Note 9. Warrants

Warrants Issued with June 2025 Private Placement

On June 12, 2025, in connection with the sale and issuance of common stock as part of the June 2025 Private Placement, the Company issued Pre-Funded Warrants to purchase up to an aggregate of 200,000 shares of Common Stock at an exercise price of $0.01 per share, as adjusted for the Reverse Stock Split, and Common Warrants to purchase up to an aggregate of 867,192 shares of Common Stock at an exercise price of $12.00 per share, as adjusted for the Reverse Stock Split. Each Share and each Pre-Funded Warrant sold pursuant to the Securities Purchase Agreement was accompanied by one Common Warrant. The combined purchase price of each Share and accompanying Common Warrant was $13.25 (which included $1.25 per Common Warrant in accordance with the rules and regulations of Nasdaq), as adjusted for the Reverse Stock Split. The combined purchase price of each Pre-Funded Warrant and accompanying Common Warrant was $13.24 (equal to the combined purchase price per Share and accompanying Common Warrant,

minus $0.01).

The Common Warrants can be exercised into either common stock or Pre-Funded Warrants at the holders' option, and both Common Warrants and Pre-Funded Warrants contain purchase rights that could result in holders receiving securities that more than offsets or neutralizes the effect of a distribution event. As a result of the aforementioned provisions, both Common Warrants and Pre-Funded Warrants fail the indexation guidance under ASC 815 and are classified as liabilities. The Pre-Funded Warrants and Common Warrants liabilities were recorded at fair value as of the issuance date and March 31, 2026, and subject to adjustment to estimated fair value at each balance sheet date until the warrants are settled.

The proceeds from June 2025 Private Placement were first allocated to the full fair value of the Pre-Funded Warrants and Common Warrants due to the liability classification. The fair value of the Pre-Funded Warrants and Common Warrants at issuance was $10.7 million. The remaining proceeds of $0.8 million, before issuance costs, were allocated to the Common Stock.

During the three months ended March 31, 2026, the Company recognized a fair value gain of $31.1 million related to the warrants.

On January 29, 2026, all 200,000 shares of the Pre-Funded Warrants were exercised through a cashless exercise into 199,765 shares of the Company's Common Stock, as adjusted for the Reverse Stock Split. All of the Common Warrants issued in connection with the June 2025 Private Placement remained outstanding as of March 31, 2026. The following table is a summary of the Company’s warrants outstanding as of March 31, 2026, as adjusted for the Reverse Stock Split: