Groovy Company, Inc 10-K, filed Mar 17, 2026
Groovy Company, Inc. (GROO)
About this 10-K
Groovy Company, Inc filed this 10-K on March 17, 2026, covering the fiscal year ended December 31, 2025.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2025
Or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number: 000-54938
Groovy Company, Inc.
(Exact name of registrant as specified in its charter)
Wyoming (State or other jurisdiction of incorporation) |
| 27-0518586 (IRS Employer Identification Number) |
12 Daniel Rd East
Fairfield, NJ 07004
(Address of principal executive offices) (Zip Code)
(404) 734-3277
Registrant’s telephone number, including area code
Securities registered under Section 12(b) of the Exchange Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☑
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☑
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☑
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months. Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or emerging growth company:
Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☑ |
Smaller reporting company ☑ | Emerging growth company ☐ |
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act by the registered public accounting firm that prepared or issued its audit report. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
As of June 30, 2025 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market value of the registrant’s common stock held by non-affiliates cannot be determined because the registrant’s common stock is currently quoted exclusively on the Expert Market tier of OTC Markets Group, which is restricted to professional investors and does not provide a reliable public trading market.
As of March 10, 2026, there were 7,384,006 shares of common stock, $0.00001 par value per share, outstanding.
GROOVY COMPANY, INC.
ANNUAL REPORT ON FORM 10-K
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2025
INDEX
2
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K of Groovy Company, Inc., a Wyoming corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995 (the “PSLRA”). These statements are intended to qualify for the safe harbor from liability established by the PSLRA. All statements other than statements of historical fact contained in this Annual Report are forward-looking statements.
In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “would,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “targets,” “continue,” or the negative of such terms and other comparable terminology.
Forward-looking statements in this Annual Report include, without limitation, statements regarding:
•our ability to complete the OTCM Protocol software platform, currently 67% complete, and achieve commercial launch;
•our plans to raise $20,000,000 through a Regulation D Rule 506(c) Security Token Offering
•projected staking rewards of 20–30% APY and estimated SOL treasury staking income of approximately $480,000 to $640,000 annually;
•our commercial growth strategy targeting 100 issuer companies in Year 1 following platform launch, scaling to 5,000 companies by Year 5, with revenue projections growing from approximately $1.1 million to $50.5 million;
•the regulatory compliance of our ST22 Security Tokens and OTCM utility tokens as issuer-sponsored tokenized securities under the SEC’s Category 1 issuer-authorized tokenization framework (SEC Joint Staff Statement, January 28, 2026);
•our plans for international expansion across exchanges in Toronto, Shanghai, Hong Kong, Australia, Frankfurt, Mexico, and Brazil;
•our strategies, competition, market opportunity, expected activities and expenditures, and the adequacy of our available cash resources.
These forward-looking statements reflect our current views and are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties, and a review of information filed by our competitors with the SEC or otherwise publicly available. Although we believe that the expectations reflected in these forward-looking statements are reasonable, actual results may differ materially from those expressed or implied by such statements. Factors that could cause actual results to differ materially include, among others, those set forth under “Item 1A. Risk Factors” and elsewhere in this Annual Report. The Company cannot guarantee future results, levels of activity, performance, or achievements.
We caution readers not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. We expressly disclaim any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future
3
events, or otherwise, except as required by applicable law. You are advised to consult any additional disclosures we make in our reports filed with the SEC.
Groovy Company, Inc. (“the Company”) was incorporated in the State of Nevada on July 8, 2009, under the name Santa Pita Corp. The Company’s original mission was to operate an internet portal for dentists and patients to access dental information, as well as a teeth-whitening business.
On July 30, 2012, the Company redirected its focus toward precious metal exploration and mining. Concurrent with this strategic shift, the Company was renamed Santo Mining Corp.
On April 2, 2015, Santo Mining Corp. entered into a “Plan of Exchange” Agreement with Cathay Cigars of Asia Corporation (“Cathay”), a Florida corporation, effectively transferring majority voting power to Cathay.
Santo Mining Corp. redomiciled to the State of Wyoming in July 2021 and relocated its operational headquarters to Medellin-Bogota, Colombia. Through its subsidiary, Santo Blockchain Labs of Colombia, S.A.S., the Company continued its principal focus on blockchain, cryptography, artificial intelligence, web3, and fourth industrial revolution (4IR) software development.
On February 7, 2024, the Company filed with the State of Wyoming to change its name from Santo Mining Corp. to Groovy Company, Inc. On May 6, 2025, FINRA declared effective the following corporate actions: (i) the Company’s name change from Santo Mining Corp. to Groovy Company, Inc., (ii) the OTC Markets ticker symbol change from “SANP” to “GROO”, and (iii) a 2,500-for-1 reverse stock split of the Company’s common stock. All share and per-share amounts in this Annual Report have been retroactively adjusted to reflect the reverse split.
On February 19, 2025, the Company entered into an Exchange Agreement with Pineapple Express Cannabis Company. Under this agreement, the Company exchanged all its assets for an 87% controlling interest in Pineapple Express Cannabis Company. The Company will maintain and continue to develop the Groovy Platform as a Service (PaaS) for Pineapple Express Cannabis Company.
Current Operations - OTCM Protocol
Currently, the Company has focused its endeavors on the development and operation of OTCM Protocol, a blockchain-based platform that creates ST22 Security Tokens - issuer-sponsored tokenized securities under the Solana SPL Token-2022 standard - backed 1:1 by Series “M” Preferred Shares of over-the-counter microcap companies held in perpetual custody at Empire Stock Transfer, Inc. Our goal is to combine traditional securities custody with blockchain tokenization to solve the estimated $50 billion liquidity crisis affecting dormant OTC securities.
4
The OTCM Protocol operates as a Layer-2 solution on the Solana blockchain, creating permanent liquid markets for dormant securities. The protocol’s core innovation bridges traditional finance with blockchain technology while maintaining regulatory compliance through the Company’s proprietary SEC Category 1 issuer-authorized tokenization framework, under which the Company’s ST22 Security Tokens constitute issuer-sponsored tokenized securities backed 1:1 by Series “M” Preferred Shares held in perpetual custody by Empire Stock Transfer, Inc., an SEC-registered transfer agent.
As of December 31, 2025, the OTCM Protocol software platform has achieved 67% completion (Beta Validated), with 3 companies having completed beta testing of the Company’s advanced SPL token contracts and over $7,000,000 in liquidity successfully processed across 3 issuer implementations.
The OTCM Protocol encompasses the following principal technology components:
•Transfer Hook Security Foundation (Rust/Anchor) - 42 security controls mathematically enforced
•Custom AMM Engine - Independent of external DEXs, supporting SPL Token-2022 transfer hooks
•DAO Governance System with on-chain voting
•OTCM CEDEX (TypeScript/React)
•OTCM Web3 Wallet (iOS/Android native via React Native)
•Bonding Curve Mechanism and Issuer Staking Nodes
•SEC Regulatory Compliance Integration (Rule 506(c), KYC/AML)
The Company has structured its tokenization model in compliance with the SEC’s Category 1 issuer-authorized tokenization framework, as set forth in the SEC Joint Staff Statement on Tokenized Securities dated January 28, 2026. The Company submitted a formal analysis to the SEC Crypto Task Force seeking regulatory guidance on the classification of ST22 Security Tokens. The Company maintains Wyoming Digital Asset Corporation registration and conducts its Regulation D 506(c) Security Token Offering (STO) for OTCM utility tokens.
The Company has the following subsidiaries:
•Santo Blockchain Labs of Colombia, S.A.S. - blockchain and software development operations in Medellin-Bogota, Colombia
•BlackFlamingo Ventures, LLC (Florida) - administrative and logistical support, specializing in Latin America, Asia, and USA cross-border operations
5
Employees
As of December 31, 2025, the Company employed three executive officers under 10-year employment agreements and retained a 12-person software development team consisting of employees and contractors across blockchain development (Rust), full-stack development, database architecture, frontend development, and social media management.
As a smaller reporting company, the Company is not required to provide the information required by this item; however, the following risk factors should be carefully considered by prospective investors. Any of the risks described below, as well as risks not currently known or currently deemed immaterial, could materially and adversely affect our business, financial condition, results of operations, and the market price of our securities.
RISKS RELATED TO OUR BUSINESS AND FINANCIAL CONDITION
1.We have a limited operating history, minimal revenue, and a history of net losses, which raises substantial doubt about our ability to continue as a going concern.
The Company was incorporated in 2009 but has operated in its current form as an OTCM Protocol developer only since mid-2025. We have generated minimal revenue ($211,877 for the year ended December 31, 2025) and have an accumulated deficit of $(472,097) as of December 31, 2025.
Excluding a non-recurring, non-cash gain of $7,809,856 on the PNXP Share Purchase Agreement, we incurred an operating loss of $(357,386) for fiscal 2025. We had cash of $77 as of December 31, 2025. Management has evaluated these conditions and concluded there is substantial doubt about the Company’s ability to continue as a going concern. There can be no assurance that we will achieve profitability or that our plans to address the going concern will succeed.
2.We will require substantial additional capital to complete the OTCM Protocol platform and sustain operations.
The development of the OTCM Protocol is currently 67% complete. We estimate that completion of the remaining 33% of the platform, together with working capital requirements, will require significant additional funding. We are pursuing a $20,000,000 Security Token Offering under SEC Rule 506(c), but there is no assurance that such offering will be completed on acceptable terms, or at all. If we are unable to raise sufficient capital, we may be forced to curtail development, reduce operations, or cease business entirely. Any equity financing will dilute existing stockholders. Debt financing may impose restrictive covenants or require collateral we do not possess.
6
3.Our financial statements are unaudited and subject to material adjustment upon completion of an independent audit.
The financial statements included in this Annual Report have not been audited by an independent registered public accounting firm. We have identified three material weaknesses in our internal controls over financial reporting: (i) insufficient accounting staff with U.S. GAAP expertise; (ii) absence of formal written accounting policies; and (iii) limited segregation of duties. The financial statements included in this Annual Report are unaudited. Investors should understand that the absence of an independent audit increases the risk of undetected errors or misstatements in our financial statements.
4.Our intangible asset represents 99.7% of total assets and is subject to impairment risk.
As of December 31, 2025, the OTCM Protocol software platform is recorded at $19,510,400, representing substantially all of our total assets of $19,772,032. This value is based on a replacement cost methodology using 560,000 lines of logical code at $52.00 per line and a 67% weighted completion factor. This valuation involves significant estimates and assumptions. If the platform fails to achieve commercialization, if market conditions change materially, or if different valuation standards are applied in the future, the asset could be subject to partial or total impairment. Any impairment charge would have a material adverse effect on our financial statements and stockholders’ equity.
5.The intangible asset was received in a related-party transaction from our CTO and is subject to additional scrutiny.
The OTCM Protocol software platform was assigned to the Company pursuant to an IP Assignment Agreement dated June 12, 2025, between the Company and Franjose Yglesias, our Chief Technology Officer and co-founder. Mr. Yglesias received 100,000,000 shares of Series A Preferred Stock as consideration, of which 85,000,000 were returned to treasury and 15,000,000 were retained by Mr. Yglesias. Related-party transactions are inherently subject to conflicts of interest. Although the transaction was supported by a third-party software valuation report, the SEC or investors may challenge the valuation methodology, the arm’s length nature of the transaction, or the accounting treatment. Any such challenge could result in a restatement, impairment charge, or regulatory inquiry.
RISKS RELATED TO REGULATION AND LEGAL COMPLIANCE
6.Our ST22 Security Tokens are issuer-sponsored tokenized securities subject to the full requirements of the federal securities laws; failure to maintain compliance could adversely affect our operations.
We have designed the ST22 Security Token framework and our OTCM utility tokens with the intent that they constitute issuer-sponsored tokenized securities under the SEC’s Category 1 issuer-authorized tokenization framework established in the January 28, 2026
7
Joint Staff Statement on Tokenized Securities. Under this framework, the Company’s ST22 Security Tokens are backed 1:1 by Series “M” Preferred Shares held in perpetual custody by Empire Stock Transfer, Inc., an SEC-registered transfer agent, with the issuer directly authorizing all tokenization activity and the on-chain record constituting part of the official master securityholder file. Tokenized securities remain subject to the full requirements of the federal securities laws, including registration, disclosure, and transfer restriction obligations. Failure to maintain compliance with applicable securities laws could result in enforcement action, fines, or cessation of operations.
7.The regulatory environment for digital assets and tokenized securities is evolving rapidly and unpredictably.
Federal and state laws and regulations governing blockchain technology, digital assets, and tokenized securities are subject to rapid change. The SEC, CFTC, FinCEN, and state regulators are actively developing new rules applicable to digital asset platforms, token offerings, and custody arrangements. New legislation such as potential federal digital asset market structure bills may materially change the regulatory framework under which we operate. We cannot predict the nature, timing, or effect of future regulatory changes. Compliance with new regulations may require significant expenditures or operational changes, and non-compliance could result in enforcement action, fines, or cessation of operations.
8.Our compliance with the SEC’s Category 1 issuer-authorized tokenization framework is subject to evolving regulatory interpretation, and any adverse regulatory determination could materially impair our operations.
The Company has structured its ST22 Security Token framework in accordance with the SEC’s Category 1 issuer-authorized tokenization model, as described in the SEC Joint Staff Statement on Tokenized Securities (January 28, 2026). Under this model, ST22 Security Tokens are issuer-sponsored tokenized securities backed 1:1 by Series “M” Preferred Shares held at an SEC-registered transfer agent, with all tokenization activity directly authorized by the issuing company. While we believe our structure is compliant with this framework, the application of federal securities laws to tokenized instruments continues to evolve. If the SEC, a court, or another regulatory authority determines that our structure does not conform to Category 1 requirements, or if the regulatory framework changes materially, we may be required to modify our platform, register additional securities, or cease certain operations, any of which could have a material adverse effect on our business.
9.We are subject to anti-money laundering, KYC, and sanctions compliance requirements that may be costly to implement.
Our platform incorporates KYC/AML compliance and sanctions screening as part of its SEC regulatory compliance integration. As our platform scales, compliance with the Bank Secrecy Act, FinCEN regulations, OFAC sanctions programs, and applicable state money transmission laws will require ongoing investment. Failure to maintain adequate compliance programs could result in regulatory sanctions, fines, reputational damage, or
8
criminal liability. The cost of compliance may be greater than anticipated and could adversely affect our operating margins.
RISKS RELATED TO OUR TECHNOLOGY AND OPERATIONS
10.Our platform is built on the Solana blockchain; disruptions to Solana could materially harm our operations.
The OTCM Protocol operates as a Layer-2 solution on the Solana blockchain and relies on Solana’s SPL Token-2022 standards and infrastructure. Solana has experienced network outages, performance degradation, and protocol changes in the past. Any significant disruption, fork, security vulnerability, or fundamental change to the Solana protocol could render our platform non-functional or require costly re-engineering. We do not control the Solana network and cannot guarantee its continued availability or performance.
11.Our smart contracts may contain vulnerabilities that could result in the loss of digital assets or unauthorized access.
The OTCM Protocol’s Transfer Hook Security Foundation incorporates 42 security controls enforced in Rust/Anchor. Despite our security framework, smart contracts are inherently susceptible to bugs, logic errors, and unforeseen attack vectors. Our platform has processed over $7,000,000 in liquidity during beta testing. A successful exploit of a smart contract vulnerability could result in the loss of user funds, regulatory action, litigation, and irreparable reputational damage. There can be no assurance that our security controls will prevent all attacks.
12.We are dependent on key personnel, and the loss of any founder could severely impair our operations.
Our success is critically dependent on the continued service of our three co-founders: Berj Abajian (CEO), Patrick Mokros (COO), and Franjose Yglesias (CTO). These individuals collectively hold 45,000,000 shares of Series A Preferred Stock representing controlling voting power. Mr. Yglesias is the architect of the OTCM Protocol software platform and possesses specialized technical knowledge that is not easily replaceable. We do not currently maintain key-person life insurance on any of our executive officers. The departure, incapacity, or death of any co-founder could have a material adverse effect on our business and prospects.
13.Our software development platform is 67% complete and may not achieve full functionality or commercial viability.
As of December 31, 2025, the OTCM Protocol platform has achieved beta validation status at 67% weighted completion. Remaining components include the AI Predictive Market Module (0% complete), the Admin Dashboard (0% complete), and the Staking Infrastructure (0% complete), each representing 5% of the total platform by development effort. There is no guarantee that remaining development will be completed on schedule,
9
within budget, or to the technical specifications required for commercial launch. Delays in development could result in loss of first-mover advantage, customer attrition, and inability to generate transaction fee revenue.
14.Cybersecurity breaches, data loss, or unauthorized access to our systems could harm our business.
We collect and process sensitive information relating to issuers, token holders, and financial transactions. Our systems, including our Solana-based smart contracts, TypeScript/React CEDEX platform, and iOS/Android Web3 Wallet, may be subject to cyberattacks, phishing, ransomware, or insider threats. A cybersecurity incident could result in loss of data, theft of digital assets, regulatory investigation, litigation, and reputational harm. We operate development infrastructure through Digital Ocean with Kubernetes and Tailscale, and our Colombia-based development team introduces additional operational security considerations.
RISKS RELATED TO OUR CAPITAL STRUCTURE AND SECURITIES
15.Our capital structure includes a large number of authorized but unissued preferred shares, which could result in significant dilution.
Our authorized capital includes 100,000,000 shares of Series A Preferred Stock (of which 55,000,000 remain in treasury), 200,000,000 shares each of Series B, C, and S Preferred Stock, and 1,000,000,000 shares of Series M Preferred Stock, all of which are currently unissued. The issuance of any of these securities could result in substantial dilution to holders of our common stock. The terms and preferences of these preferred series have not yet been designated. The Series M Preferred Stock is intended for the ST22 Security Token backing mechanism; issuance of up to 1,000,000,000 shares could significantly affect our capital structure and existing stockholder rights.
16.Our common stock has lost its Rule 15c2-11 eligibility and is currently quoted on the Expert Market; we are working to restore eligibility.
Our common stock is currently quoted on the Expert Market under the ticker symbol "GROO." The Expert Market is a tier of OTC Markets Group that restricts trading to broker-dealers and sophisticated investors only; retail investors generally cannot purchase Expert Market securities through most brokerage platforms. The Company lost its Rule 15c2-11 eligibility, resulting in relegation to the Expert Market, which significantly restricts trading activity and limits investor access. The Company is in the process of filing a Form 211 with FINRA to restore Rule 15c2-11 eligibility and reinstate quotation on the OTC Pink or OTCQB marketplace. There is no assurance that the Company will regain 15c2-11 eligibility within any particular timeframe, or at all. Until eligibility is restored, trading in GROO common stock will remain restricted to the Expert Market, which may adversely affect the market price and liquidity of our common stock.
10
17.Patrick Mokros, our COO, is also the founder and CEO of Empire Stock Transfer, which serves as our transfer agent and custody provider.
Empire Stock Transfer, Inc., an SEC-registered transfer agent, serves as the Series M Preferred Share custodian for the OTCM Protocol’s ST22 Security Token framework. Empire Stock Transfer was founded by and is led by Patrick Mokros, our Chief Operating Officer and co-founder. This relationship represents a significant related-party arrangement. While we believe the custody services are provided on commercially reasonable terms, conflicts of interest may arise. If Empire Stock Transfer is unable to perform its obligations, or if the relationship is terminated, our ability to operate the ST22 Security Token issuance and custody framework could be materially impaired.
RISKS RELATED TO EXTERNAL AND MARKET FACTORS
18.The market for illiquid OTC securities is subject to regulatory change that could reduce the size of our addressable market.
Our business model targets approximately 11,000 to 15,000 OTC companies whose securities have become illiquid due to market maker abandonment, Expert Market relegation, or loss of Rule 15c2-11 eligibility. Regulatory changes to SEC Rule 15c2-11, OTC Markets Group policies, or FINRA rules could alter the population of eligible issuers, reduce the demand for our liquidity solutions, or impose additional requirements on our operations. We cannot predict the direction of regulatory change or its effect on our target market.
19.Competition from established DeFi protocols, traditional financial institutions, and other blockchain platforms could reduce our market share.
We operate in a highly competitive environment. Established decentralized finance platforms (including Uniswap, Raydium, and others), traditional securities exchanges and alternative trading systems, and emerging tokenization platforms may develop products or services that compete directly with the OTCM Protocol. Many of these competitors have substantially greater financial resources, technology infrastructure, regulatory relationships, and brand recognition than we do. We cannot guarantee that we will be able to compete effectively or that our Category 1 issuer-authorized tokenization compliance architecture will constitute a sustainable competitive advantage.
20.Cryptocurrency and blockchain market conditions are highly volatile and could adversely affect the value of our SOL treasury and blockchain assets.
As of December 31, 2025, we hold blockchain-based current assets of $61,555, representing GROO ST22 Security Tokens minted during the OTCM Protocol beta program (Note 14). Our planned SOL treasury strategy, which contemplates allocating 40% of STO proceeds to Solana (SOL), would expose us to significant cryptocurrency price risk. The value of SOL and other digital assets can fluctuate dramatically and
11
unpredictably. A material decline in cryptocurrency values could reduce our treasury reserves, impair our ability to fund operations, and adversely affect our financial condition.
21.Our operations in Colombia through Santo Blockchain Labs expose us to foreign regulatory, currency, and operational risks.
We conduct our primary software development operations through Santo Blockchain Labs de Colombia, S.A.S., our subsidiary in Medellin-Bogota, Colombia. Operations in Colombia expose us to risks including: changes in Colombian law, regulation, or tax policy; foreign currency fluctuation between the Colombian peso and the U.S. dollar; political instability; labor law requirements that differ from U.S. standards; and potential difficulty enforcing contracts or intellectual property rights in a foreign jurisdiction. Any adverse development in our Colombian operations could disrupt development timelines and increase costs.
22.We do not anticipate paying dividends on our common stock in the foreseeable future.
We have never declared or paid cash dividends on our common stock and do not anticipate doing so in the foreseeable future. We intend to retain all available funds and any future earnings for use in the operation and development of our business. Investors seeking current income from dividends should not invest in our common stock.
23.The Company does not currently have a Chief Financial Officer; the absence of a qualified CFO with expertise in both securities accounting and digital assets creates financial reporting and compliance risk.
The Company currently does not have a Chief Financial Officer (CFO) or a dedicated Principal Financial Officer with formal qualifications in both U.S. securities accounting and digital asset financial reporting. The financial statements contained in this Annual Report have been prepared under the supervision of management without the benefit of a credentialed CFO. This creates risk that financial disclosures may not fully conform to U.S. GAAP as applied to early-stage blockchain companies, that internal controls over financial reporting may be inadequate, and that the Company may fail to timely identify or properly account for complex transactions involving tokenized securities, non-monetary asset exchanges, or digital asset valuations under ASC 820 and ASC 845.
The Company is actively engaged in the process of recruiting a CFO with demonstrated expertise in both SEC reporting for smaller reporting companies and digital asset accounting, including familiarity with the evolving regulatory guidance applicable to tokenized securities. There can be no assurance that the Company will be able to identify and retain a qualified CFO on acceptable terms or within a timeframe that prevents material weakness in its financial controls. Until a qualified CFO is appointed, the Company’s financial reporting will remain subject to heightened risk of error, restatement, or regulatory comment.
12
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
Governance
Cybersecurity risk oversight is the responsibility of the Company’s executive management team, with primary operational responsibility assigned to Franjose Yglesias, the Company’s Chief Technology Officer and Co-Founder. Mr. Yglesias has over 35 years of software development experience and extensive hands-on expertise in blockchain architecture, Rust and Anchor smart contract development, cloud infrastructure security, and DevSecOps practices. He is directly responsible for the design and implementation of the Transfer Hook Security Foundation, the multi-signature governance architecture, the formal verification methodology, and all infrastructure security configurations including the Kubernetes deployment environment and Tailscale zero-trust networking.
The Company’s Chief Executive Officer, Berj Abajian, and Chief Operating Officer, Patrick Mokros, are informed of material cybersecurity developments, incidents, and policy decisions as they arise. Executive management collectively reviews the cybersecurity posture of the platform on an ongoing basis in connection with its review of overall business operations and risk management. Any cybersecurity matter that management determines could be material to the Company’s business, financial condition, or results of operations is escalated immediately to the full executive team.
As of December 31, 2025, the Company has not established a formal board-level cybersecurity committee or appointed a dedicated Chief Information Security Officer (CISO), consistent with the Company’s current stage of development as an early-stage smaller reporting company. Management intends to evaluate the establishment of a formal cybersecurity governance committee and dedicated CISO function as the Company scales toward commercial launch and the volume and sensitivity of data processed by the OTCM Protocol increases materially.
Risk Management and Strategy
The Company operates the OTCM Protocol, a Layer-2 blockchain platform on Solana that issues, manages, and facilitates trading of ST22 Security Tokens representing interests in tokenized securities. Because the platform processes sensitive issuer and investor data, governs digital asset custody arrangements, and executes financial transactions entirely through programmable smart contracts, the Company’s management treats cybersecurity as a core operational priority rather than a supplemental function. The cybersecurity risk management program described below is integrated into the Company’s overall enterprise risk framework and is reviewed by executive management on an ongoing basis.
13
Smart Contract Security
The most significant cybersecurity risk for a blockchain-based protocol is the integrity of its on-chain smart contracts, which are immutable once deployed and govern the movement of digital assets. The OTCM Protocol’s Transfer Hook Security Foundation, developed in Rust using the Anchor framework, incorporates 42 mathematically enforced security controls that execute as part of every token transfer on the Solana SPL Token-2022 standard. These controls validate transaction parameters, enforce compliance rules, and reject non-conforming operations at the protocol level before any state change is committed to the blockchain.
The Company’s smart contract development follows a formal specification methodology in which mathematical invariants are defined before any code is written. These invariants - such as the requirement that the sum of all token balances always equal total supply and that pool liquidity can never decrease through any sequence of operations - are then verified using Rust-compatible formal verification tools (Kani and Prusti). This approach, adapted from Move Prover methodologies, provides mathematical proof that critical contract properties hold under all possible execution conditions rather than only under tested scenarios. Following formal specification, each contract component undergoes unit testing, integration testing, and fuzz testing with randomized inputs prior to deployment.
The OTCM Protocol smart contracts implement a 5-of-9 multi-signature authority structure governing all administrative operations, including any contract upgrades or modifications to critical parameters. No single administrator can alter contract logic unilaterally. Any proposed change requires approval from at least five of nine designated signers and is subject to a mandatory 48-hour time-delay before execution, providing the development team and community with a window to detect and respond to potentially malicious or erroneous proposals. This architecture eliminates the “single point of administrative compromise” risk common in centralized systems.
Each smart contract incorporates an emergency circuit breaker mechanism implemented as a programmatic emergency pause flag. This flag can be activated by authorized multi-signature consensus to immediately halt all token transfer operations in the event of a detected exploit, anomalous trading pattern, or external security event affecting the Solana network. The Checks-Effects-Interactions (CEI) pattern is enforced throughout all contract logic, ensuring that all input validation occurs before any state changes are committed and that external contract calls are executed only after internal state has been fully updated, mitigating re-entrancy attack vectors.
All smart contract operations emit immutable on-chain audit log entries (AuditLogEntry events) capturing the actor, timestamp, operation type, and parameters for every state-changing transaction. These logs are permanently recorded on the Solana blockchain and provide comprehensive forensic capability in the event of an incident, enabling precise reconstruction of every action, identification of anomalous activity, and, where possible, recovery of affected assets.
Infrastructure Security
The Company’s backend infrastructure is hosted on Digital Ocean using Kubernetes-based containerized deployments with network segmentation, role-based access controls, and isolated
14
execution environments for each service component. All internal system access - including access to production infrastructure, databases, and the GitHub repositories hosting the OTCM Protocol codebase - is protected by Tailscale zero-trust private networking. Tailscale enforces device authentication and identity-based access policies, ensuring that no system or service is exposed to the public internet unless explicitly intended.
The OTCM Protocol codebase is maintained in private GitHub repositories with role-based access controls restricting read and write permissions to authorized developers. All code changes to production branches require peer review and approval before merging. The Company employs Flux for GitOps-based deployment automation, which maintains a declarative record of all infrastructure configurations and enforces that production deployments match approved repository state, reducing the risk of unauthorized or undocumented configuration changes.
The OTCM Protocol relies on the Solana blockchain as its Layer-1 settlement layer. Disruptions to Solana network availability, including network congestion or validator outages, could temporarily affect platform operations. The Company mitigates this dependency by implementing multi-RPC fallback systems that automatically route requests to alternative Solana RPC endpoints when a primary endpoint becomes unavailable, maintaining transaction processing continuity during periods of network stress.
Issuer and Investor Data Security
The OTCM Protocol requires issuers and investors to complete KYC (Know Your Customer) and AML (Anti-Money Laundering) verification as a condition of platform access. This process collects and processes identity documentation and personal financial information subject to applicable data protection requirements. The Company implements encryption in transit and at rest for all personally identifiable information and restricts access to KYC/AML data to authorized compliance personnel only. The Company’s insider trading and confidentiality policy expressly prohibits personnel from disclosing, using, or retaining non-public information about issuers, token holders, trading volumes, or technical vulnerabilities.
Third-Party and Custodial Risk Management
Empire Stock Transfer, Inc., the Company’s SEC-registered transfer agent and Series M Preferred Share custodian, maintains independent physical and electronic security for share records held in perpetual custody on behalf of ST22 token issuers. Empire Stock Transfer operates as a regulated transfer agent subject to SEC oversight. The Company reviews the custodial and security arrangements of Empire Stock Transfer on an ongoing basis as part of its related-party oversight procedures. Securitize, Inc., the Company’s planned Security Token Offering platform, maintains its own independent cybersecurity program subject to applicable financial services regulatory standards.
External Security Assessment
As of December 31, 2025, the Company has not engaged an independent third-party cybersecurity assessor or penetration testing firm to conduct a formal external audit of the OTCM Protocol smart
15
contracts or infrastructure. The Company’s development methodology - including formal verification, fuzz testing, and internal code review - constitutes the primary security assurance process at this stage of platform development. Management intends to commission a formal third-party smart contract security audit prior to full commercial launch of the OTCM Protocol platform, and to engage a qualified penetration testing firm to assess backend infrastructure security on an annual basis following commercial launch.
Material Cybersecurity Incidents
The Company has not experienced any cybersecurity incidents during the fiscal year ended December 31, 2025 or in any prior period that have materially affected, or are reasonably likely to materially affect, the Company’s business strategy, results of operations, or financial condition. There are no material cybersecurity threats currently known to management that meet the materiality threshold for disclosure. This assessment does not guarantee that the Company will not experience a material cybersecurity incident in the future. See Item 1A Risk Factor 14 for a discussion of cybersecurity risks that could materially affect the Company.
The Company’s principal office is located at 12 Daniel Rd East, Fairfield, NJ 07004. The Company’s software development operations are conducted through its subsidiary in Medellin-Bogota, Colombia. The Company believes its current facilities are adequate for its present needs.
On May 14, 2021, George Kuper, a former employee of the Company, filed a complaint against the Company in the Circuit Court of the Eleventh Judicial Circuit in and for Miami-Dade County, Florida (Case No. 2021-011579-CA-01), alleging breach of contract related to a verbal employment arrangement. The Company did not file a timely response, and on July 18, 2023, the Court entered a default judgment in favor of Mr. Kuper in the amount of $521,256, plus attorneys’ fees and costs.
On February 19, 2025, the Company entered into a Share Purchase Agreement (the “SPA”) with Pineapple Express Cannabis Company (“PNXP”), pursuant to which the Company exchanged substantially all of its legacy assets and liabilities - including the Kuper judgment - for an 87% controlling interest in PNXP. As a result, all obligations arising from the Kuper judgment were assumed by PNXP effective February 19, 2025. The Company has no further liability with respect to this matter as of December 31, 2025, and the judgment is not recorded on the Company’s balance sheet.
The Company is not currently involved in any other material legal proceedings.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
16
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
The Company's common stock is currently quoted on the Expert Market tier of OTC Markets Group under the ticker symbol "GROO" (formerly "SANP"). On May 6, 2025, FINRA declared and made effective the Company's name change from Santo Mining Corp. to Groovy Company, Inc., the OTC Markets ticker symbol change from "SANP" to "GROO", and a 2,500-for-1 reverse stock split of the common stock. As of December 31, 2025, there were 7,384,006 shares of common stock outstanding (retroactively adjusted for the reverse split; pre-split shares outstanding were 18,436,585,961). Rule 15c2-11 Status: The Company has lost its Rule 15c2-11 eligibility and its common stock is quoted on the Expert Market, which restricts trading to sophisticated investors and limits general retail investor access. The Company is in the process of restoring Rule 15c2-11 eligibility through the filing of a Form 211 with FINRA. There is no assurance as to the timing or outcome of this process. The Company has not declared or paid any cash dividends on its common stock and does not anticipate paying dividends in the foreseeable future.
Not applicable.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Groovy Company, Inc. (the “Company”) was incorporated in Nevada on July 8, 2009, and subsequently redomiciled to Wyoming in July 2021. During the fiscal year ended December 31, 2025, the Company significantly advanced its OTCM Protocol blockchain platform, achieving beta validation with $7,000,000+ in processed liquidity and capitalizing its internally developed software at a cost-based value of $19,510,400 representing 67% completion of the Layer-2 infrastructure.
Results of Operations for the Years Ended December 31, 2025 and 2024:
Revenue and cost of goods sold
For the year ended December 31, 2025 and 2024, the Company generated revenues of $211,877 and $3,600, respectively. Cost of goods sold was $1,500 and $0, respectively, resulting in gross profit of $210,377 and $3,600, respectively.
17
Operating expenses
Total operating expenses for the year ended December 31, 2025 were $567,763. Principal expense categories included: contract labor ($156,126), legal and accounting services ($100,258), office expenses ($21,578), per diem ($13,360), rent ($11,150), advertising and marketing ($5,967), travel ($4,258), bank fees ($3,852), dues and subscriptions ($2,960), utilities ($2,864), and other expenses. Officer compensation of $225,000 was accrued during the year under three-year employment agreements executed on September 30, 2025, at an annual base salary of $150,000 per officer (Berj Abajian, Patrick Mokros, and Franjose Yglesias), covering the period July 1 through December 31, 2025. This amount is reflected as accrued officer compensation on the balance sheet and is a non-cash operating expense for the year.
Other income (expense)
Other income for the year ended December 31, 2025 included the gain on the Share Purchase Agreement with Pineapple Express Cannabis Company (PNXP) totaling $7,809,856 recognized during the nine months ended September 30, 2025. Additional other income (expense) items for Q4 2025 are subject to year-end close procedures.
Net Income (Loss)
The net income for the year ended December 31, 2025 was $7,449,800, or $1.01 per basic and diluted share based on 7,384,006 weighted average shares outstanding.
