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Warrant and Derivative Liabilities

9 Months Ended

Sep. 30, 2025

Warrant and Derivative Liabilities [Abstract]

Note 8 — Warrant and derivative liabilities

Contingent warrant liabilities

The following table summarizes the activity for the contingent warrant liabilities, using unobservable Level 3 inputs, for the three and nine months ended September 30, 2025:

	Contingent Warrant Liability
Balance at December 31, 2024	$	43,089
Change in fair value		9,795
Balance at March 31, 2025	$	52,884
Change in fair value		229
Balance at June 30, 2025		53,113
Change in fair value		36
Balance at September 30, 2025	$	53,149

Series D derivative liabilities and warrant liabilities

On September 22, 2025, the Company completed a private placement transaction with institutional investors, resulting in the issuance of Series D convertible preferred stock and accompanying warrants to purchase shares of common stock. In connection with this transaction, the Company recorded warrant liabilities related to the Series D Warrants and derivative liabilities associated with certain embedded features in the Series D Preferred Stock. These instruments were classified as liabilities and measured at fair value in accordance with ASC 815 due to their settlement provisions and other contractual terms. Refer to Note 9 for further detail on the private placement transaction.

The Company measured its bifurcated embedded derivative liabilities and warrant liabilities as of September 30, 2025 and September 22, 2025, at fair value on a recurring basis using level 3 inputs. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment to estimation. The derivative liabilities and warrant liabilities were both measured using Monte Carlo valuation models. Valuations based on unobservable inputs are highly subjective and require significant judgments. Changes in such judgments could have a material impact on fair value estimates.

The table below shows the inputs used to determine the fair value of the derivative liabilities:

	As of
	September 30,			September 22,
	2025			2025

Expected term (years)		2.98			3.0
Expected volatility		150.00	%		150.00	%
Expected dividend yield		0.00	%		0.00	%
Risk-free interest rate		3.58	%		3.56	%

The table below shows the inputs used to determine the fair value of the warrant liabilities:

	As of
	September 30,			September 22,
	2025			2025
Expected term (years)		2.98			3.0
Expected volatility		150.00	%		150.00	%
Expected dividend yield		0.00	%		0.00	%
Risk-free interest rate		3.58	%		3.56	%

The following table presents information about the Company’s derivative liabilities and warrant liabilities that are measured at fair value on a recurring basis as of September 30, 2025 and September 22, 2025, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

	Valuation Level	September 30, 2025		September 22, 2025

Warrant liabilities	Level 3	$	12,815,000	$	14,749,000
Derivative liabilities	Level 3		988,000		772,000
		$	13,803,000	$	15,521,000

The following table sets forth a summary of the change in the fair value of the derivative liabilities and warrant liabilities that are measured at fair value on a recurring basis for the three and nine months ended September 30, 2025:

	Derivative Liabilities		Warrant Liabilities
Balance, as of December 31, 2024	-		-
Fair value recognized upon issuance	$	772,000	$	14,749,000
Change in fair value		216,000		(1,934,000	)
Balance, as of September 30, 2025	$	988,000	$	12,815,000