NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

We consider the following policies to be beneficial in understanding the judgments that are involved in the preparation of our consolidated financial statements and the uncertainties that could impact our financial condition, results of operations and cash flows.

Basis of Presentation and Principles of Consolidation

The accompanying consolidated 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 Streamex Corp. and its consolidated subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

The Company consolidates entities in which it has a controlling financial interest, including variable interest entities (“VIEs”) for which the Company is determined to be the primary beneficiary. Noncontrolling interests represent the portion of equity interests in consolidated subsidiaries not attributable to the Company and are reported as a separate component of stockholders’ equity.

Segment Reporting

The Company determines its operating and reportable segments in accordance with ASC 280, Segment Reporting, based on the financial information regularly reviewed by the Chief Operating Decision Maker (“CODM”) for purposes of performance assessment and resource allocation.

As of December 31, 2025, the CODM evaluates the Company’s financial performance and allocates resources on a consolidated basis. The Company manages its operations as one integrated business and does not prepare or review discrete financial information for individual business units or subsidiaries. Accordingly, the Company has concluded that it operates as a single reportable segment.

Management will continue to monitor the CODM’s review practices and internal reporting structure and will update its segment disclosures in future periods if and when discrete financial information is regularly reviewed at a further disaggregated level.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and accounts receivable. The Company places its cash with high-credit-quality financial institutions and, at times, balances may exceed federally insured limits. The Company has not experienced losses related to these balances. As of December 31, 2025 and 2024, deposits in excess of FDIC limits were $19.7 million and nil, respectively.

In addition, as of December 31, 2025, the Company held $0.3 million in cash deposits with a Canadian financial institution that are not insured by the FDIC.

Accounts Receivable and Allowance for Credit Losses

Accounts receivable, less allowances for credit losses , reflects the net realizable value of receivables and approximates fair value. When evaluating the adequacy of the allowance for doubtful accounts and the overall probability of collecting on receivables, we analyze historical experience, client credit-worthiness, the age of the trade receivable balances, current economic conditions that may affect a client’s ability to pay and current and projected economic trends and conditions at the balance sheet date. 

The allowance for credit losses was $109 and $0 as of December 31, 2025 and 2024, respectively. The Company believes that its reserve is adequate, however results may differ in future periods. For the year ended December 31, 2025 and 2024, bad debt expense totaled $109 and $0, respectively.

Revenue

We account for revenue in accordance with Topic 606, Revenue from Contracts with Customers. We recognize revenue based on the five-step model; (i) identify the contract with the customer; (ii) identify the performance obligation in the contract; (iii) determine the contract price; (iv) allocate the transaction price; and (v) recognize revenue as each performance obligation is satisfied. If we determine that a contract with enforceable rights and obligations does not exist, revenues are deferred until all criteria for an enforceable contract are met.

The Company derived its revenue primarily from the sale of its medical device, the PURE EP™ Platform, as well as related support and maintenance services and software upgrades in connection with the system.

The Company had one customer which accounts for 97.5% of our revenue in the year ended December 31, 2024. 

Restricted Gold Holdings

The Company holds LBMA Good Delivery gold bullion on an allocated, physically segregated basis in Brink’s secure vaults and other secure third-party storage locations. Gold is maintained in a securities account with Gold Bullion International, LLC (“GBI”), which acts as the securities intermediary under UCC Article 8. The gold is pledged as collateral under the Company’s Secured Convertible Debenture Purchase Agreement and related Guaranty and Security Agreement.

Gold is accounted for as a long-lived tangible asset within the scope of ASC 360. Prior to management’s commitment to sell the gold on December 29, 2025, the asset was measured at historical cost, including purchase price and directly attributable costs necessary to bring the asset to its intended condition and location. Upon meeting the held-for-sale criteria in ASC 360 on December 29, 2025, the gold was reclassified as held for sale and measured at the lower of carrying amount or fair value less cost to sell until disposal. Gold is presented as Other Assets held for sale – Restricted Gold in the Consolidated Balance Sheets. Ongoing storage, insurance, and administrative custody costs are expensed as incurred.

