NOTE 4 – STOCKHOLDERS’ EQUITY

As of March 31, 2026, the Company was authorized to issue an aggregate of 505,000,000 shares. The authorized capital stock, as of such date, was divided into: (i) 500,000,000 shares of common stock having a par value of $0.0001 per share and (ii) 5,000,000 shares of preferred stock having a par value of $0.0001 per share.

Common Stock

The Company had 24,939,948 and 23,091,062 shares of its common stock issued and outstanding at March 31, 2026 and December 31, 2025, respectively.

Each holder of common stock is entitled to one vote for each share of common stock held on all matters submitted to a vote of the stockholders. Our Second Amended and Restated Certificate of Incorporation, as amended (the “Charter”) and Second Amended and Restated Bylaws do not provide for cumulative voting rights.

In addition, the holders of our common stock will be entitled to receive ratably such dividends, if any, as may be declared by the Board out of legally available funds; however, the current policy of our Board is to retain earnings, if any, for operations and growth. Upon liquidation, dissolution or winding-up, the holders of our common stock will be entitled to share ratably in all assets that are legally available for distribution.

Holders of our common stock have no preemptive, conversion or subscription rights, and there are no redemption or sinking fund provisions applicable to our common stock. The rights, preferences and privileges of the holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of our preferred stock that we may designate and issue in the future.

2021 Stock Incentive Plan

The Company’s Board and stockholders adopted and approved the 2021 Stock Incentive Plan (the “2021 Plan”) which took effect on July 15, 2021. The 2021 Plan allowed for the issuance of securities, including stock options, restricted stock, and restricted stock units (“RSUs”) to employees, Board members and consultants. On December 19, 2023, the remaining shares available under the 2021 Plan were added to the Company’s 2023 Stock Incentive Plan (the “2023 Incentive Plan”, or “2023 Plan”). There will be no new issuances under the 2021 Plan.

As of March 31, 2026, there were a total of 61,250 stock options outstanding under the 2021 Plan, which are all fully vested.

2023 Stock Incentive Plan

The Board and Company stockholders have adopted and approved the 2023 Plan which took effect on December 19, 2023. The 2023 Plan allows for the issuance of securities, including stock options, restricted stock, and RSUs to employees, Board members and consultants. The initial number of shares of common stock available for issuance under the 2023 Plan was 125,000 shares plus 28,389 unused shares reserved under the 2021 Plan, which will, on January 1 of each calendar year, beginning on January 1, 2024 and ending on and including January 1, 2033, unless the Board decides otherwise, automatically increase to equal to the lessor of (A) three percent (3%) of the number of shares of common stock outstanding on the final day of the immediately preceding calendar year or (B) such smaller number of shares as is determined by the Board.

On September 3, 2025, at our 2025 Annual Meeting of Stockholders, our stockholders approved an amendment (the “First Plan Amendment”) to our 2023 Plan increasing the number of shares of common stock authorized for issuance under the 2023 Plan by 1,750,000 shares to 2,014,221 shares. The First Plan Amendment became effective following its approval by our stockholders. 

On January 28, 2026, at a Special Meeting of Stockholders (the “Special Meeting”), our stockholders approved an additional amendment (the “Second Plan Amendment”) to our 2023 Plan, as amended by the First Plan Amendment, increasing the number of shares of common stock authorized for issuance under the 2023 Plan, as amended by the First Plan Amendment, by 11,985,779 shares to 14,000,000 shares. The Second Plan Amendment became effective following its approval by our stockholders.

As of March 31, 2026, 14,000,000 total shares were available under the 2023 Plan, of which 1,624,593 shares were issued and outstanding and 12,375,407 shares were available for potential issuances.

At The Market Agreement with H.C. Wainwright

On November 26, 2024, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (“Wainwright”), as sales agent, pursuant to which the Company was able to issue and sell, from time to time, through Wainwright, shares of its common stock, and pursuant to which Wainwright was able to sell its common stock by any method permitted by law deemed to be an “at the market offering” as defined by Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. The Company was obligated to pay Wainwright a commission of 3.0% of the aggregate gross proceeds from each sale of common stock. As of March 31, 2025, the Company was authorized to offer and sell up to $2,076,000 of its common stock pursuant to the ATM Agreement.