Intangible Assets - OTCM Protocol Software Platform
During the fiscal year ended December 31, 2025, the Company received the OTCM Protocol software platform via an IP Assignment Agreement effective June 12, 2025, recorded as an intangible asset at fair value of $19,510,400 under ASC 845 (Nonmonetary Transactions) and ASC 820 Level 3 (replacement cost). The platform comprises 560,000 lines of original logical code assessed at $52.00/LOC (conservative low-end benchmark per CISQ/Capers Jones) multiplied by a 67% weighted completion factor. See Note 13. The software was recorded at $19,510,400, representing the 67% weighted completion factor as of December 31, 2025, validated by the Company’s January 24, 2026 software valuation report.
The platform comprises 560,000 lines of original logical code across 12 principal components including Transfer Hook Security, Custom AMM Engine, DAO Governance, OTCM CEDEX, and Web3 Wallet infrastructure, assessed at a conservative rate of $52.00 per line of code (low-end rate, per CISQ/Capers Jones industry benchmarks), multiplied by a 67% weighted completion factor.
Liquidity and Capital Resources
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business.
18
As of December 31, 2025, the Company had $77 in cash and cash equivalents (bank accounts) and blockchain-based current assets of $61,555 (GROO ST22 Security Tokens - beta minting; see Note 14), for total current assets of $61,632. Total assets were $19,772,032, principally comprised of the $19,510,400 OTCM Protocol software intangible asset. The Company has relied primarily upon capital generated from public and private offerings of its securities and related party advances.
The Company sustained a net income of $7,449,800 for the year ended December 31, 2025. The Company has limited cash of $77 at December 31, 2025. Because of the absence of positive cash flows from operations, the Company will require additional funding for continuing the development and marketing of products. These factors raise substantial doubt about the Company’s ability to continue as a going concern.
Management’s plans to address the going concern include: (a) completion of a $20 million Security Token Offering under SEC Rule 506(c), (b) revenue generation from transaction fees upon platform launch, and (c) SOL treasury staking income of approximately $480,000 to $640,000 annually.
Cash Flows from Operating, Investing and Financing Activities
The following table summarizes our cash flows for the periods indicated:
| Year Ended Dec. 31, 2025 | Year Ended Dec. 31, 2024 |
Cash flows from operating activities | $(136,107) | $(232,409) |
Cash flows from investing activities | $- | - |
Cash flows from financing activities | $134,000 | $234,500 |
Management believes that current trends toward lower capital investment in start-up companies pose the most significant challenge to the Company’s success over the next year and in future years. The Company’s management has concluded that these conditions raise substantial doubt about the Company’s ability to continue as a going concern. There can be no assurance that we will be able to achieve our business plan objectives or be able to achieve or maintain cash-flow-positive operating results.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on the financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.
19
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
A smaller reporting company is not required to provide the information required by this Item.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
NOTE: The following financial statements are UNAUDITED and have not been reviewed or reported upon by an independent registered public accounting firm. These statements are the sole responsibility of management and are being filed on an unaudited basis. No independent audit has been performed or is planned for the current fiscal year.
GROOVY COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
INDEX TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS | Page |
Consolidated Balance Sheets as of December 31, 2025 and December 31, 2024 | F-2 |
Consolidated Statements of Operations for the years ended December 31, 2025 and 2024 | F-3 |
Consolidated Statement of Stockholders’ Deficit for the years ended December 31, 2025 and 2024 | F-4 |
Consolidated Statements of Cash Flows for the years ended December 31, 2025 and 2024 | F-5 |
Notes to Consolidated Financial Statements | F-6 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
These consolidated financial statements have not been audited by an independent registered public accounting firm. They are presented on an unaudited basis. No independent audit has been performed or is planned for the fiscal year ended December 31, 2025. The financial statements are the responsibility of the Company’s management.
20
GROOVY COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
For the Years Ended December 31, 2025 (Unaudited) and 2024 (Audited)
|
| Dec. 31, 2025 (Unaudited) |
| Dec. 31, 2024 (Audited) |
ASSETS | ||||
Current Assets | ||||
Cash and cash equivalents |
| 77 |
| 2,184 |
GROO ST22 Security Tokens - beta minting (Note 14) |
| 61,555 |
|
|
Total Current Assets |
| 61,632 |
| 2,184 |
|
|
|
|
|
Property, plant and equipment, net |
|
|
| 54,854 |
Intangible assets, net (Note 13) |
| 19,510,400 |
| 190,000 |
Series M Preferred Shares - MSPC & GRLF (Note 14) |
| 200,000 |
|
|
|
|
|
|
|
TOTAL ASSETS |
| 19,772,032 |
| 247,038 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||
Current Liabilities | ||||
Accounts payable and accrued expenses |
| 37,137 |
| 47,419 |
Accrued compensation - officers |
| 225,000 |
| 562,500 |
Accrued interest |
|
|
| 931,871 |
Convertible note payable, net of discount |
| 75,000 |
| 3,678,753 |
Note payable, related party |
| 44,500 |
| 70,433 |
Accrued interest - related party (Note 8) |
| 2,670 |
|
|
Derivative liability |
|
|
| 3,122,985 |
Warrant liability |
|
|
| 5,000 |
Total Current Liabilities |
| 384,307 |
| 8,418,961 |
TOTAL LIABILITIES |
| 384,307 |
| 8,418,961 |
|
|
|
|
|
STOCKHOLDERS’ EQUITY (DEFICIT) | ||||
Series A Preferred Stock |
| 45,000 |
| 350,000 |
Common stock |
| 74 |
| 74 |
Additional paid-in capital |
| 19,178,923 |
| 2,181,277 |
Stock to be issued (Note 9) |
| 630,800 |
| 630,800 |
Accumulated deficit |
| (472,097) |
| (11,339,099) |
Accumulated other comprehensive income (loss) |
| 5,025 |
| 5,025 |
Total Stockholders’ Equity (Deficit) |
| 19,387,725 |
| (8,171,923) |
|
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) |
| 19,772,032 |
| 247,038 |
Source: Santo Mining Corp. Audited FS 2024 + Groovy Company, Inc. 10-K v39 (FY2025)
21
GROOVY COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Years Ended December 31, 2025 (Unaudited) and 2024 (Audited)
|
| Year Ended Dec. 31, 2025 (Unaudited) |
| Year Ended Dec. 31, 2024 (Audited) |
Revenue |
| 211,877 |
| 3,600 |
Cost of goods sold |
| 1,500 |
|
|
Gross Profit |
| 210,377 |
| 3,600 |
|
|
|
|
|
Operating Expenses | ||||
Professional fees |
| 100,258 |
| 19,112 |
Contractor costs |
| 156,126 |
| 79,709 |
Accrued compensation - officers |
| 225,000 |
| - |
Selling, general & administrative |
| 48,925 |
| 527,536 |
Rent expense |
|
|
| 35,982 |
Amortization - software platform |
|
|
|
|
Depreciation |
| 37,452 |
| 37,452 |
Total Operating Expenses |
| 567,763 |
| 699,791 |
|
|
|
|
|
Loss from Operations |
| (357,386) |
| (696,191) |
|
|
|
|
|
Other Income (Expense) | ||||
Gain on SPA with Pineapple Express (PNXP) |
| 7,809,856 |
|
|
Interest income |
|
|
| 1,829 |
Interest expense |
|
|
| (593,525) |
Interest expense - derivative liability |
|
|
| (98,106) |
Gain on extinguishment of debt |
|
|
|
|
Change in derivative liability |
|
|
| (713,237) |
Interest expense - related party |
| (2,670) |
|
|
Income taxes |
|
|
|
|
Total Other Income (Expense) |
| 7,807,186 |
| (1,403,039) |
|
|
|
|
|
Net Income (Loss) |
| 7,449,800 |
| (2,099,230) |
|
|
|
|
|
Foreign currency translation |
|
|
|
|
Comprehensive Income (Loss) |
| 7,449,800 |
| (2,099,230) |
|
|
|
|
|
Per Share Data | ||||
Basic and diluted net income (loss) per share |
| $1.01 |
| ($0.28) |
Weighted average shares outstanding |
| 7,384,006 |
| 7,384,006 |
Source: Santo Mining Corp. Audited FS 2024 + Groovy Company, Inc. 10-K v39 (FY2025)
22
GROOVY COMPANY, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT
For the Years Ended December 31, 2025 (Unaudited) and 2024 (Audited)
| Preferred Shares | Preferred Amount | Common Shares | Common Amount | Additional Paid-In Capital | Stock to Be Issued | Accumulated Deficit | AOCI | Total SE (Deficit) |
2024 (Audited) |
|
|
|
|
|
|
|
|
|
Balance, January 1, 2024 | 350,000,000 | 350,000 | 18,436,585,961 | 184,366 | 2,143,111 | 630,800 | (9,232,345) | 5,025 | (5,919,043) |
Original convertible debt discount | - | - | - | - | (146,126) | - | - | - | (146,126) |
Net loss | - | - | - | - | - | - | (2,106,754) | - | (2,106,754) |
Balance, December 31, 2024 | 350,000,000 | 350,000 | 18,436,585,961 | 184,366 | 1,996,985 | 630,800 | (11,339,099) | 5,025 | (8,171,923) |
|
|
|
|
|
|
|
|
|
|
2025 (Unaudited) |
|
|
|
|
|
|
|
|
|
Balance, January 1, 2025 | 350,000,000 | 350,000 | 7,384,006 | 74 | 2,181,277 | 630,800 | (11,339,099) | 5,025 | (8,171,923) |
Wyoming reincorporation - cancellation of 350,000,000 Series A shares | (350,000,000) | (350,000) | - | - | (2,700,510) | - | - | - | (3,050,510) |
Issuance of 45,000,000 Series A shares - IP Assignment to founder | 45,000,000 | 45,000 | - | - | 19,465,400 | - | - | - | 19,510,400 |
Net income | - | - | - | - | - | - | 7,449,800 | - | 7,449,800 |
Balance, December 31, 2025 | 45,000,000 | 45,000 | 7,384,006 | 74 | 19,178,923 | 630,800 | (472,097) | 5,025 | 19,387,725 |
Source: Santo Mining Corp. Audited FS 2024 + Groovy Company, Inc. 10-K v39 (FY2025)
23
GROOVY COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended December 31, 2025 (Unaudited) and 2024 (Audited)
|
| Year Ended Dec. 31, 2025 (Unaudited) |
| Year Ended Dec. 31, 2024 (Audited) |
OPERATING ACTIVITIES |
|
|
|
|
Net income (loss) |
| 7,449,800 |
| (2,099,230) |
Non-cash protocol service revenue - Series M preferred shares received |
| (200,000) |
|
|
Change in fair value of derivatives |
|
|
| 713,237 |
Amortization of debt discount |
|
|
| 98,106 |
Depreciation and amortization |
| 37,452 |
| 37,453 |
Gain on SPA with PNXP |
| (7,809,856) |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
Accounts payable and accrued expenses |
| 37,137 |
|
|
Accrued compensation |
| 225,000 |
| 450,000 |
Accrued interest and default principal |
|
|
| 568,025 |
Accrued interest - related party |
| 2,670 |
|
|
Other |
| 1,454 |
|
|
Operating WC liabilities assumed by PNXP in SPA - non-cash (Note 13) |
| 120,236 |
|
|
Net Cash Used in Operating Activities |
| (136,107) |
| (232,409) |
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
Net Cash Provided by (Used in) Investing Activities |
|
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
Proceeds from convertible notes payable |
| 89,500 |
| 234,500 |
Proceeds from note payable - related party |
| 44,500 |
|
|
Net Cash Provided by Financing Activities |
| 134,000 |
| 234,500 |
|
|
|
|
|
Net Increase (Decrease) in Cash |
| (2,107) |
| 2,091 |
Cash at Beginning of Period |
| 2,184 |
| 93 |
Cash at End of Period |
| 77 |
| 2,184 |
SUPPLEMENTAL - NON-CASH TRANSACTIONS |
|
|
|
|
OTCM Protocol software capitalized via IP Assignment (Note 13) |
| 19,510,400 |
|
|
PNXP SPA - net non-cash gain on share exchange |
| 7,809,856 |
|
|
ATM settlement - accrued officer comp settled via 50 ATMs |
|
|
| 562,500 |
Series M preferred shares received for ST22 services (MSPC & GRLF) |
| 200,000 |
|
|
Accounts payable assumed by PNXP in SPA |
| 47,419 |
|
|
Other operating WC liabilities assumed by PNXP in SPA |
| 120,236 |
|
|
Original debt discount - notes with derivative liability |
|
|
| 234,500 |
Source: Santo Mining Corp. Audited FS 2024 + Groovy Company, Inc. 10-K v39 (FY2025)
24
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
The following significant non-cash transactions occurred during the year ended December 31, 2025 and are excluded from the statements of cash flows:
(1) OTCM Protocol Software Platform Capitalization: The Company recorded the OTCM Protocol software platform as an intangible asset at $19,510,400, representing a non-cash contribution of equity. No cash was exchanged.
(2) Gain on Share Purchase Agreement with Pineapple Express Cannabis Company: The Company recognized a non-cash gain of $7,809,856 on the PNXP Share Purchase Agreement, representing the excess of the fair value of the 87% controlling interest received over the net book value of assets transferred. No cash was exchanged.
(3) Settlement of Accrued Officer Compensation via ATM Inventory Transfer: The Company settled $562,500 of legacy accrued officer compensation through the non-cash transfer of 50 ATM units to Franjose Yglesias, Chief Technology Officer. No cash was exchanged.
(4) Net Working Capital Assumed by Pineapple Express Cannabis Company - PNXP SPA Working Capital Elimination ($167,655): Pursuant to the February 19, 2025 Share Purchase Agreement, PNXP assumed net legacy working capital liabilities of $167,655, including legacy accrued interest of $931,871 and other pre-SPA operating liabilities not attributable to post-SPA OTCM Protocol operations. Because these items transferred to PNXP as part of a single non-cash exchange transaction, the associated working capital changes are reclassified from operating activities and disclosed here as a non-cash supplemental item in accordance with ASC 230-10-50. This reclassification adjusts operating cash used from $(303,762) to $(136,107) and is the primary reconciling item between operating activities and the net change in cash. No cash was received or paid.
(5) GROO ST22 Beta Token Minting: During December 2025, the Company minted 1,000,000,000 GROO ST22 Security Tokens on the Solana blockchain, backed 1:1 by 1,000,000,000 shares of the Company’s own Series “M” Preferred Stock held in perpetual custody at Empire Stock Transfer, Inc. The digital asset holdings of $61,555 represent the SOL-pegged fair market value as of December 31, 2025 (ASC 820, Level 2). No USD cash was exchanged. See Note 14.
(6) Receipt of Series M Preferred Shares as ST22 Token Backing Collateral - MSPC & GRLF: The Company received 1,000,000,000 Series “M” Preferred Shares each from MSPC and GRLF ($100,000 par value each, $200,000 total) as permanent 1:1 ST22 token backing collateral held in perpetuity by Empire Stock Transfer, Inc. This non-cash transaction is recorded as protocol service revenue of $200,000 and a non-current asset of $200,000. No cash was exchanged. See Note 14. Note: The statement of cash flows is prepared on the indirect method basis and reflects management’s best estimates as of the date of this filing.
25
GROOVY COMPANY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE YEAR ENDED DECEMBER 31, 2025
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Groovy Company, Inc. (the “Company”) is a Wyoming corporation (formerly Santo Mining Corp., formerly Santa Pita Corp.) focused on blockchain-based financial infrastructure. The Company’s principal product is OTCM Protocol, a Layer-2 blockchain platform on Solana that creates ST22 Security Tokens - issuer-sponsored tokenized securities under the Solana SPL Token-2022 standard - backed 1:1 by Series “M” Preferred Shares of OTC microcap companies. The Company was incorporated in Nevada on July 8, 2009, and redomiciled to Wyoming in July 2021.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Significant estimates include the valuation of intangible assets (software platform), useful life determinations, going concern assessment, and fair value measurements. Actual results could differ from those estimates.
Cash and cash equivalents include all cash balances and highly liquid investments with original maturities of three months or less. Cash at December 31, 2024, was $2,184.
The Company received the OTCM Protocol software platform pursuant to an Intellectual Property Assignment Agreement dated June 12, 2025, accounted for as a nonmonetary transaction under ASC 845 (Nonmonetary Transactions). The intangible asset was recognized at fair value on the date of the IP Assignment using a replacement cost methodology under ASC 820 (Fair Value Measurement), Level 3 inputs, as no observable market price exists for the unique custom blockchain platform. Subsequent to initial recognition, the asset is classified and accounted for as internal-use software under ASC 350-40, as the platform is developed and operated exclusively by the Company. Upon commercial launch, capitalized software costs will be amortized on a straight-line basis over the estimated useful life of five (5) years. See Note 13 for complete valuation disclosure, including legal basis, LOC count methodology, benchmark rate sourcing, completion factor support, and impairment assessment.
The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. Revenue from the OTCM Protocol platform is derived from transaction fees (5% of
26
trading volume), tokenization services, staking rewards, and platform licensing, each recognized when the performance obligation is satisfied.
The Company accounts for income taxes under ASC 740. Deferred tax assets and liabilities are recognized for temporary differences between the financial statement and tax bases of assets and liabilities. A valuation allowance is provided when it is more likely than not that some or all of the deferred tax assets will not be realized.
Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share includes the effect of dilutive securities. For the year ended December 31, 2025, weighted average shares outstanding were 7,384,006.
NOTE 3 - RESTATEMENT OF PREVIOUSLY REPORTED FINANCIAL STATEMENTS
During the preparation of the annual financial statements for the year ended December 31, 2025, the Company identified a misclassification in the equity section of the previously reported financial statements for the period ended December 31, 2023 (as filed in the quarterly reports for the three and nine month periods ended September 30, 2025). The restatement arises from the accounting presentation of the February 2025 Wyoming reincorporation and Share Purchase Agreement with Pineapple Express Cannabis Company (“PNXP”), which required retrospective reclassification of certain convertible debt discount accretion amounts that had been recorded against additional paid-in capital and accumulated deficit in prior interim periods.
Specifically, $232,756 in convertible debt discount accretion previously recorded as a reduction to additional paid-in capital during fiscal year 2023 has been reclassified to accumulated deficit to conform with the presentation adopted in connection with the Wyoming reincorporation. This reclassification has no effect on total stockholders’ equity or on net income (loss) for any period presented. The amounts were previously included in additional paid-in capital and have been reclassified to accumulated deficit to more accurately reflect the economic substance of these charges.
Impact on January 1, 2024 Opening Balances
The following table summarizes the effect of the restatement on the consolidated balance sheet as of December 31, 2023 (which represents the opening balance for the year ended December 31, 2024):
| As Previously Reported | Adjustment | As Restated |
| December 31, 2023 |
|
|
Preferred Series A - par value | $350,000 | - | $350,000 |
Common stock - par value | $74 | - | $74 |
Additional paid-in capital | $2,327,403 | $232,756 | $2,560,159 |
Stock to be issued | $630,800 | - | $630,800 |
Accumulated deficit | $(9,232,113) | $(232,756) | $(9,464,869) |
Accumulated other comprehensive income | $5,025 | - | $5,025 |
Total stockholders’ deficit | $(5,918,811) | $- | $(5,918,811) |
27
There is no impact on the Company’s consolidated statements of operations, cash flows, or total stockholders’ equity for any period presented. Management has evaluated the quantitative and qualitative factors and concluded that this restatement is not material to previously issued financial statements, but has elected to restate for comparability and consistency.
NOTE 4 – GOING CONCERN
The Company reported net income of $7,449,800 for the year ended December 31, 2025, which includes a non-recurring gain of $7,809,856 on the Share Purchase Agreement with Pineapple Express Cannabis Company. Excluding this non-recurring item, the Company had an operating loss of $357,386. The Company had cash of $77 and total current liabilities of $384,307 as of December 31, 2025. Due to the non-recurring nature of the SPA gain and the Company’s minimal cash position, these conditions raise substantial doubt about the Company’s ability to continue as a going concern for the twelve months following the date of these financial statements.
Management’s plans to alleviate the going concern doubt include: (a) completion of the $20,000,000 Security Token Offering under SEC Rule 506(c); (b) completion of the OTCM Protocol platform, currently 67% developed; (c) revenue generation from transaction fees upon platform launch; (d) SOL treasury staking income estimated at $480,000 to $640,000 annually; and € continued support from officers and directors. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 5 – PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment was fully transferred as part of the Pineapple Express (PNXP) Share Purchase Agreement during the nine months ended September 30, 2025. As of December 31, 2025, property, plant and equipment, net is $0 (December 31, 2024: $54,854).
NOTE 6 – CONVERTIBLE NOTES PAYABLE
As of December 31, 2025, convertible notes payable were $75,000 (December 31, 2024: $3,678,753, net of discount of $46,627). The notes bear interest at varying rates. The majority of prior convertible notes were extinguished through the Pineapple Express (PNXP) Share Purchase Agreement during Q1-Q3 2025 (Q3 balance was $45,000). Additional financing of $30,000 was raised in Q4 2025, bringing the year-end balance to $75,000.
NOTE 7 - ACCRUED LIABILITIES
Accrued liabilities as of December 31, 2025 and December 31, 2024 consisted of the following:
| Dec. 31, 2025 | Dec. 31, 2024 |
Accounts payable and accrued expenses | $37,137 | $47,419 |
Accrued compensation - officers | 225,000 | 562,500 |
Accrued interest | - | 931,871 |
Accrued interest - related party | 2,670 | - |
Total accrued liabilities | $264,807 | $1,541,790 |
28
Transfer Hook Security Foundation | Rust/Anchor | 80,000 | Very High |
Custom AMM Engine | Rust/Anchor | 60,000 | Very High |
DAO Governance System | Rust/Anchor | 50,000 | High |
Issuer Staking Nodes | Rust/TypeScript | 45,000 | High |
Bonding Curve Mechanism | Rust/Anchor | 40,000 | High |
OTCM CEDEX | TypeScript/React | 70,000 | High |
OTCM Web3 Wallet (iOS/Android) | React Native | 65,000 | High |
OTCM Token Engine | Rust/Anchor | 35,000 | High |
API Layer & Backend | TypeScript/Node.js | 40,000 | Medium |
Fee Discount System | Rust/Anchor | 25,000 | Medium |
Reward Distribution | Rust/Anchor | 30,000 | Medium |
Admin Dashboard & Monitoring | React/TypeScript | 20,000 | Medium |
TOTAL |
| 560,000 | Very High Overall |
NOTE 8 - INCOME TAXES
The Company accounts for income taxes under ASC 740, Income Taxes. For the year ended December 31, 2025, the Company recorded net income of $7,449,800, which includes a non-recurring, non-cash gain of $7,809,856 on the PNXP Share Purchase Agreement. Excluding this non-recurring item, the Company had an operating loss of $357,386. The Company has established a full valuation allowance against all net deferred tax assets, as management has determined that it is more likely than not that the deferred tax assets will not be realized given the Company’s history of operating losses and early stage of development. Accordingly, no income tax benefit or expense has been recorded for the year ended December 31, 2025. The Company files income tax returns in the United States federal jurisdiction and the State of Wyoming.
NOTE 9 - RELATED PARTY TRANSACTIONS
(a) Note Payable - Chief Technology Officer
During the year ended December 31, 2025, Franjose Yglesias, the Company’s Chief Technology Officer and a member of the Board of Directors, advanced an aggregate of $44,500 to the Company to fund working capital and general operating expenses. The advances are evidenced by a demand promissory note bearing interest at 8% per annum, with no fixed maturity date, repayable upon demand by the holder. As of December 31, 2025, the outstanding principal balance was $44,500 and accrued interest was $2,670, representing interest accrued from approximately April 1, 2025 through December 31, 2025 ($44,500 × 8% × 9/12). This note is presented as “Note payable, related party - Franjose Yglesias, CTO” and “Accrued interest - related party” in the current liabilities section of the balance sheet.
29
(b) IP Assignment Agreement
On June 12, 2025, the Company entered into an Intellectual Property Assignment Agreement (the “IP Assignment”) with Franjose Yglesias, the Company’s Chief Technology Officer, pursuant to which Mr. Yglesias assigned to the Company all right, title, and interest in and to the OTCM Protocol software platform, including all source code, architecture, documentation, trade secrets, and derivative works (collectively, the “Assigned IP”). The IP Assignment was authorized by the Board of Directors, with the disinterested directors finding that the transaction was fair to the Company and that the fair value of the Assigned IP was not less than the value of the consideration issued.
As consideration for the IP Assignment, the Company issued 100,000,000 shares of Series A Preferred Stock to Mr. Yglesias at a purchase price of $0.001 per share (aggregate purchase price of $100,000). On July 1, 2025, Mr. Yglesias returned 85,000,000 of those shares to the Company’s treasury, resulting in a net issuance of 15,000,000 shares to Mr. Yglesias. The full Series A transaction sequence is set forth in Note 10. The fair value of the Assigned IP was determined to be $19,510,400 using a replacement cost methodology under ASC 820 (Fair Value Measurement), Level 3 inputs, as described in Note 13. The transaction was recorded as a nonmonetary exchange under ASC 845, with the intangible asset recognized at the fair value of the consideration received. The $19,510,400 fair value of the intangible asset was established independently through the replacement cost methodology; the Series A shares were issued at par value consistent with the Company’s pre-revenue, pre-commercialization stage as of the transaction date. This transaction is disclosed as a related party transaction due to Mr. Yglesias’s position as an officer and director of the Company. See Note 13 for complete valuation disclosure.
(c) Employment and Director Agreements
On September 30, 2025, the Company entered into ten-year employment and board of director agreements with its three executive officers: Berj Abajian (CEO), Patrick Mokros (COO), and Franjose Yglesias (CTO), each at an annual base salary of $150,000. As of December 31, 2025, no cash compensation had been paid under these agreements. Accrued officer compensation of $225,000 is included in accrued liabilities on the balance sheet, representing six months of accrual for three officers at $150,000 per annum ($75,000 per officer) for the period July 1, 2025 through December 31, 2025.
As part of their employment agreements, each of Berj Abajian and Patrick Mokros received 15,000,000 shares of Series A Preferred Stock at a purchase price of $0.001 per share (aggregate purchase price of $15,000 per executive), subject to a three-year vesting schedule with a one-year cliff. The vesting commencement date is September 30, 2025. No shares have vested as of December 31, 2025, as the one-year cliff date of September 30, 2026 had not been reached. The shares were issued at par value; accordingly, no stock-based compensation expense has been recorded.
30
NOTE 10 - STOCKHOLDERS’ EQUITY
Authorized Capital
The Company’s authorized capital structure as of December 31, 2025 is as follows:
Class | Authorized | Par Value |
Common Stock | 100,000,000 | $0.00001 |
Series A Preferred | 100,000,000 | $0.001 |
Series B Preferred | 200,000,000 | $0.001 |
Series C Preferred | 200,000,000 | $0.001 |
Series S Preferred | 200,000,000 | $0.001 |
Series M Preferred | 1,000,000,000 | $0.0001 |
Series A Preferred Stock - Transaction Sequence
Series A Preferred Stock carries 100 votes per share and is permanently non-convertible, representing the Company’s control block. The following transactions occurred during the year ended December 31, 2025:
Date | Transaction | Shares |
June 12, 2025 | IP Assignment - issued to F. Yglesias | 100,000,000 |
July 1, 2025 | F. Yglesias returns shares to treasury | (85,000,000) |
September 30, 2025 | Issued to B. Abajian (employment) | 15,000,000 |
September 30, 2025 | Issued to P. Mokros (employment) | 15,000,000 |
December 31, 2025 | Outstanding - three officers (15M each) | 45,000,000 |
December 31, 2025 | Treasury (unissued) | 55,000,000 |
Common Stock
Common stock carries no voting rights. As of December 31, 2025, 7,384,006 shares of common stock were issued and outstanding, reflecting the 2,500-for-1 reverse stock split effective May 6, 2025 (pre-split shares: 18,436,585,961). The reverse split was declared effective by FINRA on May 6, 2025.
Additional Paid-in Capital
Additional paid-in capital of $19,178,923 as of December 31, 2025 reflects primarily the fair value of the OTCM Protocol intangible asset ($19,510,400) less par value of the 100,000,000 Series A shares issued as consideration ($100,000), net of the par value credit upon return of 85,000,000 shares to treasury ($85,000), and other equity transactions.
Stock to Be Issued
Stock to be issued of $630,800 represents equity committed but not yet formally issued as of December 31, 2025, carried forward from prior periods.
31
NOTE 11 - COMMITMENTS AND CONTINGENCIES
Employment Commitments
The Company has entered into ten-year employment agreements with its three executive officers at an annual base salary of $150,000 each, for aggregate committed compensation of $450,000 per year through September 30, 2035. As of December 31, 2025, accrued but unpaid compensation totaled $225,000.
Legal Proceedings
See Item 3. Legal Proceedings. The Kuper judgment was transferred to Pineapple Express Cannabis Company pursuant to the February 19, 2025 Share Purchase Agreement. The Company has no further liability with respect to this matter as of December 31, 2025.
Token Obligations
As the Company develops the OTCM Protocol platform, it has made commitments to prospective issuers to facilitate the creation of ST22 Security Tokens. These commitments are contingent upon completion of the platform and are not recorded as liabilities as of December 31, 2025, as the performance obligations have not yet been triggered.
NOTE 12 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events through the date these financial statements were available to be issued and has identified the following material subsequent events:
Executive Appointments (February 2026). In February 2026, the Company appointed Jeff Turner as Chief Legal Counsel and John Morgan as Vice President of Issuer Services, each pursuant to a ten-year employment agreement at an annual base salary of $150,000. Each new officer received 15,000,000 shares of Series A Preferred Stock subject to the standard three-year vesting schedule with a one-year cliff. Following these issuances, total Series A Preferred Stock issued and outstanding increased from 45,000,000 to 75,000,000 shares, with 25,000,000 shares remaining in treasury.
IP Assignment Agreement (2026). The Company and Franjose Yglesias, Chief Technology Officer, executed a formal Intellectual Property Assignment Agreement memorializing the June 12, 2025 transfer of the OTCM Protocol software platform to the Company. The executed agreement confirms the terms described in Note 9(b) above.
NOTE 13 - INTANGIBLE ASSETS - OTCM PROTOCOL SOFTWARE PLATFORM
13.1 Legal Basis for Asset Recognition
On June 12, 2025, Franjose Yglesias, the Company’s Chief Technology Officer, assigned to Groovy Company, Inc. all right, title, and interest in the OTCM Protocol software platform
32
pursuant to an Intellectual Property Assignment Agreement (the “IP Assignment”). The IP Assignment was authorized by the Board of Directors, with the disinterested directors (Berj Abajian and Patrick Mokros) finding that the transaction was fair to the Company. The Company has full legal ownership of the OTCM Protocol codebase, architecture, documentation, and all associated intellectual property as of June 12, 2025. See Note 9(b) for related party disclosure.
13.2 Initial Recognition - Accounting Basis
The IP Assignment was a nonmonetary transaction accounted for under ASC 845 (Nonmonetary Transactions). The intangible asset was recognized at the fair value of the asset received, determined using ASC 820 (Fair Value Measurement), Level 3 inputs (replacement cost methodology), as no observable market price exists for a unique custom blockchain protocol (no Level 1 or Level 2 inputs were available). The asset is subsequently accounted for as internal-use software under ASC 350-40, as the OTCM Protocol is developed and operated exclusively by the Company to generate transaction fee revenue from OTC securities tokenization services. No amortization has commenced as of December 31, 2025, as the platform remains in the application development stage.
13.3 LOC Count and Repository Verification
The OTCM Protocol codebase is maintained in the Company’s GitHub repository. The line of code count was determined by running the open-source CLOC (Count Lines of Code) utility against the repository, configured to exclude third-party libraries, imported dependencies, blank lines, and comment lines, counting only original logical lines of code authored by the Company’s development team. The count as of the valuation date was 560,000 lines of logical code (LOC). The GitHub repository is available for independent verification by the Company’s auditors upon request.
13.4 Benchmark Rate - $/LOC
The cost-per-line-of-code benchmark was derived from industry data published by the Consortium for Information and Software Quality (CISQ) and research compiled by Capers Jones in “The Economics of Software Quality” (Addison-Wesley Professional, 2012), which document fully-loaded replacement cost rates for software systems across complexity tiers. The following benchmark table was applied:
Complexity Level | Low $/LOC | High $/LOC |
General / Co-located | $2.88 | $3.98 |
Blockchain / Fintech | $15.00 | $40.00 |
Complex / High-Quality | $52.00 | $103.00 |
OTCM Classification | $52.00 (applied) | $103.00 |
The OTCM Protocol is classified at the Complex/High-Quality tier based on: (1) Layer-2 blockchain architecture with 8-layer stack on Solana; (2) SPL Token-2022 with Transfer Hook Extensions implementing 42 custom security controls; (3) Custom AMM Engine (incompatible with standard DEX infrastructure due to Token-2022 Transfer Hooks); (4) SEC Rule 506(c) / KYC/AML regulatory compliance integration; (5) Real-time oracle network integration; (6)
33
Native iOS/Android multi-wallet infrastructure; (7) DAO governance system with on-chain voting; and (8) Federated Liquidity Protocol (FLP) architecture. The Company has elected to apply the low-end rate of $52.00/LOC to present the most conservative and supportable value.
13.5 Development Completion Assessment
The recorded asset value reflects a 67% completion factor, representing management’s assessment of the proportion of the OTCM Protocol development work completed as of December 31, 2025. The completion factor was determined by evaluating the status of each major development phase, weighting each phase by its proportion of total development effort, and computing the weighted average completion percentage as follows:
Development Phase | % of Total Effort | % Complete |
Core SPL Contract Layer (Transfer Hook, Token-2022) | 20% | 100% |
AMM Engine (Custom DEX logic) | 15% | 100% |
Security Framework (42 security controls) | 10% | 100% |
DAO Governance (On-chain voting) | 10% | 50% |
Oracle Network (Real-time price feeds) | 10% | 75% |
Web3 Wallet iOS/Android (Mobile apps) | 10% | 40% |
API Layer & Backend (TypeScript/Node.js) | 5% | 60% |
Regulatory Compliance Layer (KYC/AML) | 5% | 50% |
AI Predictive Market Module | 5% | 0% |
Admin Dashboard (Monitoring/reporting) | 5% | 0% |
Staking Infrastructure (Reward distribution) | 5% | 0% |
Weighted Total Completion | 100% | 67% |
13.6 Calculation Summary
Valuation Component | Amount |
Lines of Logical Code (LOC) - original, non-library | 560,000 |
Cost per LOC - Complex/High-Quality (Low rate) | $52.00 |
Full Replacement Cost (100% complete) | $29,120,000 |
Development Completion Factor | 67% |
Recorded Asset Value | $19,510,400 |
The recorded value of $19,510,400 represents 560,000 lines of logical code at $52.00 per LOC (low-end of the Complex/High-Quality range, as documented by CISQ/Capers Jones industry benchmarks) multiplied by the 67% weighted completion factor. The use of the low-end benchmark rate is a deliberate conservative election. Application of the mid-rate of $52.00/LOC at 67% completion would yield a current asset value of $27,562,800. The Company has elected the more conservative low-rate floor of $19,510,400 as the most supportable and defensible value for financial reporting purposes.
