Note 6. Shareholders’ Equity

Preferred Stock

Upon the Company’s IPO, all shares of the Company’s Series A preferred stock were converted into 2,438,851 shares of common stock effective June 15, 2020, with fractional share adjustments made in connection with the conversion as discussed below. As of December 31, 2025 and 2024, the Company had 1,000,000 authorized shares of preferred stock, with zero shares of preferred stock issued and outstanding.

Common Stock

During the year ended December 31, 2024, the Company issued 20,000 shares of restricted common stock to a consultant with a grant date fair value of approximately $81,000, which was included as stock-based compensation as part of general and administrative expenses in the accompanying consolidated statements of operations when the shares vested on October 4, 2024. During the year ended December 31, 2025, the Company issued 100,000 shares of restricted common stock with a fair value of approximately $406,000 in exchange for services. These shares were issued outside of the Company’s Second Amended and Restated Lantern Pharma Inc. 2018 Equity Incentive Plan (“Lantern Pharma Inc. 2018 Equity Incentive Plan”). The Company recognized approximately $367,000 of expense when 90,000 of these shares vested during the year ended December 31, 2025. The remaining 10,000 shares vested in January 2026.

In July 2025, the Company entered into the ATM, with ThinkEquity, pursuant to which the Company may offer and sell up to $15,530,000 of shares of its common stock from time to time, in an “at-the-market” offering to or through ThinkEquity. The Company pays ThinkEquity a commission of 3.0% of the aggregate gross proceeds from the sale of the Placement Shares pursuant to the ATM. The ATM contains customary representations, warranties and agreements of the Company, conditions to closing, indemnification rights and obligations of the parties, and termination provisions. The Company issued 356,922 shares of common stock to ThinkEquity during the year ended December 31, 2025, resulting in aggregate proceeds of $1,563,229, after deducting commissions and transaction costs of $50,987 and deferred offering costs of $10,331.

During the year ended December 31, 2025, 13,050 options were exercised for 13,050 shares of common stock at a price of $1.03 per share resulting in cash receipts of $13,442. No options were exercised during the year ended December 31, 2024.

As of December 31, 2025 and 2024, the Company had 25,000,000 authorized shares of Common Stock, of which 11,254,697 and 10,784,725 shares were issued and outstanding, respectively.

Warrants

During the year ended December 31, 2024, the Company issued 21,313 shares of common stock for aggregate proceeds of $66,710, relating to the exercise of warrants that were expiring. The Company also issued 22,220 shares of common stock relating to the cashless exercise of warrants to purchase 86,685 shares during the year ended December 31, 2024.

At December 31, 2024, there were 70,000 warrants outstanding, which expired unexercised during the year ended December 31, 2025. At December 31, 2025, there were no warrants outstanding.

Options

On August 29, 2018, the Board of Directors of the Company adopted the Lantern Pharma Inc. 2018 Equity Incentive Plan, which was subsequently amended on December 17, 2018, February 26, 2020, October 20, 2022, June 16, 2023 and June 13, 2024. The Lantern Pharma Inc. 2018 Equity Incentive Plan, as amended and restated, is referred to herein as the “Plan”. The Company has reserved 1,864,680 shares of its common stock for issuance under the Plan. The Plan is designed to provide additional incentives to employees, directors and consultants to remain in the service of the Company as well as to encourage stock acquisition by members of these targeted groups, which in the opinion of the management will support the alignment of the interests of the members of these groups and stockholders. Options granted under the Plan are generally exercisable for up to 10 years from grant date. 360,211 shares remain available for future awards under the Plan at December 31, 2025, following the grant of options and the award of restricted stock grants through December 31, 2025.

On September 19, 2025 (the “Effective Date”), the Company’s stockholders approved a one-time stock option repricing (the “Option Repricing”) for certain previously granted and still outstanding options held by the Company’s employees and directors. Pursuant to the Option Repricing, stock options granted under the Plan between June 15, 2020 and November 4, 2021 with an exercise price between $10.21 and $15.21 per share, were repriced to $5.04 per share, which was calculated as 125% of the Company’s average daily volume weighted average price as reported by Nasdaq Stock Market, measured over the 10 trading days ending and including the date the option repricing was approved by the Board of Directors (July 24, 2025).

Under the terms of the Option Repricing, a repriced option will only be exercisable at its original exercise price if, prior to the one-year anniversary of the Effective Date, (a) the option holder’s employment or service is terminated by the Company or by the option holder, or (b) the option is exercised. The repriced options otherwise retained their existing terms and conditions as set forth in the Plan. The Option Repricing resulted in approximately $285,000 of incremental stock compensation expense, which was calculated using the Black-Scholes option-pricing model.

During the year ended December 31, 2025, the Company recognized incremental compensation cost of approximately $80,000 relating to the Option Repricing. At December 31, 2025, there was approximately $205,000 of unrecognized stock-based compensation expense, which is expected to be recognized on a straight-line basis over the remaining service period of 0.71 years. The incremental cost is included in general and administrative expense and research and development expense on the consolidated statements of operations and comprehensive loss.

A summary of stock option activity under the Plan during the years ended December 31, 2025 and 2024 is presented below:

Schedule of Stock Option Activity 

The weighted average remaining contractual term of outstanding options at December 31, 2025 is 5.39 years. The weighted average remaining contractual term of exercisable options at December 31, 2025 is 4.76 years. The total intrinsic value of options outstanding and exercisable at December 31, 2025 and 2024 was approximately $913,000 and $1,014,000, respectively. The intrinsic value of options exercised during year ended December 31, 2025 was approximately $45,000.

Approximate stock-based compensation relating to options was as follows for the years ended December 31, 2025 and 2024:

Schedule of Stock-based Compensation 

Total remaining unrecognized compensation expense for non-vested options is approximately $716,000 as of December 31, 2025 and is expected to be recognized over a weighted average period of 1.13 years.

For the years ended December 31, 2025 and 2024, the fair value of each option granted was estimated using the Black-Scholes option-pricing model, using the following weighted average assumptions:

Schedule of Weighted Average Assumptions 

The fair value of options is recognized as an expense over the vesting period and forfeitures are accounted for as they occur.