Management evaluates impairment under ASC 360-10-35 when triggering events occur. Prior to classification as held for sale, commodity price volatility alone does not constitute an impairment indicator; impairment would be considered only if legal, custodial, regulatory, or contractual events impair the Company’s ability to access or realize economic benefits from the asset. Once classified as held for sale, the gold is carried at the lower of carrying amount or fair value less cost to sell, with any write-downs recognized in earnings and subsequent increases recognized only to the extent of previously recognized losses.

Leases (lessee)

The Company determines if a contractual arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current operating lease liabilities, and noncurrent operating lease liabilities on the Company’s Consolidated Balance Sheets. The Company evaluates and classifies leases as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty. All the Company’s real estate leases are classified as operating leases. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term.

The lease payments included in the present value are fixed lease payments. As most of the Company’s leases do not provide an implicit rate, the Company estimates its collateralized incremental borrowing rate, based on information available at the commencement date, in determining the present value of lease payments. The Company applies the portfolio approach in applying discount rates to its classes of leases. The operating lease ROU assets include any payments made before the commencement date. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company does not currently have subleases. The Company does not currently have residual value guarantees or restrictive covenants in its leases.

Property and Equipment

Property and equipment are depreciated and stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets or the remaining lease term, whichever is shorter.

The estimated useful lives of property and equipment assets as of December 31, 2025 and 2024 are described below:

 SCHEDULE OF USEFUL LIVES OF PROPERTY PLANT AND EQUIPMENT

The Company evaluates at least annually the recoverability of property and equipment for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. If such review indicates that the carrying amount of property and equipment assets is not recoverable, and the asset’s fair value is less than the carrying amount, an impairment loss is recognized in income from operations.

During the year ended December 31, 2024, the Company re-assessed its carrying amounts of certain property and equipment due to reduced manufacturing of its commercial products and determined that these carrying amounts exceeded the estimated undiscounted future cash flows. Accordingly, the Company recorded a $253 impairment charge to current operations during the year ended December 31, 2024.

Business Acquisition

The Company recognizes and measures identifiable tangible and intangible assets acquired and liabilities assumed as of the acquisition date at fair value. Fair value measurements require extensive use of estimates and assumptions, including estimates of future cash flows to be generated by the acquired assets. The operating results of the acquired business are included in our consolidated financial statements beginning on the date of acquisition. The purchase price is equivalent to the fair value of consideration transferred. Goodwill is recognized for the excess of purchase price over the net fair value of assets acquired and liabilities assumed. Acquisition-related costs are expensed as incurred.

Intangible Assets

Intangible assets with a definite useful life are recorded at cost and amortized over their estimated useful lives on a straight-line basis. The Company reviews the estimated remaining useful lives of its intangible assets each reporting period and revises those estimates when appropriate. Amortization expense is recorded in depreciation and amortization in the Consolidated Statements of Operations.

The Company evaluates the recoverability of definite-lived intangible assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When such indicators exist, the Company performs a recoverability test by comparing the carrying amount of the asset to the undiscounted future cash flows expected to result from its use and eventual disposition. If the carrying amount exceeds the undiscounted future cash flows, an impairment loss is recognized for the excess of the carrying amount over the asset’s fair value.

Goodwill

Goodwill represents the excess of the cost of an acquired business over the fair value assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include, but not limited to, significant adverse changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.

The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it’s carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.

During the year ended December 31, 2025, the Company recorded goodwill in connection with a business acquisition. The Company performs its annual goodwill impairment test in the fourth quarter of each fiscal year and evaluates goodwill for impairment more frequently if events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

In connection with its annual impairment assessment as of December 31, 2025, the Company performed a qualitative goodwill impairment assessment in accordance with ASC 350-20. Management evaluated the totality of relevant events and circumstances, including macroeconomic conditions, industry and market considerations, cost factors, overall financial performance, entity-specific events, and other factors affecting the reporting unit. Based on this assessment, management concluded that it is not more likely than not that the fair value of the Company’s reporting unit was less than its carrying amount as of December 31, 2025. Accordingly, no quantitative goodwill impairment test was required, and no impairment charge was recorded for the year ended December 31, 2025.

Marketable Securities

The Company’s marketable equity securities consist of publicly traded equity securities. These securities are classified within current assets on the Consolidated Balance Sheets because they are available to be converted into cash to fund current operations without restriction. These marketable equity securities are measured at fair value at each reporting date with gains and losses recognized in Other income (expense), net on our Consolidated Statements of Operations.

Warrants

The Company has issued warrants to purchase shares of its common stock in connection with prior equity financings. The Company evaluates its warrants at issuance and at each reporting date to determine whether such instruments should be classified as equity or as liabilities in accordance with ASC 815, Derivatives and Hedging, and ASC 480, Distinguishing Liabilities from Equity.

Warrants that do not meet the criteria for equity classification, including those that contain provisions requiring or permitting net cash settlement, variable settlement outcomes, or adjustments based on inputs other than the Company’s stock price, are classified as derivative liabilities and measured at fair value, with changes in fair value recognized in earnings. Warrants that meet the criteria for equity classification are recorded in additional paid-in capital and are not subsequently remeasured. For an overview of the Company’s derivative financial instruments and related disclosures required by ASC 815, see Note 17, Derivative Financial Instruments and Hedging Activities. Refer to Note 8, Options, Restricted Stock Units and Warrants, for warrant terms, activity, and classification.

Fair Value Measurements

We apply fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. We define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. Fair value is estimated by applying the following three-level hierarchy, which prioritizes the inputs used to measure fair value based on the lowest level of input that is available and significant to the fair value measurement:

Level 1- Quoted prices in active markets for identical assets or liabilities.

Level 2- Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3- Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

Derivative Liability

In connection with the acquisition of Streamex Exchange, a Canadian subsidiary of the Company, issued exchangeable shares (the “Exchangeable Shares”) that are exchangeable, on a one for one basis (subject to adjustment), into shares of the Company’s common stock. The Exchangeable Shares provide the holders with economic rights that are substantially similar to the Company’s common stock, including dividend and liquidation rights, and voting rights through a special voting preferred share held by a trustee.

The Company evaluated the Exchangeable Shares under ASC 815, Derivatives and Hedging, including the guidance in ASC 815 40 on contracts indexed to, and potentially settled in, an entity’s own equity. At issuance and through November 4, 2025, the Exchangeable Shares were not eligible for equity classification because the Company’s obligation to deliver shares upon exchange was subject to an exercise contingency related to the NASDAQ 19.99% limitation (as defined below) and related stockholder approval requirements. Specifically, prior to stockholder approval, the number of shares that could be issued upon exchange was limited, and the exchange ratio was subject to adjustment (including a potential increase from 1.00 to 1.25 shares) if stockholder approval was not obtained within a specified period. As a result, the Exchangeable Shares did not qualify for the scope exception in ASC 815-10-15-74 and were classified as a derivative liability.

The derivative liability was initially recognized at fair value on the acquisition date and was subsequently remeasured at fair value through earnings at each reporting date until the exercise contingency was resolved. The fair value measurement prior to stockholder approval utilized valuation techniques with significant unobservable inputs and was therefore classified within Level 3 of the fair value hierarchy.

On November 4, 2025, the Company obtained stockholder approval, which removed the conversion cap and allowed holders to exchange the Exchangeable Shares into the Company’s common stock in accordance with the exchange rights. Upon satisfaction of the stockholder approval condition and removal of the NASDAQ 19.99% limitation, the Exchangeable Shares no longer contained an exercise contingency that precluded equity classification. Accordingly, on November 4, 2025, the Company reclassified the derivative liability associated with the Exchangeable Shares to permanent equity. After reclassification, the Exchangeable Shares are no longer remeasured at fair value through earnings.