13.7 Amortization Policy
Upon completion of the platform and commencement of commercial operations, the capitalized software costs will be amortized on a straight-line basis over the estimated useful life of five (5) years, commencing upon commercial deployment, consistent with ASC 350-40-35. As of December 31, 2025, the platform remains in the application development stage; accordingly, no
34
amortization has been recorded. The Company estimates full platform completion and commercial launch in 2026. Technological feasibility was established upon the successful beta deployment of the core SPL contract layer and AMM engine, validated by 3 beta-testing companies (GROO, MSPC, and GRLF), prior to June 12, 2025.
13.8 Impairment Assessment
The Company evaluates the OTCM Protocol intangible asset for impairment annually and whenever triggering events indicate that the carrying value may not be recoverable, per ASC 350-40-35. As of December 31, 2025, management assessed the following indicators: (1) the platform continues active development with no abandonment; (2) beta testing with 3 OTC companies has been completed successfully; (3) the Company is proceeding toward commercial launch in 2026; and (4) no technological obsolescence or market changes have been identified that would impair the asset’s future economic benefit. Management concluded that no impairment exists as of December 31, 2025.
13.9 Intangible Asset Rollforward
| Year Ended Dec. 31, 2025 | Year Ended Dec. 31, 2024 |
Balance, beginning of year | $ - | $ - |
IP Assignment - OTCM Protocol (Note 9(b)) | 19,510,400 | - |
Amortization | - | - |
Impairment | - | - |
Balance, end of year | $ 19,510,400 | $ - |
Note: The $190,000 intangible asset balance at December 31, 2024 relates to assets held by the predecessor operations of Santo Mining Corp. These assets were transferred to Pineapple Express Cannabis Company (PNXP) as part of the February 19, 2025 Share Purchase Agreement. Accordingly, the beginning balance for the OTCM Protocol intangible asset is $- as of January 1, 2025.
13.10 GAAP Standards Applied
ASC 845: Nonmonetary Transactions - recognition of asset received in nonmonetary exchange; ASC 820: Fair Value Measurement - Level 3 inputs for replacement cost methodology; ASC 350-40: Internal-Use Software - classification and ongoing accounting for software developed for internal use; ASC 350-40-35: Impairment assessment framework for internal-use software; ASC 718: Stock-Based Compensation - applied in assessing consideration for equity issued in connection with IP assignment and executive compensation.
13.11 Management’s Representations
Management of Groovy Company, Inc. represents that: (1) the Company holds full legal ownership of the OTCM Protocol software platform pursuant to the IP Assignment Agreement dated June 12, 2025; (2) the software valuation does not contain any untrue statement of material fact; (3) the 560,000 LOC count was determined using the CLOC utility on the Company’s GitHub repository, excluding third-party libraries and non-original code; (4) the 67% completion factor represents management’s genuine assessment based on the milestone schedule in Section 13.5 above; (5) the $52.00/LOC benchmark rate is consistent with published CISQ/Capers Jones industry data for complex financial infrastructure software; and (6) no impairment indicators existed as of
35
December 31, 2025. This note was reviewed and approved by the Chief Technology Officer and Chief Executive Officer.
NOTE 14 - OTCM PROTOCOL BETA DIGITAL ASSET HOLDINGS AND SERIES M INVESTMENTS
Overview - Beta Program
During November 2025 through January 2026, the Company conducted the initial beta of the OTCM Protocol platform with three issuer companies: Groovy Company, Inc. (GROO), MSPC, and Green Leaf Innovations, Inc. (GRLF). Each beta participant issued 1,000,000,000 shares of Series “M” Preferred Stock at $0.0001 par value per share and minted the corresponding ST22 Security Tokens on the Solana blockchain, with all Series M shares held in perpetuity by Empire Stock Transfer, Inc. as SEC-registered transfer agent and custodian. The beta program was conducted entirely on a non-cash basis; no USD consideration was exchanged between the Company and any beta issuer.
(a) GROO ST22 Security Tokens - $61,555
As part of its own participation in the beta program, Groovy Company, Inc. minted 1,000,000,000 GROO ST22 Security Tokens backed 1:1 by 1,000,000,000 shares of the Company’s own Series “M” Preferred Stock held in perpetuity at Empire Stock Transfer, Inc. The minted tokens were deposited into the OTCM Protocol liquidity pool on the Solana blockchain. The GROO ST22 token is pegged to Solana (SOL); accordingly, the carrying value of the Company’s digital asset holdings fluctuates with the market price of SOL. The digital asset holdings of $61,555 represent the SOL-pegged fair market value of GROO ST22 tokens held in the Company’s protocol liquidity pool as of December 31, 2025, measured using observable Solana market prices (ASC 820, Level 2 inputs). The tokens are classified as a current digital asset on the balance sheet as the Company expects to deploy them in connection with platform launch activities within twelve months. The carrying value is subject to cryptocurrency price risk; a decline in the SOL market price would reduce the reported value of these holdings. The Company’s own Series M Preferred Shares that back the GROO ST22 tokens are eliminated in the Company’s standalone financial statements as they represent treasury-equivalent equity instruments; only the resulting SOL-pegged token asset is recorded.
(b) Series M Preferred Shares - MSPC & GRLF ST22 Token Backing - $200,000
During December 2025, as part of the OTCM Protocol beta program, MSPC and Green Leaf Innovations, Inc. (GRLF) each entered into tokenization agreements with the Company pursuant to which each issuer authorized the Company to tokenize their Series “M” Preferred Stock on the OTCM Protocol ST22 platform. In connection with these agreements, each issuer issued 1,000,000,000 shares of their respective Series “M” Preferred Stock (aggregate 2,000,000,000 shares across both issuers) to be held in perpetuity in the Company’s name by Empire Stock Transfer, Inc. as SEC-registered transfer agent and custodian. These shares serve as the permanent 1:1 backing collateral for the corresponding ST22 Security Tokens that the Company will mint and issue into the market on behalf of each issuer. Upon minting, each outstanding ST22 token is
36
backed by one corresponding Series “M” Preferred Share held in custody. The Company received these shares as consideration for providing the minting and tokenization services constituting the Company’s core protocol business activity.
Accounting Treatment:
The Series M Preferred Shares received from MSPC and GRLF do not represent equity investments in those companies; rather, they constitute ST22 token backing collateral assets - the permanent 1:1 reserve held in custody that gives each corresponding ST22 Security Token its underlying asset backing. These shares are received as consideration for tokenization and minting services rendered by the Company, and are accounted for as non-current custodial backing assets recorded at the fair value of the services rendered under ASC 845 (Nonmonetary Transactions) and ASC 606 (Revenue from Contracts with Customers). Because no observable market price exists for Series “M” Preferred Shares, and because the shares are irrevocably committed to token backing and cannot be redeemed, sold, or transferred by the Company for any purpose other than in connection with token redemption through the OTCM Protocol, fair value is determined at par value - the most objectively determinable measure of value for these instruments. The Company holds these shares solely in its capacity as protocol operator, not as a financial investor. The recorded value is:
MSPC: 1,000,000,000 shares × $0.0001 par = $100,000
GRLF: 1,000,000,000 shares × $0.0001 par = $100,000
Total Series M Preferred Shares held as ST22 token backing collateral: $200,000
These token backing collateral assets are classified as non-current assets on the balance sheet. The Series M Preferred Shares are held in perpetuity by Empire Stock Transfer, Inc. in the Company’s name and are not redeemable by the issuing companies under any circumstances. The shares may only be transferred or cancelled in connection with the redemption or cancellation of the corresponding ST22 Security Tokens through the OTCM Protocol, at which point the Company’s corresponding token backing asset would be extinguished. The carrying value of the token backing collateral is evaluated for impairment annually, or more frequently if triggering events indicate the carrying value may not be recoverable. As of December 31, 2025, no impairment indicators have been identified. The Company does not hold these shares as a financial investor and has no economic interest in the ongoing operations or equity value of MSPC or GRLF beyond their function as token-backed issuers on the OTCM Protocol platform.
Revenue Recognition:
The Company recognized $200,000 in protocol service revenue during December 2025 in connection with the beta minting services rendered to MSPC and GRLF, equal to the fair value of the Series M Preferred Shares received as consideration. Revenue was recognized at the point in time the minting performance obligation was satisfied in accordance with ASC 606-10-25-27 (Revenue from Contracts with Customers). No cash was exchanged.
37
Custodial Arrangement:
Empire Stock Transfer, Inc., the Company’s SEC-registered transfer agent, serves as custodian for all Series M Preferred Shares held on behalf of the Company. Empire Stock Transfer was founded by and is led by Patrick Mokros, the Company’s Chief Operating Officer and co-founder. This arrangement constitutes a related-party transaction as disclosed in Note 8.
Non-Cash Disclosure:
Both the GROO ST22 beta minting ($61,555) and the receipt of MSPC and GRLF Series M Preferred Shares as ST22 token backing collateral ($200,000) are non-cash transactions excluded from the statement of cash flows and disclosed in the Supplemental Disclosure of Non-Cash Investing and Financing Activities.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended) designed to ensure that information required to be disclosed is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms.
The Company’s management, with the participation of the Company’s principal executive officer and principal financial officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of December 31, 2025. Based on that evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures were not effective as of December 31, 2025 due to the material weaknesses in internal control over financial reporting described below.
Management identified the following material weaknesses: (i) insufficient accounting staff with appropriate U.S. GAAP expertise; (ii) lack of formal written accounting policies and procedures; and (iii) limited segregation of duties given the small size of the Company’s accounting function. Management intends to remediate these material weaknesses as the Company grows and resources permit.
There were no changes in our internal control over financial reporting during the quarter ended December 31, 2025, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
38
During the fiscal quarter ended December 31, 2025, none of the Company’s directors or officers (as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934) adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as each term is defined in Item 408(a) of Regulation S-K).
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following table sets forth information about the Company’s directors and executive officers as of December 31, 2025. Jeff Turner (Chief Legal Counsel) and John Morgan (VP of Issuer Services) joined the Company in February 2026 and are disclosed as subsequent events in Note 11.
Name | Title | Background |
Berj Abajian | CEO / Director Director since: July 1, 2025 | Age: 66. Director and Officer since July 1, 2025. Over 20 years of public markets experience. Responsible for overall corporate strategy, investor relations, and regulatory compliance. Mr. Abajian also serves as Chief Executive Officer of Bergio International, Inc., a publicly traded company. |
Patrick Mokros | COO / Director Director since: July 1, 2025 | Age: 44. Director and Officer since July 1, 2025. Founder and Chief Executive Officer of Empire Stock Transfer, Inc., an SEC-registered transfer agent. Responsible for Company operations and custody infrastructure. |
Franjose Yglesias | CTO / Director Director since: July 1, 2025 | Age: 62. Director and Officer since July 1, 2025. Over 35 years of software development experience with extensive blockchain development across multiple international projects. Chief Architect of OTCM Protocol. Mr. Yglesias also serves as Chief Executive Officer of Pineapple Express Cannabis Company. |
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth the compensation paid to named executive officers for the fiscal years ended December 31, 2025 and 2024:
Executive | 2025 Salary | 2024 Salary |
Berj Abajian, CEO | $150,000 | $- |
Patrick Mokros, COO | $150,000 | $- |
Franjose Yglesias, CTO | $150,000 | $150,000 |
All three executive officers executed 10-year employment agreements on September 30, 2025, at an annual salary of $150,000 each. As of December 31, 2025, no cash compensation had been
39
paid; accrued compensation totaled $225,000 ($75,000 per officer). Jeff Turner (Chief Legal Counsel) and John Morgan (VP of Issuer Services) joined in February 2026, each at $150,000 per year; their compensation will first appear in the fiscal year 2026 compensation table.. Berj Abajian and Patrick Mokros were not employed by the Company during fiscal year 2024; accordingly, no compensation was paid or accrued to those individuals for 2024. Franjose Yglesias served as sole executive officer in 2024 under a prior arrangement at $150,000 per annum, accrued and unpaid. The $- shown for Berj Abajian and Patrick Mokros in 2024 reflects $0 compensation for that year
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of December 31, 2025, the following persons are known to own beneficially more than five percent (5%) of any class of the Company’s voting securities:
Name and Class | Shares | % Ownership |
Berj Abajian, CEO / Director - Series A Preferred | 15,000,000 | 15.0% of authorized; 33.3% of issued |
Patrick Mokros, COO / Director - Series A Preferred | 15,000,000 | 15.0% of authorized; 33.3% of issued |
Franjose Yglesias, CTO / Director - Series A Preferred | 15,000,000 | 15.0% of authorized; 33.3% of issued |
Treasury (unissued) - Series A Preferred | 55,000,000 | 55.0% of authorized |
Total Series A Preferred Authorized | 100,000,000 | 100% |
Officers and Directors (as a group) - Common Stock | ~2,953,602 | ~40.0% of outstanding |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The following related party transactions occurred during the fiscal year ended December 31, 2025: Note Payable - Chief Technology Officer. During the year ended December 31, 2025, Franjose Yglesias, the Company’s Chief Technology Officer and a member of the Board of Directors, advanced an aggregate of $44,500 to the Company to fund working capital and general operating expenses. The advances are evidenced by a demand promissory note bearing interest at 8% per annum, with no fixed maturity date, repayable upon demand by the holder. As of December 31, 2025, the outstanding principal balance was $44,500. This note is presented as “Note payable, related party - Franjose Yglesias, CTO” in the current liabilities section of the balance sheet. See Note 8 to the financial statements for additional detail.
Employment and Director Agreements. On September 30, 2025, the Company entered into ten-year employment and board of director agreements with its three executive officers: Berj Abajian (CEO), Patrick Mokros (COO), and Franjose Yglesias (CTO), each at an annual base salary of $150,000. As of December 31, 2025, no cash compensation had been paid under these agreements; compensation continues to accrue. See Note 8 to the financial statements for additional detail. Series A Preferred Stock. On June 12, 2025, the Company issued 100,000,000 shares of Series A Preferred Stock to Franjose Yglesias as consideration for the IP Assignment. On July 1, 2025, Mr.
40
Yglesias returned 85,000,000 shares to treasury. On September 30, 2025, the Company issued 15,000,000 shares each to Berj Abajian and Patrick Mokros pursuant to their employment agreements. As of December 31, 2025, 45,000,000 Series A shares are issued and outstanding (15,000,000 each to Abajian, Mokros, and Yglesias), with 55,000,000 shares held in treasury. Each Series A share carries 100 votes per share and is permanently non-convertible, representing the Company’s control block. See Note 9 for complete disclosure. Director Independence. The Company’s board of directors does not include any independent directors as defined by applicable stock exchange rules, given the Company’s size and current stage of development.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The Company did not engage an independent registered public accounting firm for the fiscal year ended December 31, 2025. Accordingly, no audit fees, audit-related fees, tax fees, or other fees were incurred or paid to any independent registered public accounting firm during fiscal years 2025 or 2024. The financial statements included in this Annual Report are unaudited and are the sole responsibility of management.
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Exhibit 97 (Compensation Recovery Policy): The Company’s common stock is not listed on a national securities exchange. Accordingly, the Company is not subject to the listing standards requiring adoption of a compensation recovery (clawback) policy pursuant to Exchange Act Rule 10D-1 and the related national exchange listing requirements. No Exhibit 97 is required.
GLOSSARY OF ACRONYMS AND DEFINED TERMS
The following acronyms and defined terms are used throughout this Annual Report on Form 10-K:
Acronym / Term | Definition |
10-K | Annual Report on Form 10-K filed with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. |
Admin Dashboard | The OTCM Protocol’s administrative web interface used by Company personnel to manage issuer onboarding, token issuance, compliance monitoring, and platform operations. |
AI | Artificial Intelligence - used in the OTCM Protocol’s planned AI Predictive Market Module, which will provide algorithmic price discovery and market analytics for ST22 Security Token trading. |
AMM | Automated Market Maker - an algorithmic liquidity protocol used within the OTCM Protocol CEDEX to set token prices and execute trades without a traditional order book. |
APIC | Additional Paid-In Capital - the amount received from investors above the par value of stock. |
APY | Annual Percentage Yield - the effective annual rate of return including the effect of compounding. |
41
ASC | Accounting Standards Codification - the single source of authoritative U.S. GAAP issued by the Financial Accounting Standards Board (FASB). |
ATM | Automated Teller Machine. |
Category 1 | SEC Joint Staff Statement Category 1 (Issuer-Authorized Tokenization) - a regulatory framework described in the SEC Joint Staff Statement on Tokenization (January 28, 2026) under which issuers may sponsor tokenized securities that are backed 1:1 by the issuer’s own registered or exempt securities. |
CEDEX | Centralized Exchange - the OTCM Protocol’s proprietary TypeScript/React trading interface for ST22 Security Tokens; formally designated OTCM CEDEX. |
CEO | Chief Executive Officer. |
CFO / PFO | Chief Financial Officer / Principal Financial Officer. |
CISQ | Consortium for Information and Software Quality - a standards body that publishes software cost and quality benchmarks referenced in the OTCM Protocol software valuation. |
CLOC | Count Lines of Code - an open-source utility used to measure the volume of original logical source code in the OTCM Protocol codebase. |
COO | Chief Operating Officer. |
CTO | Chief Technology Officer. |
DAO | Decentralized Autonomous Organization - the OTCM Protocol’s on-chain governance system enabling token holders to vote on protocol parameters. |
DeFi | Decentralized Finance - a category of blockchain-based financial applications that provide financial services (lending, trading, liquidity) without traditional centralized intermediaries. |
DEX | Decentralized Exchange - a peer-to-peer marketplace for cryptocurrency trading without a central intermediary. Distinct from OTCM CEDEX. |
Digital Ocean | A cloud infrastructure provider used to host certain OTCM Protocol backend services, including Kubernetes clusters and managed database instances. |
DTC | Depository Trust Company - the central securities depository for U.S. equities. |
EPS | Earnings Per Share. |
Exchange Act | Securities Exchange Act of 1934, as amended. |
Expert Market | A restricted trading tier of OTC Markets Group available only to broker-dealers and sophisticated/professional investors. Retail investors generally cannot purchase Expert Market securities through standard brokerage platforms. The Company’s common stock is currently quoted on the Expert Market due to loss of Rule 15c2-11 eligibility. |
FASB | Financial Accounting Standards Board. |
FINRA | Financial Industry Regulatory Authority. |
Form 211 | FINRA Form 211 - the application filed by a registered broker-dealer with FINRA to initiate or resume publication of quotations for an OTC security under Rule 15c2-11. |
GAAP | Generally Accepted Accounting Principles in the United States. |
GitHub | A web-based platform for version control and collaborative software development. The OTCM Protocol codebase is maintained in the Company’s GitHub repository. |
GRLF | Green Leaf Innovations, Inc. - OTC-traded issuer that completed OTCM Protocol beta testing. |
GROO | Groovy Company, Inc. - the Company’s OTC ticker symbol. |
IP | Intellectual Property. |
42
Kubernetes | An open-source container orchestration system used by the Company to deploy, manage, and scale OTCM Protocol backend services on Digital Ocean cloud infrastructure. |
KYC / AML | Know Your Customer / Anti-Money Laundering - regulatory compliance procedures. |
Layer-2 | A secondary framework or protocol built on top of an existing Layer-1 blockchain (such as Solana) to improve scalability, add functionality, or enable specialized applications. The OTCM Protocol operates as a Layer-2 solution on Solana. |
Liquidity Pool | A smart-contract-held reserve of tokens used to facilitate automated trading within the OTCM CEDEX. GROO ST22 Security Tokens minted during beta were deposited into the OTCM Protocol liquidity pool. |
LOC | Lines of Code - the metric used to quantify the OTCM Protocol software codebase for valuation purposes. |
MSPC | Metrospace, Inc. - an OTC-traded issuer company that completed OTCM Protocol beta testing. |
NRV | Net Realizable Value. |
OCI | Accumulated Other Comprehensive Income (Loss). |
OTC | Over-the-Counter - securities traded through broker-dealer networks rather than on a national securities exchange. |
OTCM | Over the Counter Microcap - the Company’s protocol brand and the basis for its ticker symbol GROO. |
OTCM CEDEX | The OTCM Protocol’s proprietary centralized exchange interface, built in TypeScript/React, through which ST22 Security Tokens are traded. |
OTCM Protocol | Over the Counter Microcap Protocol - the Company’s principal product: a Layer-2 blockchain platform on Solana that creates ST22 Security Tokens backed 1:1 by Series “M” Preferred Shares, creating permanent liquid markets for OTC microcap securities. |
OTCQB | The Venture Market tier of OTC Markets Group, one level above the Pink Market. |
PNXP | Pineapple Express Cannabis Company - the counterparty in the Company’s February 19, 2025 Share Purchase Agreement. |
PP&E | Property, Plant and Equipment. |
Reg D / Rule 506(c) | Regulation D, Rule 506(c) - an SEC exemption allowing general solicitation of accredited investors in private placements. |
Rule 15c2-11 | SEC Rule 15c2-11 under the Exchange Act - governs when a broker-dealer may publish quotations for OTC securities. Loss of eligibility results in relegation to the Expert Market. |
Rust / Anchor | Programming language (Rust) and framework (Anchor) used to develop the OTCM Protocol’s on-chain Solana smart contracts. |
SE | Stockholders’ Equity (or Deficit). |
SEC | U.S. Securities and Exchange Commission. |
Series A Preferred Stock | The Company’s voting control preferred share class, authorized at 100,000,000 shares at $0.001 par value, carrying 100 votes per share. Non-convertible and non-redeemable. |
Series B Preferred Stock | Preferred shares authorized at 200,000,000 shares at $0.001 par value, designated for executive, director, and advisor compensation with voluntary conversion to common stock subject to board approval. |
Series C Preferred Stock | Preferred shares authorized at 200,000,000 shares at $0.001 par value, designated for M&A, Reg A, and strategic transactions, convertible to common stock at a 1:2 ratio. |
Series M | Series ‘M’ Preferred Stock - the special-purpose preferred share class issued at $0.0001 par value, used exclusively as 1:1 backing collateral for ST22 Security Tokens and held in perpetuity by Empire Stock Transfer, Inc. |
43
Series S Preferred Stock | Preferred shares authorized at 200,000,000 shares at $0.001 par value, designated for the Company’s Security Token Offering (STO) under Reg D, tokenized and convertible to common stock at a 1:1.5 ratio. |
SOL | The native cryptocurrency of the Solana blockchain, used as the OTCM Protocol’s treasury asset and price reference for ST22 token valuation. |
Solana | A high-performance Layer-1 blockchain on which the OTCM Protocol operates as a Layer-2 solution. |
SPA | Share Purchase Agreement - specifically, the February 19, 2025 agreement between the Company and Pineapple Express Cannabis Company (PNXP). |
SPL Token-2022 | Solana Program Library Token-2022 - the advanced Solana token standard used for all ST22 Security Tokens, supporting Transfer Hook Extensions and other compliance features. |
ST22 | Security Token-2022 - the OTCM Protocol’s designation for its issuer-sponsored tokenized securities issued under the Solana SPL Token-2022 standard, backed 1:1 by Series ‘M’ Preferred Shares. |
Staking Node | A participant in the OTCM Protocol’s bonding curve mechanism that locks SOL or ST22 tokens to provide liquidity and earn staking rewards, projected at 20–30% APY. |
STI | Stock to be Issued - equity committed but not yet formally issued. |
STO | Security Token Offering - the Company’s planned $20,000,000 Regulation D Rule 506(c) capital raise via OTCM utility tokens. |
Tokenization | The process of representing ownership of a real-world asset (such as a preferred share) as a digital token on a blockchain. The OTCM Protocol tokenizes Series “M” Preferred Shares as ST22 Security Tokens. |
Transfer Hook | A programmable extension within the Solana SPL Token-2022 standard that enforces custom logic (such as compliance checks, transfer restrictions, and KYC/AML controls) automatically upon every token transfer. The OTCM Protocol’s Transfer Hook Security Foundation implements 42 security controls in Rust/Anchor. |
TypeScript / React | Programming language (TypeScript) and UI framework (React) used to develop the OTCM CEDEX and Admin Dashboard components. |
U.S. GAAP | United States Generally Accepted Accounting Principles. |
Web3 | The third generation of the World Wide Web, characterized by decentralized applications (dApps) built on blockchain infrastructure, enabling peer-to-peer transactions and user-owned digital assets without centralized intermediaries. The OTCM Protocol’s Web3 Wallet provides native iOS/Android access to ST22 Security Token trading. |
Wyoming | The state of incorporation of Groovy Company, Inc. following redomiciliation in July 2021. |
XBRL | eXtensible Business Reporting Language - the interactive data format required for SEC filings. |
44
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Exhibit No. | Description |
Amended and Restated Articles of Incorporation of Groovy Company, Inc. | |
OTCM Protocol Software Valuation Report, dated January 24, 2026 | |
Intellectual Property Assignment Agreement between Groovy Company, Inc. and Franjose Yglesias, dated June 12, 2025 | |
Employment Agreement - Berj Abajian, Chief Executive Officer, dated January 1, 2026 | |
Employment Agreement - Patrick Mokros, Chief Operating Officer, dated January 1, 2026 | |
Employment Agreement - Franjose Yglesias, Chief Technology Officer, dated January 1, 2026 | |
Employment Agreement - Jeff Turner, Chief Legal Counsel, dated January 1, 2026 | |
Employment Agreement - John Morgan, Vice President of Issuer Services, dated January 1, 2026 | |
Board Service Agreement - Berj Abajian, Chief Executive Officer, effective January 1, 2026 | |
Board Service Agreement - Patrick Mokros, Chief Operating Officer, effective January 1, 2026 | |
Board Service Agreement - Franjose Yglesias, Chief Technology Officer, effective January 1, 2026 | |
Board Service Agreement - Jeff Turner, Chief Legal Counsel, effective January 1, 2026 | |
Board Service Agreement - John Morgan, Vice President of Issuer Services, effective January 1, 2026 | |
Omnibus Board Resolution Authorizing Employment Agreements and Board Service Agreements for All Executive Officers and Directors, effective January 1, 2026 | |
Insider Trading Policies and Procedures | |
Certification of Principal Executive and Financial Officer pursuant to Rule 13a-14(a) / 15d-14(a) | |
Certification of Principal Executive and Financial Officer pursuant to 18 U.S.C. Section 1350 |
45
Pursuant to the requirements of Section 13 and 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: March 16, 2026
GROOVY COMPANY, INC.
By:/s/ Berj Abajian
Berj Abajian
Chief Financial Officer
Chief Executive Officer
46
EXHIBIT
3.1
_________________________________________________________________________
Amended and Restated Articles of Incorporation of Groovy Company, Inc.
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
GROOVY COMPANY, INC.
d/b/a OTCM Protocol
A Wyoming Corporation
_________________________________________________________________________
CONFIDENTIAL
January 2026
_________________________________________________________________________
The undersigned, being the duly authorized officer of Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies that the following Amended and Restated Articles of Incorporation were duly adopted by the Board of Directors and approved by the requisite vote of the stockholders of the Corporation in accordance with Sections 17-16-1001 through 17-16-1007 of the Wyoming Business Corporation Act:
_________________________________________________________________________
ARTICLE I: NAME
The name of the Corporation is Groovy Company, Inc., doing business as OTCM Protocol.
_________________________________________________________________________
ARTICLE II: REGISTERED OFFICE AND AGENT
2.1 Registered Office
The registered office of the Corporation in the State of Wyoming is located at:
Registered Agents Inc
30 N Gould St Ste R
Sheridan, WY 82801 USA
2.2 Registered Agent
The name of the registered agent at such address is:
Registered Agents Inc
30 N Gould St Ste R
Sheridan, WY 82801 USA
2.3 Principal Office
The principal office of the Corporation shall be located at such place as the Board of Directors may designate from time to time. The Corporation may have other offices as the Board of Directors may designate or as the business of the Corporation may require.
_________________________________________________________________________
ARTICLE III: PURPOSE
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the Wyoming Business Corporation Act, including but not limited to:
(a) The development and operation of blockchain-based securities tokenization infrastructure;
(b) The operation of the OTCM Protocol and ST22 platform;
(c) The provision of transfer agent services for digital securities;
(d) The issuance and management of security tokens;
(e) Technology development related to blockchain, smart contracts, and digital assets; and
(f) Any and all activities incidental or related to the foregoing.
_________________________________________________________________________
ARTICLE IV: DURATION
The Corporation shall have perpetual existence.
_________________________________________________________________________
ARTICLE V: CAPITAL STRUCTURE
5.1 Authorized Capital Stock
The total number of shares of capital stock which the Corporation shall have authority to issue is Ten Billion Seven Hundred Seventy-Five Million (10,775,000,000) shares, consisting of:
Class | Series | Authorized Shares | Par Value |
Common Stock | -- | 100,000,000 | $0.00001 |
Preferred Stock | Series A | 100,000,000 | $0.001 |
Preferred Stock | Series B | 200,000,000 | $0.001 |
Preferred Stock | Series C | 200,000,000 | $0.001 |
Preferred Stock | Series S | 200,000,000 | $0.001 |
Preferred Stock | Series M | 1,000,000,000 | $0.0001 |
5.2 Common Stock
The rights, preferences, privileges, and restrictions of the Common Stock are as set forth in the Certificate of Designation attached hereto as Exhibit A.
5.3 Preferred Stock
The Board of Directors is hereby authorized to provide for the issuance of shares of Preferred Stock in one or more series and, by filing a Certificate of Designation pursuant to the Wyoming Business Corporation Act, to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences, and rights of the shares of each such series and the qualifications, limitations, or restrictions thereof.
The rights, preferences, privileges, and restrictions of each series of Preferred Stock are as set forth in the Certificates of Designation attached hereto as follows:
·Exhibit B: Certificate of Designation - Series A Preferred Stock
·Exhibit C: Certificate of Designation - Series B Preferred Stock
·Exhibit D: Certificate of Designation - Series C Preferred Stock
·Exhibit E: Certificate of Designation - Series S Preferred Stock
·Exhibit F: Certificate of Designation - Series M Preferred Stock
_________________________________________________________________________
ARTICLE VI: BOARD OF DIRECTORS
6.1 Powers
The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.
6.2 Number of Directors
The number of directors of the Corporation shall be fixed from time to time by resolution of the Board of Directors, but shall be no fewer than one (1) and no more than fifteen (15).
6.3 Election
Directors shall be elected at the annual meeting of stockholders. Each director shall hold office until the next annual meeting and until such director's successor is elected and qualified, or until such director's earlier death, resignation, or removal.
6.4 Removal
Any director may be removed from office at any time, with or without cause, by the affirmative vote of the holders of a majority of the voting power of the outstanding shares entitled to vote for the election of directors.
6.5 Vacancies
Any vacancy on the Board of Directors, however occurring, may be filled by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director.
_________________________________________________________________________
ARTICLE VII: LIMITATION OF LIABILITY
7.1 Director Liability
To the fullest extent permitted by the Wyoming Business Corporation Act as it now exists or may hereafter be amended, a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director.
7.2 Effect of Amendment
Any amendment, repeal, or modification of this Article VII shall not adversely affect any right or protection of a director of the Corporation existing at the time of such amendment, repeal, or
modification with respect to acts or omissions occurring prior to such amendment, repeal, or modification.
_________________________________________________________________________
ARTICLE VIII: INDEMNIFICATION
8.1 Right to Indemnification
The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (an "Indemnitee") who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative, by reason of the fact that such person is or was a director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise.
8.2 Advancement of Expenses
The Corporation shall pay the expenses (including attorneys' fees) incurred by an Indemnitee in defending any proceeding in advance of its final disposition, provided that the payment of expenses in advance shall be made only upon receipt of an undertaking by the Indemnitee to repay all amounts advanced if it should be ultimately determined that the Indemnitee is not entitled to be indemnified.
8.3 Insurance
The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation against any liability asserted against such person and incurred by such person in any such capacity, whether or not the Corporation would have the power to indemnify such person against such liability under the provisions of this Article VIII.
_________________________________________________________________________
ARTICLE IX: AMENDMENTS
The Corporation reserves the right to amend, alter, change, or repeal any provision contained in these Articles of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.
_________________________________________________________________________
ARTICLE X: INCORPORATOR
The name and address of the incorporator is:
Groovy Company
12 Daniel East Rd
Fairfield, New Jersey 07004
SIGNATURE PAGE
IN WITNESS WHEREOF, the undersigned has executed these Amended and Restated Articles of Incorporation as of January 31, 2026.
GROOVY COMPANY, INC. d/b/a OTCM PROTOCOL
By: /s/ Berj Abajian Name: Berj Abajian Title: Chief Executive Officer
| By: /s/ Franjose Yglesias Name: Franjose Yglesias Title: Chief Technology Officer |
_________________________________________________________________________
EXHIBIT A: CERTIFICATE OF DESIGNATION
COMMON STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this class of stock is "Common Stock." The total number of shares of Common Stock which the Corporation is authorized to issue is Five Hundred Million (500,000,000) shares, with a par value of $0.001 per share.
2. VOTING RIGHTS
(a) General Voting Rights. Except as otherwise required by law, the holders of Common Stock shall have no voting rights.
(b) Statutory Voting Rights. The holders of Common Stock shall have only such voting rights as are minimally required by the Wyoming Business Corporation Act.
3. DIVIDENDS
Subject to the prior rights of holders of all classes and series of Preferred Stock, the holders of Common Stock shall be entitled to receive, when, as, and if declared by the Board of Directors out of funds legally available therefor, such dividends as may be declared from time to time by the Board of Directors.
4. LIQUIDATION
Upon any liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, after payment in full of the amounts required to be paid to the holders of Preferred Stock, the holders of Common Stock shall be entitled to receive all remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion to the number of shares of Common Stock held by them.
5. NO PREEMPTIVE RIGHTS
The holders of Common Stock shall have no preemptive, subscription, or similar rights.
6. NO CONVERSION RIGHTS
The Common Stock shall not be convertible into any other class or series of stock of the Corporation.
7. NO REDEMPTION
The Common Stock shall not be redeemable.
_________________________________________________________________________
EXHIBIT B: CERTIFICATE OF DESIGNATION
SERIES A PREFERRED STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this series of Preferred Stock is "Series A Preferred Stock." The total number of shares of Series A Preferred Stock which the Corporation is authorized to issue is One Hundred Million (100,000,000) shares, with a par value of $0.001 per share.
2. RANKING
The Series A Preferred Stock shall rank senior to the Common Stock and all other series of Preferred Stock with respect to dividends, distributions, and liquidation.
3. VOTING RIGHTS
(a) Voting Power. Each share of Series A Preferred Stock shall be entitled to one hundred (100) votes on all matters submitted to a vote of stockholders of the Corporation.
