THUNDER MOUNTAIN GOLD INC

1. Summary of Significant Accounting Policies and Business Operations

Business Operations

Thunder Mountain Gold, Inc. ("Thunder Mountain", "THMG", or "the Company") was originally incorporated under the laws of the State of Idaho on November 9, 1935, under the name of Montgomery Mines, Inc. In April 1978, the Montgomery Mines Corporation was obtained by a group of the Thunder Mountain property holders and changed its name to Thunder Mountain Gold, Inc., with the primary goal to further develop their holdings in the Thunder Mountain Mining District, located in Valley County, Idaho. Thunder Mountain Gold, Inc. takes its name from the Thunder Mountain Mining District, where its principal lode mining claims were located. For several years, the Company's activities were restricted to maintaining its property position and exploration activities. During 2005, the Company sold its holdings in the Thunder Mountain Mining District. During 2007, the Company acquired the South Mountain Mines property in southwest Idaho and initiated exploration activities on that property, which continue today.

Basis of Presentation and Going Concern

The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company has historically incurred losses, however, the Company has cash reserves sufficient to cover normal operating expenses for the following 12 months. If necessary, the Company continues to have the ability to raise additional capital in order to fund its future exploration and working capital requirements.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company; its wholly owned subsidiaries, Thunder Mountain Resources, Inc. ("TMRI") and South Mountain Mines, Inc. ("SMMI"); and a company in which the Company owns 75% and has majority control, Owyhee Gold Trust, LLC ("OGT"). The Company's consolidated financial statements reflect the other investor's 25% noncontrolling, capped interest in OGT. Intercompany accounts are eliminated in consolidation.

Accounting Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions include the carrying value of properties and mineral interests, environmental remediation liabilities, deferred tax assets, and stock-based compensation. Management's estimates and assumptions are based on historical experience and other assumptions believed to be reasonable under the circumstances. Actual results could differ from those estimates.

Income Taxes

The Company recognizes deferred income tax liabilities or assets at the end of each period using the tax rate expected to be in effect when the taxes are actually paid or recovered. A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized.

Cash and Cash Equivalents

For the purposes of the balance sheet and statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be a cash equivalent.

Fair Value Measurements

When required to measure assets or liabilities at fair value, the Company uses a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used. The Company determines the level within the fair value hierarchy in which the fair value measurements in their entirety fall. The categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Level 1 uses quoted prices in active markets for identical assets or liabilities, Level 2 uses significant other observable inputs, and Level 3 uses significant unobservable inputs. The amount of the total gains or losses for the period are included in earnings that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date. The Company has no financial liabilities that are adjusted to fair value on a recurring basis.

Financial Instruments

The Company's financial instruments include cash and cash equivalents.

Property and Equipment

Property and equipment are carried at cost. Major betterments are capitalized and de minimis purchases are expensed. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The useful life of property and equipment for purposes of computing depreciation is three to seven years. When the Company sells or otherwise disposes of property and equipment, a gain or loss is recorded in the statement of operations. The cost of improvements that extend the life of property and equipment is capitalized. The Company periodically reviews its long-lived assets for impairment and, upon the indication that the carrying value of such assets may not be recoverable, recognizes an impairment loss by a charge against current operations.

Mineral Interests

The Company capitalizes costs for acquiring mineral interests, and expenses costs to maintain mineral rights and leases as incurred. Exploration costs are expensed in the period in which they are incurred. Should a property reach the production stage, these capitalized costs would be amortized using the units-of-production method based on periodic estimates of ore reserves. Mineral interests are periodically assessed for impairment of value and any subsequent losses are charged to operations at the time of impairment.

If a mineral interest is abandoned or sold, its capitalized costs are charged to operations. Consideration received by the Company pursuant to joint ventures or purchase option agreements is applied against the carrying value of the related mineral interest. When and if payments received exceed the carrying value, the excess amount is recognized as a gain in the consolidated statement of operations in the period the consideration is received.

