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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2026
Fair Value Measurements [Abstract] |
FAIR VALUE MEASUREMENTS | NOTE 13 — FAIR VALUE MEASUREMENTS The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1—quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2—observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3—unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s liabilities that are measured at fair value as of June 30, 2026 and December 31, 2025 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
|  |  |  | June 30, |  |  | December 31, |
Description: |  | Level |  | 2026 |  |  | 2025 |
Derivative Liabilities: |  |  |  |  |  |  |  |
Forward purchase agreement |  | 3 |  | $ | 1,756,700 |  |  | $ | 1,388,700 |
Warrants – Series A |  | 3 |  | $ | 3,015,191 |  |  | $ | 3,383,900 |
Forward purchase agreement The Company used a Monte Carlo analysis to determine the fair value of the FPA, assuming 191,007 FPA Shares. The fair value measurement of the FPA at June 30, 2026 and December 31, 2025 was calculated using the following range of weighted average assumptions:
|  | June 30, |  |  | December 31, |
|  | 2026 |  |  | 2025 |
Risk-free interest rate |  |  | 4.00 | % |  |  | 3.48 | %
Stock price |  | $ | 9.29 |  |  | $ | 7.09 |
Expected life |  |  | 0.5 years |  |  |  | 1.1 years |
Expected volatility of underlying stock |  |  | 197.5 | % |  |  | 175.0 | %
Dividends |  |  | 0 | % |  |  | 0 | %
The model measured the total present value of the Company’s proceeds at approximately $7,670 and the total present value of the Company’s liability at approximately $1,764,383, resulting in a net liability of approximately $1,756,700 as of June 30, 2026. This resulted in a non-cash non-operating loss from the change in fair value of derivatives of approximately $542,600 and $368,000 for the three and six months ended June 30, 2026. The following table presents the changes in the fair value of the derivative liability associated with the Forward Purchase Agreement, measured at fair value on a recurring basis using significant unobservable inputs (Level 3), for the three and six months ended June 30, 2026:
|  | Fair Value |
|  | Measurement |
|  | Using Level 3 |
Forward Purchase Agreement |  | Inputs Total |
Balance, December 31, 2025 |  | $ | 1,388,700 |
Change in fair value |  |  | (174,600 | )
Balance, March 31, 2026 |  |  | 1,214,100 |
Change in fair value |  |  | 542,600 |
Balance, June 30, 2026 |  |  | 1,756,700 |
Warrants – Series A and B The Company utilized a Monte Carlo simulation analysis to determine the fair value of the Series A Warrants at June 30, 2026, which included the following assumptions:
|  | Series A Warrants |
Expected term |  |  | 3.4 years |
Stock price |  | $ | 9.29 |
Risk free rate |  |  | 4.1 | %
Expected volatility |  |  | 184.1 | %
Expected dividend rate |  | $ | 0.00 |
Exercise Price |  | $ | 3.10 |
The fair value of the Series A and Series B Warrants as of June 30, 2026, was $3,015,191 and $0, respectively. The $0 fair value for the Series B Warrants reflects that all Series B Warrants had been exercised by this date. This resulted in a non-cash gain (loss) from the change in fair value of derivatives of $(375,180) and $11,570 for the three and six months ended June 30, 2026, respectively. As of June 30, 2026, investors had exercised 609,476 Series A Warrants and 114,992 Series B Warrants, resulting in the issuance of 687,225 common shares. As of June 30, 2026, 340,315 Series A Warrants and no Series B Warrants remained outstanding. The following table presents the changes in the fair value of the derivative liability associated with the Series A Warrants, measured at fair value on a recurring basis using significant unobservable inputs (Level 3), for the three and six months ended June 30, 2026:
|  | Fair Value |
|  | Measurement |
|  | Using Level 3 |
Warrants – Series A |  | Inputs Total |
Balance, December 31, 2025 |  | $ | 3,383,900 |
Change in fair value |  |  | (386,750 | )
Balance, March 31, 2026 |  |  | 2,997,150 |
Change in fair value |  |  | 18,041 |
Balance, June 30, 2026 |  |  | 3,015,191 |
Warrants – Series C and D The Company’s Series C and Series D Warrants were classified as derivative liabilities and remeasured to fair value each reporting period until their conversion and cancellation in October 2025 (see Note 8). The Company recognized non-cash gains change in fair value of the Series C and Series D Warrants of $1,500,300 and $4,382,250 for the three and six months ended June 30, 2025, respectively. Non-cash gains from the change in the fair value of the Series C and Series D Warrants of $1,500,300 and $4,382,250 were recognized for the three and six months ended June 30, 2025, respectively. As of December 31, 2025, all Series C and Series D Warrants had been exercised and no warrants remained outstanding. Accordingly, no fair value measurement was required for these instruments as of June 30, 2026, and no gain or loss from change in fair value was recognized for the three and six months ended June 30, 2026. Stock-based compensation – Awards with Market-Based Conditions The Company utilized a Monte Carlo simulation analysis to determine the fair value of the awards with market-based conditions at the date of the Merger, which included the following assumptions: stock price of $226.50, risk free rate of 3.9%, volatility of 72.5%, dividends yield of 0% and duration of 6 years. Placement Agent Warrants In connection with the 2026 Private Placement, the Company issued warrants to the placement agent to purchase up to 116,650 shares of common stock (the “Placement Agent Warrants”), which were classified within stockholders’ equity. Because the Placement Agent Warrants are equity-classified, they are measured at fair value only at issuance and are not remeasured in subsequent periods. Accordingly, the Placement Agent Warrants are not included in the recurring fair value measurement table above. The grant-date fair value of the Placement Agent Warrants of $1,938,014 was measured on a nonrecurring basis using a Black-Scholes option pricing model, which represents a Level 3 measurement given the significant unobservable inputs. The following assumptions were used: stock price of $20.47, exercise price of $17.25, expected term of 5.0 years, expected volatility of 107.5%, risk-free interest rate of 4.26%, and expected dividend yield of 0%. The fair value was recognized as an offering cost of the 2026 Private Placement within additional paid-in capital, with no net effect on total stockholders’ equity. See Note 8 for additional information.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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