NOTE 13 — FAIR VALUE MEASUREMENTS

The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring

the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

The following table presents information about the Company’s liabilities that are measured at fair value as of March 31, 2026 and December 31, 2025 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

Forward Purchase Agreement

The Company used a Monte Carlo analysis to determine the fair value of the FPA, assuming 191,007 FPA Shares.

The fair value measurement of the FPA at March 31, 2026 and December 31, 2025 was calculated using the following range of weighted average assumptions:

The model measured the total present value of the Company’s proceeds at approximately $4,182 and the total present value of the Company’s liability at approximately $1,218,251, resulting in a net liability of approximately $1,214,100 as of March 31, 2026. This resulted in a non-cash gain from the change in fair value of derivatives of approximately $174,600 for the three months ended March 31, 2026.

Warrants — Series A and B

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Series A Warrants at March 31, 2026, which included the following assumptions:

The fair value of the Series A and Series B Warrants as of March 31, 2026, was $2,997,150 and $0, respectively. The $0 fair value for the Series B Warrants reflects that all Series B Warrants had been exercised by this date. This resulted in a non-cash gain from the change in fair value of derivatives of $386,750 for the three months ended March 31, 2026, respectively. As of March 31, 2026, investors had exercised 591,145 Series A Warrants and 114,992 Series B Warrants, resulting in the issuance of 670,137 common shares. As of March 31, 2026, 508,857 Series A Warrants and no Series B Warrants remained outstanding.

Warrants — Series C and D

The Company’s Series C Warrants and Series D Warrants were classified as derivative liabilities and carried at fair value through the date of exercise. As of December 31, 2025, all Series C and Series D Warrants had been exercised and no warrants remained outstanding. Accordingly, no fair value measurement was required for these instruments as of March 31, 2026, and no gain or loss from change in fair value was recognized for the three months ended March 31, 2026.

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended March 31, 2026.

Stock-based compensation — Awards with Market-Based Conditions

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the awards with market-based conditions at the date of the Merger, which included the following assumptions: stock price of $226.50, risk free rate of 3.9%, volatility of 72.5%, dividends yield of 0% and duration of 6 years.

NOTE 13 — FAIR VALUE MEASUREMENTS

The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

The following table presents information about the Company’s liabilities that are measured at fair value as of December 31, 2025 and 2024 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. The Company did not have derivative liabilities as of December 31, 2023.

Forward Purchase Agreement

The Company used a Monte Carlo analysis to determine the fair value of the FPA, assuming 191,007 FPA Shares.

The fair value measurement of the FPA at December 31, 2025 and 2024 was calculated using the following range of weighted average assumptions:

The model measured the total present value of the Company’s proceeds at approximately $7,227 and the total present value of the Company’s liability at approximately $1,395,938, resulting in a net liability of approximately $1,388,700 as of December 31, 2025. This resulted in a non-cash gain from the change in fair value of derivatives of $5,015,400 for the year ended December 31, 2025.

The model measured the total present value of the Company’s proceeds at approximately $259,254 and the total present value of the Company’s liability at approximately $6,663,316, resulting in a net liability of approximately $6,404,100 as of December 31, 2024. This resulted in a non-cash gain from the change in fair value of derivatives of $14,485,850 for the year ended December 31, 2024.

Warrants — Series A and B

Certain prior-period amounts presented in this section related to the Change in fair value of derivative liabilities have been restated to reflect the correction of an error related to the accounting for the Series A and Series B warrant exercises. See Note 2 — Restatement and Correction of Errors in Previously Reported Consolidated Financial Statements for additional information.

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Series A Warrants and Series B Warrants at the date of issuance on March 15, 2024, which included the following assumptions:

The total fair value of the Series A Warrants and Series B Warrants measured at issuance was $12,656,550 and $82,450, respectively.

The Company utilized a Black-Scholes model to determine the fair value of the Series A Warrants at December 31, 2025, which included the following assumptions:

The fair value of the Series A and Series B Warrants as of December 31, 2025, was $3,383,900 and $0, respectively. The $0 fair value for the Series B Warrants reflects that all Series B Warrants had been exercised by this date. The Company recorded non-cash loss from changes in the fair value of derivative liabilities related to the Series A and Series B Warrants of $2,232,886 and $0 for the year ended December 31, 2025, respectively. As of December 31, 2025, investors had exercised 591,145 Series A Warrants and 114,992 Series B Warrants, resulting in the issuance of 670,137 common shares. As of December 31, 2025, 508,857 Series A Warrants and no Series B Warrants remained outstanding.

The Company utilized a Black-Scholes model to determine the fair value of the Series A Warrants at December 31, 2024, which included the following assumptions:

The fair value of the Series A and Series B Warrants as of December 31, 2024, was $4,955,300 and $0, respectively. The $0 fair value for the Series B Warrants reflects that all Series B Warrants had been exercised by this date. This resulted in a non-cash gain from the change in fair value of derivatives of $2,047,817 and a loss from the issuance of warrants of $17,820,998 for the year ended December 31, 2024, respectively. As of December 31, 2024, investors received 274,858 and 114,992 common shares from exercise of Series A and Series B warrants, respectively. As of December 31, 2024, 167,976 Series A Warrants and no Series B Warrants remained outstanding.

Warrants — Series C and D

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Series C Warrants and Series D Warrants at the date of issuance on August 30, 2024, which included the following assumptions:

The total fair value of the Series C Warrants and Series D Warrants measured at issuance was $8,114,650 and $1,540,150, respectively.

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Series C Warrants and Series D Warrants at December 31, 2024, which included the following assumptions:

The fair value of the Series C and Series D Warrants as of December 31, 2025, was $0. The $0 fair value for the Series C and D Warrants reflects that all Series C and D Warrants had been exercised by this date. The Company recorded non-cash loss from changes in the fair value of derivative liabilities related to the Series C and Series D Warrants of $31,033,241 for the year ended December 31, 2025. As of December 31, 2025, investors had exercised 3,688,357 Series C Warrants and Series D Warrants, resulting in the issuance of 3,447,957 common shares and pending issuance of 240,400 common shares. As of December 31, 2025, no Series C Warrants and Series D Warrants remained outstanding.

The fair value of the Series C Warrants and Series D Warrants as of December 31, 2024, was $13,703,250 and $210,000, respectively. This resulted in a non-cash loss from the change in fair value of derivatives and issuance of warrants of $4,258,450 and $9,654,799 for the year ended December 31, 2024, respectively. As of December 31, 2024, investors have not exercised any Series C and Series D warrants.

The table below provides a summary of the changes in fair value, including net transfers in and/or out, of all financial assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the year ended December 31, 2025 and 2024.

HBC earnout shares

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Earnout Shares at the date of the Merger, which included the following assumptions: stock price of $226.50, risk free rate of 3.98%, volatility of 85%, dividends yield of 0% and duration of 4 years.

Stock-based compensation — Awards with Market-Based Conditions

The Company utilized a Monte Carlo simulation analysis to determine the fair value of the awards with market-based conditions at the date of the Merger, which included the following assumptions: stock price of $226.50, risk free rate of 3.9%, volatility of 72.5%, dividends yield of 0% and duration of 6 years.