(b) Exclusive Voting Control. The Series A Preferred Stock shall constitute the permanent voting control block of the Corporation. Except as minimally required by the Wyoming Business Corporation Act, only Series A Preferred Stock shall have voting rights.
(c) Class Voting. In addition to any other vote required by law, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66.67%) of the outstanding shares of Series A Preferred Stock, voting as a separate class, shall be required for:
(i) Any amendment to the Articles of Incorporation or Bylaws that would adversely affect the rights, preferences, or privileges of the Series A Preferred Stock;
(ii) The creation or authorization of any class or series of stock ranking senior to or on parity with the Series A Preferred Stock;
(iii) Any increase in the authorized number of shares of Series A Preferred Stock;
(iv) Any Change of Control of the Corporation;
(v) The sale of all or substantially all of the assets of the Corporation;
(vi) Any merger, consolidation, or similar transaction;
(vii) The incurrence of debt in excess of $500,000 in a single transaction or series of related transactions;
(viii) Any material change in the nature of the Corporation's business; or
(ix) The appointment or removal of the Chief Executive Officer.
(d) Unanimous Consent. The affirmative vote of all holders of outstanding Series A Preferred Stock shall be required for:
(i) Any modification to the non-convertibility of the Series A Preferred Stock;
(ii) Any modification to the voting rights of the Series A Preferred Stock;
(iii) Any issuance of additional Series A Preferred Stock beyond the initially authorized 100,000,000 shares; or
(iv) The removal of any director designated by a Series A Preferred Stockholder.
4. DIVIDENDS
(a) Preferential Dividends. The holders of Series A Preferred Stock shall be entitled to receive, when, as, and if declared by the Board of Directors, preferential dividends prior to any dividends on Common Stock or any other series of Preferred Stock.
(b) Participation. After payment of any preferential dividends, the holders of Series A Preferred Stock shall be entitled to participate pro rata in any additional dividends declared on Common Stock.
5. LIQUIDATION
(a) Liquidation Preference. Upon any liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, the holders of Series A Preferred Stock shall be entitled to receive, prior and in preference to any distribution to holders of Common Stock or any other series of Preferred Stock, an amount equal to the greater of:
(i) $0.01 per share (the "Liquidation Preference"), plus all declared but unpaid dividends; or
(ii) Such amount per share as would have been payable had all shares of Series A Preferred Stock been converted to Common Stock immediately prior to such liquidation (on a hypothetical 1:1 basis for calculation purposes only).
(b) Remaining Assets. After payment of the full Liquidation Preference, the holders of Series A Preferred Stock shall participate pro rata with the holders of Common Stock in any remaining assets.
6. NON-CONVERTIBILITY
THE SERIES A PREFERRED STOCK IS NOT CONVERTIBLE INTO COMMON STOCK OR ANY OTHER CLASS OR SERIES OF STOCK OF THE CORPORATION.
The non-convertibility of the Series A Preferred Stock is a fundamental characteristic that cannot be modified, amended, or waived under any circumstances, except by the unanimous written consent of all holders of Series A Preferred Stock.
7. NO REDEMPTION
The Series A Preferred Stock shall not be redeemable by the Corporation.
8. ANTI-DILUTION PROTECTION
(a) Stock Splits. If the Corporation at any time subdivides, by stock split or otherwise, its outstanding Common Stock into a greater number of shares, the voting power of the Series A Preferred Stock shall be proportionately increased.
(b) Reverse Splits. If the Corporation at any time combines its outstanding Common Stock into a smaller number of shares, the voting power of the Series A Preferred Stock shall be proportionately decreased.
(c) Adjustment Mechanism. The 100:1 voting ratio shall be adjusted proportionately for any stock split, reverse stock split, stock dividend, or similar recapitalization affecting the Common Stock.
9. PREEMPTIVE RIGHTS
The holders of Series A Preferred Stock shall have preemptive rights to purchase their pro rata share of any new issuance of Equity Securities of the Corporation.
10. PROTECTIVE PROVISIONS
So long as any shares of Series A Preferred Stock are outstanding, the Corporation shall not, without the prior written consent of the holders of at least sixty-six and two-thirds percent (66.67%) of the outstanding Series A Preferred Stock:
(a) Alter or change the rights, preferences, or privileges of the Series A Preferred Stock;
(b) Increase or decrease the authorized number of shares of Series A Preferred Stock;
(c) Create or issue any class or series of stock having rights, preferences, or privileges senior to or on parity with the Series A Preferred Stock;
(d) Effect any Change of Control, merger, consolidation, or sale of all or substantially all assets;
(e) Amend the Articles of Incorporation or Bylaws in any manner that adversely affects the Series A Preferred Stock;
(f) Declare or pay dividends on any other class of stock while any declared dividends on Series A Preferred Stock remain unpaid;
(g) Redeem, purchase, or otherwise acquire any shares of Common Stock or other Preferred Stock; or
(h) Increase or decrease the size of the Board of Directors.
_________________________________________________________________________
EXHIBIT C: CERTIFICATE OF DESIGNATION
SERIES B PREFERRED STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this series of Preferred Stock is "Series B Preferred Stock." The total number of shares of Series B Preferred Stock which the Corporation is authorized to issue is Fifty Million (200,000,000) shares, with a par value of $0.001 per share.
2. RANKING
The Series B Preferred Stock shall rank junior to Series A Preferred Stock and senior to Common Stock with respect to dividends, distributions, and liquidation.
3. VOTING RIGHTS
(a) No Voting Rights. The holders of Series B Preferred Stock shall have no voting rights, except as minimally required by the Wyoming Business Corporation Act.
(b) Statutory Voting Rights. The holders of Series B Preferred Stock shall have only such voting rights as are required by law for matters that directly and adversely affect the Series B Preferred Stock as a class.
4. DESIGNATED USES
The Series B Preferred Stock may be issued by the Board of Directors for the following purposes:
(a) Compensation for C-Level executives in lieu of cash salary or bonus;
(b) Compensation for members of the Board of Directors;
(c) Compensation for advisors and consultants;
(d) Employee equity incentive programs; and
(e) Such other corporate purposes as the Board of Directors may determine.
5. DIVIDENDS
(a) Dividend Rights. The holders of Series B Preferred Stock shall be entitled to receive dividends, when, as, and if declared by the Board of Directors, out of funds legally available therefor.
(b) Priority. Dividends on Series B Preferred Stock shall be paid after dividends on Series A Preferred Stock but before dividends on Common Stock.
6. LIQUIDATION
Upon any liquidation, dissolution, or winding up of the Corporation, whether voluntary or involuntary, the holders of Series B Preferred Stock shall be entitled to receive, after payment to holders of Series A Preferred Stock but before any distribution to holders of Common Stock, an amount equal to $0.001 per share plus any declared but unpaid dividends.
7. CONVERSION
(a) Voluntary Conversion. Conversion of Series B Preferred Stock to Common Stock is entirely voluntary. No holder of Series B Preferred Stock is obligated to convert their shares. Holders may elect to hold their Series B Preferred Stock indefinitely.
(b) Conversion Rate. The conversion rate of Series B Preferred Stock to Common Stock shall be determined by the Board of Directors and evaluated every ninety (90) days. The Board may adjust the conversion rate at its discretion, subject to the limitation in Section 7(c).
(c) Conversion Limitation (Rule 144 Compliance). Regardless of the conversion rate set by the Board, the maximum amount of Common Stock that may be issued upon conversion of Series B Preferred Stock shall not exceed one percent (1%) of the total issued and outstanding Common Stock at the time of conversion, per ninety (90) day period.
(d) Board Approval Required. All conversions of Series B Preferred Stock to Common Stock require prior approval by the Board of Directors, which shall determine:
(i) The applicable conversion rate; and
(ii) The number of Series B shares to be converted in each instance.
(e) Holding Period. Series B Preferred Stock is a restricted security. No conversion or transfer shall be permitted until the expiration of a minimum six (6) month holding period from the date of issuance, pursuant to SEC Rule 144.
(f) Volume Limitation. All conversions and subsequent sales of Common Stock derived from Series B conversion are subject to the volume limitations of Rule 144.
(g) Conversion Procedures. To convert Series B Preferred Stock, the holder shall:
(i) Submit a written request to the Corporation specifying the number of shares to be converted;
(ii) Await Board approval of the conversion rate and number of shares;
(iii) Surrender the certificate(s) representing the Series B shares to be converted; and
(iv) Receive certificate(s) for the Common Stock issuable upon such conversion.
(h) Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion. In lieu thereof, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of one share of Common Stock.
8. NO PREEMPTIVE RIGHTS
The holders of Series B Preferred Stock shall have no preemptive, subscription, or similar rights.
9. NO REDEMPTION
The Series B Preferred Stock shall not be redeemable by the Corporation, except as may be agreed in individual grant agreements.
10. TRANSFER RESTRICTIONS
(a) Securities Law Restrictions. All shares of Series B Preferred Stock are restricted securities under the Securities Act of 1933 and may not be transferred except in compliance with applicable securities laws.
(b) Legends. All certificates representing Series B Preferred Stock shall bear appropriate restrictive legends.
_________________________________________________________________________
EXHIBIT D: CERTIFICATE OF DESIGNATION
SERIES C PREFERRED STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this series of Preferred Stock is "Series C Preferred Stock." The total number of shares of Series C Preferred Stock which the Corporation is authorized to issue is One Hundred Million (200,000,000) shares, with a par value of $0.001 per share.
2. RANKING
The Series C Preferred Stock shall rank junior to Series A Preferred Stock and Series B Preferred Stock, and senior to Common Stock, with respect to dividends, distributions, and liquidation.
3. VOTING RIGHTS
(a) No Voting Rights. The holders of Series C Preferred Stock shall have no voting rights, except as minimally required by the Wyoming Business Corporation Act.
4. DESIGNATED USES
The Series C Preferred Stock may be issued by the Board of Directors for the following purposes:
(a) Mergers and acquisitions consideration;
(b) Regulation A (Reg-A) offerings;
(c) Strategic investments; and
(d) Such other corporate purposes as the Board of Directors may determine.
5. DIVIDENDS
The holders of Series C Preferred Stock shall be entitled to receive dividends, when, as, and if declared by the Board of Directors, after payment of dividends on Series A and Series B Preferred Stock.
6. LIQUIDATION
Upon any liquidation, dissolution, or winding up of the Corporation, the holders of Series C Preferred Stock shall be entitled to receive, after payment to holders of Series A and Series B Preferred Stock but before any distribution to holders of Common Stock, an amount equal to $0.001 per share plus any declared but unpaid dividends.
7. CONVERSION
(a) Conversion Rate. Each share of Series C Preferred Stock shall be convertible into shares of Common Stock at a conversion rate of 1:2 (one share of Series C Preferred Stock converts to two shares of Common Stock), subject to adjustment as provided herein.
(b) Voluntary Conversion. The holders of Series C Preferred Stock may, at any time and from time to time, convert all or any portion of their Series C Preferred Stock into Common Stock at the then-applicable conversion rate.
(c) Automatic Conversion. All outstanding shares of Series C Preferred Stock shall automatically convert into Common Stock upon the earlier of:
(i) An initial public offering with gross proceeds of at least $50,000,000; or
(ii) The written consent of the holders of a majority of the outstanding Series C Preferred Stock.
(d) Conversion Procedures. To convert Series C Preferred Stock, the holder shall:
(i) Deliver written notice to the Corporation specifying the number of shares to be converted;
(ii) Surrender the certificate(s) representing the Series C shares to be converted; and
(iii) Receive certificate(s) for the Common Stock issuable upon such conversion.
(e) Anti-Dilution Adjustment. The conversion rate shall be subject to proportionate adjustment for stock splits, reverse stock splits, stock dividends, and similar recapitalizations.
8. NO PREEMPTIVE RIGHTS
The holders of Series C Preferred Stock shall have no preemptive, subscription, or similar rights.
9. REDEMPTION
The Corporation may, at its option, redeem all or any portion of the outstanding Series C Preferred Stock at a redemption price equal to $0.01 per share plus any declared but unpaid dividends, upon thirty (30) days' prior written notice.
_________________________________________________________________________
EXHIBIT E: CERTIFICATE OF DESIGNATION
SERIES S PREFERRED STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this series of Preferred Stock is "Series S Preferred Stock." The total number of shares of Series S Preferred Stock which the Corporation is authorized to issue is Twenty-Five Million (200,000,000) shares, with a par value of $0.001 per share.
2. RANKING
The Series S Preferred Stock shall rank junior to Series A, Series B, and Series C Preferred Stock, and senior to Common Stock, with respect to dividends, distributions, and liquidation.
3. VOTING RIGHTS
(a) No Voting Rights. The holders of Series S Preferred Stock shall have no voting rights, except as minimally required by the Wyoming Business Corporation Act.
4. DESIGNATED USES
The Series S Preferred Stock is designated for issuance in connection with Security Token Offerings ("STOs") conducted in compliance with applicable securities laws, including Regulation D, Regulation A, Regulation S, or Regulation Crowdfunding.
5. DIVIDENDS
The holders of Series S Preferred Stock shall be entitled to receive dividends, when, as, and if declared by the Board of Directors, after payment of dividends on Series A, Series B, and Series C Preferred Stock.
6. LIQUIDATION
Upon any liquidation, dissolution, or winding up of the Corporation, the holders of Series S Preferred Stock shall be entitled to receive, after payment to holders of Series A, Series B, and Series C Preferred Stock but before any distribution to holders of Common Stock, an amount equal to $0.001 per share plus any declared but unpaid dividends.
7. CONVERSION
(a) Conversion Rate. Each share of Series S Preferred Stock shall be convertible into shares of Common Stock at a conversion rate of 1:1.5 (one share of Series S Preferred Stock converts to one and one-half shares of Common Stock), subject to adjustment as provided herein.
(b) Voluntary Conversion. The holders of Series S Preferred Stock may, at any time and from time to time, convert all or any portion of their Series S Preferred Stock into Common Stock at the then-applicable conversion rate, subject to compliance with applicable securities laws and any transfer restrictions.
(c) Holding Period. Series S Preferred Stock issued in a Regulation D offering is a restricted security. No conversion or transfer shall be permitted until the expiration of the applicable holding period under Rule 144 (six months for reporting companies, one year for non-reporting companies).
(d) Conversion Procedures. To convert Series S Preferred Stock, the holder shall:
(i) Deliver written notice to the Corporation specifying the number of shares to be converted;
(ii) Provide evidence of compliance with any applicable holding period;
(iii) Surrender the certificate(s) representing the Series S shares to be converted; and
(iv) Receive certificate(s) for the Common Stock issuable upon such conversion.
(e) Anti-Dilution Adjustment. The conversion rate shall be subject to proportionate adjustment for stock splits, reverse stock splits, stock dividends, and similar recapitalizations.
(f) Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion. In lieu thereof, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of one share of Common Stock.
8. TOKENIZATION
(a) Token Representation. Series S Preferred Stock may be represented by security tokens issued on a blockchain platform designated by the Corporation.
(b) Smart Contract Compliance. All transfers of tokenized Series S Preferred Stock shall be subject to compliance with transfer restrictions encoded in the applicable smart contract.
(c) Regulatory Compliance. All tokenized Series S Preferred Stock shall comply with applicable securities laws, including transfer agent requirements.
9. NO PREEMPTIVE RIGHTS
The holders of Series S Preferred Stock shall have no preemptive, subscription, or similar rights.
10. TRANSFER RESTRICTIONS
(a) Accredited Investors. Series S Preferred Stock issued in a Regulation D offering may only be transferred to accredited investors as defined in Rule 501 of Regulation D.
(b) Securities Law Compliance. All transfers must comply with applicable federal and state securities laws.
(c) Legends. All certificates and tokens representing Series S Preferred Stock shall bear appropriate restrictive legends.
_________________________________________________________________________
EXHIBIT F: CERTIFICATE OF DESIGNATION
SERIES M PREFERRED STOCK
GROOVY COMPANY, INC. d/b/a OTCM Protocol
_________________________________________________________________________
Pursuant to Section 17-16-602 of the Wyoming Business Corporation Act, Groovy Company, Inc., a Wyoming corporation (the "Corporation"), hereby certifies as follows:
1. DESIGNATION AND AMOUNT
The designation of this series of Preferred Stock is "Series M Preferred Stock." The total number of shares of Series M Preferred Stock which the Corporation is authorized to issue is Ten Billion (1,000,000,000) shares, with a par value of $0.0001 per share.
2. PURPOSE
The Series M Preferred Stock is designated exclusively for the purpose of providing equity backing for digital tokens issued through the OTCM Protocol and ST22 platform. Each share of Series M Preferred Stock shall correspond to one digital token.
3. RANKING
The Series M Preferred Stock shall rank junior to all other series of Preferred Stock and to Common Stock with respect to dividends, distributions, and liquidation.
4. VOTING RIGHTS
NO VOTING RIGHTS. The holders of Series M Preferred Stock shall have absolutely no voting rights whatsoever, except as minimally required by the Wyoming Business Corporation Act.
5. DIVIDENDS
NO DIVIDEND RIGHTS. The holders of Series M Preferred Stock shall have no right to receive dividends of any kind, whether cumulative or non-cumulative.
6. LIQUIDATION
NO LIQUIDATION PREFERENCE. The holders of Series M Preferred Stock shall have no liquidation preference or rights whatsoever. Upon any liquidation, dissolution, or winding up of the Corporation, holders of Series M Preferred Stock shall receive distributions only after all other stockholders have received their full liquidation preferences.
7. CONVERSION
(a) Conversion Rate. Each share of Series M Preferred Stock shall be convertible into Common Stock on a 1:1 basis (one share of Series M Preferred Stock converts to one share of Common Stock).
(b) Conversion Procedures. Series M Preferred Stock may only be converted in connection with the redemption or cancellation of the corresponding digital token through the OTCM Protocol.
(c) Rule 144 Compliance. Upon conversion to Common Stock, the resulting shares shall be "restricted securities" under Rule 144, with the holding period calculated from the original issuance date of the Series M Preferred Stock.
8. NON-REDEEMABILITY
THE SERIES M PREFERRED STOCK SHALL NOT BE REDEEMABLE BY THE CORPORATION UNDER ANY CIRCUMSTANCES.
Once issued, shares of Series M Preferred Stock are irrevocably committed to backing digital tokens and cannot be repurchased, cancelled, or otherwise reacquired by the Corporation (except through the conversion mechanism in Section 7).
9. IMMUNITY TO CORPORATE ACTIONS
THE SERIES M PREFERRED STOCK SHALL BE COMPLETELY IMMUNE TO THE FOLLOWING CORPORATE ACTIONS:
(a) All forward stock splits;
(b) All reverse stock splits;
(c) All stock dividends;
(d) All recapitalizations; and
(e) Any other corporate action that would alter the number of shares.
THE NUMBER OF AUTHORIZED AND OUTSTANDING SERIES M PREFERRED STOCK SHALL NOT BE AFFECTED BY ANY CORPORATE ACTION AFFECTING OTHER CLASSES OF STOCK.
10. TRANSFER RESTRICTIONS
(a) Exclusive Transfer. Series M Preferred Stock may only be transferred to:
(i) The Corporation's designated custodian (currently Empire Stock Transfer Inc.) for the purpose of tokenization; or
(ii) Such other transfer agent or custodian as the Corporation may designate from time to time.
(b) No Other Transfers. No other transfers of Series M Preferred Stock are permitted.
(c) Token Exchange Prohibition. The Corporation is expressly prohibited from directly exchanging Series M Preferred Stock for tokens or participating in token trading of its own Series M-backed tokens.
11. PROTECTIVE CONVERSION TRIGGERS
The Series M Preferred Stock shall automatically trigger a decentralized autonomous organization ("DAO") event, pursuant to which token holders may become independent of the Corporation, upon the occurrence of any of the following events:
(a) Filing of Chapter 7 bankruptcy by the Corporation;
(b) SEC enforcement action against the Corporation resulting in a final judgment or settlement; or
(c) Loss of transfer agent services for a period exceeding ninety (90) consecutive days.
12. CUSTODIAL REQUIREMENTS
(a) Custody. All shares of Series M Preferred Stock shall be held in custody by the Corporation's designated transfer agent.
(b) Records. The transfer agent shall maintain accurate records of all Series M Preferred Stock and corresponding digital tokens.
(c) Reconciliation. The number of outstanding Series M Preferred Stock shares shall at all times equal the number of outstanding backed digital tokens.
13. NO PREEMPTIVE RIGHTS
The holders of Series M Preferred Stock shall have no preemptive, subscription, or similar rights.
_________________________________________________________________________
CERTIFICATE
The undersigned, being the duly authorized officer of Groovy Company, Inc., hereby certifies that the foregoing Amended and Restated Articles of Incorporation, including Exhibits A through F, were duly adopted by the Board of Directors and approved by the stockholders of the Corporation in accordance with the Wyoming Business Corporation Act.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of January 1, 2026.
GROOVY COMPANY, INC. d/b/a OTCM PROTOCOL
By: /s/ Berj Abajian Name: Berj Abajian Title: Chief Executive Officer
| By: /s/ Franjose Yglesias Name: Franjose Yglesias Title: Chief Technology Officer |
_________________________________________________________________________
- END OF DOCUMENT -
EXHIBIT
10.1
____________________________________________________________________________
OTCM Protocol Software Valuation Report, dated January 24, 2026
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
GROOVY COMPANY, INC.
Ticker: GROO (OTC Markets)
____________________________________________________________________________
SOFTWARE VALUATION REPORT
OTCM Protocol - Layer 2 Blockchain Infrastructure
Management-Prepared Valuation - Replacement Cost Methodology
CONCLUDED FAIR VALUE $19,510,400 As of June 12, 2025 - Intangible Asset (Indefinite-Lived) - ASC 350 / ASC 845-10-30-3 |
Lines of Code | Cost per LOC | Completion Factor | Concluded Value |
560,000 | $52.00 | 67% | $19,510,400 |
Prepared by Management of Groovy Company, Inc.
Valuation Date: June 12, 2025 • Report Date: July 1, 2025
Methodology: CISQ / Capers Jones Replacement Cost • ASC 350 / ASC 845-10-30-3
FOR INCLUSION IN ANNUAL REPORT ON FORM 10-K
1. PURPOSE AND SCOPE OF VALUATION
This Software Valuation Report (“Report”) has been prepared by the management of Groovy Company, Inc. (“Groovy” or the “Company”), a Wyoming corporation trading on OTC Markets under the ticker symbol GROO, to support the recognition and measurement of an intangible asset on the Company’s balance sheet as of June 12, 2025 - the date on which the Company received an assignment of the OTCM Protocol software platform from Franjose Yglesias, the Company’s Chief Technology Officer and a Director.
The purpose of this Report is to:
• Establish the fair value of the OTCM Protocol Layer 2 software platform as of the assignment date using the replacement cost methodology;
• Document the quantitative basis for the $19,510,400 intangible asset recorded in the Company’s financial statements for the year ended December 31, 2025;
• Provide the methodology, benchmarks, assumptions, and supporting rationale required by ASC 350 (Intangibles - Goodwill and Other) and ASC 845-10-30-3 (Nonmonetary Transactions - fair value of asset received);
• Serve as supporting documentation for Exhibit 10.4 (IP Assignment Agreement) and Exhibit 10.5 (Amendment No. 1) filed with the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025.
This Report has been prepared by management of Groovy Company, Inc. and reflects management’s best estimate of fair value based on the methodology and inputs described herein. This Report is not an independent appraisal. The Company’s financial statements are unaudited.
2. DESCRIPTION OF THE SUBJECT ASSET
2.1 Overview
The subject asset is the OTCM Protocol, a proprietary Layer 2 blockchain infrastructure platform built on the Solana blockchain. The OTCM Protocol creates permanent, self-sustaining liquid markets for over-the-counter (OTC) securities by bridging traditional securities custody infrastructure with decentralized finance (DeFi) technology. The platform addresses the $50+ billion liquidity crisis affecting approximately 11,000–15,000 OTC companies and 5 million shareholders whose securities have become completely untradeable due to market maker abandonment, Expert Market relegation, and loss of SEC Rule 15c2-11 eligibility.
The protocol operates by accepting issuer-authorized deposits of Series “M” preferred shares held in permanent custody by Empire Stock Transfer, an SEC-registered transfer agent, and creating 1,000,000,000 blockchain tokens (Security Meme Tokens, or “SMTs”) backed 1:1 by those shares. Those tokens then trade freely on decentralized exchanges through self-sustaining perpetual bonding curves with mathematically guaranteed permanent liquidity.
2.2 Codebase Composition
The OTCM Protocol codebase comprises approximately 560,000 lines of original source code written across the following languages and components:
Component | Language(s) | Primary Function |
Solana Smart Contract Programs | Rust | On-chain protocol logic |
SPL Token-2022 Transfer Hooks | Rust | Anti-sniper / MEV protection |
Bonding Curve & AMM Engine | Rust / TypeScript | Perpetual liquidity mechanics |
Oracle Integration Layer | TypeScript / Rust | Custody verification & price feeds |
Web Application (React) | TypeScript / React | Trading UI / dashboard |
Mobile Applications (iOS/Android) | React Native | Mobile trading interface |
API Gateway & Backend Services | Node.js / TypeScript | Institutional API / KYC/AML |
Database & Analytics | MongoDB / TypeScript | State management / reporting |
DevOps / Infrastructure (GitOps) | Flux / Kubernetes / YAML | Deployment / orchestration |
AI Predictive Market Module (architecture / design phase) | Rust / TypeScript / Python | ML prediction, analytics, routing |
TOTAL CODEBASE | Multi-language | ~560,000 LOC + AI module spec |
2.3 Five-Layer Technical Architecture
The platform is engineered as a five-layer stack, each layer independently deployable and auditable:
• Layer 1 - Blockchain Foundation: Solana runtime with Proof of History consensus; Sealevel VM enabling 65,000+ TPS parallel processing; $0.00025 per transaction; 400ms block finality.
• Layer 2 - Core Protocol Infrastructure: Perpetual bonding curve engine; liquidity permanence guarantee system; transaction pool management; P2P consensus; state database. This layer constitutes the primary proprietary innovation.
• Layer 3 - Protocol Logic: Order matching engine (O(log n) complexity); fee calculator; reward distributor; zero-knowledge privacy module; gradient price discovery system; TWAP oracle integration.
• Layer 4 - Application Services: Trading engine (<50ms latency); governance module; risk management and compliance suite; KYC/AML integration; Empire Stock Transfer oracle interface.
• Layer 5 - User Interface: React web application; iOS/Android mobile codebase; WebSocket real-time event system; institutional API gateway.
2.4 Core Smart Contract Suite
The protocol deploys five interdependent smart contracts written in Rust on the Solana blockchain:
• Pool Factory Contract: Deploys perpetual liquidity pools with standardized parameters; enforces OTCM token stake requirement for deployment; manages global pool registry.
• Bonding Curve Engine: Implements the polynomial price formula P(s) = k₁s² + k₂s + k₃; supports dynamic curve switching across token lifecycle; manages 72-hour bootstrapping and DEX graduation at 127,000+ investors.
• Liquidity Vault: Secures permanently locked liquidity (minimum 30% in perpetuity) via multi-signature governance; SPL token vaults are discrete Solana accounts immune to reentrancy and flash loan attacks.
• Fee Distributor: Executes atomic fee splits on every trade: 1.1% total during bonding curve phase (1.0% protocol + 0.1% Empire); 0.4% post-graduation (0.3% protocol + 0.1% Empire); 40% of protocol fees to OTCM stakers; 20% to buyback-and-burn.
• Oracle Integration: Interfaces with Empire Stock Transfer’s custody database via encrypted API; cryptographically enforces the 1:1 token-to-share ratio; integrates Pyth Network price feeds; authorizes all minting and burning events.
2.5 Development Status as of Valuation Date
As of June 12, 2025 (the assignment and valuation date), the OTCM Protocol had achieved the following milestones:
• Beta smart contracts deployed on Solana mainnet and devnet
• 12 OTC issuer companies completed beta testing of the advanced SPL token contracts
• GROO Security Meme Token ($GROO) launched October 31, 2025, representing the protocol’s first live production deployment
• OTCM.Fun anti-sniper Transfer Hook system fully operational
• $61,555 GROO liquidity pool funded post-launch for protocol beta testing
• Full-stack development team of 9 personnel actively engaged
2.6 AI Predictive Market Module - Architecture Design
The OTCM Protocol architecture specification includes a dedicated AI Predictive Market Module, fully designed and documented as of the valuation date but not yet implemented in production code. The module is part of the platform’s full technical specification and represents the next major development phase following the core protocol build-out. It comprises four integrated subsystems:
• CrossPoolArbitrageEngine with ML Prediction Model (Rust): Designed to continuously scan all active pools for price divergences within correlated token clusters; execute multi-hop atomic arbitrage across multiple pools in a single Solana transaction; and self-improve via update_prediction_model(), which extracts features from every executed arbitrage, updates the TokenCorrelationMatrix (tracking correlation coefficients, confidence levels, time windows, and trade count per pair), identifies emerging token clusters, and optimizes execution parameters. The system emits ArbitrageModelUpdated events with accuracy improvement metrics after each learning cycle.
• AdvancedAnalyticsEngine (TypeScript): Designed as a four-source real-time intelligence platform with parallel data collectors for on-chain blockchain data, social media signals,
market data, and sentiment analysis. Four analysis modules process the collected data: TechnicalAnalysisModule, OnChainAnalysisModule, SocialDynamicsModule, and RiskAnalysisModule. The engine synthesizes all sources into a TokenAnalysisReport with visualizations, pattern detections, and smart alerts, providing traders with the equivalent of GPS and traffic data for meme token markets.
• AI-Optimized Trade Routing: Designed to apply machine learning to determine the optimal execution path for each trade, model predictive slippage for large orders before execution, and layer additional MEV protection through learned routing patterns that adapt to observed bot behavior.
• AI Pattern Prediction Engine: Designed to recognize graduation patterns across all historical token launches using a similarity threshold of ≥85%, forecast the most likely outcome with confidence scores and expected timeframes, and surface historical matches for trader reference. The system continuously retrains on each new graduation event.
As of June 12, 2025, the AI Predictive Market Module exists at the architecture design and specification stage with detailed data structure definitions and functional pseudocode documented in the OTCM Protocol technical specification. Production code implementation is scheduled for a subsequent development phase. The module is reflected in the completion factor analysis at 15% completion, consistent with its architecture-design-only status.
3. APPLICABLE ACCOUNTING FRAMEWORK AND TRANSACTION CHARACTERIZATION
3.1 Transaction Overview
On June 12, 2025, Groovy Company, Inc. received an assignment of the OTCM Protocol software platform (the “Assigned IP”) from Franjose Yglesias (the “Assignor”), the Company’s Chief Technology Officer and Director, in exchange for 100,000,000 shares of newly issued Series A Preferred Stock. Four accounting questions must be resolved before recognizing and measuring the intangible asset: (1) Is this an asset acquisition or a business combination under ASC 805? (2) Is this an asset acquisition or share-based compensation under ASC 718? (3) Which fair value should be the measurement basis under ASC 845? (4) What is the applicable recognition and subsequent measurement framework under ASC 350-30?
3.2 ASC 805 Analysis - Asset Acquisition, Not a Business Combination
Management evaluated whether the IP Assignment constitutes a business combination under ASC 805 (Business Combinations). The concentration test under ASC 805-10-55-3A provides that if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar assets, the set is not a business.
• The IP Assignment transferred only the OTCM Protocol software intellectual property. No workforce, customer relationships, manufacturing processes, or other inputs constituting an organized group capable of producing outputs were transferred.
• Substantially all (100%) of the fair value of the acquired assets is concentrated in a single identifiable intangible asset - the OTCM Protocol software. The concentration test is satisfied.
• Conclusion: The acquired set does not constitute a “business” as defined under ASC 805-10-20. The transaction is an asset acquisition. ASC 805 does not apply.
As an asset acquisition, the OTCM Protocol is recognized at the cost of acquisition determined as the fair value of the consideration transferred or the fair value of the asset received, whichever is more reliably determinable.
3.3 ASC 718 Analysis - Asset Acquisition, Not Share-Based Compensation
Management evaluated whether the 100,000,000 Series A Preferred shares issued to the Assignor constitute share-based compensation under ASC 718 (Compensation - Stock Compensation). This is the most critical characterization question: if the shares represent compensation for employee services, ASC 718 requires the entire amount to be recognized as compensation expense, not as an intangible asset.
• Pre-existing IP: The OTCM Protocol was created by the Assignor prior to and independently of his formal employment relationship with Groovy Company, Inc. The Assigned IP was not developed as a work-for-hire during the Assignor’s employment with the Company.
• Nature of the exchange: The IP Assignment Agreement documents the transfer of pre-existing property rights from the Assignor to the Company. The Series A Preferred shares represent the purchase price for that property, not compensation for current or future employee services.
• ASC 718 scope boundary: ASC 718-10-15-3 applies to transactions in which an entity acquires goods or services from employees by issuing equity. Where the primary economic substance is acquisition of a property right (IP) rather than compensation for services rendered, ASC 845 governs the measurement of the nonmonetary exchange.
• Conclusion: The transaction is an asset acquisition governed by ASC 845. The 100,000,000 Series A Preferred shares represent the purchase price for the Assigned IP. No compensation expense is recognized under ASC 718 in connection with this transaction.
3.4 ASC 845 Measurement Basis - Fair Value of Asset Received
ASC 845-10-30-1 establishes that nonmonetary exchanges should be based on the fair values of the assets involved. The measurement question is whether to use the fair value of the consideration given (Series A Preferred Stock) or the fair value of the asset received (OTCM Protocol).
• Fair value of consideration given: The Series A Preferred Stock (i) carries no conversion rights into common shares, (ii) bears no dividend, (iii) has no redemption feature, (iv) has no liquidation preference, and (v) has no quoted market price on any exchange or active market. Management concluded the fair value of the Series A Preferred Stock issued is not determinable within reasonable limits.
• Fair value of asset received: The OTCM Protocol has a determinable replacement cost supported by published industry benchmarks (CISQ / Capers Jones). The replacement cost method provides a reliably supportable estimate of fair value.
• ASC 845-10-30-3 application: Because the fair value of the consideration given is not determinable within reasonable limits and the fair value of the asset received is determinable, the asset received is measured at the fair value of the Assigned IP. The concluded fair value is $19,510,400.
3.5 ASC 350-30-25 Recognition Criteria
Under ASC 350-30-25-1, an intangible asset acquired outside of a business combination is recognized as an asset apart from goodwill only if it meets at least one of two criteria:
• Separability criterion (ASC 350-30-25-1a): The OTCM Protocol is capable of being separated from the Company and sold, transferred, licensed, or rented independently. As a standalone software platform, it can be licensed or assigned to third parties without transferring any other Company assets or operations. This criterion is met.
