WARRANT LIABILITY |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| WARRANT LIABILITY | NOTE 12 – WARRANT LIABILITY
The Company analyzed the warrants issued in connection with the Series C Convertible Preferred Stock (see Note 6) for derivative accounting consideration under ASC 815, “Derivatives and Hedging,” and determined that the instruments should be classified as liabilities due to reset provisions and exercise price variability. These features result in there being no fixed value or explicit limit to the number of shares to be delivered upon exercise.
ASC 815 requires the Company to assess the fair value of derivative liabilities at the end of each reporting period and recognize any change in fair value within current period earnings as other income or expense.
The Company determined its warrant liabilities to be Level 3 fair value measurements based on the use of significant unobservable inputs. Management used the Black-Scholes pricing model to calculate the fair value at each reporting date. The Black-Scholes model requires six basic inputs: the exercise price, time to expiration, risk-free interest rate, current stock price, estimated future stock price volatility, and expected dividend yield. Changes to these inputs could produce a significantly higher or lower fair value measurement.
The following table summarizes the changes in the warrant liabilities during the six months ended June 30, 2026:
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