Use of Estimates

The preparation of the accompanying unaudited condensed financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the accompanying condensed financial statements and related disclosures. Significant estimates include, but are not limited to, the valuation of stock-based compensation awards, the assessment of deferred tax assets and related valuation allowances, lease-related assumptions, including the determination of the incremental borrowing rate used in measuring lease liabilities and right-of-use assets, and other estimates and assumptions used in the preparation of the accompanying condensed financial statements.

Management bases its estimates on historical experience and on various other factors believed to be reasonable under the circumstances. Actual results could differ materially from those estimates. Management reviews its estimates on an ongoing basis, and revisions are recognized in the period in which the facts and circumstances giving rise to the revisions become known.

Fair Value Measurements

The Company follows the provisions of ASC 820, Fair Value Measurement, which establishes a framework for measuring fair value and expands disclosures about fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

ASC 820 establishes a three-level hierarchy for inputs used in measuring fair value:

The carrying amounts of cash and cash equivalents, interest receivable, accounts payable, accrued expenses and other current liabilities approximate fair value because of the short-term nature of these instruments.

At June 30, 2026, the Company held approximately $2.0 million of certificates of deposit with original maturities greater than 90 days and less than a year, which are presented as investments in the accompanying condensed balance sheet and are carried at amortized cost, which approximates fair value due to short-term nature. Interest receivable on these investments is presented separately in the accompanying condensed balance sheet. The estimated fair value would be categorized within Level 2 of the fair value hierarchy.

There were no transfers between Level 1, Level 2 or Level 3 during the six months ended June 30, 2026 or 2025.

Net Loss per Common Share

The Company computes earnings per share (“EPS”) in accordance with ASC 260-10 issued by the Financial Accounting Standards Board.

Basic net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period.

Diluted net loss per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. Because the Company reported a net loss for each period presented, all potentially dilutive securities were anti-dilutive and, accordingly, diluted net loss per common share equals basic net loss per common share.

The following tables reconcile net loss to net loss attributable to common stockholders:

Subsequent to the filing of the Company's financial statements for the three and six months ended June 30, 2025, management identified an error in the calculation of net loss attributable to common stockholders used in determining basic and diluted loss per share. The error resulted from the omission of undeclared dividends on the Series B Convertible Preferred Stock of $498,670 and $991,860 for the three and six months ended June 30, 2025, respectively. The amounts presented in the table above have been revised to reflect the correct net loss attributable to common stockholders for those periods.

In addition, the Company did not appropriately reflect the impact of the 1-for-5.92 reverse stock split that became effective on September 29, 2025. In accordance with ASC 260, all share and per-share amounts for periods presented should have been retrospectively adjusted to reflect the reverse stock split. As a result, weighted-average common shares outstanding were previously reported as 41,104,826 for the three and six months ended June 30, 2025, but should have been reported as 6,943,383. Accordingly, basic and diluted loss per share was previously reported as $0.03 and $0.05 for the three and six months ended June 30, 2025, respectively, but should have been reported as $0.17 and $0.32.

The following potential dilutive securities were excluded from the computation of diluted net loss per common share because their effect would have been anti-dilutive:

The Company has outstanding Series C convertible preferred shares that are convertible into common stock at a conversion rate determined by the market price of the Company's common stock on the conversion date as described under the terms of the agreement. Because the conversion rate is variable, the number of shares issuable upon conversion cannot be determined until the conversion date. These securities were excluded from the table above and the computation of diluted net loss per share for the period presented because their inclusion would have been anti-dilutive.

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. ASU 2024-03 requires public business entities to provide additional disclosures about certain expense captions presented on the face of the income statement, including disaggregation of specified natural expense categories in interim and annual reporting periods. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the effect that adoption of ASU 2024-03 will have on its financial statement disclosures.

In April 2026, the FASB issued ASU 2026-01, Equity (Topic 505): Initial Measurement of Paid-in-Kind Dividends on Equity-Classified Preferred Stock. The amendments establish guidance for the initial measurement of paid-in-kind dividends on equity-classified preferred stock. The amendments are effective for annual reporting periods beginning after December 15, 2026, including interim periods within those annual reporting periods, with early adoption permitted. The Company is currently evaluating the impact that adoption of this guidance will have on its financial statements and related disclosures.