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| Shareholders' Equity | 6. Shareholders’ Equity
As of June 30, 2026 and December 31, 2025, the Company had a total of 69,450,000 and 41,650,000 shares of Class A common stock issued and outstanding, respectively. As of June 30, 2026 and December 31, 2025, the Company had a total of 196,200,000 and 224,000,000 shares of Class B common stock issued and outstanding, respectively. As of June 30, 2026 and December 31, 2025, the Company had no preferred shares issued and outstanding. During the three months ended June 30, 2026, the Company's largest shareholder elected to convert 27,800,000 Class B shares to Class A shares.
On December 30, 2025, the Company issued the Warrants to the Cooperative. The Warrants meet the requirements of equity classification due to their provisions that do not require cash settlement or variable settlement features. At the time of issuance, the Company utilized a Black-Scholes model to estimate the fair value of the Warrants, which included assumptions such as risk-free interest rate, volatility, and expected term to estimate the fair value of the Warrants. The most sensitive assumption the Company used in determining the fair value of the Warrants is volatility. The Company developed a comparable volatility using publicly available data of peer group companies. The Company notes that an increase or decrease in expected volatility could have a material impact on the fair value of the Warrants, and the Company's actual volatility may differ from the assumption used. The following assumptions were used to fair value the Warrants:
Effective February 7, 2026, the Company completed a 7 for 1 forward stock split of its Class A and Class B common stock. All share amounts in the condensed consolidated financial statements have been adjusted for the forward stock split.
In April 2026, the Company’s largest shareholder gifted 21,200,000 shares to certain employees and consultants resulting in $4,664,000 of non-cash equity compensation expense which is recorded as a component of general and administrative expense on the statements of operations.
The Company has determined these to be equity-based compensation in accordance with ASC 718 (Accounting Standards Codification Topic 718). The Company determined a fair value as of the date of the grant to the employees and contractors. The fair value of grant is estimated on the date of grant using the fair value of the Company’s stock with the following assumptions used for the grants:
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