Leases

Arrangements meeting the definition of a lease are classified as operating or financing leases and are recorded on the consolidated balance sheet as both a right-of-use asset and lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company's incremental borrowing rate. Lease liabilities are increased by interest and reduced by payments each period, and the right-of-use asset is amortized over the lease term. For operating leases, interest on the lease liability and the amortization of the right-of-use asset result in straight-line rent expense over the lease term. For finance leases, interest on the lease liability and the amortization of the right-of-use asset results in front-loaded expense over the lease term. Variable lease expenses are recorded when incurred.

Investments in Joint Ventures

For companies and joint ventures (JVs) where the Company holds more than 50% of the voting interests, but less than 100%, and has significant influence, the company or joint venture is consolidated, and other investor interests are presented as noncontrolling. In determining whether significant influence exists, the Company considers its participation in policy-making decisions and its representation on the venture's management committee.

For JVs in which the Company does not have joint control or significant influence, the cost method is used. For those JVs in which there is joint control between the parties, the equity method is utilized whereby the Company's share of the ventures' earnings and losses is included in the statement of operations as earnings in JVs and its investments therein are adjusted by a similar amount. The Company periodically assesses its investments in JVs for impairment. If management determines that a decline in fair value is other than temporary it will write-down the investment and charge the impairment against operations.

Reclamation and Remediation

The Company's operations have been, and are subject to, standards for mine reclamation that have been established by various governmental agencies. The Company would record the fair value of an asset retirement obligation as a liability in the period in which the Company incurred a legal obligation for the retirement of tangible long-lived assets. A corresponding asset would also be recorded and depreciated over the life of the asset.

For non-operating properties, the Company accrues costs associated with environmental remediation obligations when it is probable that such costs will be incurred, and they are reasonably estimable. Such costs are based on management's estimate of amounts expected to be incurred when the remediation work is performed. The Company had accrued $86,380 at December 31, 2025 and, $81,250 at December 31, 2024, on its consolidated balance sheets relating to estimated mine closure and reclamation costs on its South Mountain Mines property.

Share-Based Compensation

Share-based payments to employees and directors, including grants of employee stock options, are measured at fair value and expensed in the consolidated statements of operations over the vesting period. The Company has elected to account for forfeitures of share-based payment awards as they occur. Accordingly, any previously recognized compensation expense related tonon-employee share-based payment awards that are subsequently forfeited will be reversed in the period in which the forfeiture occurs.

Segment Policy

The Chief Executive Officer of Thunder Mountain Gold Inc. serves as the Company's Chief Operating Decision Maker ("CODM"). The Company operates as a single business segment, focused primarily on the exploration and development of the South Mountain Project.

As a single-segment entity, the Company complies with ASC 280-10-50-20, reporting segment profit or loss, significant expenses, and other segment items. Given our status as a mineral exploration company with no revenue, financial activities were minimal, primarily consisting of essential corporate expenditure and limited exploration.

Investments in Equity Securities

Investments in equity securities are generally measured at fair value. Unrealized gains and losses for equity securities resulting from changes in fair value are recognized in current earnings. If an equity security does not have a readily determinable fair value, we may elect to measure the security at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer. At the end of each reporting period, we reassess whether an equity investment security without a readily determinable fair value qualifies to be measured at cost, less impairment, consider whether impairment indicators exist to evaluate if an equity investment security is impaired and, if so, record an impairment loss. At the end of each reporting period, unrealized gains and losses resulting from changes in fair value are recognized in current earnings. Upon sale of an equity security, the realized gain or loss is recognized in current earnings.

Recent Accounting Pronouncements

Accounting Standards Updates

In November 2024, the Financial Accounting Standards Board ("FASB") issued ASU 2024-03,Disaggregation of Income Statement Expenses (Subtopic 220-40). The standard requires public business entities to disclose additional information about certain expense categories included in income statement captions, including purchases of inventory, employee compensation, depreciation, depletion, and amortization. The amendments also require qualitative disclosures regarding other significant expense components included within the same income statement captions. The guidance is effective for annual reporting periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The company is currently evaluating the impact of the standard on its consolidated financial statement disclosures.