On June 20, 2025, the Company increased the maximum aggregate offering price of the shares of common stock issuable under the ATM Agreement, from $2,076,000 to $4,227,000 and filed a prospectus supplement to register an aggregate of $2,151,000 of additional shares of common stock available to be sold under the ATM Agreement.

On January 26, 2026, the Company filed a Post-Effective Amendment No. 1 (the “Amendment”) to its Registration Statement on Form S-3 (File No. 333-271010) (the “Registration Statement”), to deregister any and all securities of the Company registered but unsold or otherwise unissued under the Registration Statement as of the date thereof. As a result of such Amendment, the Company is not able to sell any additional shares of its common stock under the ATM Agreement. As such, during the three months ended March 31, 2026, the Company did not sell any shares of common stock under its ATM Agreement.

During the three months ended March 31, 2025, the Company sold 440,000 shares of common stock under its ATM Agreement at an average price of $3.88 per share for gross proceeds of $1,705,528 and net proceeds of $1,652,745.

May 2025 Public Offering

On May 6, 2025, the Company entered into securities purchase agreements with investors (the “May 2025 Purchase Agreements”) pursuant to which the Company agreed to sell an aggregate of (i) 3,094,284 shares (the “May 2025 Shares”) of common stock, (ii) 477,144 pre-funded warrants (the “May 2025 Pre-Funded Warrants”) to purchase up to an aggregate of 477,144 shares of common stock (the “May 2025 Pre-Funded Warrant Shares”), (iii) 3,571,428 Series C Common Warrants (the “Series C Common Warrants”) to purchase up to an aggregate of 3,571,428 shares of common stock, and (iv) 3,571,428 Series D Common Warrants (the “Series D Common Warrants” and, together with the Series C Common Warrants, the “May 2025 Common Warrants”) to purchase up to an aggregate of 3,571,428 shares of common stock. Each May 2025 Share, or May 2025 Pre-Funded Warrant in lieu thereof, was sold together with a Series C Common Warrant to purchase one share of common stock and a Series D Common Warrant to purchase one share of common stock in a best-efforts public offering (the “May 2025 Public Offering”).

The public offering price for each May 2025 Share and accompanying May 2025 Common Warrants was $1.40, and the public offering price for each May 2025 Pre-Funded Warrant and accompanying May 2025 Common Warrants was $1.399. The May 2025 Pre-Funded Warrants have an exercise price of $0.001 per share, are exercisable immediately and will expire when exercised in full. The Series C Common Warrants have an exercise price of $1.40 per share, became exercisable upon issuance and will expire five years thereafter. The Series D Common Warrants have an exercise price of $1.40 per share, became exercisable upon issuance and will expire 18 months thereafter. Simultaneously with the closing of the May 2025 Public Offering, certain investors exercised Series D Common Warrants to purchase an aggregate of 914,286 shares of common stock, resulting in additional gross proceeds of approximately $1.3 million. In addition, all May 2025 Pre-Funded Warrants were exercised simultaneously with the closing of the May 2025 Public Offering, resulting in the issuance of 477,144 May 2025 Pre-Funded Warrant Shares.

A holder will not have the right to exercise any portion of the May 2025 Common Warrants if the holder (together with its affiliates) would beneficially own in excess of 4.99% (or, at the election of the holder, 9.99%) of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the May 2025 Common Warrants. However, upon notice from the holder to the Company, the holder may increase the beneficial ownership limitation, which may not exceed 9.99% of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the May 2025 Common Warrants, provided that any increase in the beneficial ownership limitation will not take effect until 61 days following notice to the Company.

The net proceeds of the May 2025 Public Offering, after deducting the placement agent fees and estimated offering expenses payable by the Company and excluding the net proceeds from the exercise of the May 2025 Common Warrants, were approximately $4.2 million. The aggregate gross proceeds from the May 2025 Public Offering and the exercise of the Series D Common Warrants were approximately $6.3 million.

In addition, the Company issued to the placement agent or its designees warrants (the “May 2025 Placement Agent Warrants”) to purchase up to an aggregate of 250,000 shares of common stock at an exercise price equal to $1.75 per share. The May 2025 Placement Agent Warrants have substantially the same terms as the Series C Common Warrants, became exercisable immediately upon issuance and have a term of five (5) years from the date of the May 2025 Purchase Agreements.

The warrants issued in connection with the May 2025 Public Offering met the requirement for equity classification. The Company computes the fair value of warrants and options using a Black-Scholes model. The expected term used for warrants is the contractual life. The Company is utilizing an expected volatility figure based on a review of the historical volatilities, over a period of time, equivalent to the expected life of the instrument being valued, of similarly positioned public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.

December 2025 Public Offering

On November 28, 2025, the Company agreed to sell to investors an aggregate of (i) 14,846,665 shares (the “December 2025 Shares”) of common stock and (ii) 65,153,335 pre-funded warrants (the “December 2025 Pre-Funded Warrants”) to purchase up to an aggregate of 65,153,335 shares of common stock (the “December 2025 Pre-Funded Warrant Shares”) in a best efforts public offering (the “December 2025 Offering”).

The public offering price for each December 2025 Share was $0.75, and the public offering price for each December 2025 Pre-Funded Warrant was $0.749. The December 2025 Pre-Funded Warrants have an exercise price of $0.001 per share, became exercisable immediately and will expire when exercised in full.

The net proceeds of the December 2025 Offering, after deducting the placement agent fees and estimated offering expenses payable by the Company, were approximately $54.9 million. The December 2025 Offering closed on December 1, 2025.

A holder will not have the right to exercise any portion of the December 2025 Pre-Funded Warrants if the holder (together with its affiliates) would beneficially own in excess of 4.99% (or, at the election of the holder, 9.99%) of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the December 2025 Pre-Funded Warrants. However, upon notice from the holder to the Company, the holder may increase the beneficial ownership limitation, which may not exceed 9.99% of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the December 2025 Pre-Funded Warrants, provided that any increase in the beneficial ownership limitation will not take effect until 61 days following notice to the Company.

In addition, the Company issued to the placement agent or its designees warrants (the “December 2025 Placement Agent Warrants”) to purchase up to an aggregate of 4,000,000 shares of common stock at an exercise price equal to $0.9375 per share. The December 2025 Placement Agent Warrants expire on November 28, 2030, and become exercisable upon a shareholder approval to increase the authorized and unissued shares of common stock of the Company to satisfy the exercise of the December 2025 Placement Agent Warrants. As such, the December 2025 Placement Agent Warrants were not exercisable upon consummation of the offering. The Company concluded at issuance that the December 2025 Placement Agent Warrants did not meet the criteria for equity classification under the guidance of ASC 815 as the Company did not have sufficient authorized and unissued shares to satisfy the December 2025 Placement Agent Warrants as of the closing date of the December 2025 Offering or December 31, 2025. The Company recorded the December 2025 Placement Agent Warrants as liabilities at their fair value. This liability would be subject to remeasurement at each balance sheet date and any change in fair value would be recognized in the Company’s condensed consolidated statement of operations and comprehensive income. The Company incurred $3,426,238 of placement agent warrant issuance costs in connection with the December 2025 Offering. During the year ended December 31, 2025, the Company recorded a loss on derivative warrant liability related to the December 2025 Placement Agent Warrants of $416,619 and the fair value of the December 2025 Placement Agent Warrants as of December 31, 2025, was $3,842,857.

On January 28, 2026, the Company filed a Certificate of Amendment to the Charter with the Secretary of State of the State of Delaware to increase the number of the Company’s authorized shares of common stock from 100,000,000 shares to 500,000,000 shares. The Certificate of Amendment was approved by the Company’s stockholders at the Special Meeting and became effective upon filing. Based on the new number of authorized shares of common stock of the Company on January 28, 2026, the Company had sufficient authorized and unissued shares to reclassify the December 2025 Placement Agent Warrants out of liability and as equity warrants. The fair value was remeasured at $2,294,631, with the warrant reclassified to equity as of that date, with the change in fair value of $1,548,227 recorded in the condensed consolidated statement of operations. The fair value of the December 2025 Placement Agent Warrants was estimated by using the Black Scholes method using the following inputs: the price of the Company’s common stock of $0.85; risk-free interest rates of 3.83%; and volatility of the Company’s common stock of 115.83%.

During the three months ended March 31, 2026, an aggregate of 1,850,000 December 2025 Pre-Funded Warrants were exercised and the Company issued an aggregate of 1,848,886 shares of common stock pursuant to the exercises. A total of 1,114 shares of common stock were cancelled with a value of $1,101 as part of a cashless exercise. 750,000 December 2025 Pre-Funded Warrants were exercised for cash for a total of $750. As of March 31, 2026, 63,303,335 December 2025 Pre-Funded Warrants are paid and issued but unexercised.