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Stockholder's Equity | 3 Months Ended
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Mar. 31, 2026
Stockholders Equity [Abstract] |
STOCKHOLDER’S EQUITY | NOTE 9 — STOCKHOLDER’S EQUITY On June 21, 2024, the Business Combination was completed. The transaction was accounted as a reverse recapitalization in accordance with GAAP. Under this method of accounting, Redwoods was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the financial statements of the Combined Company represent a continuation of the financial statements of Klotho with the Transactions treated as the equivalent of Klotho issuing shares for the net assets of Redwoods, accompanied by a recapitalization. Accordingly, for accounting purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization. The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded. See “NOTE 1 — Organization and Business Description” for detail. Equity Incentive Plan In connection with the Business Combination, the Company’s Board adopted, and the Company’s stockholders approved, the Equity Incentive Plan (“Equity Incentive Plan”). Although the Company does not have a formal policy with respect to the grant of equity incentive awards to the Company’s executive officers, the Company believes that equity awards provide the Company’s executive officers with a strong link to the Company’s long-term performance, create an ownership culture and help to align the interests of the Company’s executives and the Company’s stockholders. In addition, Company believes that equity awards with a time-based vesting feature promote executive retention because this feature provides incentives to Company’s executive officers to remain in employment with the Company during the applicable vesting period. Accordingly, the Company’s board of directors periodically reviews the equity incentive compensation of the Company’s executive officers and from time to time may grant equity incentive awards to them. During the quarter ended March 31, 2026, the Company granted 8,050,000 restricted shares under the Equity Incentive Plan at a share price of $0.42, resulting in recognized stock-based compensation expense of $3,321,430. During the year ended December 31, 2025, the Company granted 180,000 stock options under the Equity Incentive Plan at a weighted average fair value of $0.38, resulting in recognized stock-based compensation expense of $68,760. During the year ended December 31, 2025, the Company granted 408,691 shares at a share price of $1.34 under the Equity Incentive Plan, to a member of management, resulting in stock-based compensation expense of $547,646. Unamortized stock-based compensation related to these grants was $0 as of December 31, 2025. Non-Equity Incentive Plan Shares Issuances During the quarter ended March 31, 2026, the Company granted 1,000,000 restricted shares at a share price of $0.42, unrelated to the Equity Incentive Plan, resulting in recognized stock-based compensation expense of $412,600. During the year ended December 31, 2025, the Company granted 1,000,000 shares at a share price of $0.52, unrelated to the Equity Incentive Plan, related to a consulting agreement, resulting in professional fees of $516,000. Unamortized expenses related to these grants was $0 as of December 31, 2025. During the year ended December 31, 2024, the Company granted 3,285,452 shares and options, unrelated to the Equity Incentive Plan, at a weighted average fair value of $0.92, resulting in amortized stock-based compensation expense of $2,279,573. Stock-based compensation related to these awards totaled $713,375 during the year ended December 31, 2025. Unamortized stock-based compensation related to these grants was $69,375 as of December 31, 2025. Private Placement On March 2, 2026, the Company closed and completed the private placement (the “Financing”) contemplated by that certain Securities Purchase Agreement, dated February 19, 2026, by and among the Company and the purchasers named therein (the “Purchasers”). At the closing of the Offering, the Company issued to the Purchasers an aggregate of 34,551,939 shares of the Company’s common stock and warrants to purchase up to an aggregate of 34,551,939 shares of Common Stock (the “Warrants”). The sale of the securities resulted in aggregate gross proceeds to the Company of approximately $7,750,000. Warrants During February 2026, the Company entered into a consulting agreement under which it issued 2,500,000 shares of restricted common stock and 2,500,000 common stock purchase warrants to a third-party consultant in exchange for business development and advisory services. The equity instruments issued for services were accounted for in accordance with ASC 718 and measured at their grant date fair value. The associated expense is recognized in general and administrative expenses as the services are rendered (or upon vesting, if immediately vested). The warrants were determined to be equity-classified instruments recognized at fair value on the date of issuance. Modification of Previously Issued Financing Warrants During the year ended December 31, 2025, the Company reduced the strike price on certain of its issued warrants to induce exercise of the warrants, reducing the exercise price from $3.49 to $1.35 for certain outstanding warrants. The warrants were subsequently exercised (during the year ended December 31, 2025) as a result of the modification. In accordance with ASC paragraphs 815-40-35-16 through 17, the Company determined that the effect of the modification, which was calculated as $1,530,910, should be recognized as an equity issuance cost. As a result, the Company recognized a deferred offering cost with a corresponding increase to additional paid in capital. Further, upon exercise of the warrants, the Company, in accordance with SAB Topic 5.A, charged the deferred offering costs against the gross proceeds of the offering (i.e. a $1,530,910 reduction to additional paid in capital). During the year ended December 31, 2025, holders of common stock warrants exercised a total of 11.0 million warrants for gross proceeds of $11.4 million. Austria Note Conversion During the three months ended June 30, 2025, $650,000 of principal related to the Austria Capital LLC Convertible Promissory Note was converted into 2,600,000 shares of common stock at a conversion price of $0.25. The remainder of the note in the amount of $550,000 was settled in cash. Therefore, the Company de-recognized the remaining unamortized original issue discount of $85,554 and deferred financing costs of $438,471, which were recognized in interest expense on the condensed consolidated statements of operations. During the year ended December 31, 2025, the Company issued 2,000,000 additional shares in connection with settlement of the note, resulting in interest expense of $1,178,000. 3i Note Conversion During the year ended December 31, 2025, $823,444 of principal and $57,641 of interest and make whole related to 3i convertible notes was converted into 5,413,474 shares of common stock at conversion prices ranging from $0.12 to $0.25. Investor Share Purchase On June 5, 2025, the Company entered into a securities purchase agreement with an accredited investor pursuant to Regulation D of the Securities Act of 1933, as amended. Under the terms of the agreement, the Company issued 6,250,000 shares of its common stock at a purchase price of $0.08 per share, for total gross proceeds of $500,000. The proceeds were allocated to common stock based upon their par value of the common stock and the remainder in recorded to additional paid in capital on the condensed consolidated balance sheets. Preferred B Shares On June 9, 2025, the Company conducted a private offering and issued 500 preferred B shares at $0.0001 par value per share for a total of $500,000. The 500 preferred shares are convertible into 6,250,000 common shares. During the year ended December 31, 2025, all 500 preferred B shares were converted into 6,250,000 common shares. Preferred C Shares On March 4, 2026, the Company purchased mineral rights and exploratory licenses and issued 47,940 preferred C shares at $0.0001 par value per share for a total fair value of $47,940,000. Each of the 47,940 preferred shares has a conversion option to convert into 42,554 common shares upon shareholder’s approval. The Series C Preferred Shares issued in connection with the Greenland Mines transaction had the following rights and privileges:
| ● | Prior to stockholder approval, the holders of the Series C Preferred Shares have no voting rights and are not entitled to vote on any matters submitted to stockholders;
| ● | Following stockholder approval, each share shall vote together with the common stock on an as-converted basis;
| ● | Prior to stockholder approval, the Series C Preferred Shares are not convertible into common stock; and
| ● | Upon stockholder approval, each share is convertible into shares of common stock at a stated conversion ratio
Pursuant to the Agreement and Plan of Merger dated March 4, 2026, the Company issued 47,000 shares of Series C Preferred Stock to the stockholders of Greenland Mines as consideration for the transaction. 940 Series C shares were issued as a finder’s fee related to the transaction. These shares were issued in connection with the asset acquisition and were subject to stockholder approval for both conversion and voting rights. Prior to such approval, the shares are non-voting and non-convertible; upon approval, they become convertible into common stock and participate in voting on an as-converted basis. The Company has classified the Series C Preferred Stock within permanent equity. This classification, in accordance with ASC 480, is appropriate as the shares are not redeemable, do not contain any obligations requiring the Company to transfer assets, and do not embody features that would require liability classification under applicable accounting guidance. The conversion feature embedded in the Series C Preferred Stock was evaluated under ASC 815 to determine whether bifurcation as a derivative instrument was required. The Company concluded that bifurcation is not required, as the conversion option:
| ● | Is indexed to the Company’s own stock based on a fixed conversion ratio;
| ● | Does not include any contingent settlement provisions that would require net cash settlement; and
| ● | Does not embody any features that are not clearly and closely related to the host equity instrument.
Accordingly, the conversion feature qualifies for the scope exception for equity-linked instruments and is not required to be separated from the host instrument. As of March 31, 2026, conversion of the Series C Preferred Stock had not occurred due to the requirement to obtain stockholder approval prior to conversion. Meteora Agreement On June 13, 2024, RWOD and Klotho entered into a forward purchase agreement with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading Opportunities Master, LP (“MSTO”), and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively with MCP and MSTO, the “Seller”) (the “Forward Purchase Agreement”). Redwoods is the holder of the asset and Sponsor and is also a counterparty to Klotho. Upon Closing of the merger on June 21, 2024 and on September 30, 2024, the value of the contract was $0 as the contract created no receivable or obligation for the Company. On September 19, 2024, the Company modified the settlement amount price of the contract to $2.00 and allowed the shares held with Meteora to be sold at Meteora’s sole discretion, with the reset price subject to weekly changes. During the quarter ending March 31, 2025, Meteora sold and terminated on behalf of the Company 100,000 shares at a reset price of $0.4610, for total proceeds to Klotho in the amount of $46,100. On May 15, 2025, Meteora terminated an additional 550,214 shares at a reset price of $0.1717 for total proceeds of $94,472, thereby reducing the number of shares per the agreement to 10,000 shares remaining. During September 2025, the Company entered into a second amendment (the “Second Amendment”) to the Forward Purchase Agreement with MCP which primarily (i) increased the maximum number of shares to 6,755,000 and (ii) modified the reset price to $10.00 subject to a reset on a weekly basis. In connection with the modification, which relates to the reverse merger, the Company issued 6,745,000 common shares under the arrangement to MCP. The Company recognized the common shares at par value in the amount of $675 on the consolidated balance sheets with a corresponding recording of additional paid-in capital. During the year ending December 31, 2025, Meteora sold and terminated on behalf of the Company 100,000 shares at a reset price of $0.4610, for total proceeds to Klotho in the amount of $46,100. During the three months ended March 31, 2026, Meteora sold and terminated on behalf of the Company 923,340 shares at a reset price of $0.2352 and 457,905 shares at a reset price of $0.4260, for total proceeds to Klotho in the amount of $412,329. At-the-Market Sales Agreement On July 3, 2025, the Company entered into a sales agreement with A.G.P./Alliance Global Partners (“A.G.P.”) relating to the sale of newly issued shares of the Company’s common stock. In accordance with the terms of the sales agreement, the Company may offer and sell shares of its common stock having an aggregate offering amount of up to $50,000,000 from time to time through A.G.P., acting as the Company’s sales agent or principal. The Company intends to use the net proceeds from the offering for working capital and for general corporate purposes. During the year ended December 31, 2025, the Company sold 2,206,930 shares at a weighted average price of $0.50 per share for gross proceeds of $1,112,745. During the quarter ended March 31, 2026, the Company sold no shares under the sales agreement.

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