Adopted accounting pronouncements

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-09Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This update requires companies to report on an annual basis, specific categories in the rate reconciliation and additional information on reconciling items greater than 5% of the taxable income or loss. The update also requires disclosure of income taxes paid to Federal, state and foreign jurisdictions along with other municipal and local jurisdictions representing 5% or more of total income taxes paid. This update is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company adopted this guidance effective January 1, 2025. The adoption did not have a material impact on the Company's consolidated financial statements; however, it resulted in expanded income tax disclosures (see Note 9).

Net Income (Loss) Per Share

The Company is required to have dual presentation of basic earnings per share ("EPS") and diluted EPS. The Company calculates basic earnings (loss) per share by dividing net income or loss available to common stockholders by the weighted average number of common shares outstanding. Diluted earnings per share reflect potentially dilutive common stock equivalents, including options and warrants that could share in our earnings through the conversion to common shares, except where their inclusion would be anti-dilutive. For the years ended December 31, 2025 and 2024 outstanding common stock options and warrants of 28,395,000 and 15,850,000, respectively were excluded from the calculation of diluted earnings per share as their effect would have been anti-dilutive due to the net loss for the period.

2. Mineral Interest Commitments

The Company holds leases pertaining to land parcels adjacent to its South Mountain patented and unpatented mining claims. The details of these leases are as follows:

Former Acree Lease:

On June 20, 2008, the Company entered into a lease agreement with Ronald Acree covering 113 acres. On December 9, 2025, the Company completed the acquisition of the property previously subject to the Acree Lease pursuant to a purchase and sale agreement (see Note 4 and Note 6). As a result of the acquisition, the lease agreement was terminated and no further lease payments are required.* *

Lowry Lease:

On October 24, 2008, the Company executed a lease agreement with William and Nita Lowry for a duration of 6 years, encompassing 376 acres at a rate of $20 per acre. Following the passing of the original lessors, the lease was inherited by Michael Lowry, their son. On October 24, 2025, the Company entered into an extension of the lease agreement with Michael for an additional 21-year term through October 24, 2046. Under the amended agreement, annual lease payments are $40 per acre for the first seven -year period, $50 per acre for the second seven-year period, and $60 per acre for the final seven-year period.

Looten Lease:

On June 2, 2025, the Company executed a lease agreement with Kevin and Jo Looten for an initial term of 7 years, encompassing 18 acres at a rate of $30 per acre. Similar to the Acree Lease, the Looten Lease incorporates an option to extend for an additional 10 years at a revised rate of $40 per acre.

Lequerica Lease:

On August 22, 2025, the Company executed a lease agreement with Lequerica & Sons, Inc. covering 432 acres for an initial term of seven years at an annual rental rate of $30 per acre. The lease includes an option to extend for an additional seven years at a revised rate of $40 per acre. The agreement contains a right of first refusal in favor of the Company with respect to the underlying property in the event of a proposed sale by the lessor.

The leases have no work requirements. It is the current intention of the Company to engage in negotiations for new leases with the current landowners upon the expiration of the existing lease agreements. The negotiations may involve modifications to terms, rates, or other conditions as mutually agreed upon by the parties involved.

The Company has 26 unpatented claims (533 acres) in the Trout Creek area and 34 unpatented claims in the South Mountain area.

The Company incurred an increase in claims fees in the South Mountain area as compared to the prior quarter as a result of adding approximately over 200 BLM lode claims to their land position.

The claim fees are paid on these unpatented claims annually as follows:

3. South Mountain Project

SMMI Joint Venture - OGT, LLC

The Company's wholly owned subsidiary SMMI is the sole manager of the South Mountain Project in its entirety through a separate Mining Lease with Option to Purchase ("Lease Option") with the Company's majority-owned subsidiary OGT. SMMI has an option to purchase the South Mountain mineral interest for a capped $5 million less net returns royalties paid through the date of exercise. The Lease Option expires in November 2026. If SMMI exercises the option, the option payment of $5 million less advance royalties will be distributed 100% by OGT to OGT's minority member, ISGCII. Under the Lease Option, SMMI pays an advance of $5,000 net returns royalty to OGT annually on November 4 which was distributed to OGT's minority member during 2025 and 2024.

