STOCKHOLDERS’ EQUITY |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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May 31, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY Common Stock On January 15, 2026, the Company’s stockholders approved an amendment to increase the total number of shares of common stock the Company is authorized to issue from 500,000,000 shares to 50,000,000,000 shares. On July 9, 2025, the Company entered into a Controlled Equity Offering Sales Agreement with each of Cantor Fitzgerald & Co. and ThinkEquity LLC, pursuant to which the Company, from time to time, at its option may offer and sell shares of its common stock (the “ATM Offering”). For further information regarding the ATM Offering, refer to “Note 9. Stockholders’ Equity” of the 2025 Annual Report. During the nine months ended May 31, 2026, the Company sold 340,748,312 shares of common stock pursuant to the ATM Offering and received cash proceeds of $11,869,401 net of the issuance cost of $469. During the nine months ended May 31, 2026, the Company paid cash dividends totaling $4,258 ($0.01 per share) to holders of common stock. No dividends were paid in the three months ended May 31, 2026. These dividends were recorded as a reduction to accumulated deficit. Liability Classified Warrants On September 22, 2025, the Company entered into a securities purchase agreement with an institutional investor, pursuant to which it issued (i) 5,217,715 shares of common stock at a price of $70 per share and (ii) warrants to purchase up to 10,435,430 shares of common stock at an exercise price of $87.50 per share. The warrants are immediately exercisable and expire on March 22, 2027. The exercise price and number of shares issuable upon exercise are subject to adjustment for certain corporate events, including stock dividends, splits, and fundamental transactions. The warrants contain standard anti-dilution provisions and may be adjusted in connection with certain fundamental transactions. In the event of a fundamental transaction, the holder may be entitled to receive cash, securities, or other property, consistent with the terms of the warrant agreement. The warrants are classified as liabilities in accordance with ASC 815, as they contain provisions that could require net cash settlement in circumstances not solely within the Company’s control. Upon issuance, the warrant liability was measured at fair value using a Black-Scholes valuation model. The warrant liability is remeasured at fair value at each reporting date, with changes in fair value recognized in earnings. At May 31, 2026, the fair value of the warrant liability was $2,087. The fair value was determined using the Black-Scholes option pricing model, with the following key inputs:
For the three and nine months ended May 31, 2026, the Company recognized a gain of $16,488 and $264,121, respectively related to changes in the fair value of the warrant liability. During the nine months ended May 31, 2026, no liability classified warrants were exercised and all remained outstanding as of May 31, 2026. There were no liability classified warrants held as of August 31, 2025. Series A and B Convertible Preferred Stock The Company is authorized to issue 500,000 shares of Series A Convertible Preferred Stock and 3,000 shares of Series B Convertible Preferred Stock. The Series A Convertible Preferred Stock carries a liquidation preference of $10 per share, plus any declared but unpaid dividends, while the Series B Convertible Preferred Stock carries a liquidation preference of $1,000 per share, plus any declared but unpaid dividends. In the event of liquidation, the Series A Preferred Stock ranks senior to both the Series B Preferred Stock and common stock, while the Series B Preferred Stock ranks senior to the common stock. Both Series A and Series B Preferred Stock are convertible into common stock at the option of the holder. All outstanding shares of Series A and Series B Convertible Preferred Stock were converted into common stock during the year ended August 31, 2025. No preferred shares were outstanding as of May 31, 2026. Preferred Stock On January 15, 2026, the Company’s stockholders approved an amendment to authorize the issuance of 20,000,000 shares of preferred stock. As of May 31, 2026, no shares of preferred stock have been issued. Non-Controlling Interests Non-controlling interests represent Ethereum Tower LLC's 2.0% ownership in MAVAN Holdings. The ownership interest was granted in connection with the Management Services Agreement entered into as part of the Pier Two acquisition. The non-controlling interest is presented as a separate component of stockholders' equity in the accompanying condensed consolidated balance sheets. Net income attributable to the non-controlling interest is allocated based on the ownership percentage and is reflected separately in the condensed consolidated statements of operations and comprehensive loss.
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