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WARRANTS | 12 Months Ended
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Dec. 31, 2025
WARRANTS [Abstract] |
WARRANTS | 10.WARRANTS On June 29, 2023, the Company entered into a Securities Purchase Agreement (the “Series A Purchase Agreement”) with certain directors of the Company and certain accredited and institutional investors (collectively, the “Series A Investors”), pursuant to which it agreed to sell to the Series A Investors in a registered direct offering (the “Series A Offering”) (i) an aggregate of 10,000 shares of the Company’s newly-designated Series A Convertible Preferred Stock, with par value $0.0001 per share and a stated value of $1,000 per share (the “Series A Preferred Stock”), initially convertible into up to 6,896,553 shares of the Company’s common stock, at an initial conversion price of $1.45 per share, and (ii) warrants to acquire up to an aggregate of 6,896,553 shares of Common Stock (the “Series A Warrants”). Each Series A Warrant has an exercise price of $1.45, became exercisable after the date that was six months from the date of issuance and will expire 5 years following the date of issuance. The exercise price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price (subject to certain exceptions). The closing of the Offering occurred on July 3, 2023. The aggregate gross proceeds from the Offering were $10,000, of which $7,717 was allocated to the Series A Warrants. The Company expects to use the net proceeds from the Offering for general corporate purposes (see Note 4). On February 24, 2025, the Company entered into a securities purchase agreement (the “PIPE Purchase Agreement”) with certain accredited investors (collectively, the “PIPE Purchasers”) for the issuance and sale in a private placement of an aggregate of 3,216,666 shares (the “Common Shares”) of Common Stock and accompanying warrants (“PIPE Warrants”) to purchase up to 3,216,666 shares of Common Stock, with an exercise price of $1.80 per share. The purchase price for one Common Share and accompanying PIPE Warrant was $1.80. The gross proceeds to the Company were $5,790 before estimated offering expenses payable by the Company, of which $5,178 was allocated to the PIPE Warrants. On June 30, 2025, the Company entered into a warrant amendment (the “Series A Warrant Amendment”) with the Required Holders (as defined in the Series A Purchase Agreement), pursuant to which, the Required Holders agreed to amend the terms of the Series A Warrants to make certain adjustments to the definition of “Black Scholes Value” in each of the Series A Warrants, as described in the Series A Warrant Amendment, such that the underlying price per share as used in such calculation equals the sum of the price per share being offered in cash in the applicable Fundamental Transaction (as defined in the Series A Warrants), if any, plus the value of the non-cash consideration being offered in the applicable Fundamental Transaction, if any. As consideration for entering into the Series A Warrant Amendment, the Company and the Required Holders agreed to amend the term of the Series A Warrants to be six and one-half years from the date of issuance. Additionally, on June 30, 2025, the Company entered into a warrant amendment (the “2025 Warrant Amendment”) with certain of the PIPE Purchasers, pursuant to which, such PIPE Purchasers agreed to amend the terms of their respective PIPE Warrants to make certain adjustments to the definition of “Black Scholes Value,” as described in the 2025 Warrant Amendment, such that the underlying price per share as used in such calculation equals the sum of the price per share being offered in cash in the applicable Fundamental Transaction (as defined in the PIPE Warrants), if any, plus the value of the non-cash consideration being offered in the applicable Fundamental Transaction, if any. As consideration for entering into the 2025 Warrant Amendment, the Company and the applicable PIPE Purchasers agreed to amend the term of their respective 2025 Warrants to be five and one-half years from the date of issuance. Under ASC 815-40-35-10, upon effective amendment on June 30, 2025, each of the Series A Warrants and PIPE Warrants qualify for equity-classification. Immediately before the equity reclassification, such warrants were each revalued at fair value with the resulting gain or loss being recorded in the Statement of Operations. After fair value remeasurement, the reclassification from warrant liabilities to additional paid-in capital was completed. On August 18, 2025, the Company entered into a securities purchase agreement with certain accredited investors, including V4 Global, LLC (an entity controlled by the Company's Chief Executive Officer), for the issuance and sale of 4,500 shares of Series B Convertible Preferred Stock (par value $0.0001, stated value $1,000 per share) and accompanying warrants to purchase 3,000,000 shares of Common Stock (the "Series B Warrants") for aggregate gross proceeds of $4,500 before offering expenses. V4 Global, LLC purchased 1,000 shares (22% of the offering) on the same terms as non-affiliated investors. The Series B Preferred Stock and Series B Warrants were not exercisable or convertible until stockholder approval was obtained on December 12, 2025, pursuant to Nasdaq Stock Market Rule 5635(d) for issuances exceeding 19.99% of outstanding Common Stock at prices below the Minimum Price. Series B Warrants The Series B Warrants are exercisable for 3,000,000 shares of Common Stock at an exercise price of $1.50 per share and expire on December 12, 2030 (five years from the date stockholder approval was obtained). Warrant holders may not exercise if such exercise would result in the holder owning more than 4.99% (or at holder election, 9.99%) of the Company's outstanding Common Stock immediately after exercise. The Series B Warrants are classified within permanent equity (additional paid-in capital) and are not subject to subsequent fair value remeasurement. Allocation of Proceeds The Company allocated the $4,500 gross proceeds between the Series B Preferred Stock and Series B Warrants using the with-and-without method. Under this method, the warrants were valued at their fair value as of the issuance date (August 18, 2025), with the residual proceeds allocated to the preferred stock. The fair value of the warrants was determined using the Black-Scholes option pricing model with the following key assumptions as of August 18, 2025: Stock price: $1.40 Exercise price: $1.50 Expected term: 5.0 years Expected volatility: 72.4% (based on 1-year historical analysis) Risk-free interest rate: 3.90% Expected dividend yield: 0% Based on this valuation, the Company allocated $2,553 to the Series B Warrants and $1,947 to the Series B Preferred Stock within additional paid-in capital. The Company performed sensitivity analysis on the key valuation assumptions. A 10% change in stock price results in approximately 13% change in warrant value, while a 10% change in volatility results in approximately 7% change in warrant value. Across reasonable scenarios, the warrant valuation ranges from $2,000 to $3,100, confirming the materiality of the warrant component and the appropriateness of the allocation methodology. Interim Recording and Year-End Adjustment At September 30, 2025, the Company initially recorded the full proceeds as preferred stock equity pending completion of a formal valuation. In the fourth quarter of 2025, upon obtaining a formal Black-Scholes valuation as of the August 18, 2025 issuance date, the Company reallocated $2,553 from additional paid-in capital attributable to preferred stock to additional paid-in capital attributable to warrants to reflect the proper allocation based on relative fair values.

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