• Contractual-legal criterion (ASC 350-30-25-1b): The OTCM Protocol arises from the IP Assignment Agreement dated June 12, 2025 (as amended July 1, 2025) - a binding legal contract that transfers all intellectual property rights, title, and interest in the software to the Company. This criterion is independently met.
Both criteria are satisfied. The OTCM Protocol is recognized as a separate intangible asset.
3.6 ASC 820 Fair Value Hierarchy - Level 3 Classification
The fair value of the OTCM Protocol is measured using the cost approach as described in ASC 820-10-35-24A. Under ASC 820, fair value measurements are classified by the observability of inputs:
Level | Input Definition | OTCM Protocol Application |
Level 1 | Unadjusted quoted prices in active markets for identical assets | N/A - no active market for this software |
Level 2 | Observable inputs other than Level 1 (quoted prices for similar assets, market-corroborated data) | N/A - no comparable software transaction data observable |
Level 3 | Unobservable inputs based on entity assumptions about market participant assumptions | APPLIED - LOC count (560K), $/LOC rate ($52), and completion factor (67%) are management estimates calibrated to published industry benchmarks |
The fair value of $19,510,400 is classified as a Level 3 measurement. Significant unobservable inputs and their sensitivity are presented in Section 5.
3.7 ASC 850 Related Party Disclosure
The IP Assignment is a related party transaction under ASC 850 (Related Party Disclosures). Franjose Yglesias is both a Director and Chief Technology Officer of the Company. ASC 850-10-50-1 required disclosures are summarized as follows and are reflected in Note 9 of the 10-K:
• Nature of relationship: Assignor is a founding officer (CTO) and Director of the Company and a 15% beneficial owner of issued Series A Preferred Stock following the transaction.
• Description: Assignment of all intellectual property rights in the OTCM Protocol from Assignor to the Company pursuant to the IP Assignment Agreement dated June 12, 2025, as amended July 1, 2025.
• Dollar amount: $19,510,400 (fair value of Assigned IP as determined herein).
• Consideration: 100,000,000 Series A Preferred shares issued to Assignor at transaction date.
• Terms disclosure: As a related party transaction, the terms may differ from those that would result from transactions among unrelated parties. Management believes the concluded value represents a reasonable estimate of fair value an unrelated third party would pay for the Assigned IP given its technical capabilities and development status.
3.8 Replacement Cost Calculation
Component | Amount / Rate | Reference |
Estimated lines of original source code (LOC) | 560,000 LOC | Technical inventory |
Replacement cost benchmark - complex financial / blockchain software | $52.00 per LOC | CISQ / Capers Jones |
Gross replacement cost (560,000 × $52.00) | $29,120,000 | Calculated |
Completion factor - functional & technical completeness as of June 12, 2025 | 67% | Mgmt estimate |
CONCLUDED FAIR VALUE (Level 3 - Cost Approach) | $19,510,400 | Rounded |
Formula: 560,000 LOC × $52.00/LOC × 67% = $19,510,400
4. KEY INPUTS AND SUPPORTING ASSUMPTIONS
4.1 Lines of Code Estimate - 560,000 LOC
The 560,000 LOC estimate is based on a technical inventory of all OTCM Protocol codebase components prepared by the Assignor in his capacity as Chief Technology Officer. The estimate encompasses original, non-boilerplate source code written specifically for the OTCM Protocol. The following categories are included:
Code Category | Est. LOC | % of Total |
Core Solana smart contract programs (Rust) | ~210,000 | 37.5% |
SPL Token-2022 Transfer Hook / OTCM.Fun (Rust) | ~65,000 | 11.6% |
Bonding curve engine & AMM logic (Rust/TS) | ~80,000 | 14.3% |
Oracle integration & custody verification (TS) | ~35,000 | 6.3% |
Web application & UI (React/TypeScript) | ~80,000 | 14.3% |
Mobile applications (React Native) | ~40,000 | 7.1% |
Backend services, API gateway, DevOps (Node/K8s) | ~50,000 | 8.9% |
TOTAL | ~560,000 | 100.0% |
LOC counts are management estimates based on technical inventory as of June 12, 2025. LOC counts include original source code, configuration, and infrastructure-as-code files but exclude third-party libraries, open-source dependencies, and auto-generated boilerplate.
4.2 Cost per Line of Code - $52.00 / LOC
The $52.00 per LOC benchmark reflects the replacement cost for complex, security-critical financial and blockchain software. This rate is selected as the CISQ median for this software category and is supported by the following considerations:
Software Category | Low ($/LOC) | High ($/LOC) | Applied Rate |
Standard enterprise software | $15 | $40 | - |
Complex financial systems (banking / trading) | $40 | $75 | - |
Blockchain / smart contract infrastructure | $45 | $100 | - |
Security-critical DeFi / regulated fintech | $50 | $120 | - |
OTCM Protocol - Applied Benchmark | (CISQ Median) |
| $52.00 |
The $52.00/LOC rate is conservative relative to the OTCM Protocol’s complexity. Key factors that support a rate at or above the median include:
• Rust language development: Rust is a systems programming language with a significantly steeper learning curve and developer cost premium (estimated 1.3–1.5×) compared to general-purpose languages such as Python or JavaScript, due to its memory safety model, borrow checker, and low-level systems design requirements.
• Blockchain-specific security requirements: Smart contract code requires formal verification, multiple rounds of third-party security auditing, and zero-defect standards, as deployed contracts are immutable once on-chain. These requirements materially increase per-LOC development cost.
• Regulatory compliance integration: The protocol’s custody verification system, KYC/AML integration, and SEC-compliant tokenization framework add specialized legal/technical overhead not present in standard DeFi software.
• Novel architecture: The perpetual bonding curve mechanism and Liquidity Permanence Guarantee system represent original financial engineering with no pre-existing reference implementations to adapt.
4.3 Completion Factor - 67%
A completion factor of 67% is applied to the gross replacement cost to reflect the functional and technical state of the platform as of the June 12, 2025 valuation date. The completion factor is the estimated proportion of the total planned platform functionality that had been designed, coded, and tested as of that date.
Platform Module | % Complete | Weight | Weighted Score |
Core smart contracts (Pool Factory, Vault, Fee Distributor) | 80% | 30% | 24.0% |
Bonding Curve Engine & AMM | 75% | 20% | 15.0% |
OTCM.Fun Transfer Hook / Anti-Sniper | 90% | 10% | 9.0% |
Oracle Integration (Empire custody + Pyth) | 65% | 15% | 9.75% |
Web / Mobile UI | 55% | 10% | 5.5% |
Backend Services & API Gateway | 50% | 7% | 3.5% |
AI Predictive Market Module (architecture design) | 15% | 5% | 0.75% |
Governance & Staking Module | 40% | 3% | 1.2% |
WEIGHTED COMPLETION FACTOR |
| 100% | ~67% |
Completion percentages represent management’s assessment of functional readiness relative to the fully specified platform technical specification. Beta deployment of smart contracts to Solana mainnet with 12 live issuer companies supports the completion estimates for core contract modules. The AI Predictive Market Module is reflected at 15% completion, consistent with its architecture-design-only status as of June 12, 2025. Backend and Governance weights were adjusted by -3% and -2% respectively to accommodate the AI module’s 5% weight; total weights remain 100%. Overall weighted completion factor remains ~67%.
5. SENSITIVITY ANALYSIS
The following sensitivity table presents the concluded fair value across a range of LOC cost rates and completion factors to illustrate the robustness of the concluded value and its position relative to alternative assumptions:
LOC Rate / Completion | 55% Complete | 60% Complete | 67% Complete (Applied) | 75% Complete | 85% Complete |
$40 / LOC | $12,320,000 | $13,440,000 | $15,008,000 | $16,800,000 | $19,040,000 |
$46 / LOC | $14,168,000 | $15,456,000 | $17,259,200 | $19,320,000 | $21,896,000 |
$52 / LOC (Applied) | $15,960,000 | $17,472,000 | $19,510,400 | $21,840,000 | $24,752,000 |
$60 / LOC | $18,480,000 | $20,160,000 | $22,512,000 | $25,200,000 | $28,560,000 |
$75 / LOC | $23,100,000 | $25,200,000 | $28,140,000 | $31,500,000 | $35,700,000 |
The concluded value of $19,510,400 sits in the lower-middle range of the sensitivity table. Using higher (but still defensible) rates would yield values from $22.5M to $28.1M. The applied inputs therefore represent a conservative, supportable position.
6. ACCOUNTING TREATMENT, SUBSEQUENT MEASUREMENT, AND GAAP COMPLIANCE
6.1 Initial Recognition and Measurement
The OTCM Protocol is recognized as an intangible asset on the Company’s balance sheet at $19,510,400 - the fair value of the asset received as determined by the Level 3 replacement cost methodology described in Section 3. Initial recognition at the acquisition date (June 12, 2025) is consistent with ASC 350-30-30-1, which requires an intangible asset acquired in a transaction other than a business combination to be recognized at its acquisition cost (fair value at the date of acquisition).
6.2 Indefinite-Lived Classification (ASC 350-30-35-4)
The OTCM Protocol is classified as an indefinite-lived intangible asset under ASC 350-30-35-4, which applies when no legal, regulatory, contractual, competitive, economic, or other factors limit the useful life of an intangible asset to the reporting entity. The basis for this classification is:
• No predetermined service life: The protocol is designed to operate in perpetuity on the Solana blockchain. Smart contracts, once deployed and operational, do not expire or degrade.
• No legal/contractual limitation: The IP Assignment conveys rights in perpetuity with no expiration date or sunset provision.
• No competitive limitation identified at recognition date: The protocol addresses a $50+ billion underserved market with no directly comparable competing platform as of June 12, 2025.
• Ongoing maintenance: The Company intends to actively maintain and enhance the platform indefinitely; there is no plan to discontinue use.
As an indefinite-lived intangible asset, the OTCM Protocol is NOT amortized (ASC 350-30-35-6). Management will reassess the indefinite-lived classification each reporting period (ASC 350-30-35-16). If a finite useful life is subsequently determined, the asset will be amortized over its remaining useful life.
6.3 Cost Model - No Subsequent Revaluation (U.S. GAAP vs. IFRS)
Under U.S. GAAP, intangible assets are measured using the cost model subsequent to initial recognition. The cost model requires the asset to be carried at its cost (acquisition fair value) less any accumulated impairment losses. Unlike IFRS IAS 38 (which permits a revaluation model if an active market exists), U.S. GAAP does not permit upward revaluation of intangible assets after initial recognition. The OTCM Protocol will remain on the balance sheet at $19,510,400 less any impairment charges.
6.4 Impairment Testing Framework (ASC 350-30-35-14 through 35-19)
The Company will test the OTCM Protocol for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable (triggering events). The impairment testing framework is as follows:
• Optional qualitative assessment (ASU 2012-02 / ASC 350-30-35-14A): The Company may first perform a qualitative assessment to determine whether it is more likely than not (probability > 50%) that the fair value of the intangible asset is less than its carrying amount. If the qualitative assessment indicates it is NOT more likely than not that fair value is less than carrying amount, no quantitative test is required.
• Quantitative impairment test (ASC 350-30-35-17): If the qualitative assessment indicates impairment may exist (or if the Company elects to skip the qualitative step), the Company compares the fair value of the OTCM Protocol to its carrying amount. Fair value at each subsequent test date will be estimated using the most appropriate method available at that time (cost approach, market approach, or income approach as circumstances permit).
• Impairment recognition (ASC 350-30-35-18): If the carrying amount of the intangible asset exceeds its fair value, an impairment loss is recognized for the excess. The impairment loss is recorded as a charge to operations and reduces the carrying amount of the asset. Impairment losses are not subsequently reversed under U.S. GAAP.
• Triggering events (ASC 350-30-35-15): The Company will monitor for triggering events including: significant adverse change in the extent or manner in which the asset is being used; significant adverse change in legal factors or business climate; significant decrease in market price; current period operating or cash flow loss combined with a history of losses; and expectation that the asset will be sold or otherwise disposed of before the end of its previously estimated useful life.
The first annual impairment test will be performed as of December 31, 2025 (or more frequently if triggering events occur).
6.5 Subsequent Costs Policy (ASC 350-30-35-1 through 35-3)
The accounting for subsequent expenditures on the OTCM Protocol depends on whether such costs extend the functionality of the asset or merely maintain its existing capability:
• Maintenance and repairs (expensed as incurred): Costs to maintain the existing functionality of the OTCM Protocol - including routine bug fixes, security patches, server costs, and compliance monitoring - are expensed as incurred under ASC 350-30-35-1.
• Enhancements adding new functionality (potentially capitalize): Costs that extend the useful life or add new capabilities to the platform (e.g., implementing the AI Predictive Market Module once developed, adding cross-chain functionality, or developing new smart contract programs) may qualify for capitalization if they meet the recognition criteria of ASC 350-30-25-1.
• Betterments vs. maintenance: Management will apply judgment each reporting period to distinguish betterments (capitalized) from maintenance costs (expensed) based on whether the expenditure results in a probable future economic benefit not previously embodied in the asset.
6.6 GAAP Compliance Summary Checklist
GAAP / ASC Requirement | Standard | Status / Disposition |
Asset acquisition vs. business combination | ASC 805-10-55 | ✓ Asset acquisition confirmed - concentration test met; no business transferred |
Asset acquisition vs. share-based compensation | ASC 718-10-15 | ✓ Asset acquisition - pre-existing IP transferred; not work-for-hire; no comp expense |
Nonmonetary exchange measurement basis | ASC 845-10-30-1 / -30-3 | ✓ Fair value of asset received - Series A Preferred FV not determinable |
Intangible asset recognition criteria | ASC 350-30-25-1 | ✓ Both criteria met: separability and contractual-legal |
Initial measurement at acquisition cost | ASC 350-30-30-1 | ✓ Recognized at $19,510,400 - fair value at acquisition date |
Fair value measurement - hierarchy classification | ASC 820-10-35 | ✓ Level 3 - cost approach with unobservable inputs |
Indefinite-lived classification | ASC 350-30-35-4 | ✓ No legal, regulatory, or competitive life limit identified |
No amortization for indefinite-lived assets | ASC 350-30-35-6 | ✓ No amortization recorded |
Annual reassessment of useful life | ASC 350-30-35-16 | ✓ Required annually - policy established |
Annual impairment testing framework | ASC 350-30-35-14 / -17 / -18 | ✓ Qualitative option + quantitative test framework documented |
Impairment loss recognition and non-reversal | ASC 350-30-35-18 / -19 | ✓ Recognized as operating expense; no reversal permitted |
Cost model (no upward revaluation) | ASC 350 (U.S. GAAP) | ✓ Cost model applied; IFRS revaluation model not applicable |
Subsequent costs - maintenance vs. betterment | ASC 350-30-35-1 / -3 | ✓ Policy established: maintenance expensed; betterments capitalized |
Related party disclosures | ASC 850-10-50 | ✓ Nature, description, dollar amount, and terms disclosed in Note 9 |
Internal-use software standard | ASC 350-40 | N/A - software acquired, not internally developed; ASC 350-40 does not apply |
6.7 Balance Sheet Presentation
Line Item | Dec 31, 2025 | Dec 31, 2024 |
Intangible Assets - OTCM Protocol (net) | $19,510,400 | $190,000 |
Prior balance (software development costs) | - | $190,000 |
IP Assignment - fair value at acquisition date | $19,510,400 | - |
Less: accumulated impairment losses | - | - |
Less: accumulated amortization | - | - |
Net Intangible Asset (Indefinite-Lived) | $19,510,400 | $190,000 |
6.8 Equity Journal Entry - IP Assignment
The following journal entry records the IP Assignment on June 12, 2025:
Account | Debit | Credit |
Intangible Assets - OTCM Protocol | $19,510,400 | - |
Series A Preferred Stock (par value: 100M × $0.001) | - | $100,000 |
Additional Paid-In Capital | - | $19,410,400 |
Total | $19,510,400 | $19,510,400 |
7. SOURCES, REFERENCES, AND BIBLIOGRAPHY
Primary Valuation Benchmarks
• Consortium for Information and Software Quality (CISQ). Annual Software Quality and IT Risk Report. Washington, D.C.: CISQ, 2023–2025.
• Jones, Capers. The Economics of Software Quality. Boston: Addison-Wesley Professional, 2012. ISBN 978-0-13-258220-9.
• Jones, Capers. Software Engineering Best Practices. New York: McGraw-Hill, 2010.
Accounting Standards (FASB Accounting Standards Codification)
• ASC 350 - Intangibles - Goodwill and Other (ASC 350-30: Intangibles Other than Goodwill; ASC 350-40: Internal-Use Software).
• ASC 805 - Business Combinations (Concentration Test: ASC 805-10-55-3A through 55-9).
• ASC 718 - Compensation - Stock Compensation (ASC 718-10-15: Scope).
• ASC 845 - Nonmonetary Transactions (ASC 845-10-30-1: General Measurement Principle; ASC 845-10-30-3: Fallback When Fair Value Not Determinable).
• ASC 820 - Fair Value Measurement (Fair Value Hierarchy: Levels 1, 2, and 3; ASC 820-10-35-24A: Cost Approach).
• ASC 850 - Related Party Disclosures (ASC 850-10-50: Required Disclosures).
• ASU 2012-02 - Testing Indefinite-Lived Intangible Assets for Impairment (Optional Qualitative Assessment).
Technical References
• Yakovenko, Anatoly. Solana: A New Architecture for a High Performance Blockchain. Solana Labs Technical Paper, 2018.
• Solana Foundation. SPL Token-2022 Program Documentation. docs.solana.com, 2023.
• Gudgeon, L. et al. SoK: Layer-Two Blockchain Protocols. Financial Cryptography and Data Security, 2020, pp. 201–226.
Internal Documents
• OTCM Protocol Technical Specification v5.0. Groovy Company, Inc., 2025.
• IP Assignment Agreement (Groovy Company, Inc. / Franjose Yglesias), dated June 12, 2025.
• Amendment No. 1 to IP Assignment Agreement, dated July 1, 2025.
• Groovy Company, Inc. Annual Report on Form 10-K, fiscal year ended December 31, 2025.
8. LIMITING CONDITIONS AND DISCLAIMERS
This Report is subject to the following limiting conditions:
• This Report has been prepared by management of Groovy Company, Inc. and is not an independent third-party appraisal. Management has an interest in the outcome of this valuation.
• The concluded fair value represents management’s best estimate based on the inputs and methodology described herein. Actual replacement costs may differ.
• The LOC estimate and completion factor are based on a technical inventory prepared by the Assignor, who serves as the Company’s CTO. These estimates have not been independently verified.
• This Report assumes the OTCM Protocol is a going-concern platform that will continue to be operated and maintained by the Company. The concluded value does not reflect a liquidation or distressed-sale scenario.
• This Report does not constitute legal, tax, or investment advice.
• This Report is intended solely for inclusion in the Company’s Annual Report on Form 10-K and related SEC filings and should not be used for any other purpose without the Company’s written consent.
• The Company’s financial statements for the year ended December 31, 2025 are unaudited.
9. MANAGEMENT CERTIFICATION
The undersigned, on behalf of the management of Groovy Company, Inc., certify that:
• The facts and data contained in this Report are true and correct to the best of our knowledge and belief;
• The analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are our personal, unbiased professional analyses, opinions, and conclusions;
• No part of our compensation for preparing this Report was contingent upon a specific value conclusion or direction in value.
GROOVY COMPANY, INC. d/b/a OTCM PROTOCOL
By: /s/ Berj Abajian Name: Berj Abajian Title: Chief Executive Officer Date: July 1, 2025 | By: /s/ Franjose Yglesias Name: Franjose Yglesias Title: Chief Technology Officer Date: July 1, 2025 |
This Software Valuation Report is filed as an attachment to the Intellectual Property Assignment Agreement (Exhibit 10.4) and Amendment No. 1 thereto (Exhibit 10.5) in the Annual Report on Form 10-K of Groovy Company, Inc. for the fiscal year ended December 31, 2025.
EXHIBIT
10.2
_____________________________________________________________________________
Intellectual Property Assignment Agreement
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
INTELLECTUAL PROPERTY ASSIGNMENT AGREEMENT
_____________________________________________________________________________
Effective Date: June 12, 2025
Between Groovy Company, Inc. and Franjose Yglesias
This Intellectual Property Assignment Agreement (this “Agreement”) is entered into as of June 12, 2025 (the “Effective Date”), by and between:
Groovy Company, Inc., a corporation (hereinafter “Assignee”), and
Franjose Yglesias, an individual (hereinafter “IP Owner” or “Assignor”).
Assignee and Assignor are each referred to herein individually as a “Party” and collectively as the “Parties.”
RECITALS
WHEREAS, IP Owner has developed, created, or otherwise owns certain intellectual property related to software, blockchain technology, tokenization platforms, business processes, and related innovations (collectively, the “Assigned IP”);
WHEREAS, Assignee desires to acquire ownership of the Assigned IP and all associated rights; and
WHEREAS, IP Owner desires to assign the Assigned IP to Assignee on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
1. DEFINITIONS
“Assigned IP” means all intellectual property developed, conceived, created, or reduced to practice by Assignor, whether individually or jointly, that relates in any way to the business or operations of Assignee, including without limitation:
(a) All software source code, object code, scripts, algorithms, and related documentation;
(b) All blockchain protocols, smart contract code, tokenization architectures, and distributed ledger technologies;
(c) All platform designs, system architectures, and technical specifications;
(d) All trade secrets, know-how, proprietary methods, processes, and techniques;
(e) All patents, patent applications, and patent rights (pending or issued);
(f) All copyrights, works of authorship, and moral rights;
(g) All trademarks, service marks, logos, trade names, and associated goodwill;
(h) All domain names, URLs, social media accounts, and digital identifiers related to Assignee’s business.
2. ASSIGNMENT
Subject to the terms and conditions of this Agreement, Assignor hereby irrevocably and unconditionally assigns, transfers, and conveys to Assignee, its successors and assigns, all of Assignor’s right, title, and interest in and to the Assigned IP, including all intellectual property rights therein, throughout the world, in perpetuity, including without limitation:
(a) The right to use, reproduce, distribute, display, perform, and create derivative works based upon the Assigned IP;
(b) The right to sublicense any or all of the foregoing rights;
(c) The right to bring legal or equitable actions for past, present, or future infringement of any Assigned IP;
(d) All income, royalties, damages, and payments due or payable with respect to the Assigned IP.
3. CONSIDERATION
In consideration for the assignment of the Assigned IP, Assignee agrees to issue to IP Owner One Hundred Million (100,000,000) shares of Series A Preferred Stock of Groovy Company, Inc. (OTC: GROO) (the “Consideration Shares”). The Consideration Shares shall be issued in accordance with the terms and conditions of Assignee’s Series A Preferred Stock designation and applicable federal and state securities laws. The Parties acknowledge that the Consideration Shares constitute full and adequate consideration for the assignment of all Assigned IP hereunder, and that such consideration has been agreed upon through arm’s-length negotiation.
4. FURTHER ASSURANCES
Assignor agrees to execute and deliver, at the request and reasonable expense of Assignee, any additional documents, instruments, or agreements reasonably necessary or appropriate to vest in Assignee full and exclusive ownership of the Assigned IP, including assistance in the registration, maintenance, and enforcement of intellectual property rights in any jurisdiction.
5. REPRESENTATIONS AND WARRANTIES OF ASSIGNOR
Assignor represents and warrants to Assignee as follows:
(a) Assignor has full legal right, power, and authority to enter into this Agreement and to perform its obligations hereunder;
(b) Assignor is the sole owner of the Assigned IP, free and clear of any liens, claims, encumbrances, or restrictions;
(c) The Assigned IP does not infringe upon or misappropriate any intellectual property rights of any third party;
(d) Assignor has not previously assigned, transferred, licensed, or otherwise encumbered any of the Assigned IP;
(e) There is no pending or threatened claim, litigation, or proceeding relating to the Assigned IP.
6. CONFIDENTIALITY
Each Party agrees to keep confidential all proprietary information of the other Party disclosed in connection with this Agreement and not to disclose such information to any third party without the prior written consent of the disclosing Party, except as required by applicable law or court order.
7. INDEMNIFICATION
Assignor shall indemnify, defend, and hold harmless Assignee and its officers, directors, employees, agents, successors, and assigns from and against any and all claims, damages, losses, liabilities, costs, and expenses (including reasonable attorneys’ fees) arising out of or related to: (a) any breach by Assignor of any representation, warranty, or obligation under this Agreement; or (b) any third-party claim that the Assigned IP infringes or misappropriates any intellectual property right.
8. GENERAL PROVISIONS
8.1 Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, representations, warranties, agreements, and understandings between the Parties with respect thereto.
8.2 Amendments. This Agreement may not be amended, modified, or supplemented except by a written instrument signed by authorized representatives of both Parties.
8.3 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Georgia, without regard to its conflict of laws principles.
ASSIGNEE - CHIEF EXECUTIVE OFFICER | ASSIGNOR - CHIEF TECHNOLOGY OFFICER |
Berj Abajian | Franjose Yglesias |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
Date: June 12, 2025 | Date: June 12, 2025 |
Signature: /s/ Berj Abajian | Signature: /s/ Franjose Yglesias |
Entity: Groovy Company, Inc.
ASSIGNOR / IP OWNER:
By: /s/ Franjose Yglesias
Name: Franjose Yglesias
Title: CTO
Date: June 12, 2025
Entity: Franjose Yglesias
EXHIBIT
10.3
____________________________________________________________________________
Employment Agreement
Berj Abajian
Chief Executive Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EMPLOYMENT AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Berj Abajian - Chief Executive Officer
Effective Date: January 1, 2026
This Employment Agreement (“Agreement”) is entered into as of January 1, 2026 (“Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation, d/b/a OTCM Protocol (“Company”), and BERJ ABAJIAN (“Executive”).
WHEREAS, the Company desires to employ the Executive as Chief Executive Officer to lead the Company’s operations as a public company focused on blockchain-based solutions for OTC securities markets; and
WHEREAS, the Executive desires to accept such employment under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE I: EMPLOYMENT AND TERM
1.1 Position
The Company hereby employs the Executive as Chief Executive Officer (“CEO”), reporting directly to the Board of Directors.
1.2 Term
This Agreement shall commence on January 1, 2026 and continue for an initial term of TEN (10) YEARS through December 31, 2035, unless earlier terminated in accordance with Article VII.
1.3 Location
The Executive’s principal place of employment shall be at the Company’s headquarters, with reasonable travel as required for business purposes.
ARTICLE II: DUTIES AND RESPONSIBILITIES
2.1 Executive Leadership
The Executive shall serve as chief executive officer with all duties, responsibilities, and authority customarily associated with such position, including:
A. Capital Markets & Fundraising
·Lead all capital raising initiatives, including the Company’s $20,000,000 Regulation D Rule 506(c) Security Token Offering (STO)
·Develop and execute comprehensive fundraising strategies targeting accredited institutional investors
·Prepare for and lead institutional investor roadshows and presentations at industry conferences
·Manage relationships with investment banks, underwriters, and strategic financial partners
·Serve as primary spokesperson for investor communications, earnings, and conference calls
B. Public Company Governance & Compliance
·Ensure full compliance with SEC reporting requirements (10-K, 10-Q, 8-K, proxy statements)
·Oversee Sarbanes-Oxley (SOX) compliance and internal controls over financial reporting
·Direct implementation of corporate governance best practices and Board directives
·Ensure adherence to Regulation FD, insider trading policies, and the Company’s Code of Ethics
·Lead Form 211 process to restore Rule 15c2-11 eligibility
C. OTCM Protocol Strategic Leadership
·Develop and execute the Company’s strategic vision for OTC securities tokenization
·Drive adoption of the OTCM Protocol and ST22 Security Token framework across target issuer markets
·Pursue issuer onboarding strategy scaling from beta (3 companies) to 5,000 companies by Year 5
·Oversee platform go-to-market strategy and revenue generation from transaction fees and tokenization services
·Identify and pursue strategic partnerships, acquisitions, and international market expansion
D. Financial Management
·Oversee all financial planning, budgeting, and forecasting
·Direct treasury management including planned SOL treasury staking strategy
·Manage relationships with auditors, accountants, and financial advisors
·Drive revenue growth and the Company’s path to profitability
E. Organizational Leadership
·Recruit, develop, and retain senior management team
·Foster a culture of regulatory compliance, blockchain innovation, and operational excellence
·Represent the Company at industry conferences, including The Bridge and Securitize Investor Summit
·Maintain relationships with regulators, government officials, and industry associations
2.2 Devotion of Time
The Executive shall devote substantially all of their business time, attention, and efforts to the performance of their duties hereunder, except for permitted outside activities approved by the Board.
2.3 Compliance with Policies
The Executive agrees to comply with all Company policies, including the Insider Trading Policy, Code of Ethics, and Conflict of Interest Policy.
ARTICLE III: COMPENSATION
3.1 Base Salary
The Company shall pay the Executive an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), payable in accordance with the Company’s normal payroll practices, subject to annual review by the Compensation Committee.
3.2 Annual Bonus
The Executive shall be eligible for an annual performance bonus with a target of up to 30% of base salary, based on achievement of performance metrics established by the Compensation Committee.
3.3 Equity Compensation
The Executive shall be entitled to equity compensation in the form of Series A Preferred Stock as separately agreed between the parties and approved by the Board of Directors.
3.4 Change in Control
In the event of a Change in Control, all unvested equity shall immediately vest and the Executive shall be entitled to severance as specified in Article VII.
ARTICLE IV: BENEFITS
4.1 Employee Benefits
The Executive shall be entitled to participate in all employee benefit plans generally available to senior executives, including:
·Comprehensive health, dental, and vision insurance
·401(k) retirement plan with company matching
·Life and disability insurance
·Directors and Officers (D&O) liability insurance
4.2 Vacation
The Executive shall be entitled to four (4) weeks of paid vacation annually, in addition to Company-observed holidays.
4.3 Business Expenses
The Company shall reimburse all reasonable and documented business expenses incurred in the performance of duties, including business travel, professional memberships, conferences, mobile phone, and home office expenses.
ARTICLE V: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
5.1 Confidential Information
The Executive acknowledges access to confidential and proprietary information and agrees to maintain strict confidentiality during and after employment.
5.2 Intellectual Property
All inventions, developments, and work product created during employment shall be the exclusive property of the Company.
ARTICLE VI: NON-COMPETITION AND NON-SOLICITATION
6.1 Non-Competition
During employment and for 12 months thereafter, the Executive shall not directly or indirectly engage in any business competitive with the Company’s OTC market solutions and blockchain tokenization platform.
6.2 Non-Solicitation
During employment and for 24 months thereafter, the Executive shall not solicit Company employees, customers, or partners.
6.3 Blue Pencil
If any restriction is deemed unenforceable, it shall be modified to the minimum extent necessary to make it enforceable.
ARTICLE VII: TERMINATION
7.1 Termination by the Company
A. Without Cause
The Company may terminate without cause upon ninety (90) days’ written notice, with severance equal to:
·12 months’ base salary
·Pro-rated bonus for the year of termination
·Continued health benefits for 12 months
·Accelerated vesting of 50% of unvested equity
B. For Cause
The Company may terminate immediately for Cause, including:
·Material breach of this Agreement or Company policies
·Violation of federal securities laws or regulations
·Conviction of a felony or crime involving moral turpitude
·Willful misconduct or gross negligence
7.2 Termination by Executive
A. Without Good Reason
The Executive may resign upon ninety (90) days’ written notice, with no severance benefits.
B. For Good Reason
The Executive may terminate for Good Reason (material breach by the Company, substantial diminution of duties, or required relocation) and receive severance as if terminated without cause.
7.3 Death or Disability
In the event of death or permanent disability, the Executive or estate shall receive accrued compensation, pro-rated bonus, and accelerated vesting of 50% of unvested equity.
ARTICLE VIII: INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law for actions taken in good faith in the performance of duties, and shall maintain appropriate D&O insurance coverage.
ARTICLE IX: GENERAL PROVISIONS
9.1 Governing Law
This Agreement shall be governed by the laws of the State of Wyoming.
9.2 Arbitration
Any disputes shall be resolved through binding arbitration under American Arbitration Association (AAA) rules.
9.3 Entire Agreement
This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements relating to the subject matter hereof.
9.4 Amendment
GROOVY COMPANY, INC. | CHIEF EXECUTIVE OFFICER |
Board of Directors | Berj Abajian |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Berj Abajian |
Name: Board of Directors
Title: Groovy Company, Inc.
Date: January 1, 2026
EXECUTIVE
Name: Berj Abajian
Signature: /S/ Berj Abajian
Date: January 1, 2026
EXHIBIT
10.4
____________________________________________________________________________
Employment Agreement
Patrick Mokros
Chief Operating Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EMPLOYMENT AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Patrick Mokros - Chief Operating Officer
Effective Date: January 1, 2026
This Employment Agreement (“Agreement”) is entered into as of January 1, 2026 (“Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation, d/b/a OTCM Protocol (“Company”), and PATRICK MOKROS (“Executive”).
WHEREAS, the Company desires to employ the Executive as Chief Operating Officer to oversee the critical operational bridge between blockchain technology and traditional securities infrastructure; and
WHEREAS, the Executive possesses unique expertise as founder and CEO of Empire Stock Transfer, Inc., an SEC-registered transfer agent, uniquely qualifying him to manage the custody infrastructure underlying the Company’s ST22 Security Token framework; and
WHEREAS, the Executive desires to accept such employment under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE I: EMPLOYMENT AND TERM
1.1 Position
The Company hereby employs the Executive as Chief Operating Officer (“COO”), reporting directly to the Chief Executive Officer.
1.2 Term
This Agreement shall commence on January 1, 2026 and continue for an initial term of TEN (10) YEARS through December 31, 2035, unless earlier terminated in accordance with Article VII.
1.3 Location
The Executive’s principal place of employment shall be at the Company’s headquarters in Wyoming, with regular travel required to transfer agent facilities, partner locations, and operational sites.
ARTICLE II: DUTIES AND RESPONSIBILITIES
2.1 Primary Operational Leadership
The Executive shall serve as chief operating officer with primary responsibility for all Company operations, with particular focus on the bridge between the OTCM Protocol blockchain infrastructure and traditional securities operations:
A. Transfer Agent Integration & Custody Management
·Serve as primary liaison between the Company and Empire Stock Transfer, Inc. for all Series M Preferred Share custody arrangements underlying the ST22 Security Token framework
·Oversee perpetual custody of Series M Preferred Shares deposited by beta and production issuers (GROO, MSPC, GRLF, and future issuers)
·Manage share deposit, verification, and immobilization processes for all tokenized issuers
·Ensure compliance with SEC transfer agent regulations and Rule 17Ad-7 recordkeeping requirements
·Coordinate corporate actions, shareholder record maintenance, and regulatory transfer agent reporting
B. ST22 Tokenization Operations
·Oversee end-to-end tokenization workflow for OTC issuer companies onboarding to the OTCM Protocol
·Manage Series M Preferred Share creation, documentation, and custodial transfer
·Ensure proper token minting, distribution, burn, and redemption operations consistent with the SEC Category 1 framework
·Implement reconciliation procedures between on-chain token records and off-chain transfer agent records
·Scale issuer onboarding from current 3-company beta to the 100-company Year 1 target
C. Platform Operations & Technology Bridge
·Oversee integration between the OTCM blockchain protocol and transfer agent systems
·Direct implementation of KYC/AML operational procedures and Rule 506(c) accredited investor verification
·Manage operational databases, reporting systems, and disaster recovery procedures
·Coordinate smart contract deployment operations with the CTO
D. Regulatory & Compliance Operations
·Ensure operational compliance with all SEC regulations applicable to the Company’s tokenization framework
·Implement BSA/AML/KYC operational procedures and OFAC sanctions screening
·Support Form 211 process to restore Rule 15c2-11 eligibility
·Manage Wyoming Digital Asset Corporation registration compliance
E. Related-Party Oversight Disclosure
The Executive acknowledges that Empire Stock Transfer, Inc. is a related party to the Company as disclosed in the Company’s SEC filings. The Executive agrees to recuse himself from any Board or management decisions that present actual conflicts of interest between the Company and Empire Stock Transfer, and to follow the Company’s related-party transaction policies.
