Note 10. Subsequent Events

The Company has evaluated events that occurred through May 6, 2026, the date that the financial statements were issued, and determined that there have been no events that have occurred that would require adjustments to its disclosures in the financial statements except for the transactions described below.

Warrant Inducement

On April 1, 2026, the Company consummated a private placement offering (the “Warrant Inducement”), pursuant to which, in exchange for an investor’s exercise for cash of the Company’s warrants (“Existing Warrants”) to purchase 571,430 shares of common stock (the “Existing Warrant Shares”) at the reduced exercise price of $4.50 per share, in accordance with the terms of a warrant inducement letter agreement the Company entered into with an investor, dated March 31, 2026, the Company issued to such investor new unregistered Series B-1 common stock purchase warrants (the “Series B-1 Warrants”) to purchase an aggregate of 571,430 shares of common stock and new unregistered Series B-2 common stock purchase warrants (the “Series B-2 Warrants” and, together with the Series B-1 Warrants, the “New Warrants”) to purchase an aggregate of 571,430 shares of common stock. The New Warrants are immediately exercisable at an exercise price of $4.50 per share. The Series B-1 Warrants and the Series B-2 Warrants are exercisable for a term of five (5) years and eighteen (18) months, respectively, from the date that a resale registration statement registering the resale of the shares of common stock issuable upon exercise of the New Warrants (the “Resale Registration Statement”) is declared effective by the SEC. The Resale Registration Statement was declared effective on April 29, 2026. 

Upon consummation of the Warrant Inducement on April 1, 2026, the Company received aggregate gross proceeds of approximately $2.5 million from the exercise of the Existing Warrants, before deducting placement agent fees and other expenses payable by the Company. As compensation for H.C.W. serving as the Company’s placement agent in connection with the Warrant Inducement, H.C.W. received a cash fee equal to 7.0% of the aggregate gross proceeds received upon exercise of the Existing Warrants and the Company issued warrants to purchase up to 37,143 shares of common stock to designees of H.C.W., which warrants have substantially the same terms as the Series B-1 Warrants, except that they have an exercise price of $5.625 per share, which is equal to 125% of the exercise price of the New Warrants.

Stockholders’ Equity

In this Quarterly Report on Form 10-Q, the Company reported stockholders’ equity of $1,797,115 as of March 31, 2026, which is below the minimum stockholders’ equity requirement of at least $2,500,000 for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(b)(1) (the “Stockholders’ Equity Requirement”). Subject to Nasdaq response, the Company believes that it has regained compliance with the Stockholders’ Equity Requirement as a result of its receipt of net proceeds of $2.3 million from the exercise of the Existing Warrants in connection with the Warrant Inducement consummated on April 1, 2026, as described above in this Note 10.