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WARRANT LIABILITY

9 Months Ended

Sep. 30, 2025

NOTE 7 – WARRANT LIABILITY

Based on an evaluation, pursuant to ASC 815-40, the May 2025 Warrants and July 2025 Warrants (see note 6) do not meet all the equity classification criteria and therefore were determined to be classified as liabilities measured at fair value through earnings. The Company utilized the Black Scholes Model to calculate the value of the May 2025 Warrants and July 2025 Warrants issued during the three months ended September 30, 2025.

The fair value of the May 2025 Warrants and Representative’s Warrants of $5,306 and $265, respectively, was estimated at the date of issuance using the following assumptions: dividend yield 0%; expected term of 5.0 years; equity volatility of 145.65%; and a risk-free interest rate of 4.06%.

The fair value of the July 2025 Warrants of $2,772 was estimated at the date of issuance using the following assumptions: dividend yield 0%; expected term of 1.5 years; equity volatility of 170.97%; and a risk-free interest rate of 3.94%.

The Company recognized changes in the fair value of the warrant liability of $3,203 and $4,613 during the three and nine months ended September 30, 2025, respectively, as financial income on the consolidated statement of operations. The aggregate fair value of the Warrants of $3,730 was estimated on September 30, 2025 utilizing the Black Scholes Model and using the following assumptions: stock price $5.64, exercise price $20.40 – $22.50, dividend yield 0%; remaining term of 1.50 – 4.63 years; equity volatility of 149.90% - 178.58%; and a risk-free interest rate of 3.74% - 3.94%.

Changes in the warrant liability balance

Below is the change in the warrant liability balance for the nine months ended September 30, 2025:

SCHEDULE OF CHANGE IN WARRANT LIABILITY

Balance as of December 31, 2024	$	-
Issuance		8,343
Change in fair value		(4,613	)
Balance as of September 30, 2025	$	3,730

See note 12 for assets and liabilities which are measured at fair value on a recurring basis by level within the fair value hierarchy.