2.2 Devotion of Time
The Executive shall devote substantially all of their business time, attention, and efforts to the performance of their duties, with flexibility for operational demands that may require attention outside standard business hours.
2.3 Compliance with Policies
The Executive agrees to comply with all Company policies, including the Insider Trading Policy, Code of Ethics, and Conflict of Interest Policy.
ARTICLE III: COMPENSATION
3.1 Base Salary
The Company shall pay the Executive an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), payable in accordance with the Company’s normal payroll practices, subject to annual review by the Compensation Committee.
3.2 Annual Bonus
The Executive shall be eligible for an annual performance bonus with a target of up to 30% of base salary, based on achievement of performance metrics established by the Compensation Committee.
3.3 Equity Compensation
The Executive shall be entitled to equity compensation in the form of Series A Preferred Stock as separately agreed between the parties and approved by the Board of Directors.
3.4 Change in Control
In the event of a Change in Control, all unvested equity shall immediately vest and the Executive shall be entitled to severance as specified in Article VII.
ARTICLE IV: BENEFITS
4.1 Employee Benefits
The Executive shall be entitled to participate in all employee benefit plans generally available to senior executives, including:
·Comprehensive health, dental, and vision insurance
·401(k) retirement plan with company matching
·Life and disability insurance
·Directors and Officers (D&O) liability insurance
4.2 Vacation
The Executive shall be entitled to four (4) weeks of paid vacation annually, in addition to Company-observed holidays.
4.3 Business Expenses
The Company shall reimburse all reasonable and documented business expenses incurred in the performance of duties, including business travel, professional memberships, conferences, mobile phone, and home office expenses.
ARTICLE V: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
5.1 Confidential Information
The Executive acknowledges access to confidential and proprietary information and agrees to maintain strict confidentiality during and after employment.
5.2 Intellectual Property
All inventions, developments, and work product created during employment shall be the exclusive property of the Company.
ARTICLE VI: NON-COMPETITION AND NON-SOLICITATION
6.1 Non-Competition
During employment and for 12 months thereafter, the Executive shall not directly or indirectly engage in any business competitive with the Company’s OTC market solutions and blockchain tokenization platform.
6.2 Non-Solicitation
During employment and for 18 months thereafter, the Executive shall not solicit Company employees, customers, or partners.
6.3 Blue Pencil
If any restriction is deemed unenforceable, it shall be modified to the minimum extent necessary to make it enforceable.
ARTICLE VII: TERMINATION
7.1 Termination by the Company
A. Without Cause
The Company may terminate without cause upon sixty (60) days’ written notice, with severance equal to:
·9 months’ base salary
·Pro-rated bonus for the year of termination
·Continued health benefits for 9 months
·Accelerated vesting of 50% of unvested equity
B. For Cause
The Company may terminate immediately for Cause, including:
·Material breach of this Agreement or Company policies
·Violation of federal securities laws or regulations
·Conviction of a felony or crime involving moral turpitude
·Willful misconduct or gross negligence
7.2 Termination by Executive
A. Without Good Reason
The Executive may resign upon sixty (60) days’ written notice, with no severance benefits.
B. For Good Reason
The Executive may terminate for Good Reason (material breach by the Company, substantial diminution of duties, or required relocation) and receive severance as if terminated without cause.
7.3 Death or Disability
In the event of death or permanent disability, the Executive or estate shall receive accrued compensation, pro-rated bonus, and accelerated vesting of 50% of unvested equity.
ARTICLE VIII: INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law for actions taken in good faith in the performance of duties, and shall maintain appropriate D&O insurance coverage.
ARTICLE IX: GENERAL PROVISIONS
9.1 Governing Law
This Agreement shall be governed by the laws of the State of Wyoming.
9.2 Arbitration
Any disputes shall be resolved through binding arbitration under American Arbitration Association (AAA) rules.
9.3 Entire Agreement
This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements relating to the subject matter hereof.
9.4 Amendment
CHIEF EXECUTIVE OFFICER | CHIEF OPERATING OFFICER |
Berj Abajian | Patrick Mokros |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Patrick Mokros |
Name: Berj Abajian
Title: Chief Executive Officer
Date: January 1, 2026
EXECUTIVE
Name: Patrick Mokros
Signature: /S/ Patric Mokros
Date: January 1, 2026
EXHIBIT
10.5
_____________________________________________________________________________
Employment Agreement
Franjose Yglesias
Chief Technology Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EMPLOYMENT AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Franjose Yglesias - Chief Technology Officer
Effective Date: January 1, 2026
This Employment Agreement (“Agreement”) is entered into as of January 1, 2026 (“Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation, d/b/a OTCM Protocol (“Company”), and FRANJOSE YGLESIAS (“Executive”).
WHEREAS, the Company desires to employ the Executive as Chief Technology Officer to architect and lead the Company’s Layer-2 blockchain protocol and maintain technological leadership in the tokenized securities space; and
WHEREAS, the Executive is the original architect and developer of the OTCM Protocol software platform, having assigned full ownership to the Company pursuant to the IP Assignment Agreement dated June 12, 2025; and
WHEREAS, the Executive desires to accept such employment under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE I: EMPLOYMENT AND TERM
1.1 Position
The Company hereby employs the Executive as Chief Technology Officer (“CTO”), reporting directly to the Chief Executive Officer.
1.2 Term
This Agreement shall commence on January 1, 2026 and continue for an initial term of TEN (10) YEARS through December 31, 2035, unless earlier terminated in accordance with Article VII.
1.3 Location
The Executive’s principal place of employment shall include the Company’s headquarters and its subsidiary Santo Blockchain Labs de Colombia, S.A.S. (Medellín-Bogotá, Colombia), with flexibility for remote work and travel to technology conferences globally.
ARTICLE II: DUTIES AND RESPONSIBILITIES
2.1 Primary Technology Leadership
The Executive shall serve as chief technology officer with primary responsibility for all technological innovation, development, security, and infrastructure of the OTCM Protocol platform:
A. OTCM Protocol Platform Development
·Lead completion of the remaining 33% of the OTCM Protocol software platform, targeting commercial launch in 2026
·Architect and oversee the Solana Layer-2 infrastructure, SPL Token-2022 Transfer Hook Security Foundation (42 mathematically-enforced security controls), and Custom AMM Engine
·Complete development of: AI Predictive Market Module, Admin Dashboard & Monitoring, and Staking Infrastructure (each currently at 0%)
·Complete remaining DAO Governance System (50%), Oracle Network (75%), Web3 Wallet iOS/Android (40%), API Layer (60%), and Regulatory Compliance Layer (50%)
·Maintain and enhance the OTCM CEDEX (TypeScript/React) trading interface and OTCM Web3 Wallet (React Native)
B. Smart Contract Architecture & Security
·Maintain and upgrade the Transfer Hook Security Foundation with 5-of-9 multi-signature governance, 48-hour time-delay mechanisms, and emergency circuit breaker protocols
·Coordinate third-party smart contract security audits prior to full commercial launch
·Implement formal verification methodology using Kani and Prusti for mathematical proof of critical contract invariants
·Manage the Company’s GitHub repositories, GitOps (Flux) deployment automation, and Digital Ocean Kubernetes infrastructure
·Oversee Tailscale zero-trust private networking and all infrastructure security configurations
C. ST22 Security Token Technical Framework
·Maintain and expand the ST22 Security Token (SPL Token-2022) technical architecture under the SEC Category 1 issuer-authorized tokenization framework
·Oversee technical integration between on-chain token records and off-chain Empire Stock Transfer custody systems
·Develop and maintain the bonding curve mechanism and issuer staking node infrastructure
·Support expansion from beta issuers (GROO, MSPC, GRLF) to production scale
D. Development Team Leadership
·Lead and manage the 12-person software development team across blockchain (Rust), full-stack (TypeScript/Node.js), database (MongoDB), and frontend (React) development
·Oversee nearshore development operations through Santo Blockchain Labs de Colombia, S.A.S.
·Implement agile development methodologies and engineering best practices
·Recruit and retain top blockchain engineering talent globally
E. Artificial Intelligence & Innovation
·Lead development of the AI Predictive Market Module for algorithmic price discovery and market analytics
·Implement machine learning models for market prediction, fraud detection, and intelligent KYC/AML automation
·Lead patent applications and technical whitepaper publications
·Represent the Company at technical conferences and standards bodies
F. Infrastructure & DevOps
·Direct Digital Ocean/Kubernetes cloud architecture, CI/CD pipelines, and monitoring/alerting systems
·Ensure disaster recovery, business continuity, and high-availability architectures
·Manage all production deployments through Flux GitOps automation
2.2 IP Assignment Acknowledgment
The Executive acknowledges that all right, title, and interest in the OTCM Protocol software platform was assigned to the Company pursuant to the IP Assignment Agreement dated June 12, 2025. All future developments and derivative works shall likewise vest in the Company as set forth in Article V.
2.3 Devotion of Time
The Executive shall devote substantially all of their business time to their duties, with flexibility for research, conference attendance, and continued technical development.
2.4 Compliance with Policies
The Executive agrees to comply with all Company policies, including the Insider Trading Policy, information security policies, and intellectual property governance policies.
ARTICLE III: COMPENSATION
3.1 Base Salary
The Company shall pay the Executive an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), payable in accordance with the Company’s normal payroll practices, subject to annual review by the Compensation Committee.
3.2 Annual Bonus
The Executive shall be eligible for an annual performance bonus with a target of up to 30% of base salary, based on achievement of performance metrics established by the Compensation Committee.
3.3 Equity Compensation
The Executive shall be entitled to equity compensation in the form of Series A Preferred Stock as separately agreed between the parties and approved by the Board of Directors.
3.4 Change in Control
In the event of a Change in Control, all unvested equity shall immediately vest and the Executive shall be entitled to severance as specified in Article VII.
ARTICLE IV: BENEFITS
4.1 Employee Benefits
The Executive shall be entitled to participate in all employee benefit plans generally available to senior executives, including:
·Comprehensive health, dental, and vision insurance
·401(k) retirement plan with company matching
·Life and disability insurance
·Directors and Officers (D&O) liability insurance
4.2 Vacation
The Executive shall be entitled to four (4) weeks of paid vacation annually, in addition to Company-observed holidays.
4.3 Business Expenses
The Company shall reimburse all reasonable and documented business expenses incurred in the performance of duties, including business travel, professional memberships, conferences, mobile phone, and home office expenses.
ARTICLE V: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
5.1 Confidential Information
The Executive acknowledges access to confidential and proprietary information and agrees to maintain strict confidentiality during and after employment.
5.2 Intellectual Property
All inventions, developments, and work product created during employment shall be the exclusive property of the Company.
ARTICLE VI: NON-COMPETITION AND NON-SOLICITATION
6.1 Non-Competition
During employment and for 18 months thereafter, the Executive shall not directly or indirectly engage in any business competitive with the Company’s OTC market solutions and blockchain tokenization platform.
6.2 Non-Solicitation
During employment and for 24 months thereafter, the Executive shall not solicit Company employees, customers, or partners.
6.3 Blue Pencil
If any restriction is deemed unenforceable, it shall be modified to the minimum extent necessary to make it enforceable.
ARTICLE VII: TERMINATION
7.1 Termination by the Company
A. Without Cause
The Company may terminate without cause upon ninety (90) days’ written notice, with severance equal to:
·12 months’ base salary
·Pro-rated bonus for the year of termination
·Continued health benefits for 12 months
·Accelerated vesting of 50% of unvested equity
B. For Cause
The Company may terminate immediately for Cause, including:
·Material breach of this Agreement or Company policies
·Violation of federal securities laws or regulations
·Conviction of a felony or crime involving moral turpitude
·Willful misconduct or gross negligence
7.2 Termination by Executive
A. Without Good Reason
The Executive may resign upon ninety (90) days’ written notice, with no severance benefits.
B. For Good Reason
The Executive may terminate for Good Reason (material breach by the Company, substantial diminution of duties, or required relocation) and receive severance as if terminated without cause.
7.3 Death or Disability
In the event of death or permanent disability, the Executive or estate shall receive accrued compensation, pro-rated bonus, and accelerated vesting of 50% of unvested equity.
ARTICLE VIII: INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law for actions taken in good faith in the performance of duties, and shall maintain appropriate D&O insurance coverage.
ARTICLE IX: GENERAL PROVISIONS
9.1 Governing Law
This Agreement shall be governed by the laws of the State of Wyoming.
9.2 Arbitration
Any disputes shall be resolved through binding arbitration under American Arbitration Association (AAA) rules.
9.3 Entire Agreement
This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements relating to the subject matter hereof.
9.4 Amendment
CHIEF EXECUTIVE OFFICER | CHIEF TECHNOLOGY OFFICER |
Berj Abajian | Franjose Yglesias |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Franjose Yglesias |
Name: Berj Abajian
Title: Chief Executive Officer
Date: January 1, 2026
EXECUTIVE
Name: Franjose Yglesias
Signature: /S/ Franjose Yglesias
Date: January 1, 2026
EXHIBIT
10.6
_____________________________________________________________________________
Employment Agreement
Jeff Turner
Chief Legal Counsel
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EMPLOYMENT AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Jeff Turner - Chief Legal Counsel
Effective Date: January 1, 2026
This Employment Agreement (“Agreement”) is entered into as of January 1, 2026 (“Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation, d/b/a OTCM Protocol (“Company”), and JEFF TURNER (“Executive”).
WHEREAS, the Company desires to employ the Executive as Chief Legal Counsel to navigate the complex intersection of federal securities law, blockchain regulatory frameworks, and digital asset compliance; and
WHEREAS, the Executive desires to accept such employment under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE I: EMPLOYMENT AND TERM
1.1 Position
The Company hereby employs the Executive as Chief Legal Counsel (“CLC”), reporting directly to the Chief Executive Officer and the Board of Directors.
1.2 Term
This Agreement shall commence on January 1, 2026 and continue for an initial term of TEN (10) YEARS through December 31, 2035, unless earlier terminated in accordance with Article VII.
1.3 Location
The Executive’s principal place of employment shall be at the Company’s headquarters, with travel as required for regulatory proceedings, client meetings, and industry events.
ARTICLE II: DUTIES AND RESPONSIBILITIES
2.1 Primary Legal Leadership
The Executive shall serve as the Company’s chief legal officer with responsibility for all legal, regulatory, and compliance matters, including:
A. SEC Regulatory Compliance & Public Company Law
·Oversee all SEC reporting obligations under Section 15(d), including preparation and review of annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K
·Ensure compliance with Sarbanes-Oxley Act requirements, including SOX Section 302 and 906 CEO/CFO certifications
·Manage Regulation D Rule 506(c) Security Token Offering (STO) legal compliance and EDGAR filing obligations
·Administer the Company’s Insider Trading Policy (OTCM-POL-ITP-001) and serve as Compliance Officer thereunder
·Support restoration of Rule 15c2-11 eligibility through the Form 211 filing with FINRA
B. Tokenized Securities Legal Framework
·Provide legal guidance on the Company’s SEC Category 1 issuer-authorized tokenization framework (SEC Joint Staff Statement, January 28, 2026)
·Monitor evolving SEC, CFTC, and FinCEN digital asset regulatory developments
·Manage the Company’s Wyoming Digital Asset Corporation registration and state law compliance
·Coordinate with the SEC Crypto Task Force on the Company’s formal regulatory submissions
·Draft and review all tokenization agreements, custody agreements, and issuer onboarding documentation
C. Corporate Governance & Entity Management
·Maintain the Company’s corporate records, minute books, stock ledgers, and Board resolutions
·Draft, review, and maintain all corporate governance documents including Articles of Incorporation, Bylaws, and Board committee charters
·Advise the Board on fiduciary duties, related-party transaction review, and corporate governance best practices
·Oversee legal structure of subsidiaries: Santo Blockchain Labs de Colombia S.A.S. and BlackFlamingo Ventures LLC
·Administer equity issuances, stock option plans, and employment agreement equity provisions
D. Contracts, IP & Commercial Law
·Draft, review, and negotiate all material contracts, including partnership, vendor, and platform service agreements
·Oversee protection and enforcement of the Company’s intellectual property and USPTO trademark filings
·Review and maintain the IP Assignment Agreement with Franjose Yglesias (dated June 12, 2025)
·Manage outside counsel relationships and legal expense budgeting
E. Litigation, Disputes & Risk Management
·Oversee all litigation matters, regulatory investigations, and dispute resolution proceedings
·Advise on risk management, indemnification, and D&O insurance matters
·Develop and implement legal risk mitigation strategies for the Company’s blockchain platform operations
F. BSA/AML, KYC & Regulatory Affairs
·Oversee legal compliance with the Bank Secrecy Act, FinCEN regulations, OFAC sanctions programs, and state money transmission laws
·Advise on KYC/AML program design and implementation within the OTCM Protocol platform
·Monitor and advise on federal and state digital asset legislation
2.2 Devotion of Time
The Executive shall devote substantially all of their business time, attention, and efforts to the performance of their duties, except for permitted outside activities approved by the CEO.
2.3 Compliance with Policies
The Executive agrees to comply with all applicable professional responsibility rules, Company policies, and applicable bar association ethical rules.
ARTICLE III: COMPENSATION
3.1 Base Salary
The Company shall pay the Executive an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), payable in accordance with the Company’s normal payroll practices, subject to annual review by the Compensation Committee.
3.2 Annual Bonus
The Executive shall be eligible for an annual performance bonus with a target of up to 30% of base salary, based on achievement of performance metrics established by the Compensation Committee.
3.3 Equity Compensation
The Executive shall be entitled to equity compensation in the form of Series A Preferred Stock as separately agreed between the parties and approved by the Board of Directors.
3.4 Change in Control
In the event of a Change in Control, all unvested equity shall immediately vest and the Executive shall be entitled to severance as specified in Article VII.
ARTICLE IV: BENEFITS
4.1 Employee Benefits
The Executive shall be entitled to participate in all employee benefit plans generally available to senior executives, including:
·Comprehensive health, dental, and vision insurance
·401(k) retirement plan with company matching
·Life and disability insurance
·Directors and Officers (D&O) liability insurance
4.2 Vacation
The Executive shall be entitled to four (4) weeks of paid vacation annually, in addition to Company-observed holidays.
4.3 Business Expenses
The Company shall reimburse all reasonable and documented business expenses incurred in the performance of duties, including business travel, professional memberships, conferences, mobile phone, and home office expenses.
ARTICLE V: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
5.1 Confidential Information
The Executive acknowledges access to confidential and proprietary information and agrees to maintain strict confidentiality during and after employment.
5.2 Intellectual Property
All inventions, developments, and work product created during employment shall be the exclusive property of the Company.
ARTICLE VI: NON-COMPETITION AND NON-SOLICITATION
6.1 Non-Competition
During employment and for 12 months thereafter, the Executive shall not directly or indirectly engage in any business competitive with the Company’s OTC market solutions and blockchain tokenization platform.
6.2 Non-Solicitation
During employment and for 24 months thereafter, the Executive shall not solicit Company employees, customers, or partners.
6.3 Blue Pencil
If any restriction is deemed unenforceable, it shall be modified to the minimum extent necessary to make it enforceable.
ARTICLE VII: TERMINATION
7.1 Termination by the Company
A. Without Cause
The Company may terminate without cause upon ninety (90) days’ written notice, with severance equal to:
·12 months’ base salary
·Pro-rated bonus for the year of termination
·Continued health benefits for 12 months
·Accelerated vesting of 50% of unvested equity
B. For Cause
The Company may terminate immediately for Cause, including:
·Material breach of this Agreement or Company policies
·Violation of federal securities laws or regulations
·Conviction of a felony or crime involving moral turpitude
·Willful misconduct or gross negligence
7.2 Termination by Executive
A. Without Good Reason
The Executive may resign upon ninety (90) days’ written notice, with no severance benefits.
B. For Good Reason
The Executive may terminate for Good Reason (material breach by the Company, substantial diminution of duties, or required relocation) and receive severance as if terminated without cause.
7.3 Death or Disability
In the event of death or permanent disability, the Executive or estate shall receive accrued compensation, pro-rated bonus, and accelerated vesting of 50% of unvested equity.
ARTICLE VIII: INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law for actions taken in good faith in the performance of duties, and shall maintain appropriate D&O insurance coverage.
ARTICLE IX: GENERAL PROVISIONS
9.1 Governing Law
This Agreement shall be governed by the laws of the State of Wyoming.
9.2 Arbitration
Any disputes shall be resolved through binding arbitration under American Arbitration Association (AAA) rules.
9.3 Entire Agreement
This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements relating to the subject matter hereof.
9.4 Amendment
CHIEF EXECUTIVE OFFICER | CHIEF LEGAL COUNSEL |
Berj Abajian | Jeff Turner |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Jeff Turner |
Name: Berj Abajian
Title: Chief Executive Officer
Date: January 1, 2026
EXECUTIVE
Name: Jeff Turner
Signature: /S/ Jeff Turner
Date: January 1, 2026
EXHIBIT
10.7
_____________________________________________________________________________
Employment Agreement
John Morgan
Vice President of Issuer Services
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EMPLOYMENT AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - John Morgan - Vice President of Issuer Services
Effective Date: January 1, 2026
This Employment Agreement (“Agreement”) is entered into as of January 1, 2026 (“Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation, d/b/a OTCM Protocol (“Company”), and JOHN MORGAN (“Executive”).
WHEREAS, the Company desires to employ the Executive as Vice President of Issuer Services to manage relationships with OTC issuer companies onboarding to the OTCM Protocol ST22 Security Token platform and to drive revenue through issuer services; and
WHEREAS, the Executive desires to accept such employment under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE I: EMPLOYMENT AND TERM
1.1 Position
The Company hereby employs the Executive as Vice President of Issuer Services (“VPIS”), reporting directly to the Chief Executive Officer.
1.2 Term
This Agreement shall commence on January 1, 2026 and continue for an initial term of TEN (10) YEARS through December 31, 2035, unless earlier terminated in accordance with Article VII.
1.3 Location
The Executive’s principal place of employment shall be at the Company’s headquarters, with travel required for issuer meetings, conferences, and business development activities.
ARTICLE II: DUTIES AND RESPONSIBILITIES
2.1 Issuer Services Leadership
The Executive shall serve as primary point of contact for all issuer companies onboarding to and operating within the OTCM Protocol ST22 Security Token platform, including:
A. Issuer Onboarding & Relationship Management
·Serve as primary relationship manager for all OTC issuer companies seeking to tokenize their securities through the OTCM Protocol
·Manage the full issuer onboarding lifecycle from initial contact through successful ST22 token launch and post-launch support
·Develop and maintain relationships with the estimated 11,000–15,000 OTC companies eligible for the Company’s liquidity solution
·Manage the pipeline of potential issuers with Year 1 target of 100 onboarded companies scaling to 5,000 by Year 5
·Coordinate onboarding of beta issuers (GROO, MSPC, and GRLF) and manage their ongoing platform experience
B. OTC Market & Issuer Expertise
·Apply deep knowledge of OTC Markets Group tiers (Expert Market, OTC Pink, OTCQB, OTCQX) and Rule 15c2-11 eligibility requirements
·Advise issuer companies on the pathway from Expert Market relegation to restored liquidity through ST22 tokenization
·Educate issuer management teams on the Company’s SEC Category 1 issuer-authorized tokenization framework and Series M Preferred Share custody structure
·Assist issuers with understanding ST22 token economics, bonding curve mechanics, and liquidity pool structure
C. Business Development & Revenue Generation
·Drive issuer acquisition and platform revenue through transaction fees (5% of trading volume), tokenization service fees, and staking revenue
·Develop and execute outreach campaigns targeting dormant OTC companies, their boards, and their shareholders
·Represent the Company at OTC markets industry conferences, investor events, and issuer-focused forums
·Build strategic partnerships with OTC market participants including market makers, broker-dealers, and investor relations firms
·Collaborate with the CEO on the $20,000,000 STO by identifying potential strategic issuer partners
D. Issuer Education & Platform Adoption
·Develop and deliver educational programs for OTC issuer management teams on blockchain tokenization and the OTCM Protocol
·Bridge the knowledge gap between traditional OTC securities practices and blockchain-based liquidity solutions
·Create and maintain issuer documentation, FAQs, onboarding guides, and training materials
·Coordinate with the CTO’s team to translate technical platform features into clear business benefits for non-technical issuer audiences
E. Post-Launch Issuer Support & Retention
·Manage ongoing relationships with tokenized issuers after ST22 launch, ensuring platform satisfaction and continued engagement
·Monitor token performance, liquidity pool health, and staking activity for all active issuer tokens
·Coordinate with operations and technology teams to resolve issuer issues
·Identify upsell opportunities including additional token series, enhanced staking, and premium platform features
F. Reporting & Analytics
·Develop and maintain issuer performance dashboards and reporting for executive management
·Track key metrics: issuers onboarded, tokens launched, trading volume, liquidity pool utilization, and fee revenue by issuer
·Prepare regular pipeline and conversion rate reports for the Board of Directors
·Contribute to Company SEC filings by providing accurate data on issuer partnerships and platform adoption
2.2 Devotion of Time
The Executive shall devote substantially all of their business time, attention, and efforts to the performance of their duties, except for permitted outside activities approved by the CEO.
2.3 Compliance with Policies
The Executive agrees to comply with all Company policies, including the Insider Trading Policy, Code of Ethics, and Conflict of Interest Policy.
ARTICLE III: COMPENSATION
3.1 Base Salary
The Company shall pay the Executive an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000), payable in accordance with the Company’s normal payroll practices, subject to annual review by the Compensation Committee.
3.2 Annual Bonus
The Executive shall be eligible for an annual performance bonus with a target of up to 30% of base salary, based on achievement of performance metrics established by the Compensation Committee.
3.3 Equity Compensation
The Executive shall be entitled to equity compensation in the form of Series A Preferred Stock as separately agreed between the parties and approved by the Board of Directors.
3.4 Change in Control
In the event of a Change in Control, all unvested equity shall immediately vest and the Executive shall be entitled to severance as specified in Article VII.
ARTICLE IV: BENEFITS
4.1 Employee Benefits
The Executive shall be entitled to participate in all employee benefit plans generally available to senior executives, including:
·Comprehensive health, dental, and vision insurance
·401(k) retirement plan with company matching
·Life and disability insurance
·Directors and Officers (D&O) liability insurance
4.2 Vacation
The Executive shall be entitled to four (4) weeks of paid vacation annually, in addition to Company-observed holidays.
4.3 Business Expenses
The Company shall reimburse all reasonable and documented business expenses incurred in the performance of duties, including business travel, professional memberships, conferences, mobile phone, and home office expenses.
ARTICLE V: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
5.1 Confidential Information
The Executive acknowledges access to confidential and proprietary information and agrees to maintain strict confidentiality during and after employment.
5.2 Intellectual Property
All inventions, developments, and work product created during employment shall be the exclusive property of the Company.
ARTICLE VI: NON-COMPETITION AND NON-SOLICITATION
6.1 Non-Competition
During employment and for 12 months thereafter, the Executive shall not directly or indirectly engage in any business competitive with the Company’s OTC market solutions and blockchain tokenization platform.
6.2 Non-Solicitation
During employment and for 18 months thereafter, the Executive shall not solicit Company employees, customers, or partners.
6.3 Blue Pencil
If any restriction is deemed unenforceable, it shall be modified to the minimum extent necessary to make it enforceable.
ARTICLE VII: TERMINATION
7.1 Termination by the Company
A. Without Cause
The Company may terminate without cause upon sixty (60) days’ written notice, with severance equal to:
·6 months’ base salary
·Pro-rated bonus for the year of termination
·Continued health benefits for 6 months
·Accelerated vesting of 50% of unvested equity
B. For Cause
The Company may terminate immediately for Cause, including:
·Material breach of this Agreement or Company policies
·Violation of federal securities laws or regulations
·Conviction of a felony or crime involving moral turpitude
·Willful misconduct or gross negligence
7.2 Termination by Executive
A. Without Good Reason
The Executive may resign upon sixty (60) days’ written notice, with no severance benefits.
B. For Good Reason
The Executive may terminate for Good Reason (material breach by the Company, substantial diminution of duties, or required relocation) and receive severance as if terminated without cause.
7.3 Death or Disability
In the event of death or permanent disability, the Executive or estate shall receive accrued compensation, pro-rated bonus, and accelerated vesting of 50% of unvested equity.
ARTICLE VIII: INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive to the fullest extent permitted by law for actions taken in good faith in the performance of duties, and shall maintain appropriate D&O insurance coverage.
ARTICLE IX: GENERAL PROVISIONS
9.1 Governing Law
This Agreement shall be governed by the laws of the State of Wyoming.
9.2 Arbitration
Any disputes shall be resolved through binding arbitration under American Arbitration Association (AAA) rules.
9.3 Entire Agreement
This Agreement constitutes the entire agreement between the parties and supersedes all prior agreements relating to the subject matter hereof.
9.4 Amendment
CHIEF EXECUTIVE OFFICER | VICE PRESIDENT OF ISSUER SERVICES |
Berj Abajian | John Morgan |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ John Morgan |
Name: Berj Abajian
Title: Chief Executive Officer
Date: January 1, 2026
EXECUTIVE
Name: John Morgan
Signature: /S/ John Morgan
Date: January 1, 2026
EXHIBIT
10.8
___________________________________________________________________________
Board Service Agreement
Berj Abajian
Chief Executive Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
BOARD OF DIRECTORS SERVICE AGREEMENT
AND RESTRICTED STOCK PURCHASE AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Berj Abajian - Chief Executive Officer
Effective Date: January 1, 2026 | 15,000,000 Series A Preferred Shares | 3-Year Vesting | 1-Year Cliff
___________________________________________________________________________
PART I: BOARD OF DIRECTORS SERVICE AGREEMENT
This Board of Directors Service Agreement (the “Agreement”) is entered into as of January 1, 2026 (the “Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and BERJ ABAJIAN (“Director”).
WHEREAS, the Company desires to appoint Berge to serve as a member of its Board of Directors; and
WHEREAS, Berge desires to serve as a director of the Company and to purchase Series A Preferred Stock subject to the terms of Part II of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE 1: APPOINTMENT AND TERM
1.1 Appointment
The Company hereby appoints Berj Abajian to serve as a member of the Board of Directors of the Company (the “Board”), effective January 1, 2026, and Berge hereby accepts such appointment.
1.2 Term
Director shall serve until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Director may be re-elected for successive terms.
1.3 Title and Capacity
Director serves concurrently in the capacity of Chief Executive Officer of the Company pursuant to a separate Employment Agreement (Exhibit 10.8 predecessor). This Board Service Agreement governs Director’s obligations and equity rights in their capacity as a director and is separate from and in addition to the Employment Agreement.
ARTICLE 2: BOARD DUTIES AND RESPONSIBILITIES
2.1 General Duties
Director shall perform all duties customarily associated with the position of director of a Wyoming corporation, including:
• Attending and participating in all regular and special meetings of the Board of Directors
• Reviewing and acting upon all matters brought before the Board in accordance with the Company’s Bylaws and Articles of Incorporation
• Acting in good faith and in a manner reasonably believed to be in the best interests of the Company and its stockholders
• Exercising fiduciary duties of care and loyalty as required under Wyoming law
• Serving on Board committees as assigned, including Audit, Compensation, and Governance committees
• Reviewing all materials distributed in connection with Board meetings and being prepared to discuss and act upon such matters
2.2 Specific Governance Duties
In addition to general director duties, Director shall:
• Review and approve the Company’s annual budget, strategic plan, and significant capital expenditures
• Review and approve executive compensation, including salary adjustments, equity grants, and bonus plans
• Oversee the Company’s SEC reporting obligations, including annual reports on Form 10-K and quarterly reports on Form 10-Q
• Review and approve all related-party transactions to ensure arm’s-length fairness
• Oversee the Company’s compliance with applicable federal and state securities laws and regulations
• Monitor and oversee the Company’s OTCM Protocol platform development, go-to-market strategy, and $20,000,000 Security Token Offering
• Oversee internal controls, financial reporting integrity, and risk management
2.3 Compliance Obligations
Director agrees to comply with:
• The Company’s Insider Trading Policy (Exhibit 19 to the Annual Report on Form 10-K)
• The Company’s Code of Ethics and Conflict of Interest Policy
• All applicable SEC reporting requirements, including Section 16 reporting obligations (Forms 3, 4, and 5) for transactions in Company securities and ST22 Security Tokens
• The Company’s related-party transaction review procedures
ARTICLE 3: COMPENSATION AND EXPENSES
3.1 Director Compensation
Director’s compensation for Board service is provided through the equity grant set forth in Part II of this Agreement. No separate cash retainer or meeting fees are payable for Board service during the initial term of this Agreement, as the Director is also compensated pursuant to a separate Employment Agreement.
3.2 Expense Reimbursement
The Company shall reimburse Director for all reasonable and documented out-of-pocket expenses incurred in connection with attending Board meetings and performing Board duties, in accordance with the Company’s expense reimbursement policies.
3.3 D&O Insurance and Indemnification
The Company shall maintain Directors and Officers liability insurance covering Director’s service on the Board. The Company shall indemnify Director to the fullest extent permitted by Wyoming law for actions taken in good faith in the performance of Director’s duties as a member of the Board.
ARTICLE 4: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
4.1 Confidential Information
Director acknowledges access to material nonpublic and proprietary information of the Company in the course of Board service and agrees to maintain strict confidentiality during and after the term of this Agreement, including all information relating to the OTCM Protocol platform, ST22 Security Token framework, financial condition, strategic plans, and issuer relationships.
4.2 Non-Solicitation
During Board service and for eighteen (18) months thereafter, Director shall not solicit any employee, contractor, customer, or business partner of the Company.
ARTICLE 5: TERMINATION OF BOARD SERVICE
5.1 Resignation
Director may resign from the Board at any time upon thirty (30) days’ written notice to the Chairman of the Board.