Under the OGT operating agreement, SMMI and ISGC II have 75% and 25% ownership, respectively, in OGT. SMMI is the sole manager and pays all expenses for exploration and development of the property. The Company has established 75% ownership and full management of the property. OGT's financial information is included 100% in the Company's consolidated financial statements as of December 31, 2025 and 2024. The Company's consolidated financial statements reflect ISGC II's 25% noncontrolling interest.

MFD Investment Holdings

On January 27, 2025, the Company announced a strategic partnership with Swiss-based MFD Investment Holdings SA ("MFD"). The letter agreement signed outlines that MFD will provide additional funding, contributing $1,000,000 in project-related expenditures as well as providing technical support for project development. This partnership adds additional financial strength in advancing South Mountain's technical and economic studies. The letter agreement is in the form of an option, whereby THMG grants an option to MFD to earn an interest in its South Mountain Project pursuant to which MFD shall have the right, but not the obligation, to complete certain requirements in return for the acquisition of a 10% interest in the Project. As of December 31, 2025, the Company has received $203,498 from MFD for project-related reimbursements, recorded as a reduction to exploration expenses.

4. Property and Equipment

On December 9, 2025, the Company completed the acquisition of private land for a total cost of approximately $260,136, inclusive of the purchase price and directly attributable acquisition costs. The land was acquired to support the Company's mineral exploration activities and long-term development strategy. The Board of Directors approved the land purchase by formal resolution on December 4, 2025. The transaction was completed pursuant to an executed purchase and sale agreement, with a portion of the purchase price financed through a seller-financed promissory note. The land is intended for long-term use in exploration activities and is not held for sale. The acquisition supports the Company's strategic exploration objectives and enhances operational flexibility related to future exploration and development plans.

The Company's property and equipment are as follows:

5. Related Party Transactions

Board of Directors Compensation

For the year ended December 31, 2024, the Board of Directors suspended its compensation in an effort to conserve financial resources. For the year ending December 31, 2025, the Board of Directors received $10,500 in cash compensation, and an additional $21,000 was accrued for 4 th quarter services. In 2026, $21,000 will be paid in the first quarter.

Deferred Compensation

As of December 31, 2025, and December 31, 2024, the balances of the total deferred compensation for the officers, are as follows, Eric Jones, President and Chief Executive Officer: $469,500; Jim Collord, Vice President and Director: $420,000; Larry Thackery, former Chief Financial Officer: $215,125. The total deferred compensation for these officers at December 31, 2025 and December 31, 2024 was $1,104,625.

Private Placement Transactions with Related Parties

During the year ended December 31, 2025, certain greater-than-five percent shareholders participated in the Company's private placement offerings. Olivier Tielens, Henriicus Thijssen, and MFD Investment Holdings SA each purchased units consisting of shares of common stock and warrants under the same terms and conditions offered to other investors in the respective private placements. The Company received cash proceeds consistent with the subscription agreements executed by such related parties.

Consultant Stock Option Grant

On October 1, 2025, the Company granted 1,000,000 stock options to Olivier Tielens, a greater-than-five percent shareholder, in his capacity as a non-employee consultant.(see Note 8).

6. Note Payable

In connection with the acquisition of land to support the Company's mineral exploration activities (see note 4 - Property and Equipment), the Company entered into a seller-financed promissory note during the year ended December 31, 2025. On December 9, 2025, the Company issued a promissory note with an initial principal balance of $205,000 to finance a portion of the purchase price of the Acree land acquisition. The note is secured by the underlying land acquired pursuant to a deed of trust. The note bears simple interest at a fixed rate of 5% per annum and requires five annual payments of $47,350, with payments due on December 5 of each year from 2026 through 2030. The final payment fully satisfies the obligation. As of December 31, 2025, the outstanding principal balance of the note payable was $205,000, of which $37,100 was classified as the current portion of note payable, and $167,900 was classified as long-term debt in the accompanying consolidated balance sheet. The stated interest rate on the promissory note was evaluated and determined to be reasonable based on market conditions at the time of issuance; therefore, no imputed interest was required. Interest expense is recognized over the term of the note based on the outstanding principal balance.

