Note 10 - Derivative Liability for Cryptocurrency Private Placement

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Derivative Instruments and Hedging Activities Disclosure [Text Block]

NOTE 10 – DERIVATIVE LIABILITY FOR CRYPTOCURRENCY PRIVATE PLACEMENT

On September 29, 2025, the Company entered into a securities purchase agreement (the “Crypto SPA”) with certain accredited investors pursuant to which the Company agreed to sell and issue to such investors in a private placement (the “Crypto PIPE Offering”) pre-funded warrants (the “Crypto PIPE Warrants”) to purchase an aggregate of up to 14,903,393 shares of the Company’s common stock (the “Crypto PIPE Warrant Shares”) at a purchase price per Crypto PIPE Warrant equal to $11.6265 (the “Per Share Purchase Price”) minus a fixed nominal amount of $0.01 per underlying Crypto PIPE Warrant Share, with such purchase price being pre-funded on October 7, 2025 (the “Closing Date”).

The Crypto SPA was determined to meet the definition of a derivative in accordance with ASC 815, Derivatives and Hedging. The settlement amount of the derivative varies based upon the USD value of ATH contributed by investors between the effective date of the Crypto SPA on September 29, 2025, and the Closing Date. Because the Crypto SPA obligates the Company to issue a fixed number of shares while the settlement value of those shares is indexed to the price of ATH, the Crypto SPA was classified as a derivative liability and the Company recorded a liability as of September 29, 2025 at its then-fair value with the offsetting entry to earnings. The derivative liability was remeasured as of September 30, 2025 with the change in the fair value of the derivative liability recognized within earnings. The fair value of the Crypto PIPE Warrants was $74,366,000 and was recorded as a derivative liability on the condensed consolidated balance sheet as of September 30, 2025.

The derivative liability was fully settled when the Crypto PIPE Offering closed on October 7, 2025, on which date the purchasers in the Crypto PIPE Offering tendered ATH to the Company and the Company issued the Crypto PIPE Warrants to purchasers. Refer to Note 15 – Subsequent Events for further details.