Refer to Note 7, Stockholder Equity, for related equity and special voting preferred stock information of the Exchangeable Shares. For additional information regarding the Exchangeable Shares including the acquisition structure and terms, see Note 11, Business Acquisition. For an overview of the Company’s derivative financial instruments and related disclosures required by ASC 815, see Note 17, Derivative Financial Instruments and Hedging Activities. Refer to Note 12, Fair Value Measurements, for additional information regarding the fair value measurement related to the Exchangeable Shares.

Convertible Debentures

The Company accounts for its secured convertible debentures (the “Convertible Debentures”) as debt instruments and records them at amortized cost, net of original issue discount (“OID”), debt issuance costs, and any debt discount resulting from the bifurcation of embedded derivatives.

The Company allocates the proceeds received between (i) the host debt component and (ii) any embedded derivative features that require bifurcation (see “Embedded Derivative Liability” below). The host debt is initially recorded at its allocated amount, with the difference between the principal amount and the initial carrying amount recorded as debt discount including OID, issuance costs, and the bifurcation discount and amortized to interest expense using the effective interest method over the estimated life of the debenture.

The Company accounts for conversions of the Convertible Debentures in accordance with the applicable debt conversion guidance, recognizing the issuance of equity for the carrying amount of the debt extinguished (including any related unamortized discounts and issuance costs associated with the extinguished portion) and derecognizing any related embedded derivative liability associated with the converted portion at its fair value on the conversion date.

The Company accounts for repayments and extinguishments of the Convertible Debentures in accordance with the debt extinguishment guidance. Upon extinguishment, the Company derecognizes the carrying amount of the debt, derecognizes any related embedded derivative liability, records any cash paid including any prepayment premium, and recognizes the resulting gain or loss in earnings.

Embedded Derivative Liability — Bifurcated Conversion Option

The Convertible Debentures contain an embedded conversion option that provides the holder with the right to convert principal and accrued interest into a variable number of the Company’s common shares based on a conversion price that is the lower of (i) a fixed price (subject to a one-time downward reset after registration effectiveness) and (ii) 97% of the lowest daily VWAP over a defined look-back period, subject to a floor price.

The Company evaluates embedded features in its debt instruments under ASC 815 to determine whether such features are required to be bifurcated from the host contract and accounted for as derivatives. The conversion option meets the definition of a derivative and is not clearly and closely related to the host debt because the economic exposure of the conversion feature is primarily linked to the Company’s equity price rather than interest rate risk inherent in a conventional debt host.

In addition, the conversion option does not qualify for the scope exception for certain contracts indexed to, and potentially settled in, an entity’s own equity because the conversion terms are not “fixed-for-fixed” (i.e., the conversion price is variable and may be adjusted based on future VWAP, subject to a floor and other reset provisions). Accordingly, the Company bifurcates the conversion option and records it as an embedded derivative liability measured at fair value, with changes in fair value recognized in earnings each reporting period.

At initial recognition, the embedded derivative liability is recorded at fair value, with an offsetting debt discount recorded as a reduction of the carrying amount of the host debt. This debt discount is amortized to interest expense using the effective interest method over the estimated term of the debenture. For an overview of the Company’s derivative financial instruments and related disclosures required by ASC 815, see Note 17, Derivative Financial Instruments and Hedging Activities. Refer to Note 12, Fair Value Measurements, for additional information regarding the fair value measurement related to the embedded derivative liability. For the terms of the Convertible Debentures and related accounting, see Note 15, Convertible Debentures.

Stock Based Compensation

The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award as measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. The Company recognizes forfeitures on stock based compensation as they occur.

Research and Development Costs

The Company accounts for research and development costs in accordance with the Accounting Standards Codification subtopic 730-10, Research and Development (“ASC 730-10”). Under ASC 730-10, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and developments costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company incurred research and development expenses of $31 and $0.8 million for the year ended December 31, 2025, and 2024, respectively.

