NOTE 5 - STOCKHOLDERS’ EQUITY (DEFICIT)

Equity Sales

During the three months ended September 30, 2025, the Company sold common stock in one private unregistered transaction to a related party resulting in total proceeds of $245,000 and the issuance of 15,322 shares of common stock.   During the three months ended September 30, 2024, the Company sold common stock in 9 private unregistered transactions to investors resulting in the issuance of 171,364 shares of common stock and total proceeds of $1,414,474 including $1,336,373 in cash and $78,101 in accounts payable. Included in the totals are 45,406 shares of common stock sold to related parties for total proceeds of $378,101 including $300,000 in cash and $78,101 in related party accounts payable. 

During the nine months ended September 30, 2025, the Company sold common stock in 2 private unregistered transactions to investors resulting in total proceeds of $395,000 and the issuance of 25,954 shares of common stock. Two of these transactions were to related parties for proceeds of $295,000 and the issuance of 18,810 shares of common stock. During the nine months ended September 30, 2024, the Company sold common stock in 38 private unregistered transactions to investors resulting in the issuance of 662,550 shares of common stock and total proceeds of $3,177,798 including $3,099,697 in cash and $78,101 in accounts payable. Included in the totals are 185,959 shares of common stock sold to related parties for total proceeds of $1,168,882 including $1,090,781 in cash and $78,101 in related party accounts payable.

Warrants

In the three months ended September 30, 2025, the Company issued to a private investor warrants to acquire 1,793 shares of the Company’s common stock. These warrants were tied to a convertible note under a board approved convertible note fund raising program.

In the nine months ended September 30, 2025, the Company issued warrants to acquire 2,855 shares of the Company’s common stock. These warrants were tied to direct placements of common stock under a board approved private fund raising program and a convertible note. Of the total, warrants for 348 shares were issued to a Related Party.

In the three months ended September 30, 2024, the Company issued 17,134 warrants to investors under a board approved private fund raising program.  Of the total, warrants for 4,540 shares were issued to Related Parties.

In the nine months ended September 30, 2024 the Company issued 17,832 warrants to investors under a board approved private fund raising program.  Of the total, warrants for 5,238 shares were issued to Related Parties.

Equity Compensation

For the three months ended September 30, 2025, the Company made no new equity awards for either Board Members or employees. For the three months ended September 30, 2025, the Company expensed $26,958 for equity compensation to certain employees related to awards made to certain employees and the non-employee directors in the prior periods. $12,544 of the total expense for the quarter was related to research and development (R&D) and the remaining $14,414 was for general and administrative expenses (G&A).

For the three months ended September 30, 2024, the Company recognized expense of $1,066,668 for equity compensation to members of the Board of Directors and certain employees for restricted stock awards and option grants. The total expense amount was related to new equity grants in the period plus equity awards from prior periods. $106,236 of the total expense for the quarter was related to R&D and the remaining $960,432 was for G&A.

For the nine months ended September 30, 2025, the Company expensed $964,247 for equity compensation to members of the Board of Directors and certain employees. The total expense included amounts related to awards made to certain employees and the non-employee directors in the prior periods, and amounts related to new awards made to the non-employee directors in the period. $72,536 of the total expense for the quarter was related to R&D and the remaining $891,711 was for G&A.

For the nine months ended September 30, 2024, the Company expensed $8,728,427 for equity compensation to members of the Board of Directors and certain employees for restricted stock awards and option grants. The total expense amount was related to new equity grants in the period plus equity awards from prior periods. $2,166,464 of the total expense for the quarter was related to R&D and the remaining $6,561,963 was for G&A.

Directors’ Stock Awards

On January 1, 2025 the Compensation Committee of the Board of Directors awarded 38,378 RSA shares to the four non-employee members of the Boards in three separate actions.

From January 1, 2024 through June 10, 2024 the Company accrued payments to the non-employee board members pursuant to the Non-Employee Directors Compensation Policy in place at the time. The total amount accrued for that time period was $69,827. The Compensation Committee agreed the non-employee members of the board would forgo the accrued cash payment in lieu of RSA shares. The Compensation Committee determined the fair exchange price would be $16.74 per share resulting in the Company issuing an aggregate of 4,170 shares in exchange for the $69,827 of accrued cash. The restricted shares have been issued to the non-employee board members and vested in full on March 31, 2025.

Additionally, from June 11, 2024 through December 31, 2024 the Company accrued payments to the non-employee board members in total of $124,934 for board service. The Compensation Committee agreed the non-employee members of the board would forgo the accrued cash payment in lieu of RSA shares. The Compensation Committee also considered the Company’s cash position going forward and awarded the non-employee board members RSA shares for the remainder of the members’ service through the Company’s next annual meeting of shareholders in lieu of cash payments. This future amount would have been $104,819. The Compensation Committee determined the fair exchange price would be $7.97 per share resulting in the Company issuing an aggregate of 28,826 shares in exchange for the $229,753 of accrued and future cash payments. The restricted shares have been issued to the non-employee board members and have vested in full on June 10, 2025.

The Compensation Committee awarded Laith Yaldoo 5,382 RSA shares for his pro-rata share of the annual RSA award based on his appointment to the Board of Directors on July 12, 2024. The restricted shares have been issued to Mr. Yaldoo, 2,691 shares vested immediately on the date of the award, 1,345 shares vested on March 11, 2025, and 1,346 shares and vested on June 9, 2025, the day prior to the 2025 annual stockholder meeting.

Common Stock Restricted Stock Awards (RSA)

The total RSA expense recorded in the three and nine months ended September 30, 2025 and 2024 are as follows:

The 2025 and 2024 RSA activity is as follows:

As of September 30, 2025, there was no remaining unrecognized compensation expense related to RSAs.

The total fair value of RSAs vested during the nine months ended September 30, 2025, was $2,829,329, and during the nine months ended September 30, 2024, was $3,372,116. The fair value was determined based on the number of shares vesting and the closing price of shares of our common stock on the dates the awards vested.

Common Stock Warrants - Unregistered

A summary of the status of the Company’s unregistered warrants is presented below:

Unregistered warrants outstanding and exercisable by price range as of September 30, 2025, were as follows:

Common Stock Warrants - Registered

A summary of the status of the Company’s registered warrants is presented below:

Registered warrants outstanding and exercisable by price range as of September 30, 2025, were as follows: