20. Equity

Stock Option and Stock Issuance Plan

2021 Plan

The Company’s board of directors and shareholders approved and adopted on October 7, 2021 the 2021 Equity Incentive Plan (“2021 Plan”) under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing. Under the 2021 Plan, the Company reserved 750 shares of common stock for issuance. As of June 30, 2026, 324 shares have been issued and 268 options to purchase shares have been awarded under the 2021 Plan.

2023 Plan

The Company’s board of directors and shareholders approved and adopted on February 28, 2023 the 2023 Equity Incentive Plan (“2023 Plan”) under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing. Under the 2023 Plan, the Company reserved 1,250 shares of common stock for issuance. As of June 30, 2026, 1,208 shares have been issued and 34 options to purchase shares have been awarded under the 2023 Plan.

2024 Plan

The Company’s board of directors and shareholders approved and adopted on October 27, 2023 the 2024 Equity Incentive Plan (“2024 Plan”) under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing. Under the 2024 Plan, the Company reserved 3,750 shares of common stock for issuance. As of June 30, 2026, 3,741 shares have been issued under the 2024 Plan and no options to purchase shares have been awarded under the 2024 Plan.

2025 Plan

On November 19, 2025, the Company’s board of directors approved the 2025 Equity Incentive Plan (the “2025 Plan”), subject to shareholder approval, which was subsequently obtained. The 2025 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards and other equity-based awards to officers, directors, employees, consultants and advisors of the Company. Upon approval of the 2025 Plan, the Company reserved 350,000 shares of common stock for issuance under the plan. The 2025 Plan supplements the Company’s prior equity incentive plans; however, following adoption of the 2025 Plan, no additional awards will be granted under the Company’s existing equity incentive plans, although previously granted awards will remain outstanding in accordance with their terms. As of June 30, 2026, no shares had been issued and no options had been granted under the 2025 Plan.

Common Stock Issuances

On February 6, 2026, the Company entered into a Securities Purchase Agreement (the “SPA”) with certain accredited investors (the “Purchasers”), pursuant to which the Company agreed to issue and sell, and the Purchasers agreed to purchase, 8% Unsecured Original Issue Discount Debentures (the “Debentures”) in the aggregate principal amount of up to $1,086,956 (with a funded amount of $1,000,000 after giving effect to an 8% original issue discount). The Debentures were issued in a private placement exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and Rule 506(b) of Regulation D promulgated thereunder. The financing closed on February 9, 2026. The Debentures mature on the earlier of (i) May 30, 2026, (ii) four months from the original issue date (May 30, 2026), or (iii) the closing of any debt or equity financing by the Company resulting in gross proceeds of at least $5,000,000. The Debentures do not bear regular interest but are issued at an 8% original issue discount. The Company has the option to prepay the Debentures at any time at the principal amount. As additional consideration, the Company issued an aggregate of 300,000 shares of the Company’s Common Stock to the Purchasers on a pro rata basis (the “Incentive Shares”). The SPA contains customary representations, warranties, covenants, and closing conditions. The Debentures contain negative covenants restricting the Company from incurring additional indebtedness (subject to permitted exceptions), creating liens, amending charter documents in a materially adverse manner, repurchasing equity or other indebtedness (with limited exceptions), paying dividends, or entering into affiliate transactions without Required Holders’ (holders of at least 50% plus $1.00 of the principal amount) consent. Events of default include non-payment, breaches of covenants, bankruptcy events, cross-defaults on material indebtedness, and other customary events. On January 29, 2026, the Company entered into an Engagement Agreement for Advisory Services (the “Engagement Agreement”) with RBW Capital Partners LLC and Dawson James Securities, Inc. (collectively, the “Financial Advisor”), pursuant to which the Financial Advisor provided advisory services in connection with the private debt transaction. The Company paid a one-time advisory fee of $10,000 at closing. The Engagement Agreement includes provisions for an exclusive placement agent engagement for four months post-closing, indemnification, and other standard terms.

Between April 30, 2026 and May 5, 2026, certain holders of the Company’s convertible notes elected to convert an aggregate of approximately $3.6 million of outstanding notes payable into shares of common stock, and the Company issued an aggregate of 11,559,964 shares, consisting of 309,734 shares at a conversion price of $0.9458 per share, 2,182,908 shares at $0.4559 per share and 9,067,322 shares at $0.2511 per share. Please see Note 14 – Notes payable for further details.

Preferred Stock

The Company is authorized to issue 10,000,000 shares of preferred stock, par value $0.0001 per share. As of December 31, 2025, no preferred stock was issued and outstanding. The preferred stock is “blank check” preferred stock, the terms of which may be established by the Board of Directors from time to time.

On February 11, 2026, the Company designated 10,000 shares of its authorized preferred stock as Series A Preferred Stock and issued all 10,000 shares of such Series to an investor for aggregate proceeds of $145,244. The Company received $145,000 of such proceeds in May 2026 and a receivable for the $244 differences remained outstanding as of June 30, 2026. The Series A Preferred Stock is non-convertible into common stock and initially had a stated value of approximately $14.52 per share. Each share was entitled to voting rights on an as-converted basis, initially equal to approximately 14.5 votes per share, subject to adjustment. The Series A Preferred Stock ranks pari passu with the Company’s common stock with respect to dividends and liquidation rights and is redeemable at the Company’s option at the stated value per share, plus any declared and unpaid dividends. On March 2, 2026, the Company amended the terms of the Series A Preferred Stock to reduce the stated value to approximately $5.16 per share and the voting rights to approximately 5.16 votes per share.

On June 2, 2026, the Company designated 1,000 shares of its authorized preferred stock as Series B Convertible Preferred Stock and issued all 1,000 shares of such Series to the seller in connection with the acquisition of Anira Consulting FZC. The Series B Preferred Stock was issued with an aggregate stated value of approximately $6.6 million, or $6,595 per share. The Series B Preferred Stock was initially convertible into shares of the Company’s common stock at a fixed conversion price of $3.00 per share, subject to certain ownership limitations and applicable Nasdaq shareholder approval requirements. Pursuant to the amendment to the Anira Share Purchase Agreement entered into on June 8, 2026, the Series B Preferred Stock was made non-convertible and non-voting, and the related $5,000,000 convertible promissory note was replaced with a non-convertible promissory note of the same principal amount, which was subsequently amended and restated in the principal amount of $4.5 million pursuant to Amendment No. 2 to the Share Purchase Agreement. See Note 22 – Subsequent Events. The Series B Preferred Stock ranks pari passu with the Company’s common stock with respect to economic and liquidation rights on an as-converted basis. The Series B Preferred Stock does not carry a dividend rate and is subject to the rights, preferences, and limitations set forth in the Certificate of Designation.

On June 10, 2026, the Company’s Board of Directors adopted, and the Company filed with the Secretary of State of the State of Nevada, a Certificate of Designation designating a series of its authorized preferred stock as Series C Preferred Stock. The Series C Preferred Stock was created in connection with Amendment No. 1 to the Written Option Agreement described in Note 8, Purchase Option - Membership Interest, which replaced all references in the Option Agreement to preferred shares convertible into common stock with shares of Series C Preferred Stock. The Series C Preferred Stock is expressly non-convertible into common stock under any circumstances, ranks pari passu with the Company’s common stock in all economic and liquidation respects on an as-stated-value basis, carries no coupon, dividend or interest, and carries no voting rights except as required by applicable law. No shares of Series C Preferred Stock were issued or outstanding as of June 30, 2026. Under the amended Option Agreement, the exercise price and a post-closing monthly management fee are payable in shares of Series C Preferred Stock, subject to the Company’s right, exercisable in its sole discretion and subject to Board approval and compliance with its debt covenants, to satisfy any such obligation in cash in an amount equal to the stated value of the shares otherwise issuable, with no premium or discount.

Restricted Share Awards

As of June 30, 2026, there were 974 restricted share awards outstanding awarded to employees, consultants and the board of directors.

A summary of the activity related to the restricted share awards, is presented below:

See Note 19 – Commitments and contingencies for further details on Restricted Share Awards.

Warrant and Option Valuation

The Company has computed the fair value of warrants and options granted using the Black-Scholes option pricing model. The expected term for warrants and options issued to non-employees is the contractual life. The Company is utilizing an expected volatility figure based on a review of the historical volatilities, over a period of time, equivalent to the expected term of the instrument being valued, of similarly positioned public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.

Options

During the three and six months ended June 30, 2026, there were 0 and 27 shares forfeited upon resignation or termination of executives and board members, respectively.

A summary of option activity is presented below:

A summary of warrants activity during the three and six months ended June 30, 2026 and 2025 is presented below:

Pre-Funded Warrants

On September 23, 2025, the Company completed a registered direct offering of (i) 44,370 shares of common stock and (ii) 37,063 pre-funded warrants, at purchase prices of $6.14 per share and $6.1399 per pre-funded warrant (equal to the share price less the $0.0001 per-share exercise price), for gross proceeds of approximately $500,000 before placement agent fees and offering expenses. Each Pre-Funded Warrant is exercisable for one share of common stock at an exercise price of $0.0001 per share and is exercisable immediately, subject to any beneficial ownership limitations set forth in the warrant.

The Company classified the Pre-Funded Warrants in shareholders’ equity. As of December 31, 2025, 37,063 Pre-Funded Warrants were exercised.

Stock-Based Compensation Expense

Stock-based compensation related to restricted stock issued to employees, directors and consultants amounted to $(265.6) thousand and $93.7 thousand for the three and six months ended June 30, 2026, respectively, of which $(106.5) thousand and $74.7 thousand were executive compensation, $(1.0) thousand and $2.0 thousand were given to the board of directors, $(158.1) thousand and $17.0 thousand were given to consultants for services rendered and $0.0 million and $0.0 million were stock-based consulting expenses paid to related party, respectively.

Stock-based compensation related to restricted stock issued to employees, directors and consultants, warrants and warrants to consultants amounted to $0.4 million and $1.8 million for the three and six months ended June 30, 2025, respectively, of which $0.1 million and $0.3 million were executive compensation, $0.1 million and $0.2 million were given to the board of directors, $0.2 million and $0.4 million were given to consultants for services rendered.