v3.26.1
Business Combinations
 12 Months Ended
Dec. 31, 2025
Business Combination, Asset Acquisition, Transaction between Entities under Common Control, and Joint Venture Formation [Abstract]  
Business Combinations

Note 4 – Business Combinations

 

NAYA Therapeutics

 

On October 11, 2024 (the “Effective Time”), the Company, a wholly owned subsidiary (“Merger Sub”), and NTI entered into an Amended and Restated Agreement and Plan of Merger (the “A&R Merger Agreement”) and consummated the transactions contemplated thereby (the “NTI Acquisition”). Upon the terms and subject to the conditions set forth in the A&R Merger Agreement, Merger Sub merged with and into NTI, with NTI continuing as the surviving corporation and a wholly owned subsidiary of the Company.

 

At the Effective Time and as a result of the consummation of the NTI Acquisition:

 

● Each share of Class A common stock, par value $0.000001 per share, and Class B common stock, par value $0.000001 per share, of NTI (“NTI common stock”) outstanding immediately prior to the Effective Time, other than certain excluded shares held by NTI as treasury stock or owned by the Company or Merger Sub, automatically converted into the right to receive 82 shares of the Company’s common stock and 30,375 shares of the Company’s newly-designated Series C-1 Convertible Preferred Stock (the “Series C-1 Preferred”). See Note 13 – Stockholders’ Equity for additional information on the Series C-1 Preferred.

 

● Certain outstanding debt obligations of NTI, including a portion of an amended and restated senior secured convertible debenture issued to Five Narrow Lane LP (“FNL”), with a combined principal balance of $8,575,833 converted into the right to receive 465 shares of the Company’s common stock and 8,576 shares of the Company’s newly-designated Series C-2 Convertible Preferred Stock (the “Series C-2 Preferred”). The Company and FNL have agreed that the Company shall issue to FNL a pre-funded common stock purchase warrant (the “NAYA Acquisition Pre-funded Warrants”) to purchase up to 320 shares of the Company’s common stock in lieu of 320 shares of the aforementioned common stock. See Note 13 – Stockholders’ Equity for additional information on the Series C-2 Preferred.

 

● The remaining balance of the amended and restated senior secured convertible debenture issued to FNL in the amount of $3,934,146 was exchanged for a 7.0% senior secured convertible debenture in the principal balance of $3,934,146 due December 11, 2025 (the “Convertible Debenture”). A description of the rights, preferences, and privileges of the Convertible Debenture are set forth below in Note 10 – Notes Payable.

 

The allocation of the purchase price is as follows:

  

      
Consideration given:    
Common Stock  $214,937 
NAYA Acquisition Pre-funded Warrants   300,978 
Series C-1 Preferred   17,691,000 
Series C-2 Preferred   7,457,000 
Convertible Debenture   3,934,146 
Business acquisition cost   29,598,061 
Assets and liabilities acquired:     
Cash   472,008 
Other current assets   40,747 
Tradename   257,000 
In process R&D   14,571,000 
Goodwill   17,656,707 
AP & accrued liabilities   (3,109,039)
Debt   (290,362)
Total assets and liabilities acquired  $29,598,061 

 

 

On June 2, 2025, the Company divested a majority stake in NTI. The Company elected to redeem all outstanding shares of Series C-1 Preferred at a redemption price of 113.8558 shares of Class A Common Stock of NTI for each share of C-1 Preferred being redeemed. Immediately, prior to the redemption, the Company was the holder of 3,227,813 shares of Class A Common Stock of NTI, representing all outstanding common shares of NTI. The Company retained 6,300 shares of Series A Preferred Stock of NTI, which represents 19.9% of the outstanding common stock on an as-if converted basis. In addition, on May 28, 2025, NTI issued a secured convertible promissory note (“NTI Note Receivable”) in the principal amount of $4,803,175 to the Company. The NTI Note Receivable carries an interest rate of 7% per annum and has a maturity date of November 28, 2026. In the event of a Qualified IPO or Qualified Securities transaction, the NTI Note Receivable shall convert into share of NTI Class A Common Stock at a conversion price equal to the closing sale price of the IPO or Qualified Securities, subject to beneficial ownership limitations.

 

The Company recognized a loss of $1,534,517 upon the disposition of the 80.1% ownership of NTI.

  

      
Consideration received:    
Series C-1 Preferred   2,466,810 
NTI Note Receivable   4,803,175 
NTI Series A Preferred   3,879,611 
Business acquisition cost  $11,149,596 
      
Assets and liabilities divested:     
Cash   6,569 
Other current assets   16,700 
Tradename   257,000 
In process R&D   14,571,000 
Goodwill   3,011,638 
AP & accrued liabilities   (4,804,016)
Debt   (374,778)
Net assets  $12,684,113 
      
Loss on disposition  $1,534,517 

 

The Company’s consolidated financial statements for the year ended December 31, 2025, include NTI’s results of operations through June 2, 2025. The Company’s consolidated financial statements reflect the purchase accounting adjustments in accordance with ASC 805 “Business Combinations”, whereby the purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values on the acquisition date as well as deconsolidation adjustments in accordance with ASC 810 “Consolidation”, whereby the loss upon disposition was recognized.

 

The carrying amounts of major classes of assets and liabilities held for disposal are as follows:

  

   December 31, 2024 
ASSETS     
Cash  $121,876 
Prepaid expenses and other current assets   1,437 
Intangible assets, net   14,828,000 
Goodwill   17,656,707 
Total assets held for sale  $32,608,020 
LIABILITIES     
Accounts payable and accrued liabilities  $4,009,743 
Notes payable, net   284,778 
Total liabilities held for sale  $4,294,521 

 

The major classes of line items constituting loss from discontinued operations are as follows:

 

       
   For the Year Ended 
   December 31, 
   2025   2024 
Revenue  $-   $- 
Cost of revenue   -    - 
Selling, general and administrative expenses   1,408,305    1,013,003 
Research and development expenses   393,470    484,780 
Impairment loss   14,645,069    - 
Depreciation and amortization   -    - 
Interest expense   5,718    21,217 
Loss on discontinued operations  $16,452,562   $1,519,000 

 

There were no depreciation, amortization, capital expenditures, or significant operating and investing noncash items related to the discontinued operations.