Note 14. Stockholders’ Equity

Authorized Capital Stock

The Company has authorized 5,000,000 shares of preferred stock with a par value of $0.0001.

The Company has authorized 210,000,000 shares of common stock with a par value of $0.0001, consisting of 200,000,000 shares of Class A common stock and 10,000,000 shares of Class B common stock. The Class B common stock is entitled to ten votes and is convertible at any time into one share of Class A common stock.

Class A Common Stock

The Company had 35,147,483 and 15,956,816 shares of Class A common stock issued and outstanding as of September 30, 2025 and December 31, 2024, respectively.

July 2025 Public Offering

On July 29, 2025, the Company completed an underwritten public offering of 7,143,000 shares of Class A common stock at a public offering price of $1.05 per share, for approximately $6.7 million of net proceeds.

September 2025 Public Offering

On September 14, 2025, the Company completed an underwritten public offering of 9,800,000 shares of Class A common stock at a public offering price of $1.00 per share, for approximately $8.8 million of net proceeds.

In addition, during the nine months ended September 30, 2025, the Company issued 2,247,667 shares of Class A common stock as follows;

Class B Common Sock

The Company had 100,000 shares of Class B common stock issued and outstanding as of September 30, 2025 and December 31, 2024.

Warrants

True up warrant

The Company adjusted the number of warrants and their exercise price granted in October 2023 due to offerings in third quarter of 2025. 6,571 warrants were granted, and the new exercise price was adjusted to $1.00. The Company recognized the value of warrants of approximately $8,000 as direct incremental costs of the offering and recorded as a reduction of additional paid in capital.

July 2025 offering

The Company issued a total of 357,150 underwriter warrants exercisable after the July 29, 2025 date of the offering agreement, for a period of five years at an exercise price per share of $1.31 in connection with the common stock sold. The Company recognized the value of 357,150 underwriter warrants of approximately $698,000 as direct incremental costs of the offering and recorded as a reduction of additional paid in capital.

September 2025 offering

The Company issued a total of 490,000 underwriter warrants exercisable after the September 16, 2025 date of the offering agreement, for a period of five years at an exercise price per share of $1.25 in connection with the common stock sold. The Company recognized the value of 490,000 underwriter warrants of approximately $620,000 as direct incremental costs of the offering and recorded as a reduction of additional paid in capital.

The Company utilizes the Black-Scholes model to value its warrants. The Company utilized the following assumptions:

 Schedule of Warrant Valuation Assumption

A summary of activity of the warrants during the nine months ended September 30, 2025 as follows:

 Schedule of Activity of Warrants

The intrinsic value of the warrants as of September 30, 2025 is $1,051.

Stock Options

On February 1, 2025, the Company granted 265,000 options with an exercise price of $2.57, with a term of five (5) years to exercise from the grant date to employees of the Company. Options issued vest at 33% of shares subject to the option on each anniversary date, on February 1, 2026, 2027 and 2028.

The Company utilizes the Black-Scholes model to value its stock options. The Company utilized the following assumptions:

 Schedule of Utilizes Black-Scholes Model to Value of Stock Options

During the nine months ended September 30, 2025, the 265,000 options that were granted were valued at $609,330. During the nine months ended September 30, 2025 and 2024, the Company recognized stock option expense of $310,812 and $130,390, respectively, and as of September 30, 2025, $753,001 remains unamortized and is expected to be recognized ratably over the remaining vesting period through February 1, 2028. The intrinsic value of the 329,752 options outstanding as of September 30, 2025, is $0.

A summary of activity of the stock options during the nine months ended September 30, 2025, is as follows:

 Schedule of Activity of Stock Options

Restricted Stock Unit (RSU)

On February 1, 2025, the Company granted 265,000 RSUs to employees of the Company, valued at $620,689. RSUs entitle the holder to receive a specified number of shares of the Company’s common stock and RSU issued vest 100% of shares subject to the RSU on the third anniversary date, on February 1, 2028. The $620,689 related to unvested RSU’s is expected to be recognized ratable over the service period of three years. During the nine months ended September 30, 2025, the Company recognized stock compensation expense of $146,048 related to unvested RSUs. Stock compensation expense is expected to be recognized ratably over the remaining service period of 2.34 years. These RSUs are not included in shares outstanding.

On August 1, 2025, the Company granted 50,567 RSUs to board members. The RSUs will be fully vested by July 1, 2026. On August 1, 2025, the Company granted 10,000 RSUs to an employee of the Company. The RSUs are expected to be recognized ratable over the service period of three years.

Stock Award

During the nine months ended September 30, 2025, the Company recorded stock compensation expense of $128,333 for 50,327 vested shares as part of an annual total stock award to be issued of 66,667 shares of Class A Common Stock to board members.