facility, which became effective on September 22, 2025.

Since inception, CJMB has funded its operations through a combination of operating cash flows and external financing sources, including the Equity Line of Credit, which has 23.45 million remaining availability, subject to market conditions (please see Note 8 – Equity – Equity Line of Credit), and other sources, such as through funding from Mr. Wayne Williams, the Company’s Chief Executive Officer and largest shareholder. Management intends to continue evaluating and utilizing available funding to support the Company’s operations and growth, including operating cash flows and potential other sources of funding, such as equity or debt financing, as well as additional funding from Mr. Williams.

Actual sales of shares of common stock to Investor as a drawdown under the ELOC Facility will depend on a variety of factors to be determined by the Company from time to time, which may include, among other things, market conditions, the trading price of the Company’s common stock and determinations by the Company as to the appropriate sources of funding for our business and operations.

As of December 31, 2025, the Company has issued approximately 340,094 shares of Common Stock under the ELOC Facility for net proceeds of approximately $497,750. Additionally, as of March 31, 2026, the Company has raised $1.55 million, with $23.45 million remaining availability from such ELOC Facility. Management believes that these liquidity sources, combined with its plan to explore various strategic initiatives, investment opportunities and cost reduction strategy, will alleviate any substantial doubts regarding the Company’s ability to continue as a going concern.

During the year ended December 31, 2025, cash provided by (used in) financing activities was $5,196,433 compared to ($3,551,861) during the year ended December 31, 2024, a change of $8,748,294. Our financing activities for the year ended December 31, 2025 compared to December 31, 2024 included a decrease in partners distributions of $3,382,254 and an increase in proceeds from IPO and overallotment, net of $4,543,989 and proceeds from issuance of shares under the ELOC Facility of $497,750.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The Company’s financial instruments primarily consist of cash and cash equivalents, accounts receivable, accounts payable and derivative liabilities.

The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable approximate their respective fair values because of the short-term maturities or expected settlement dates of these instruments. This is considered a Level I valuation technique.

The derivative liability is valued using a Monte Carlo simulation model utilizing a variety of inputs and assumptions such as volatility, risk-free rates, volume weighted average price and cash flow assumptions. This is considered a Level III valuation technique. Please see Note 11, “Equity” for information on these assumptions and fair value of this derivative liability as of September 30, 2025.

There are no assets or liabilities measured at fair value as of December 31, 2024.

In November 2024, the FASB issued ASU 2024-03, Income Statement Reporting-Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses. The standard update improves the disclosures about a public business entity’s expenses by requiring more detailed information about certain types of costs and expenses in the notes to the financial statements. The guidance will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The standard updates are to be applied prospectively, with the option to apply them retrospectively. We are currently evaluating the impact of the new standard’s disclosure requirements on our financial statements.

For a discussion of recently issued accounting standards, see Note 1 to our consolidated financial statements included herein.

Cost of revenue for the three and six months ended June 30, 2026, was $618,380 and $1,297,288, respectively, as compared to $1,022,439 and $1,858,724 for the three and six months ended June 30, 2025, respectively. The majority of the decrease in the cost of revenue is driven by the decrease in revenue for both comparative periods. The decrease in the comparative three-month period is also attributable to a $44,639 decrease in shippers and components costs and a $21,608 decrease in direct labor costs, partially offset by a $20,208 increase in repairs and maintenance expense. The decrease in the comparative six-month period is also attributable to a $244,296 decrease in direct labor costs, a $116,679 decrease in freight forwarding expense, a $107,215 decrease in shippers and components costs, and a $93,043 decrease in medical supplies expense.

Our selling, general and administrative costs include personnel costs, consulting and professional fees, and other overhead expenses. Selling, general and administrative expenses for the three and six months ended June 30, 2026, were $2,104,592 and $4,233,015 respectively compared to $2,050,410 and $3,901,878 respectively for the three and six months ended June 30, 2025, an increase of $54,182 and $331,137 respectively. The increase in the comparative three-month period was primarily attributable to a $232,118 increase in legal expenses and a $66,711 increase in salaries and benefits, partially offset by a $123,366 decrease in accounting fees, a $36,013 decrease in bad debt expense, and a $34,038 decrease in marketing strategy expenses. The increase in the comparative six-month period was primarily attributable to a $274,411 increase in legal expenses, a $153,038 increase in accounting fees, a $147,260 increase in salaries and benefits, a $95,335 increase in rent expense, and a $71,928 increase in other operating costs, partially offset by a $187,944 decrease in marketing strategy expenses and a $91,201 decrease in other professional fees.

As of June 30, 2026, the Company had an accumulated deficit of $(14,706,991) and negative cash flow from operating activities of $(2,075,943) for the six months ended June 30, 2026. In addition, the Company incurred a net loss of $(4,446,977) for the six months ended June 30, 2026 and had cash and cash equivalents of $860,273 as of June 30, 2026. The Company has recurring losses, has not yet generated sufficient cash flows from operations to fund its activities, and expects to continue incurring operating losses and using cash in support of its business plan. These conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date these condensed consolidated financial statements are issued. Accordingly, the Company may be unable to realize its assets and discharge its liabilities in the normal course of business.

Since inception, the Company has funded its operations through operating cash flows, the ELOC Facility, and capital contributions or other funding from Mr. Williams. Management will continue to evaluate additional sources of capital, including equity and debt financings. However, the availability and terms of future financing are subject to market conditions, investor demand, and the Company’s operating performance, and there can be no assurance that additional capital will be available when needed or on acceptable terms On April 7, 2026, the Company received notice from The Nasdaq Stock Market LLC (“Nasdaq”) that it was not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires a minimum of $2.5 million in stockholders’ equity for continued listing on The Nasdaq Capital Market. The Company submitted a compliance plan to Nasdaq and is working to regain compliance; however, there can be no assurance that the Company will regain compliance within any period granted by Nasdaq.

On June 29, 2026, the Company received an additional notice from Nasdaq indicating that it was not in compliance with Nasdaq Listing Rule 5550(a)(2), which requires a minimum closing bid price of $1.00 per share. The Company has until December 28, 2026 to regain compliance with the minimum bid price requirement. The notices have no immediate effect on the listing of the Company’s common stock, which continues to trade on The Nasdaq Capital Market under the symbol “CJMB.”

The Company is actively monitoring its compliance with Nasdaq’s continued listing requirements and evaluating alternatives to regain and maintain compliance. There can be no assurance that the Company will regain compliance with the applicable Nasdaq listing standards or otherwise maintain compliance with the continued listing requirements of The Nasdaq Capital Market.

For the six months ended June 30, 2026, cash used in operating activities was $(2,075,943) compared to cash used in operating activities of $(2,124,970) during the six months ended June 30, 2025, a decrease of $49,027. This decrease was primarily due to a decrease in accounts receivable of $82,091, in addition to the balance of recovering from credit losses for $37,750 with resulting net change in accounts receivable of $119,841.