5.2 Removal
Director may be removed from the Board as provided in the Company’s Bylaws and the Wyoming Business Corporation Act.
5.3 Effect on Equity
Upon termination of Board service for any reason, vesting of the Shares shall be governed by Part II of this Agreement and the terms of the Restricted Stock Purchase Agreement.
ARTICLE 6: GENERAL PROVISIONS
6.1 Governing Law
This Agreement is governed by the laws of the State of Wyoming.
6.2 Arbitration
Disputes shall be resolved by binding arbitration under JAMS rules in Cheyenne, Wyoming.
6.3 Entire Agreement
This Agreement, together with Part II (RSPA) and all exhibits, constitutes the entire agreement between the parties regarding Director’s Board service and equity rights.
6.4 Amendment
GROOVY COMPANY, INC. | DIRECTOR |
Berj Abajian | Berj Abajian |
Chief Executive Officer | Chief Executive Officer |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Berj Abajian |
Chief Executive Officer
Date: January 1, 2026
DIRECTOR
By: /S/ Berj Abajian
Berj Abajian
Chief Executive Officer
Date: January 1, 2026
PART II: RESTRICTED STOCK PURCHASE AGREEMENT - SERIES A PREFERRED STOCK
This Restricted Stock Purchase Agreement (the “RSPA”) is entered into as of January 1, 2026, between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and BERJ ABAJIAN (“Purchaser”), and is incorporated into and forms Part II of the Board of Directors Service Agreement above.
ARTICLE 1: PURCHASE OF SHARES
1.1 Sale and Issuance
Subject to the terms of this RSPA, the Company hereby agrees to sell to Berge, and Berge hereby agrees to purchase from the Company, FIFTEEN MILLION (15,000,000) shares of the Company’s Series A Preferred Stock (the “Shares”) at a purchase price of $0.001 per share, for an aggregate purchase price of FIFTEEN THOUSAND DOLLARS ($15,000.00) (the “Purchase Price”).
1.2 Payment
The Purchase Price shall be paid by check, wire transfer, or promissory note payable to the Company, concurrently with the execution of this RSPA.
1.3 Series A Rights
As a holder of Series A Preferred Stock, Purchaser shall be entitled to: (a) full voting rights at 100 Common share votes per Series A share; (b) permanent non-convertibility (the Company’s control block); (c) liquidation preference; (d) anti-dilution protection; and (e) preemptive rights for future issuances.
ARTICLE 2: VESTING SCHEDULE
2.1 Vesting
The Shares shall vest as follows - Vesting Commencement Date: January 1, 2026:
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
2.2 Cliff Period
No Shares shall vest during the first twelve (12) months. If service terminates prior to January 1, 2027, all Shares shall be forfeited.
2.3 Continuous Service
Vesting is contingent upon Purchaser’s Continuous Service as an employee, officer, director, or consultant of the Company.
2.4 Acceleration
Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or resignation for Good Reason within 12 months. Death or Disability: 50% of unvested Shares accelerate. Termination Without Cause: 12 months of additional vesting accelerates.
ARTICLE 3: COMPANY REPURCHASE RIGHT
3.1 Repurchase Right
If Purchaser’s Continuous Service terminates for any reason, the Company may repurchase all unvested Shares at $0.001 per share within ninety (90) days of termination.
ARTICLE 4: TRANSFER RESTRICTIONS
4.1 No Transfer of Unvested Shares
Purchaser shall not sell, assign, transfer, pledge, or otherwise dispose of any unvested Shares without the prior written consent of the Company.
4.2 Right of First Refusal
The Company shall have a right of first refusal on any proposed transfer of vested Shares.
4.3 Securities Law Compliance
All transfers are subject to applicable federal and state securities laws, including SEC Rule 144 holding period and volume limitations.
ARTICLE 5: SECTION 83(b) ELECTION
GROOVY COMPANY, INC. | PURCHASER |
Berj Abajian | Berj Abajian |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Berj Abajian |
Date: January 1, 2026
PURCHASER
By: /S/ Berj Abajian
Berj Abajian
Chief Executive Officer
Date: January 1, 2026
EXHIBIT A - STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto Groovy Company, Inc. d/b/a OTCM Protocol (the “Company”) _________________ shares of the Series A Preferred Stock of the Company standing in the undersigned’s name, and hereby irrevocably appoints the Secretary of the Company as attorney-in-fact to transfer said shares with full power of substitution.
This Stock Assignment may be used only in connection with the Company’s exercise of its Repurchase Right under the RSPA.
Date: January 1, 2026
Signature: /S/ Berj Abajian
Berj Abajian
Chief Executive Officer
EXHIBIT B - VESTING SCHEDULE SUMMARY
Director: Berj Abajian
Title: Chief Executive Officer
Vesting Commencement Date: January 1, 2026
Total Shares Granted: 15,000,000 Series A Preferred
Equity Percentage: 15% of Series A (100,000,000 authorized)
Purchase Price: $0.001 per share / $15,000.00 aggregate
Full Vesting Date: January 1, 2029
Cliff Date: January 1, 2027
83(b) Election Deadline: January 31, 2026 (ABSOLUTE - cannot be extended)
Acceleration Provisions:
• Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or for Good Reason within 12 months of Change of Control
• Death or Disability: 50% of unvested shares accelerate immediately
• Termination Without Cause / Good Reason: 12 months of additional vesting accelerates
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
EXHIBIT
10.9
____________________________________________________________________________
Board Service Agreement
Patrick Mokros
Chief Operating Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
BOARD OF DIRECTORS SERVICE AGREEMENT
AND RESTRICTED STOCK PURCHASE AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Patrick Mokros - Chief Operating Officer
Effective Date: January 1, 2026 | 15,000,000 Series A Preferred Shares | 3-Year Vesting | 1-Year Cliff
____________________________________________________________________________
PART I: BOARD OF DIRECTORS SERVICE AGREEMENT
This Board of Directors Service Agreement (the “Agreement”) is entered into as of January 1, 2026 (the “Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and PATRICK MOKROS (“Director”).
WHEREAS, the Company desires to appoint Patrick to serve as a member of its Board of Directors; and
WHEREAS, Patrick desires to serve as a director of the Company and to purchase Series A Preferred Stock subject to the terms of Part II of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE 1: APPOINTMENT AND TERM
1.1 Appointment
The Company hereby appoints Patrick Mokros to serve as a member of the Board of Directors of the Company (the “Board”), effective January 1, 2026, and Patrick hereby accepts such appointment.
1.2 Term
Director shall serve until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Director may be re-elected for successive terms.
1.3 Title and Capacity
Director serves concurrently in the capacity of Chief Operating Officer of the Company pursuant to a separate Employment Agreement (Exhibit 10.9 predecessor). This Board Service Agreement governs Director’s obligations and equity rights in their capacity as a director and is separate from and in addition to the Employment Agreement.
ARTICLE 2: BOARD DUTIES AND RESPONSIBILITIES
2.1 General Duties
Director shall perform all duties customarily associated with the position of director of a Wyoming corporation, including:
• Attending and participating in all regular and special meetings of the Board of Directors
• Reviewing and acting upon all matters brought before the Board in accordance with the Company’s Bylaws and Articles of Incorporation
• Acting in good faith and in a manner reasonably believed to be in the best interests of the Company and its stockholders
• Exercising fiduciary duties of care and loyalty as required under Wyoming law
• Serving on Board committees as assigned, including Audit, Compensation, and Governance committees
• Reviewing all materials distributed in connection with Board meetings and being prepared to discuss and act upon such matters
2.2 Specific Governance Duties
In addition to general director duties, Director shall:
• Review and approve the Company’s annual budget, strategic plan, and significant capital expenditures
• Review and approve executive compensation, including salary adjustments, equity grants, and bonus plans
• Oversee the Company’s SEC reporting obligations, including annual reports on Form 10-K and quarterly reports on Form 10-Q
• Review and approve all related-party transactions to ensure arm’s-length fairness
• Oversee the Company’s compliance with applicable federal and state securities laws and regulations
• Monitor and oversee the Company’s OTCM Protocol platform development, go-to-market strategy, and $20,000,000 Security Token Offering
• Oversee internal controls, financial reporting integrity, and risk management
2.3 Compliance Obligations
Director agrees to comply with:
• The Company’s Insider Trading Policy (Exhibit 19 to the Annual Report on Form 10-K)
• The Company’s Code of Ethics and Conflict of Interest Policy
• All applicable SEC reporting requirements, including Section 16 reporting obligations (Forms 3, 4, and 5) for transactions in Company securities and ST22 Security Tokens
• The Company’s related-party transaction review procedures
ARTICLE 3: COMPENSATION AND EXPENSES
3.1 Director Compensation
Director’s compensation for Board service is provided through the equity grant set forth in Part II of this Agreement. No separate cash retainer or meeting fees are payable for Board service during the initial term of this Agreement, as the Director is also compensated pursuant to a separate Employment Agreement.
3.2 Expense Reimbursement
The Company shall reimburse Director for all reasonable and documented out-of-pocket expenses incurred in connection with attending Board meetings and performing Board duties, in accordance with the Company’s expense reimbursement policies.
3.3 D&O Insurance and Indemnification
The Company shall maintain Directors and Officers liability insurance covering Director’s service on the Board. The Company shall indemnify Director to the fullest extent permitted by Wyoming law for actions taken in good faith in the performance of Director’s duties as a member of the Board.
ARTICLE 4: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
4.1 Confidential Information
Director acknowledges access to material nonpublic and proprietary information of the Company in the course of Board service and agrees to maintain strict confidentiality during and after the term of this Agreement, including all information relating to the OTCM Protocol platform, ST22 Security Token framework, financial condition, strategic plans, and issuer relationships.
4.2 Non-Solicitation
During Board service and for eighteen (18) months thereafter, Director shall not solicit any employee, contractor, customer, or business partner of the Company.
ARTICLE 5: TERMINATION OF BOARD SERVICE
5.1 Resignation
Director may resign from the Board at any time upon thirty (30) days’ written notice to the Chairman of the Board.
5.2 Removal
Director may be removed from the Board as provided in the Company’s Bylaws and the Wyoming Business Corporation Act.
5.3 Effect on Equity
Upon termination of Board service for any reason, vesting of the Shares shall be governed by Part II of this Agreement and the terms of the Restricted Stock Purchase Agreement.
ARTICLE 6: GENERAL PROVISIONS
6.1 Governing Law
This Agreement is governed by the laws of the State of Wyoming.
6.2 Arbitration
Disputes shall be resolved by binding arbitration under JAMS rules in Cheyenne, Wyoming.
6.3 Entire Agreement
This Agreement, together with Part II (RSPA) and all exhibits, constitutes the entire agreement between the parties regarding Director’s Board service and equity rights.
6.4 Amendment
GROOVY COMPANY, INC. | DIRECTOR - CHIEF OPERATING OFFICER |
Berj Abajian | Patrick Mokros |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Patrick Mokros |
Chief Executive Officer
Date: January 1, 2026
DIRECTOR
By: /S/ Patrick Mokros
Patrick Mokros
Chief Operating Officer
Date: January 1, 2026
PART II: RESTRICTED STOCK PURCHASE AGREEMENT - SERIES A PREFERRED STOCK
This Restricted Stock Purchase Agreement (the “RSPA”) is entered into as of January 1, 2026, between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and PATRICK MOKROS (“Purchaser”), and is incorporated into and forms Part II of the Board of Directors Service Agreement above.
ARTICLE 1: PURCHASE OF SHARES
1.1 Sale and Issuance
Subject to the terms of this RSPA, the Company hereby agrees to sell to Patrick, and Patrick hereby agrees to purchase from the Company, FIFTEEN MILLION (15,000,000) shares of the Company’s Series A Preferred Stock (the “Shares”) at a purchase price of $0.001 per share, for an aggregate purchase price of FIFTEEN THOUSAND DOLLARS ($15,000.00) (the “Purchase Price”).
1.2 Payment
The Purchase Price shall be paid by check, wire transfer, or promissory note payable to the Company, concurrently with the execution of this RSPA.
1.3 Series A Rights
As a holder of Series A Preferred Stock, Purchaser shall be entitled to: (a) full voting rights at 100 Common share votes per Series A share; (b) permanent non-convertibility (the Company’s control block); (c) liquidation preference; (d) anti-dilution protection; and (e) preemptive rights for future issuances.
ARTICLE 2: VESTING SCHEDULE
2.1 Vesting
The Shares shall vest as follows - Vesting Commencement Date: January 1, 2026:
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
2.2 Cliff Period
No Shares shall vest during the first twelve (12) months. If service terminates prior to January 1, 2027, all Shares shall be forfeited.
2.3 Continuous Service
Vesting is contingent upon Purchaser’s Continuous Service as an employee, officer, director, or consultant of the Company.
2.4 Acceleration
Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or resignation for Good Reason within 12 months. Death or Disability: 50% of unvested Shares accelerate. Termination Without Cause: 12 months of additional vesting accelerates.
ARTICLE 3: COMPANY REPURCHASE RIGHT
3.1 Repurchase Right
If Purchaser’s Continuous Service terminates for any reason, the Company may repurchase all unvested Shares at $0.001 per share within ninety (90) days of termination.
ARTICLE 4: TRANSFER RESTRICTIONS
4.1 No Transfer of Unvested Shares
Purchaser shall not sell, assign, transfer, pledge, or otherwise dispose of any unvested Shares without the prior written consent of the Company.
4.2 Right of First Refusal
The Company shall have a right of first refusal on any proposed transfer of vested Shares.
4.3 Securities Law Compliance
All transfers are subject to applicable federal and state securities laws, including SEC Rule 144 holding period and volume limitations.
ARTICLE 5: SECTION 83(b) ELECTION
GROOVY COMPANY, INC. | PURCHASER - CHIEF OPERATING OFFICER |
Berj Abajian | Patrick Mokros |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Patrick Mokros |
Date: January 1, 2026
PURCHASER
By: /S/ Patrick Mokros
Patrick Mokros
Chief Operating Officer
Date: January 1, 2026
EXHIBIT A - STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto Groovy Company, Inc. d/b/a OTCM Protocol (the “Company”) _________________ shares of the Series A Preferred Stock of the Company standing in the undersigned’s name, and hereby irrevocably appoints the Secretary of the Company as attorney-in-fact to transfer said shares with full power of substitution.
This Stock Assignment may be used only in connection with the Company’s exercise of its Repurchase Right under the RSPA.
Date: January 1, 2026
Signature: /S/ Patrick Mokros
Patrick Mokros
Chief Operating Officer
EXHIBIT B - VESTING SCHEDULE SUMMARY
Director: Patrick Mokros
Title: Chief Operating Officer
Vesting Commencement Date: January 1, 2026
Total Shares Granted: 15,000,000 Series A Preferred
Equity Percentage: 15% of Series A (100,000,000 authorized)
Purchase Price: $0.001 per share / $15,000.00 aggregate
Full Vesting Date: January 1, 2029
Cliff Date: January 1, 2027
83(b) Election Deadline: January 31, 2026 (ABSOLUTE - cannot be extended)
Acceleration Provisions:
• Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or for Good Reason within 12 months of Change of Control
• Death or Disability: 50% of unvested shares accelerate immediately
• Termination Without Cause / Good Reason: 12 months of additional vesting accelerates
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
EXHIBIT
10.10
_____________________________________________________________________________
Board Service Agreement
and Restricted Stock Purchase Agreement
Franjose Yglesias
Chief Technology Officer
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
BOARD OF DIRECTORS SERVICE AGREEMENT
AND RESTRICTED STOCK PURCHASE AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Franjose Yglesias - Chief Technology Officer
Effective Date: January 1, 2026 | 15,000,000 Series A Preferred Shares | 3-Year Vesting | 1-Year Cliff
_____________________________________________________________________________
PART I: BOARD OF DIRECTORS SERVICE AGREEMENT
This Board of Directors Service Agreement (the “Agreement”) is entered into as of January 1, 2026 (the “Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and FRANJOSE YGLESIAS (“Director”).
WHEREAS, the Company desires to appoint Franjose to serve as a member of its Board of Directors; and
WHEREAS, Franjose desires to serve as a director of the Company and to purchase Series A Preferred Stock subject to the terms of Part II of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE 1: APPOINTMENT AND TERM
1.1 Appointment
The Company hereby appoints Franjose Yglesias to serve as a member of the Board of Directors of the Company (the “Board”), effective January 1, 2026, and Franjose hereby accepts such appointment.
1.2 Term
Director shall serve until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Director may be re-elected for successive terms.
1.3 Title and Capacity
Director serves concurrently in the capacity of Chief Technology Officer of the Company pursuant to a separate Employment Agreement (Exhibit 10.10 predecessor). This Board Service Agreement governs Director’s obligations and equity rights in their capacity as a director and is separate from and in addition to the Employment Agreement.
ARTICLE 2: BOARD DUTIES AND RESPONSIBILITIES
2.1 General Duties
Director shall perform all duties customarily associated with the position of director of a Wyoming corporation, including:
• Attending and participating in all regular and special meetings of the Board of Directors
• Reviewing and acting upon all matters brought before the Board in accordance with the Company’s Bylaws and Articles of Incorporation
• Acting in good faith and in a manner reasonably believed to be in the best interests of the Company and its stockholders
• Exercising fiduciary duties of care and loyalty as required under Wyoming law
• Serving on Board committees as assigned, including Audit, Compensation, and Governance committees
• Reviewing all materials distributed in connection with Board meetings and being prepared to discuss and act upon such matters
2.2 Specific Governance Duties
In addition to general director duties, Director shall:
• Review and approve the Company’s annual budget, strategic plan, and significant capital expenditures
• Review and approve executive compensation, including salary adjustments, equity grants, and bonus plans
• Oversee the Company’s SEC reporting obligations, including annual reports on Form 10-K and quarterly reports on Form 10-Q
• Review and approve all related-party transactions to ensure arm’s-length fairness
• Oversee the Company’s compliance with applicable federal and state securities laws and regulations
• Monitor and oversee the Company’s OTCM Protocol platform development, go-to-market strategy, and $20,000,000 Security Token Offering
• Oversee internal controls, financial reporting integrity, and risk management
2.3 Compliance Obligations
Director agrees to comply with:
• The Company’s Insider Trading Policy (Exhibit 19 to the Annual Report on Form 10-K)
• The Company’s Code of Ethics and Conflict of Interest Policy
• All applicable SEC reporting requirements, including Section 16 reporting obligations (Forms 3, 4, and 5) for transactions in Company securities and ST22 Security Tokens
• The Company’s related-party transaction review procedures
ARTICLE 3: COMPENSATION AND EXPENSES
3.1 Director Compensation
Director’s compensation for Board service is provided through the equity grant set forth in Part II of this Agreement. No separate cash retainer or meeting fees are payable for Board service during the initial term of this Agreement, as the Director is also compensated pursuant to a separate Employment Agreement.
3.2 Expense Reimbursement
The Company shall reimburse Director for all reasonable and documented out-of-pocket expenses incurred in connection with attending Board meetings and performing Board duties, in accordance with the Company’s expense reimbursement policies.
3.3 D&O Insurance and Indemnification
The Company shall maintain Directors and Officers liability insurance covering Director’s service on the Board. The Company shall indemnify Director to the fullest extent permitted by Wyoming law for actions taken in good faith in the performance of Director’s duties as a member of the Board.
ARTICLE 4: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
4.1 Confidential Information
Director acknowledges access to material nonpublic and proprietary information of the Company in the course of Board service and agrees to maintain strict confidentiality during and after the term of this Agreement, including all information relating to the OTCM Protocol platform, ST22 Security Token framework, financial condition, strategic plans, and issuer relationships.
4.2 Non-Solicitation
During Board service and for eighteen (18) months thereafter, Director shall not solicit any employee, contractor, customer, or business partner of the Company.
ARTICLE 5: TERMINATION OF BOARD SERVICE
5.1 Resignation
Director may resign from the Board at any time upon thirty (30) days’ written notice to the Chairman of the Board.
5.2 Removal
Director may be removed from the Board as provided in the Company’s Bylaws and the Wyoming Business Corporation Act.
5.3 Effect on Equity
Upon termination of Board service for any reason, vesting of the Shares shall be governed by Part II of this Agreement and the terms of the Restricted Stock Purchase Agreement.
ARTICLE 6: GENERAL PROVISIONS
6.1 Governing Law
This Agreement is governed by the laws of the State of Wyoming.
6.2 Arbitration
Disputes shall be resolved by binding arbitration under JAMS rules in Cheyenne, Wyoming.
6.3 Entire Agreement
This Agreement, together with Part II (RSPA) and all exhibits, constitutes the entire agreement between the parties regarding Director’s Board service and equity rights.
6.4 Amendment
GROOVY COMPANY, INC. | DIRECTOR - CHIEF TECHNOLOGY OFFICER |
Berj Abajian | Franjose Yglesias |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Franjose Yglesias |
Chief Executive Officer
Date: January 1, 2026
DIRECTOR
By: /S/ Franjose Yglesias
Franjose Yglesias
Chief Technology Officer
Date: January 1, 2026
PART II: RESTRICTED STOCK PURCHASE AGREEMENT - SERIES A PREFERRED STOCK
This Restricted Stock Purchase Agreement (the “RSPA”) is entered into as of January 1, 2026, between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and FRANJOSE YGLESIAS (“Purchaser”), and is incorporated into and forms Part II of the Board of Directors Service Agreement above.
ARTICLE 1: PURCHASE OF SHARES
1.1 Sale and Issuance
Subject to the terms of this RSPA, the Company hereby agrees to sell to Franjose, and Franjose hereby agrees to purchase from the Company, FIFTEEN MILLION (15,000,000) shares of the Company’s Series A Preferred Stock (the “Shares”) at a purchase price of $0.001 per share, for an aggregate purchase price of FIFTEEN THOUSAND DOLLARS ($15,000.00) (the “Purchase Price”).
1.2 Payment
The Purchase Price shall be paid by check, wire transfer, or promissory note payable to the Company, concurrently with the execution of this RSPA.
1.3 Series A Rights
As a holder of Series A Preferred Stock, Purchaser shall be entitled to: (a) full voting rights at 100 Common share votes per Series A share; (b) permanent non-convertibility (the Company’s control block); (c) liquidation preference; (d) anti-dilution protection; and (e) preemptive rights for future issuances.
ARTICLE 2: VESTING SCHEDULE
2.1 Vesting
The Shares shall vest as follows - Vesting Commencement Date: January 1, 2026:
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
2.2 Cliff Period
No Shares shall vest during the first twelve (12) months. If service terminates prior to January 1, 2027, all Shares shall be forfeited.
2.3 Continuous Service
Vesting is contingent upon Purchaser’s Continuous Service as an employee, officer, director, or consultant of the Company.
2.4 Acceleration
Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or resignation for Good Reason within 12 months. Death or Disability: 50% of unvested Shares accelerate. Termination Without Cause: 12 months of additional vesting accelerates.
ARTICLE 3: COMPANY REPURCHASE RIGHT
3.1 Repurchase Right
If Purchaser’s Continuous Service terminates for any reason, the Company may repurchase all unvested Shares at $0.001 per share within ninety (90) days of termination.
ARTICLE 4: TRANSFER RESTRICTIONS
4.1 No Transfer of Unvested Shares
Purchaser shall not sell, assign, transfer, pledge, or otherwise dispose of any unvested Shares without the prior written consent of the Company.
4.2 Right of First Refusal
The Company shall have a right of first refusal on any proposed transfer of vested Shares.
4.3 Securities Law Compliance
All transfers are subject to applicable federal and state securities laws, including SEC Rule 144 holding period and volume limitations.
ARTICLE 5: SECTION 83(b) ELECTION
GROOVY COMPANY, INC. | PURCHASER - CHIEF TECHNOLOGY OFFICER |
Berj Abajian | Franjose Yglesias |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Franjose Yglesias |
Date: January 1, 2026
PURCHASER
By: /S/ Franjose Yglesias
Franjose Yglesias
Chief Technology Officer
Date: January 1, 2026
EXHIBIT A - STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto Groovy Company, Inc. d/b/a OTCM Protocol (the “Company”) _________________ shares of the Series A Preferred Stock of the Company standing in the undersigned’s name, and hereby irrevocably appoints the Secretary of the Company as attorney-in-fact to transfer said shares with full power of substitution.
This Stock Assignment may be used only in connection with the Company’s exercise of its Repurchase Right under the RSPA.
Date: January 1, 2026
Signature: /S/ Franjose Yglesias
Franjose Yglesias
Chief Technology Officer
EXHIBIT B - VESTING SCHEDULE SUMMARY
Director: Franjose Yglesias
Title: Chief Technology Officer
Vesting Commencement Date: January 1, 2026
Total Shares Granted: 15,000,000 Series A Preferred
Equity Percentage: 15% of Series A (100,000,000 authorized)
Purchase Price: $0.001 per share / $15,000.00 aggregate
Full Vesting Date: January 1, 2029
Cliff Date: January 1, 2027
83(b) Election Deadline: January 31, 2026 (ABSOLUTE - cannot be extended)
Acceleration Provisions:
• Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or for Good Reason within 12 months of Change of Control
• Death or Disability: 50% of unvested shares accelerate immediately
• Termination Without Cause / Good Reason: 12 months of additional vesting accelerates
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
EXHIBIT
10.11
_____________________________________________________________________________
Board of Directors Service Agreement
and Restricted Stock Purchase Agreement
Jeff Turner
Chief Legal Counsel
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
BOARD OF DIRECTORS SERVICE AGREEMENT
AND RESTRICTED STOCK PURCHASE AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - Jeff Turner - Chief Legal Counsel
Effective Date: January 1, 2026 | 15,000,000 Series A Preferred Shares | 3-Year Vesting | 1-Year Cliff
_____________________________________________________________________________
PART I: BOARD OF DIRECTORS SERVICE AGREEMENT
This Board of Directors Service Agreement (the “Agreement”) is entered into as of January 1, 2026 (the “Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and JEFF TURNER (“Director”).
WHEREAS, the Company desires to appoint Jeff to serve as a member of its Board of Directors; and
WHEREAS, Jeff desires to serve as a director of the Company and to purchase Series A Preferred Stock subject to the terms of Part II of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE 1: APPOINTMENT AND TERM
1.1 Appointment
The Company hereby appoints Jeff Turner to serve as a member of the Board of Directors of the Company (the “Board”), effective January 1, 2026, and Jeff hereby accepts such appointment.
1.2 Term
Director shall serve until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Director may be re-elected for successive terms.
1.3 Title and Capacity
Director serves concurrently in the capacity of Chief Legal Counsel of the Company pursuant to a separate Employment Agreement (Exhibit 10.11 predecessor). This Board Service Agreement governs Director’s obligations and equity rights in their capacity as a director and is separate from and in addition to the Employment Agreement.
ARTICLE 2: BOARD DUTIES AND RESPONSIBILITIES
2.1 General Duties
Director shall perform all duties customarily associated with the position of director of a Wyoming corporation, including:
• Attending and participating in all regular and special meetings of the Board of Directors
• Reviewing and acting upon all matters brought before the Board in accordance with the Company’s Bylaws and Articles of Incorporation
• Acting in good faith and in a manner reasonably believed to be in the best interests of the Company and its stockholders
• Exercising fiduciary duties of care and loyalty as required under Wyoming law
• Serving on Board committees as assigned, including Audit, Compensation, and Governance committees
• Reviewing all materials distributed in connection with Board meetings and being prepared to discuss and act upon such matters
2.2 Specific Governance Duties
In addition to general director duties, Director shall:
• Review and approve the Company’s annual budget, strategic plan, and significant capital expenditures
• Review and approve executive compensation, including salary adjustments, equity grants, and bonus plans
• Oversee the Company’s SEC reporting obligations, including annual reports on Form 10-K and quarterly reports on Form 10-Q
• Review and approve all related-party transactions to ensure arm’s-length fairness
• Oversee the Company’s compliance with applicable federal and state securities laws and regulations
• Monitor and oversee the Company’s OTCM Protocol platform development, go-to-market strategy, and $20,000,000 Security Token Offering
• Oversee internal controls, financial reporting integrity, and risk management
2.3 Compliance Obligations
Director agrees to comply with:
• The Company’s Insider Trading Policy (Exhibit 19 to the Annual Report on Form 10-K)
• The Company’s Code of Ethics and Conflict of Interest Policy
• All applicable SEC reporting requirements, including Section 16 reporting obligations (Forms 3, 4, and 5) for transactions in Company securities and ST22 Security Tokens
• The Company’s related-party transaction review procedures
ARTICLE 3: COMPENSATION AND EXPENSES
3.1 Director Compensation
Director’s compensation for Board service is provided through the equity grant set forth in Part II of this Agreement. No separate cash retainer or meeting fees are payable for Board service during the initial term of this Agreement, as the Director is also compensated pursuant to a separate Employment Agreement.
3.2 Expense Reimbursement
The Company shall reimburse Director for all reasonable and documented out-of-pocket expenses incurred in connection with attending Board meetings and performing Board duties, in accordance with the Company’s expense reimbursement policies.
3.3 D&O Insurance and Indemnification
The Company shall maintain Directors and Officers liability insurance covering Director’s service on the Board. The Company shall indemnify Director to the fullest extent permitted by Wyoming law for actions taken in good faith in the performance of Director’s duties as a member of the Board.
ARTICLE 4: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
4.1 Confidential Information
Director acknowledges access to material nonpublic and proprietary information of the Company in the course of Board service and agrees to maintain strict confidentiality during and after the term of this Agreement, including all information relating to the OTCM Protocol platform, ST22 Security Token framework, financial condition, strategic plans, and issuer relationships.
4.2 Non-Solicitation
During Board service and for eighteen (18) months thereafter, Director shall not solicit any employee, contractor, customer, or business partner of the Company.
ARTICLE 5: TERMINATION OF BOARD SERVICE
5.1 Resignation
Director may resign from the Board at any time upon thirty (30) days’ written notice to the Chairman of the Board.
5.2 Removal
Director may be removed from the Board as provided in the Company’s Bylaws and the Wyoming Business Corporation Act.
5.3 Effect on Equity
Upon termination of Board service for any reason, vesting of the Shares shall be governed by Part II of this Agreement and the terms of the Restricted Stock Purchase Agreement.
ARTICLE 6: GENERAL PROVISIONS
6.1 Governing Law
This Agreement is governed by the laws of the State of Wyoming.
6.2 Arbitration
Disputes shall be resolved by binding arbitration under JAMS rules in Cheyenne, Wyoming.
6.3 Entire Agreement
This Agreement, together with Part II (RSPA) and all exhibits, constitutes the entire agreement between the parties regarding Director’s Board service and equity rights.
6.4 Amendment
GROOVY COMPANY, INC. | DIRECTOR - CHIEF LEGAL COUNSEL |
Berj Abajian | Jeff Turner |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Jeff Turner |
Chief Executive Officer
Date: January 1, 2026
DIRECTOR
By: /S/ Jeff Turner
Jeff Turner
Chief Legal Counsel
Date: January 1, 2026
PART II: RESTRICTED STOCK PURCHASE AGREEMENT - SERIES A PREFERRED STOCK
This Restricted Stock Purchase Agreement (the “RSPA”) is entered into as of January 1, 2026, between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and JEFF TURNER (“Purchaser”), and is incorporated into and forms Part II of the Board of Directors Service Agreement above.
ARTICLE 1: PURCHASE OF SHARES
1.1 Sale and Issuance
Subject to the terms of this RSPA, the Company hereby agrees to sell to Jeff, and Jeff hereby agrees to purchase from the Company, FIFTEEN MILLION (15,000,000) shares of the Company’s Series A Preferred Stock (the “Shares”) at a purchase price of $0.001 per share, for an aggregate purchase price of FIFTEEN THOUSAND DOLLARS ($15,000.00) (the “Purchase Price”).
1.2 Payment
The Purchase Price shall be paid by check, wire transfer, or promissory note payable to the Company, concurrently with the execution of this RSPA.
1.3 Series A Rights
As a holder of Series A Preferred Stock, Purchaser shall be entitled to: (a) full voting rights at 100 Common share votes per Series A share; (b) permanent non-convertibility (the Company’s control block); (c) liquidation preference; (d) anti-dilution protection; and (e) preemptive rights for future issuances.
ARTICLE 2: VESTING SCHEDULE
2.1 Vesting
The Shares shall vest as follows - Vesting Commencement Date: January 1, 2026:
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
2.2 Cliff Period
No Shares shall vest during the first twelve (12) months. If service terminates prior to January 1, 2027, all Shares shall be forfeited.
2.3 Continuous Service
Vesting is contingent upon Purchaser’s Continuous Service as an employee, officer, director, or consultant of the Company.
2.4 Acceleration
Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or resignation for Good Reason within 12 months. Death or Disability: 50% of unvested Shares accelerate. Termination Without Cause: 12 months of additional vesting accelerates.
ARTICLE 3: COMPANY REPURCHASE RIGHT
3.1 Repurchase Right
If Purchaser’s Continuous Service terminates for any reason, the Company may repurchase all unvested Shares at $0.001 per share within ninety (90) days of termination.
ARTICLE 4: TRANSFER RESTRICTIONS
4.1 No Transfer of Unvested Shares
Purchaser shall not sell, assign, transfer, pledge, or otherwise dispose of any unvested Shares without the prior written consent of the Company.
4.2 Right of First Refusal
The Company shall have a right of first refusal on any proposed transfer of vested Shares.
4.3 Securities Law Compliance
All transfers are subject to applicable federal and state securities laws, including SEC Rule 144 holding period and volume limitations.
ARTICLE 5: SECTION 83(b) ELECTION
GROOVY COMPANY, INC. | PURCHASER - CHIEF LEGAL COUNSEL |
Berj Abajian | Jeff Turner |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Jeff Turner |
Date: January 1, 2026
PURCHASER
By: /S/ Jeff Turner
Jeff Turner
Chief Legal Counsel
Date: January 1, 2026
EXHIBIT A - STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto Groovy Company, Inc. d/b/a OTCM Protocol (the “Company”) _________________ shares of the Series A Preferred Stock of the Company standing in the undersigned’s name, and hereby irrevocably appoints the Secretary of the Company as attorney-in-fact to transfer said shares with full power of substitution.
This Stock Assignment may be used only in connection with the Company’s exercise of its Repurchase Right under the RSPA.