Deferred Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, as well as operating loss, capital loss and tax credit carryforwards. Deferred tax assets and liabilities are classified as non-current. Valuation allowances are established against deferred tax assets if it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or laws is recognized in operations in the period that includes the date of the enactment.

The Company is subject to income taxes in the United States and Canada, and deferred tax assets and liabilities are recorded for temporary differences and carryforwards in the jurisdictions in which they arise, using enacted tax rates applicable in those jurisdictions.

The provision for, or benefit from, income taxes includes deferred taxes resulting from the temporary differences in income for financial and tax purposes using the liability method. Such temporary differences result primarily from the differences in the carrying value of assets and liabilities. Future realization of deferred income tax assets requires sufficient taxable income within the carryback, carryforward period available under tax law. Management evaluates, on a quarterly basis whether, based on all available evidence, it is probable that the deferred income tax assets are realizable. Valuation allowances are established when it is more likely than not that the tax benefit of the deferred tax asset will not be realized. The evaluation, as prescribed by ASC 740-10, includes the consideration of all available evidence, both positive and negative, regarding historical operating results including recent years with reported losses, the estimated timing of future reversals of existing taxable temporary differences, estimated future taxable income exclusive of reversing temporary differences and carryforwards, and potential tax planning strategies which may be employed to prevent an operating loss or tax credit carryforward from expiring unused.

Income Tax Uncertainties

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain tax positions based on the two-step process prescribed by applicable accounting principles. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires the Company to estimate and measure the tax benefit as the largest amount that is more likely than not being realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as this requires the Company to determine the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision in the period. The Company recognizes interest and penalties as incurred in Other income (expense), net in the consolidated statements of operations.

As of December 31, 2025 and 2024, no liabilities were accrued on the consolidated balance sheets related to uncertain tax positions.

During the years ending December 31, 2025 and 2024, the Company had no changes in unrecognized tax benefits or associated interest and penalties as a result of tax positions made during the current or prior periods with respect to its continuing operations.

The Company files income tax returns in the United States federal jurisdiction, various state jurisdictions, and Canada. The Company is no longer subject to U.S. federal income tax examinations for tax years ended on or before December 31, 2021. State income tax returns are generally subject to examination for periods ranging from three to five years, depending on the jurisdiction. Canadian income tax returns are generally subject to examination for three years following the date of assessment. As of December 31, 2025, the Company is not currently under examination by any U.S. federal, state, or foreign tax authorities.

Foreign Currency Translations and Transactions

The Company translates the financial statements of foreign subsidiaries whose functional currency is the local currency into U.S. dollars in accordance with ASC 830, Foreign Currency Matters. The Company’s functional currency is the U.S. dollar. Assets and liabilities are translated at exchange rates in effect at the balance sheet date, while revenues and expenses are translated at average exchange rates for the reporting period.

Translation adjustments resulting from the conversion of foreign currency financial statements are recorded in “Accumulated Other Comprehensive Income”, a separate component of stockholders’ equity (deficit).

Foreign currency transactions denominated in a currency other than the functional currency are remeasured at the exchange rate in effect on the transaction date. Monetary assets and liabilities are remeasured at period-end exchange rates, and resulting gains or losses are recognized in “Other income (expense), net” in the Consolidated Statements of Operations.

The majority of the Company’s transactions are settled in U.S. dollars. The Company does not currently engage in foreign currency hedging activities.

Concentration of Assets

As of December 31, 2025, the Company’s consolidated assets totaled approximately $187.5 million, of which approximately 38.18% ($71.6 million) were located in the United States and 61.82% ($115.9 million) were located in Canada. The Canadian assets are held through ExchangeCo, a wholly owned subsidiary of the Company, and relate to the Company’s Streamex Exchange business. These assets consist primarily of goodwill and intangible assets ($115.4 million), cash ($343 thousand), sales tax receivable ($51 thousand), amounts due from a related party ($11 thousand), and prepaid expenses and other assets ($165 thousand).

