NOTE I – WARRANT LIABILITY

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Warrants to purchase a total of 623,834 shares of the Company’s common stock (the “Private Warrants”) expired unexercised during the year ended December 31, 2025.

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The Private Warrants included provisions that affected the settlement amount. Such variables were outside of those used to determine the fair value of a fixed-for-fixed instrument, and as such, the Private Warrants did not meet the criteria for equity treatment under guidance contained in ASC Topic 815 – Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in a Company’s Own Stock. The Company classified the Private Warrants as a liability at their fair value subject to re-measurement at each balance sheet date and adjusted at each reporting period until expired, and any change in fair value was recognized in the Company's condensed consolidated statements of operations. Prior to their expiration, the fair value of the Private Warrants was determined using the Black-Scholes option pricing model.