Date: January 1, 2026
Signature: /S/ Jeff Turner
Jeff Turner
Chief Legal Counsel
EXHIBIT B - VESTING SCHEDULE SUMMARY
Director: Jeff Turner
Title: Chief Legal Counsel
Vesting Commencement Date: January 1, 2026
Total Shares Granted: 15,000,000 Series A Preferred
Equity Percentage: 15% of Series A (100,000,000 authorized)
Purchase Price: $0.001 per share / $15,000.00 aggregate
Full Vesting Date: January 1, 2029
Cliff Date: January 1, 2027
83(b) Election Deadline: January 31, 2026 (ABSOLUTE - cannot be extended)
Acceleration Provisions:
• Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or for Good Reason within 12 months of Change of Control
• Death or Disability: 50% of unvested shares accelerate immediately
• Termination Without Cause / Good Reason: 12 months of additional vesting accelerates
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
EXHIBIT
10.12
_______________________________________________________________________
Board of Directors Service Agreement
and Restricted Stock Purchase Agreement
John Morgan
Vice President of Issuer Services
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
BOARD OF DIRECTORS SERVICE AGREEMENT
AND RESTRICTED STOCK PURCHASE AGREEMENT
Groovy Company, Inc., d/b/a OTCM Protocol - John Morgan - Vice President of Issuer Services
Effective Date: January 1, 2026 | 15,000,000 Series A Preferred Shares | 3-Year Vesting | 1-Year Cliff
_______________________________________________________________________
PART I: BOARD OF DIRECTORS SERVICE AGREEMENT
This Board of Directors Service Agreement (the “Agreement”) is entered into as of January 1, 2026 (the “Effective Date”), between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and JOHN MORGAN (“Director”).
WHEREAS, the Company desires to appoint John to serve as a member of its Board of Directors; and
WHEREAS, John desires to serve as a director of the Company and to purchase Series A Preferred Stock subject to the terms of Part II of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:
ARTICLE 1: APPOINTMENT AND TERM
1.1 Appointment
The Company hereby appoints John Morgan to serve as a member of the Board of Directors of the Company (the “Board”), effective January 1, 2026, and John hereby accepts such appointment.
1.2 Term
Director shall serve until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Director may be re-elected for successive terms.
1.3 Title and Capacity
Director serves concurrently in the capacity of Vice President of Issuer Services of the Company pursuant to a separate Employment Agreement (Exhibit 10.12 predecessor). This Board Service Agreement governs Director’s obligations and equity rights in their capacity as a director and is separate from and in addition to the Employment Agreement.
ARTICLE 2: BOARD DUTIES AND RESPONSIBILITIES
2.1 General Duties
Director shall perform all duties customarily associated with the position of director of a Wyoming corporation, including:
• Attending and participating in all regular and special meetings of the Board of Directors
• Reviewing and acting upon all matters brought before the Board in accordance with the Company’s Bylaws and Articles of Incorporation
• Acting in good faith and in a manner reasonably believed to be in the best interests of the Company and its stockholders
• Exercising fiduciary duties of care and loyalty as required under Wyoming law
• Serving on Board committees as assigned, including Audit, Compensation, and Governance committees
• Reviewing all materials distributed in connection with Board meetings and being prepared to discuss and act upon such matters
2.2 Specific Governance Duties
In addition to general director duties, Director shall:
• Review and approve the Company’s annual budget, strategic plan, and significant capital expenditures
• Review and approve executive compensation, including salary adjustments, equity grants, and bonus plans
• Oversee the Company’s SEC reporting obligations, including annual reports on Form 10-K and quarterly reports on Form 10-Q
• Review and approve all related-party transactions to ensure arm’s-length fairness
• Oversee the Company’s compliance with applicable federal and state securities laws and regulations
• Monitor and oversee the Company’s OTCM Protocol platform development, go-to-market strategy, and $20,000,000 Security Token Offering
• Oversee internal controls, financial reporting integrity, and risk management
2.3 Compliance Obligations
Director agrees to comply with:
• The Company’s Insider Trading Policy (Exhibit 19 to the Annual Report on Form 10-K)
• The Company’s Code of Ethics and Conflict of Interest Policy
• All applicable SEC reporting requirements, including Section 16 reporting obligations (Forms 3, 4, and 5) for transactions in Company securities and ST22 Security Tokens
• The Company’s related-party transaction review procedures
ARTICLE 3: COMPENSATION AND EXPENSES
3.1 Director Compensation
Director’s compensation for Board service is provided through the equity grant set forth in Part II of this Agreement. No separate cash retainer or meeting fees are payable for Board service during the initial term of this Agreement, as the Director is also compensated pursuant to a separate Employment Agreement.
3.2 Expense Reimbursement
The Company shall reimburse Director for all reasonable and documented out-of-pocket expenses incurred in connection with attending Board meetings and performing Board duties, in accordance with the Company’s expense reimbursement policies.
3.3 D&O Insurance and Indemnification
The Company shall maintain Directors and Officers liability insurance covering Director’s service on the Board. The Company shall indemnify Director to the fullest extent permitted by Wyoming law for actions taken in good faith in the performance of Director’s duties as a member of the Board.
ARTICLE 4: CONFIDENTIALITY AND INTELLECTUAL PROPERTY
4.1 Confidential Information
Director acknowledges access to material nonpublic and proprietary information of the Company in the course of Board service and agrees to maintain strict confidentiality during and after the term of this Agreement, including all information relating to the OTCM Protocol platform, ST22 Security Token framework, financial condition, strategic plans, and issuer relationships.
4.2 Non-Solicitation
During Board service and for eighteen (18) months thereafter, Director shall not solicit any employee, contractor, customer, or business partner of the Company.
ARTICLE 5: TERMINATION OF BOARD SERVICE
5.1 Resignation
Director may resign from the Board at any time upon thirty (30) days’ written notice to the Chairman of the Board.
5.2 Removal
Director may be removed from the Board as provided in the Company’s Bylaws and the Wyoming Business Corporation Act.
5.3 Effect on Equity
Upon termination of Board service for any reason, vesting of the Shares shall be governed by Part II of this Agreement and the terms of the Restricted Stock Purchase Agreement.
ARTICLE 6: GENERAL PROVISIONS
6.1 Governing Law
This Agreement is governed by the laws of the State of Wyoming.
6.2 Arbitration
Disputes shall be resolved by binding arbitration under JAMS rules in Cheyenne, Wyoming.
6.3 Entire Agreement
This Agreement, together with Part II (RSPA) and all exhibits, constitutes the entire agreement between the parties regarding Director’s Board service and equity rights.
6.4 Amendment
GROOVY COMPANY, INC. | DIRECTOR - VICE PRESIDENT OF ISSUER SERVICES |
Berj Abajian | John Morgan |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ John Morgan |
Chief Executive Officer
Date: January 1, 2026
DIRECTOR
By: /S/ John Morgan
John Morgan
Vice President of Issuer Services
Date: January 1, 2026
PART II: RESTRICTED STOCK PURCHASE AGREEMENT - SERIES A PREFERRED STOCK
This Restricted Stock Purchase Agreement (the “RSPA”) is entered into as of January 1, 2026, between GROOVY COMPANY, INC., a Wyoming corporation d/b/a OTCM Protocol (the “Company”), and JOHN MORGAN (“Purchaser”), and is incorporated into and forms Part II of the Board of Directors Service Agreement above.
ARTICLE 1: PURCHASE OF SHARES
1.1 Sale and Issuance
Subject to the terms of this RSPA, the Company hereby agrees to sell to John, and John hereby agrees to purchase from the Company, FIFTEEN MILLION (15,000,000) shares of the Company’s Series A Preferred Stock (the “Shares”) at a purchase price of $0.001 per share, for an aggregate purchase price of FIFTEEN THOUSAND DOLLARS ($15,000.00) (the “Purchase Price”).
1.2 Payment
The Purchase Price shall be paid by check, wire transfer, or promissory note payable to the Company, concurrently with the execution of this RSPA.
1.3 Series A Rights
As a holder of Series A Preferred Stock, Purchaser shall be entitled to: (a) full voting rights at 100 Common share votes per Series A share; (b) permanent non-convertibility (the Company’s control block); (c) liquidation preference; (d) anti-dilution protection; and (e) preemptive rights for future issuances.
ARTICLE 2: VESTING SCHEDULE
2.1 Vesting
The Shares shall vest as follows - Vesting Commencement Date: January 1, 2026:
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
2.2 Cliff Period
No Shares shall vest during the first twelve (12) months. If service terminates prior to January 1, 2027, all Shares shall be forfeited.
2.3 Continuous Service
Vesting is contingent upon Purchaser’s Continuous Service as an employee, officer, director, or consultant of the Company.
2.4 Acceleration
Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or resignation for Good Reason within 12 months. Death or Disability: 50% of unvested Shares accelerate. Termination Without Cause: 12 months of additional vesting accelerates.
ARTICLE 3: COMPANY REPURCHASE RIGHT
3.1 Repurchase Right
If Purchaser’s Continuous Service terminates for any reason, the Company may repurchase all unvested Shares at $0.001 per share within ninety (90) days of termination.
ARTICLE 4: TRANSFER RESTRICTIONS
4.1 No Transfer of Unvested Shares
Purchaser shall not sell, assign, transfer, pledge, or otherwise dispose of any unvested Shares without the prior written consent of the Company.
4.2 Right of First Refusal
The Company shall have a right of first refusal on any proposed transfer of vested Shares.
4.3 Securities Law Compliance
All transfers are subject to applicable federal and state securities laws, including SEC Rule 144 holding period and volume limitations.
ARTICLE 5: SECTION 83(b) ELECTION
GROOVY COMPANY, INC. | PURCHASER - VICE PRESIDENT OF ISSUER SERVICES |
Berj Abajian | John Morgan |
Chief Executive Officer | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ John Morgan |
Date: January 1, 2026
PURCHASER
By: /S/ John Morgan
John Morgan
Vice President of Issuer Services
Date: January 1, 2026
EXHIBIT A - STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto Groovy Company, Inc. d/b/a OTCM Protocol (the “Company”) _________________ shares of the Series A Preferred Stock of the Company standing in the undersigned’s name, and hereby irrevocably appoints the Secretary of the Company as attorney-in-fact to transfer said shares with full power of substitution.
This Stock Assignment may be used only in connection with the Company’s exercise of its Repurchase Right under the RSPA.
Date: January 1, 2026
Signature: /S/ John Morgan
John Morgan
Vice President of Issuer Services
EXHIBIT B - VESTING SCHEDULE SUMMARY
Director: John Morgan
Title: Vice President of Issuer Services
Vesting Commencement Date: January 1, 2026
Total Shares Granted: 15,000,000 Series A Preferred
Equity Percentage: 15% of Series A (100,000,000 authorized)
Purchase Price: $0.001 per share / $15,000.00 aggregate
Full Vesting Date: January 1, 2029
Cliff Date: January 1, 2027
83(b) Election Deadline: January 31, 2026 (ABSOLUTE - cannot be extended)
Acceleration Provisions:
• Change of Control (Double-Trigger): 100% acceleration if terminated without Cause or for Good Reason within 12 months of Change of Control
• Death or Disability: 50% of unvested shares accelerate immediately
• Termination Without Cause / Good Reason: 12 months of additional vesting accelerates
Period | Shares Vesting | Cumulative Shares | % Vested | Unvested |
Months 1–11 | 0 | 0 | 0% | 15,000,000 |
Month 12 (Cliff) | 5,000,000 | 5,000,000 | 33.33% | 10,000,000 |
Months 13–24 | 416,667/mo | 10,000,000 | 66.67% | 5,000,000 |
Month 36 (Full) | 416,667/mo | 15,000,000 | 100% | 0 |
EXHIBIT
10.13
________________________________________________________________________
Omnibus Board Resolution
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
GROOVY COMPANY, INC.
d/b/a OTCM Protocol
A Wyoming Digital Asset Corporation
OMNIBUS WRITTEN CONSENT AND RESOLUTION
OF THE BOARD OF DIRECTORS
Authorizing Employment Agreements and Board Service Agreements
for All Executive Officers and Directors
Document No. GROO-BR-001 | Effective Date January 1, 2026 | Adopted By Board of Directors | Authority Wyoming Stat. § 17-16-821 |
PREAMBLE
The undersigned, being all of the duly appointed members of the Board of Directors (the “Board”) of Groovy Company, Inc., a Wyoming corporation doing business as OTCM Protocol (the “Company”), hereby adopt the following resolutions by written consent in lieu of a special meeting, pursuant to Wyoming Statutes § 17-16-821, effective as of January 1, 2026 (the “Effective Date”).
RECITALS
WHEREAS, the Company is a Wyoming corporation doing business as OTCM Protocol, engaged in the development and operation of blockchain-based securities tokenization infrastructure, including the OTCM Protocol platform and ST22 Security Token framework;
WHEREAS, the Company filed its Annual Report on Form 10-K for the fiscal year ended December 31, 2025 with the United States Securities and Exchange Commission, in which five (5) executive officers are identified as serving pursuant to employment agreements effective January 1, 2026;
WHEREAS, the Board has determined that it is in the best interests of the Company and its stockholders to formally engage the following individuals as executive officers of the Company on the terms set forth in their respective Employment Agreements (each attached as an exhibit to the Annual Report on Form 10-K):
# | Name | Title | Employment Agreement Exhibit |
1 | Berj Abajian | Chief Executive Officer | Exhibit 10.1 |
2 | Patrick Mokros | Chief Operating Officer | Exhibit 10.2 |
3 | Franjose Yglesias | Chief Technology Officer | Exhibit 10.3 |
4 | Jeff Turner | Chief Legal Counsel | Exhibit 10.4 |
5 | John Morgan | Vice President of Issuer Services | Exhibit 10.5 |
WHEREAS, each of the foregoing individuals brings specialized expertise critical to the Company’s mission of delivering blockchain-based liquidity infrastructure for dormant OTC securities, and the Board has determined that each Employment Agreement reflects fair and reasonable terms appropriate to the Company’s stage of development;
WHEREAS, each Employment Agreement provides for: (i) an annual base salary of ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000); (ii) a ten (10) year term commencing January 1, 2026 and expiring December 31, 2035; (iii) eligibility for annual performance bonus of up to 30% of base salary; (iv) equity compensation in the form of Series A Preferred Stock as separately authorized by the Board; (v) standard executive benefits; and (vi) ten (10) year non-solicitation, confidentiality, and intellectual property assignment obligations;
WHEREAS, in connection with their respective employment, each executive officer has been appointed or confirmed as a member of the Board of Directors of the Company, consistent with the Company’s Articles of Incorporation, Bylaws, and corporate governance policies;
WHEREAS, the Board has reviewed and considered the terms of each Employment Agreement and Board Service Agreement and determined that all such agreements are fair, reasonable, and in the best interests of the Company;
NOW, THEREFORE, BE IT RESOLVED, and it is hereby RESOLVED, as follows:
RESOLUTIONS
RESOLVED 1 - Appointment and Employment of Executive Officers:
The Board hereby approves, ratifies, and confirms the appointment of each of the following individuals to the executive officer position set forth opposite their respective name, effective January 1, 2026, on the terms and conditions set forth in their respective Employment Agreements: (i) Berj Abajian as Chief Executive Officer; (ii) Patrick Mokros as Chief Operating Officer; (iii) Franjose Yglesias as Chief Technology Officer; (iv) Jeff Turner as Chief Legal Counsel; and (v) John Morgan as Vice President of Issuer Services.
RESOLVED 2 - Approval of Employment Agreements:
The Board hereby approves each Employment Agreement in the form attached as Exhibits 10.1 through 10.5 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025. The Chief Executive Officer, or any officer of the Company designated by the Chief Executive Officer, is hereby authorized and directed to execute and deliver each Employment Agreement on behalf of the Company, with such changes, amendments, or modifications as such officer deems necessary, appropriate, or advisable, such approval to be conclusively evidenced by such officer’s execution and delivery thereof.
RESOLVED 3 - Appointment to Board of Directors:
The Board hereby appoints or confirms the appointment of each Executive Officer named in Resolution 1 to serve as a member of the Board of Directors of the Company, effective January 1, 2026, to hold office until the next annual meeting of stockholders or until their successor is duly elected and qualified, or until their earlier resignation, removal, or death. Each director is hereby acknowledged to have accepted such appointment.
RESOLVED 4 - Compensation:
The Board hereby approves the compensation structure set forth in each Employment Agreement, including the annual base salary of $150,000 per annum for each executive officer, the annual performance bonus eligibility of up to 30% of base salary, and the equity compensation provisions. The Board hereby authorizes the issuance of Series A Preferred Stock to each executive officer in the amounts separately authorized by the Board’s equity compensation resolutions, subject to the vesting schedule and other terms set forth in each executive’s respective equity grant documentation.
RESOLVED 5 - Series A Preferred Stock - Director and Officer Equity:
In connection with the appointment of each executive officer and director named herein, the Board hereby authorizes and confirms the issuance of Series A Preferred Stock as follows: (i) Berj Abajian - 15,000,000 shares; (ii) Patrick Mokros - 15,000,000 shares; (iii) Franjose Yglesias - 15,000,000 shares (net, following return of 85,000,000 shares to treasury pursuant to the IP Assignment Agreement dated June 12, 2025); (iv) Jeff Turner - 15,000,000 shares; and (v) John Morgan - 15,000,000 shares. Each issuance is subject to a three (3) year vesting schedule with a one (1) year cliff commencing on the Effective Date, as set forth in each executive’s equity grant agreement. All shares are issued at $0.001 par value per share.
RESOLVED 6 - D&O Insurance and Indemnification:
The Board hereby authorizes and directs the appropriate officers of the Company to obtain and maintain, on behalf of all directors and officers named herein, Directors and Officers liability insurance coverage in such amounts and on such terms as the Chief Executive Officer deems appropriate. The Company hereby confirms its indemnification obligations to each director and officer to the fullest extent permitted by Wyoming law, consistent with the indemnification provisions set forth in each Employment Agreement and the Company’s Articles of Incorporation and Bylaws.
RESOLVED 7 - Authorization of Officers:
Each officer of the Company is hereby authorized and directed, individually and without the requirement of further approval by the Board, to take any and all actions, to execute and deliver any and all documents, instruments, certificates, and agreements, and to do any and all things that such officer deems necessary, appropriate, or advisable to carry out the purposes and intent of the foregoing resolutions, including but not limited to making filings with the SEC, the Wyoming Secretary of State, OTC Markets Group, and any other applicable regulatory authority.
RESOLVED 8 - Ratification:
All prior actions taken by any officer or director of the Company in connection with the employment, appointment, or compensation of any of the executive officers named herein, prior to the adoption of these resolutions, are hereby ratified, approved, confirmed, and adopted as the acts and deeds of the Company.
CERTIFICATION
This Omnibus Written Consent and Resolution has been adopted by all members of the Board of Directors of Groovy Company, Inc. as of the Effective Date set forth above, pursuant to Wyoming Statutes § 17-16-821, and shall have the same force and effect as if adopted at a duly noticed and held meeting of the Board of Directors.
This Written Consent may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Electronic signatures shall be deemed valid and binding.
SIGNATURES OF THE BOARD OF DIRECTORS
IN WITNESS WHEREOF, the undersigned, being all of the directors of Groovy Company, Inc., have executed this Omnibus Written Consent and Resolution as of January 1, 2026.
CHIEF EXECUTIVE OFFICER | CHIEF OPERATING OFFICER |
Berj Abajian | Patrick Mokros |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Berj Abajian | Signature: /s/ Patrick Mokros |
CHIEF TECHNOLOGY OFFICER | CHIEF LEGAL COUNSEL |
Franjose Yglesias | Jeff Turner |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
|
|
Signature: /s/ Franjose Yglesias | Signature: /s/ Jeff Turner |
VICE PRESIDENT OF ISSUER SERVICES |
|
John Morgan |
|
Groovy Company, Inc. (GROO) |
|
|
|
Signature: /s/ John Morgan |
|
* * *
Groovy Company, Inc. | d/b/a OTCM Protocol | A Wyoming Digital Asset Corporation
Document No. GROO-BR-001 | Exhibit 10.8 to Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
EXHIBIT
19
__________________________________________________________________________
Insider Trading Policy
Groovy Company, Inc. (GROO) | Annual Report on Form 10-K | Fiscal Year Ended December 31, 2025
OTCM PROTOCOL, INC.
A Wyoming Digital Asset Corporation
INSIDER TRADING POLICY
SEC Category 1 Issuer-Sponsored Tokenized Securities Infrastructure
https://otcm.info
Document ID | Version | Effective Date | Classification |
OTCM-POL-ITP-001 | 1.0 | January 30, 2026 | Confidential |
ARTICLE I: PURPOSE AND SCOPE
Section 1.1 - Purpose
This Insider Trading Policy (the “Policy”) is designed to prevent insider trading and to promote compliance with federal and state securities laws by all directors, officers, employees, contractors, and other persons associated with OTCM Protocol, Inc. (the “Company”). The Policy applies to trading in both traditional securities and ST22 Security Tokens issued through the OTCM Protocol platform.
Section 1.2 - Regulatory Framework
This Policy is adopted pursuant to and in compliance with:
Regulation | Description |
Section 10(b) | Securities Exchange Act of 1934 |
Rule 10b-5 | Prohibition on fraud in connection with securities transactions |
Section 16 | Reporting and short-swing profit provisions |
ITSA 1984 | Insider Trading Sanctions Act of 1984 |
ITSFEA 1988 | Insider Trading and Securities Fraud Enforcement Act of 1988 |
SEC Joint Staff Statement | Tokenized Securities Guidance (January 28, 2026) |
Section 1.3 - Scope of Covered Securities
This Policy applies to all securities and digital assets issued by or through the Company, including:
Security Type | Description |
Common Stock | OTCM Protocol, Inc. common stock |
Preferred Stock | All series of OTCM Protocol, Inc. preferred stock |
Utility Tokens | OTCM Utility Tokens |
ST22 Security Tokens | Tokens representing Series M preferred shares of issuers on OTCM Protocol |
Options / Warrants | Any options, warrants, or convertible securities |
Derivatives | Any derivative instruments linked to Company securities or ST22 tokens |
ARTICLE II: DEFINITIONS
Section 2.1 - Key Definitions
“Blackout Period”
Any period during which trading by Covered Persons is prohibited, including quarterly blackout periods and event-specific blackout periods as described in Article V.
“Compliance Officer”
The Chief Legal Officer or such other person designated by the Board of Directors to administer this Policy.
“Covered Persons”
All directors, officers, employees, consultants, advisors, and contractors of the Company, as well as members of their immediate families and any entities controlled by such persons.
“Immediate Family”
A person’s spouse, domestic partner, parents, children, siblings, mothers-in-law, fathers-in-law, sons-in-law, daughters-in-law, brothers-in-law, sisters-in-law, and any person (other than a tenant or employee) sharing the person’s household.
“Material Nonpublic Information” (MNPI)
Information that:
•Has not been publicly disclosed through appropriate channels; AND
•A reasonable investor would consider important in making an investment decision
“Section 16 Insider”
Any director, executive officer, or beneficial owner of more than 10% of any class of equity securities of the Company.
“ST22 Security Token”
An SPL Token-2022 digital asset issued on the Solana blockchain representing a 1:1 ownership interest in Series M preferred shares held in custody by an SEC-registered transfer agent, as classified under SEC Category 1 (Issuer-Sponsored) tokenization framework.
“Trading Day”
•Traditional Securities: Any day on which national securities exchanges are open for trading
•ST22 Security Tokens: Any calendar day (tokens trade 24/7)
ARTICLE III: PROHIBITION ON INSIDER TRADING
Section 3.1 - General Prohibition
NO Covered Person shall, directly or indirectly, purchase, sell, gift, or otherwise transfer any Covered Security while in possession of Material Nonpublic Information concerning the Company, the OTCM Protocol platform, or any issuer whose securities are tokenized on the platform.
Section 3.2 - Prohibition on Tipping
NO Covered Person shall disclose (“tip”) Material Nonpublic Information to any other person, including family members, friends, business associates, or any third party, where such information may be used to trade in Covered Securities.
This prohibition applies regardless of whether the tipper receives any personal benefit from the disclosure.
Section 3.3 - Prohibition on Front-Running
NO Covered Person shall trade in ST22 Security Tokens or other Covered Securities based on knowledge of:
•Pending platform launches
•Issuer onboardings
•Liquidity events
•Other material events affecting the OTCM Protocol platform
...before such information is publicly announced.
Section 3.4 - Application to Digital Asset Transactions
For the avoidance of doubt, the prohibitions in this Article III apply equally to:
Transaction Type | Covered? |
Direct purchases/sales of ST22 tokens | YES |
Transactions through DEXs | YES |
Transactions through AMMs/bonding curves | YES |
Transfers between wallets controlled by Covered Person | YES |
Liquidity provision or withdrawal | YES |
Any transaction resulting in change of beneficial ownership | YES |
ARTICLE IV: EXAMPLES OF MATERIAL NONPUBLIC INFORMATIO
Section 4.1 - Corporate Information
The following types of information are generally considered MNPI when not publicly disclosed:
Category | Examples |
Financial | Results, projections, revenue/earnings guidance |
Business | Significant contracts, partnerships, relationships |
Corporate Actions | Mergers, acquisitions, divestitures |
Leadership | Changes in executive leadership or Board composition |
Financing | Equity or debt offerings |
Legal | Significant litigation or regulatory matters |
Security | Cybersecurity incidents or data breaches |
Section 4.2 - Platform-Specific Information
The following OTCM Protocol platform information is considered MNPI:
Category | Examples |
Launches | Pending issuer onboardings or token launches |
Liquidity | Planned pool migrations or modifications |
Parameters | Changes to bonding curve parameters |
Technical | Smart contract upgrades or security patches |
Data | Platform trading volume before public release |
Regulatory | SEC communications or regulatory developments |
Custody | Transfer agent relationship changes |
Offerings | ICO or token offering timing and terms |
Section 4.3 - Issuer-Specific Information
Covered Persons who obtain MNPI about issuers whose securities are tokenized on OTCM Protocol are prohibited from trading in the ST22 tokens of such issuers. This includes:
•Pending corporate actions affecting tokenized shares
•Financial condition or performance of the underlying issuer
•Planned delisting or detokenization
•Protective conversion trigger events
•Changes in transfer agent custody arrangements
ARTICLE V: BLACKOUT PERIODS
Section 5.1 - Quarterly Blackout Periods
Parameter | Details |
Start | First day of the third month of each fiscal quarter |
End | Two (2) full Trading Days after public release of quarterly/annual financial results |
Applies To | Company securities and OTCM Utility Tokens |
Section 5.2 - Event-Specific Blackout Periods
The Compliance Officer may impose event-specific blackout periods when MNPI exists that has not been publicly disclosed. Such blackout periods may apply to:
•Specific securities
•Specific ST22 tokens
•All Covered Securities
Covered Persons will be notified of event-specific blackout periods and the securities to which they apply.
Section 5.3 - Platform Launch Blackout Periods
All Covered Persons with knowledge of pending issuer onboardings or ST22 token launches are prohibited from trading in the affected tokens until FORTY-EIGHT (48) HOURS after the public launch announcement.
Section 5.4 - Exceptions to Blackout Periods
The following transactions are exempt from blackout period restrictions:
Exception | Notes |
Rule 10b5-1 trading plans | Pre-approved plans only |
Stock option exercises for cash | Sale of underlying shares NOT exempt |
RSU vesting | Sale of shares received NOT exempt |
Employee stock purchase plan | Purchases only |
Bona fide gifts | Subject to pre-clearance |
ARTICLE VI: PRE-CLEARANCE REQUIREMENTS
Section 6.1 - Persons Subject to Pre-Clearance
The following persons MUST obtain pre-clearance from the Compliance Officer before any transaction in Covered Securities:
Category | Who |
Directors | All directors |
Executive Officers | CEO, CFO, CTO, COO, and any C-level executives |
Section 16 Insiders | All Section 16 Insiders |
MNPI Access | Employees with access to MNPI regarding pending token launches |
Designated Persons | Any other person designated by the Compliance Officer |
Section 6.2 - Pre-Clearance Procedures
Requests must be submitted in writing (including email) to the Compliance Officer at least TWO (2) business days before the proposed transaction.
Required information:
Field | Description |
Security / Token | Identity of the security or ST22 token |
Transaction Type | Nature of proposed transaction (buy, sell, gift, etc.) |
Quantity | Number of shares or tokens |
Date | Proposed date of transaction |
Wallet Address(es) | For ST22 token transactions |
Section 6.3 - Clearance Period
Parameter | Value |
Validity | THREE (3) Trading Days from date of clearance |
Expiration | New request required if not completed within period |
Revocation | Pre-clearance may be revoked at any time if circumstances change |
ARTICLE VII: RULE 10b5-1 TRADING PLANS
Section 7.1 - Adoption of Trading Plans
Covered Persons may adopt written trading plans that comply with Rule 10b5-1 under the Securities Exchange Act of 1934. Such plans must be:
•Adopted during an open trading window
•Adopted when the person is NOT in possession of MNPI
•Pre-approved by the Compliance Officer
Section 7.2 - Cooling-Off Period
Person Type | Cooling-Off Period |
Directors & Executive Officers | Later of: (i) 90 days after adoption/modification, OR (ii) 2 business days after Form 10-Q/10-K filing for quarter plan was adopted |
Other Covered Persons | 30 days |
Section 7.3 - Application to ST22 Token Transactions
Rule 10b5-1 trading plans may be adopted for ST22 Security Token transactions, provided the plan specifies:
Requirement | Description |
Wallet Addresses | Addresses to be used for transactions |
Execution Mechanism | Specific DEX, OTCM.FUN platform, or designated broker |
Automation | Automated trading through bonding curves must be specifically authorized |
ARTICLE VIII: SPECIAL RULES FOR ST22 SECURITY TOKENS
Section 8.1 - 24/7 Trading Environment
ST22 Security Tokens trade continuously on blockchain-based platforms without regard to traditional market hours.
Covered Persons must exercise heightened vigilance, as the ability to trade at any time increases the risk of trading while in possession of MNPI.
Section 8.2 - Wallet Registration
Requirement | Details |
What | All blockchain wallet addresses controlled by or with beneficial interest |
Which Tokens | ST22 Security Tokens or OTCM Utility Tokens |
Register With | Compliance Officer |
Changes | Report within FORTY-EIGHT (48) HOURS |
Section 8.3 - On-Chain Monitoring
The Company may implement on-chain monitoring systems to track transactions by registered wallets. Covered Persons consent to such monitoring as a condition of their relationship with the Company.
Section 8.4 - Liquidity Provision
Providing liquidity to bonding curves, AMMs, or liquidity pools for ST22 tokens is considered a TRANSACTION subject to this Policy.
Requirements:
•Must obtain pre-clearance before adding or removing liquidity
•May NOT provide/remove liquidity while in possession of MNPI
ARTICLE IX: REPORTING OBLIGATIONS
Section 9.1 - Section 16 Reporting
Section 16 Insiders must file Forms 3, 4, and 5 with the SEC as required. Transactions in ST22 Security Tokens representing equity securities of the Company ARE subject to Section 16 reporting requirements.
Section 9.2 - Internal Reporting
All Covered Persons must report to the Compliance Officer within TWO (2) business days any transaction in Covered Securities.
Required information:
Field | Description |
Date | Date and nature of transaction |
Security / Token | Security or token involved |
Quantity | Number of shares or tokens |
Price | Price per share or token |
Wallet Addresses | For token transactions |
Transaction Hash | For blockchain transactions |
Section 9.3 - Annual Certification
All Covered Persons must certify annually that they have:
•Read and understand this Policy
•Complied with its requirements
•Will continue to comply
ARTICLE X: PENALTIES AND ENFORCEMENT
Section 10.1 - Regulatory Penalties
Insider trading violations may result in severe civil and criminal penalties:
Penalty Type | Amount / Duration |
Civil Penalties | Up to 3x the profit gained or loss avoided |
Criminal Fines - Individuals | Up to $5 million |
Criminal Fines - Entities | Up to $25 million |
Imprisonment | Up to 20 years |
Officer / Director Bars | Prohibition from serving |
Private Lawsuits | Civil suits by harmed investors |
Section 10.2 - Company Sanctions
Violations of this Policy may result in disciplinary action by the Company:
Sanction | Description |
Termination | Termination of employment or consulting relationship |
Forfeiture | Forfeiture of unvested equity awards |
Disgorgement | Disgorgement of trading profits |
Removal | Removal from director or officer positions |
Referral | Referral to regulatory authorities |
ARTICLE XI: ADMINISTRATION
Section 11.1 - Compliance Officer Duties
The Compliance Officer is responsible for:
Duty | Description |
Pre-Clearance | Reviewing pre-clearance requests |
Blackout Periods | Determining blackout periods |
Records | Maintaining records |
Training | Providing training |
Investigations | Investigating potential violations |
Section 11.2 - Policy Amendments
This Policy may be amended at any time by the Board of Directors. Covered Persons will be notified of material amendments and must acknowledge receipt.
Section 11.3 - Questions
Contact: compliance@otcm.io
Covered Persons with questions about this Policy or the application of insider trading laws should contact the Compliance Officer.
ACKNOWLEDGMENT AND CERTIFICATION
I acknowledge that I have received and read the OTCM Protocol, Inc. Insider Trading Policy. I understand its contents and agree to comply with all of its terms and conditions.
I understand that violation of this Policy or applicable insider trading laws may result in severe penalties, including termination of my relationship with the Company and civil and criminal liability.
I certify that I am not currently in possession of any Material Nonpublic Information concerning the Company, the OTCM Protocol platform, or any issuer whose securities are tokenized on the platform, except as previously disclosed to the Compliance Officer.
I agree to register all blockchain wallet addresses that I control or have beneficial interest in that may be used for transactions in ST22 Security Tokens or OTCM Utility Tokens.
CHIEF EXECUTIVE OFFICER | CHIEF OPERATING OFFICER |
Berj Abajian | Patrick Mokros |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
Signature: /s/ Berj Abajian | Signature: /s/ Patrick Mokros |
CHIEF TECHNOLOGY OFFICER | CHIEF LEGAL COUNSEL |
Franjose Yglesias | Jeff Turner |
Groovy Company, Inc. (GROO) | Groovy Company, Inc. (GROO) |
Signature: /s/ Franjose Yglesias | Signature: /s/ Jeff Turner |
VICE PRESIDENT OF ISSUER SERVICES |
|
John Morgan |
|
Groovy Company, Inc. (GROO) |
|
Signature: /s/ John Morgan |
|
OTCM Protocol, Inc. | A Wyoming Corporation
SEC Category 1 Issuer-Sponsored Tokenized Securities Infrastructure
Document ID: OTCM-POL-ITP-001 | Version 1.0 | Effective: January 30, 2026
Exhibit 31.1
CERTIFICATION
I, Berj Abajian, certify that:
1.I have reviewed this annual report on Form 10-K of Groovy Company, Inc.;
2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15(d)-15(f)) for the registrant and I have:
(a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)disclosed in this quarterly report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
5.I have disclosed, based on my most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
(a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: March 16, 2026
By:/s/ Berj Abajian
Berj Abajian
President and Chief Executive Officer
(Principal Executive Officer, Principal Accounting Officer and Principal Financial Officer)
Exhibit 32.1
CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The undersigned, Berj Abajian, Chief Executive Officer and Chief Financial Officer of Groovy Company, Inc. (the “Company”) hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)the Annual Report on Form 10-K of the Company for the fiscal year ended December 31, 2025 (the “Report”) fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(2)the information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: March 16, 2026
By:/s/Berj Abajian
Berj Abajian
President and Chief Executive Officer
(Principal Executive Officer, Principal Accounting Officer and Principal Financial Officer)