The Company evaluates geographic concentrations in accordance with ASC 275, Risks and Uncertainties, and considers potential exposure to economic, regulatory, and currency-related risks. While the Canadian-based assets represent a significant portion of consolidated assets, they are not currently subject to material operational, legal, or foreign exchange restrictions. Management believes that the Company is not exposed to heightened risk from geographic concentration, given the nature of the assets, the stability of the Canadian jurisdiction, and the strategic alignment of the Streamex Exchange business with the Company’s broader operations.

Comprehensive Loss

Comprehensive loss is comprised of the Company’s consolidated net loss and other comprehensive income (loss). The component of other comprehensive income (loss) consists solely of foreign currency translation adjustments, net of income tax effects.

Net Income (loss) Per Common Share

The Company computes earnings (loss) per share in accordance with Accounting Standards Codification subtopic 260, Earnings Per Share (“ASC 260”). Basic earnings (loss) per common share is computed by dividing net income (loss) attributable to the Company’s common stockholders by the weighted-average number of shares of common stock outstanding during the period, including exchangeable shares that are economically equivalent to the Company’s common stock.

The Company has outstanding exchangeable shares issued by a consolidated subsidiary that are economically equivalent to the Company’s common stock in all material respects, including rights to dividends and participation in earnings, and are exchangeable on a one-for-one basis into shares of the Company’s common stock at the option of the holders. The exchangeable shares are classified within stockholders’ equity and are included in the weighted-average shares outstanding used in the calculation of basic earnings (loss) per common share because these shares participate equally with the Company’s common stock in undistributed net income (loss).

Diluted earnings per common share is computed by giving effect to all potentially dilutive securities and other contracts to issue common stock using the treasury stock method and the if-converted method, as applicable, in accordance with ASC 260. Potentially dilutive securities may include stock options, warrants, restricted stock units, and other equity awards (treasury stock method), as well as the Company’s convertible preferred stock and convertible debt, including the secured convertible debentures (if-converted method). Under the if-converted method, convertible instruments are assumed to have been converted at the beginning of the period (or at issuance, if later), and related preferred dividends and/or interest expense (net of tax), as applicable, are adjusted in the determination of net income available to common stockholders.

In periods in which the Company reports a net loss, basic and diluted loss per share are the same, as the inclusion of stock options, warrants, restricted stock units, convertible preferred stock, convertible debt and other potentially dilutive securities would be antidilutive. Accordingly, such securities are excluded from the computation of diluted loss per share.

Potentially dilutive securities excluded from the computation of basic and diluted net income (loss) per share are as follows:

 SCHEDULE OF ANTI-DILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE

Recently adopted accounting pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation, as well as information related to income taxes paid to enhance the transparency and decision usefulness of income tax disclosures. The Company adopted ASU 2023-09 for the current year and has elected to apply the standard on a prospective basis.

Recently issued accounting pronouncements not yet adopted

In November 2024, the FASB issued ASU 2024-03, “Disaggregation of Income Statement Expenses” (“ASU 2024-03”). ASU 2024-03 requires disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement and disclosures about selling expenses. ASU 2024-03 will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating ASU 2024-03 and does not expect it to have a material effect on the Company’s consolidated financial statements.

In May 2025, the FASB issued ASU No. 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity (“VIE”), which provides clarifying guidance on determining the accounting acquirer in certain transactions involving VIEs. The update aims to improve consistency and comparability in financial reporting. The guidance will be effective for annual periods beginning after December 15, 2026, including interim periods within those annual periods. Early adoption is permitted. Upon adoption, the guidance will be applied prospectively. The Company is currently evaluating the provisions of the amendments and the impact on its future financial statements.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This standard provides all entities with a practical expedient to assume that current conditions as of the balance sheet date do not change for the remaining life of the current accounts receivable and current contract assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025 and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-05.

In September 2025, the FASB issued ASU 2025-06, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to modernize the accounting guidance for internal-use software costs. The standard removes all references to software development project stages and instead requires capitalization when (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027 and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2025-06.