NOTE 8 — WARRANT LIABILITIES

On November 20, 2024, the Company closed its private placement transaction resulting in the issuance of newly designated Series A-2 Preferred Stock (see Note 14 – Stockholders Equity (Deficit)). As a result of the issuance of a new class of voting securities, the Company evaluated its equity classified warrants’ respective terms, and concluded that warrants for 68,712 common shares with a weighted average exercise price of $2.00 were required to be reclassified to liabilities, including pre-funded warrants with an exercise price of $0.05 per share. The pre-funded warrants are exercisable upon issuance and will remain exercisable until all the pre-funded warrants are exercised in full. At September 30, 2025, pre-funded warrants for 51,199 common shares remained outstanding. During the three and nine months ended September 30, 2025 the Company recorded a loss on change in fair value of warrant liabilities of $148,347 and $94,119.29, respectively for these warrants. At September 30, 2025 and December 31, 2024, the fair value of these warrants was $362,323 and $269,175, respectively.

In 2004, the Company issued warrants to various investors and brokers for the purchase of Series C preferred stock in connection with a private placement (the “Series C Warrants”). The Series C Warrants were subsequently extended and, upon closing of the reverse recapitalization transaction with Ritter, exchanged for warrants to purchase common stock of the Company. On February 27, 2024, these Series C Warrants were repriced as a result of a down-round provision triggered by a Securities Purchase Agreement with Alpha for the purchase of the February 2024 Debentures described below, from an exercise price of $36.50 per share to an exercise price of $13.00 per share, with 16,473 additional ratchet Series C Warrants issued, resulting in 25,586 Series C Warrants outstanding on March 31, 2024, which expired on June 26, 2024, resulting in a gain recorded in the amount of $187,900. At September 30, 2025 and December 31, 2024 the fair value of these warrants was $0.

The following table summarizes the activity in liability classified warrants for the nine months ended September 30, 2025:

 SCHEDULE OF WARRANTS ACTIVITY

The following table summarizes the activity in liability classified warrants for the nine months ended September 30, 2024:

The following table presents the Company’s fair value hierarchy for its warrant liabilities measured at fair value on a recurring basis as of September 30, 2025:

 SCHEDULE OF FAIR VALUE OF HIERARCHY FOR WARRANT LIABILITIES

The following table presents the Company’s fair value hierarchy for its warrant liabilities measured at fair value on a recurring basis as of December 31, 2024:

During the three and nine months ended September 30, 2025, there were no warrants reclassified from equity to liabilities. There were no transfers of financial assets or liabilities between category levels for the three and nine months ended September 30, 2025. During the three and nine months ended September 30, 2024, warrants for 2,314 common shares with an exercise price of $6.50 with a fair value of $14,997 as of September 30, 2024 were reclassified from equity to liabilities.

The value of the warrant liabilities was based on a valuation received from an independent valuation firm determined using the Black-Scholes Model at September 30, 2025, and a Monte-Carlo simulation at September 30, 2024. For volatility, the Company considers comparable public companies as a basis for its expected volatility to calculate the fair value of common stock warrants and transitions to its own volatility as the Company develops sufficient appropriate history as a public company. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected term of the common stock warrant. The Company uses an expected dividend yield of zero based on the fact that the Company has never paid cash dividends and does not expect to pay cash dividends in the foreseeable future. Any significant changes in the inputs may result in significantly higher or lower fair value measurements.

The following are the weighted average and the range of assumptions used in estimating the fair value of warrant liabilities (weighted average calculated based on the number of outstanding warrants on each issuance) as of September 30, 2025 and December 31, 2024:

 SCHEDULE OF ASSUMPTIONS OF WARRANT LIABILITIES