Future principal maturities of the note payable as of December 31, 2025 are as follows:

7. Stockholders' Equity

The Company's common stock has a par value of $0.001 with 200,000,000 shares authorized. The Company also has 5,000,000 authorized shares of preferred stock with a par value of $0.0001. The Company also has 22,400,000 warrants outstanding as of December 31, 2025, with a weighted average exercise price of $0.18 and a weighted average life of 1.73 years.

Additional information regarding warrant activity is presented below.

On November 28, 2024, the Board of Directors authorized a private placement financing of up to $700,000, offering equity units at $0.05 per unit. Each unit consisted of one share of common stock and one common stock purchase warrant, with each warrant exercisable for one additional share at $0.10 per share for 36 months from issuance. On December 16, 2024, the Company closed the private placement, issuing 12,400,000 shares of common stock and an equal number of common stock purchase warrants, generating gross proceeds of approximately $620,000, including $20,000 in non-cash consideration for vendor services.

On April 15, 2025, the Company Board approved a private placement financing of 10,000,000 units at a price of $0.12 per unit for total proceeds to the company of $1,200,000. Each unit includes one share of common stock and one-half warrant to purchase one share of common stock, exercisable for 2 years from the close of the offering at an exercise price of $0.18 per share. On May 25, 2025, the Company closed the private placement of 10,000,000 units for aggregate proceeds of $1,200,000. No placement agent fees were paid during the offering.

On October 1, 2025, the Company Board approved a private placement financing of 10,000,000 units at a price of $0.25 per unit for total proceeds to the Company of $2,500,000. Each unit includes one share of common stock and one-half warrant to purchase one share of common stock, exercisable for 2 years from the close of the offering at an exercise price of $0.40. On October 24, 2025, the Company completed a non-brokered private placement financing pursuant to the Board's approval on October 1, 2025.

On October 22, 2025, in connection with the private placement approved by the Board on October 1, 2025, the Company received a subscription agreement from an investor for 200,000 shares of common stock and 100,000 common stock purchase warrants for $50,000. As of December 31, 2025, the investor had not received the stock certificates.

8. Stock Options

The Company has a Stock Incentive Plan (the "SIP"), that authorizes the granting of stock options up to 10 percent of the total number of issued and outstanding shares of common stock, that provides for the grant of stock options, incentive stock options, stock appreciation rights, restricted stock awards, and incentive awards to eligible individuals including directors, executive officers and advisors that have furnished bona fide services to the Company not related to the sale of securities in a capital-raising transaction. On December 10, 2024, the Company's shareholders, at their Annual Meeting, ratified and reapproved the Stock Option Plan.

There wereno stock options awarded in 2024. On March 25, 2024,1,325,000 options expired.

On February 7, 2025, the Company issued 3,045,000 stock options to officers and directors of the Company. The options are exercisable on or before February 7, 2030, and have an exercise price of $0.10. The options were fully vested upon grant. The fair value of the options was determined to be $325,815 using the Black Scholes model. As the options were fully vested at issuance, the entire fair value was recognized as share-based compensation expense, included as part of management and administrative expenses on the Statement of Operations, for the period ended December 31, 2025. The Company recognized $10,700 in compensation expense for share-based payment awards issued to non-employees as part of the total compensation expense recognized during the same period.

On June 18, 2025, the Company granted 2,295,000 stock options to certain officers and directors. The options are exercisable at $0.20 per share and expire on June 18, 2030. The options were fully vested upon grant. The fair value of the options was determined to be $445,230 using the Black-Scholes valuation model. As the options were fully vested at issuance, the entire fair value was recognized as share-based compensation expense during the period December 31, 2025. This expense was included in management and administrative expenses on the Company's Statement of Operations. The Company recognized $39,000 in compensation expense for share-based payment awards issued to non-employees as part of the total compensation expense recognized during the same period. On October 1, 2025, the Company's Board approved the recission of the stock options granted on June 18, 2025, to all directors, except for management, reducing the options from 2,295,000 to 450,000.

On October 1, 2025, the Company issued 1,000,000 stock options to Olivier Tielens. The options are exercisable on or before October 1, 2030, and have an exercise price of $0.25. The fair value of the options was determined to be $353,000 using the Black Scholes model. The options were fully vested upon grant and the entire fair value was recognized as share-based compensation expense, included as part of management and administrative expenses on the Statement of Operations, for the period ended December 31, 2025.

The fair value of each option award was estimated on the date of the grant using the assumptions noted in the following table:

During the year ended December 31, 2025, a total of 1,950,000 options expired, including 1,630,000 options that expired on March 29, 2025. The remaining expirations relate to options previously granted to former consultants that were not exercised within the contractual post-termination exercise period.

The following is a summary of the Company's options issued and outstanding under the SIP:

The average remaining contractual term of the options outstanding and exercisable at December 31, 2025, was 3.5 years. At December 31, 2025, options outstanding and exercisable had an aggregate intrinsic value of $3,566,875 based on the Company's stock price of $0.725 at December 31, 2025.

9. Income Taxes

The Company adopted ASU 2023-09,Improvements to Income Tax Disclosures, effective January 1, 2025. The adoption did not have a material impact on the Company's financial statements but resulted in expanded income tax disclosures.

The Company did not recognize a tax provision during 2025 and 2024. The company paid the Idaho minimum tax of $30 in 2025 and 2024.

Significant components of net deferred tax assets at December 31, 2025 and 2024 are as follows:

The Company fully reserved the deferred tax asset as of December 31, 2025 and 2024, as management of the Company cannot determine that it's more likely than not that, the Company will realize the benefits of the deferred tax assets.

At December 31, 2025, the Company has approximately $10.8 million of federal and state net operating loss carry forwards. $7.5 million of the federal net operating losses will expire between 2028 and 2045 and $3.3 million of the losses were incurred after 2017 and can be carried forward indefinitely, although the usage of these net operating losses is limited to 80% of taxable income in future years. The Idaho State net operating loss carryforward expires between 2028-2045.

The income tax benefit for the years ended December 31, 2025 and 2024 differs from the statutory rate as follows:

The Company has analyzed its filing positions in all jurisdictions where it is required to file income tax returns and found no positions that would require a liability for uncertain income tax benefits to be recognized. The Company is subject to possible tax examinations for the years 2023 through 2025. Prior year tax attributes could be adjusted by taxing authorities. If applicable, the Company will deduct interest and penalties as interest expense on the financial statements.

10. Leases

The Company renewed its office operating lease on February 1, 2023, for 24 months. The Company entered into a two -year operating lease for its corporate office space for a total lease payment of $41,625. A lease liability and corresponding right-of-use asset of $38,701 was recognized on the lease inception date, February 1, 2023. This lease ended on January 31, 2025. During the year ended December 31, 2025, the Company paid $1,771 in lease payments, with imputed interest of $46.

On February 1, 2025, the Company entered into an office lease agreement for a term of 12 months through January 31, 2026. Because the lease term did not exceed 12 months and did not contain a purchase option, the Company elected the short-term lease exemption under ASC 842 and did not recognize a right-of-use asset or lease liability related to this lease. Total short-term lease expense recognized for the year ended December 31, 2025, was approximately $39,454.

In December 2025, the Company entered into a new 12-month office lease agreement for the period February 1, 2026 through January 31, 2027. The Company evaluated the lease under ASC 842 and determined that the lease qualifies for the short-term lease exemption, as the lease term is 12 months or less and does not contain a purchase option or renewal option. Accordingly, no right-of-use asset or lease liability was recognized as of December 31, 2025, related to this lease. Lease payments are recognized as lease expense on a straight-line basis over the lease term.

11. Subsequent Events

On January 29, 2026, the Compensation Committee of the Board of Directors approved the grant of 150,000 stock options to a consultant and 50,000 stock options to an employee. The options were granted with an exercise price of $0.77 per share, expire five years from the date of grant, and vest immediately upon issuance.

On January 6, 2026, a consultant exercised stock options to purchase an aggregate of 250,000 shares of the Company's common stock. The options exercised consisted of 100,000 shares at an exercise price of $0.10 per share and 150,000 shares at an exercise price of $0.20 per share. The Company received aggregate gross proceeds of $40,000 in connection with the exercise and issued 250,000 shares of common stock in accordance with the terms of the applicable stock option agreements.