What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-05-15 compared with 2025-11-13 · 276 added, 178 removed, 511 unchanged (47% of the section changed)

4 unchanged sentences

(EXPRESSED IN US DOLLARS)

September 30,

Current assets:

6 unchanged sentences

Operating lease right-of-use assets, net

Investment accounts

Investment accounts-restricted

Investment accounts-unrestricted

Total noncurrent assets

2 unchanged sentences

Accounts payable

Interest payable

Deferred revenues

13 unchanged sentences

Preferred Stock, $ 0.0001 par value, 10,000,000 shares authorized,

-Series A, 584,869 and 1,000,000 shares issued and outstanding as of September 30, 2025 and December 31, 2024*, respectively

-Series B, 5,000 and no shares issued and outstanding as of September 30, 2025 and December 31, 2024*, respectively

Class A Common Stock, $ 0.0001 par value, 50,000,000 shares authorized, 6,535,014 shares issued and outstanding as of September 30, 2025 and December 31, 2024*, respectively

Class B Common Stock $ 0.0001 par value, 450,000,000 shares authorized, 18,087,473 and 10,730,691 shares issued and outstanding as of September 30, 2025 and December 31, 2024*, respectively

-Series A, 522,801 shares issued and outstanding as of March 31, 2026 and December 31, 2025*

-Series B, 1,875 and 2,775 shares issued and outstanding as of March 31, 2026 and December 31, 2025*, respectively

-Series C, 2,000 shares issued and outstanding as of March 31, 2026 and 2025*, respectively

Class A Common Stock, $ 0.0001 par value, 1,000,000 shares authorized, 130,701 shares issued and outstanding as of March 31, 2026 and 2025*

Class B Common Stock $ 0.0001 par value, 40,000,000 shares authorized, 1,174,718 and 496,434 shares issued and outstanding as of March 31, 2026 and 2025*, respectively

Additional paid-in capital

2 unchanged sentences

( 11,644,589 )

Total stockholders' (deficit)

( 4,519,154 )

Total stockholders' equity

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025 and reverse stock split on March 9, 2026

See accompanying notes to the consolidated financial statements.

3 unchanged sentences

(EXPRESSED IN US DOLLARS)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Service revenues

Consulting revenues (related party)

Total revenues

8 unchanged sentences

(Loss) from operations

( 2,599,833 )

Other income (expense)

1 unchanged sentence

Change in fair value of crypto assets

( 2,444,670 )

Change in fair value of convertible debt

Financing cost

Staking rewards

Interest and other expense

Total other income (expense)

Total other (expense)

( 3,292,719 )

(Loss) before provision for income taxes

Provision for income taxes

Net income (loss)

( 4,187,534 )

Provision for income taxes

$ ( 4,187,534 )

2 unchanged sentences

Basic and diluted net income per share-Preferred Stock-Series A*

$ ( 1,462,541 )

$ ( 219,607 )

Weighted average shares outstanding-Preferred Stock-Series B*

Basic and diluted net income per share-Preferred Stock-Series B*

Weighted average shares outstanding-Preferred Stock-Series C*

Basic and diluted net income per share-Preferred Stock-Series C*

Weighted average shares outstanding-Class A Common Stock*

1 unchanged sentence

$ ( 365,637 )

$ ( 180,829 )

Weighted average shares outstanding-Class B Common Stock*

1 unchanged sentence

$ ( 2,347,341 )

$ ( 1,106,051 )

$ ( 308,028 )

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025 and reverse stock split on March 9, 2026

See accompanying notes to the consolidated financial statements.

8 unchanged sentences

Preferred Stock-Series B amount

Preferred Stock-Series C*

Preferred Stock-Series C amount

Class A Common Stock*

7 unchanged sentences

( 4,187,534 )

Stock compensation issued for consulting services

Balance at March 31, 2024 (unaudited)

( 4,187,534 )

$ ( 3,843,195 )

Balance at June 30, 2024 (unaudited)

$ ( 4,096,584 )

$ ( 4,016,014 )

Balance at September 30, 2024 (unaudited)

$ ( 4,273,204 )

$ ( 4,192,634 )

Balance at December 31, 2024

Conversion of convertible debt

Employee stock compensation

Conversion of preferred stock to common stock

Issuance of common stock for warrants excise

Balance at March 31, 2026 (Unaudited)

$ ( 15,832,123 )

$ ( 4,816,361 )

( 3,866,169 )

Reverse recapitalization

Balance at December 31, 2024

$ ( 4,053,883 )

$ ( 3,973,313 )

Conversion of convertible debt

Common stock issued to SPAC public shareholders

Capital contribution from private placement

Employee stock compensation

Stock compensation to advisors

Conversion of preferred stock to common stock

Issurance of common stock and warrants for intangible assets acquisition

Stock issued for waiving contractual restriction

Balance at June 30, 2025 (unaudited)

Balance at March 31, 2025 (Unaudited)

$ ( 4,351,090 )

Employee stock compensation

Stock compensation to advisors

Balance at September 30, 2025 (unaudited)

$ ( 4,270,520 )

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025

* Giving retroactive effect to reverse recapitalization effected on April 4, 2025 and reverse stock split on March 9, 2026

See accompanying notes to the consolidated financial statements.

3 unchanged sentences

(EXPRESSED IN US DOLLARS)

For the Nine Months Ended September 30,

For the Three Months Ended March 31,

Cash flows from operating activities:

5 unchanged sentences

Employee stock compensation

Stock compensation issued for advisory service

Deferred tax liabilities

Change in fair value of warrants

Change in fair value of crypto assets

( 3,342,651 )

Change in fair value of convertible debt

Stock issued for waiving contractual restriction

Staking rewards

3 unchanged sentences

Accounts payable

Interest payable

Deferred revenues

3 unchanged sentences

Net cash (used in) operating activities

( 3,174,525 )

Cash flows from investing activities:

Purchases of property and equipment

Purchases of crypto assets

( 1,050,000 )

Purchases of intangible assets

( 1,250,000 )

Net cash (used in) investing activities

( 2,300,000 )

Cash flows from financing activities:

Proceeds from convertible notes payable

Capital contribution from private placement

Proceeds from the reverse recapitalization

Repayment of promissory notes to related party

Proceeds from promissory notes related party

6 unchanged sentences

Noncash activities:

Issurance of common stock and warrants for intangible assets acquisition

Purchase of crypto assets through covertible debt

Common stock issued for liability payment

Conversion of convertible debt and interest payable

Issuance of common stock for warrants excise

Conversion of convertible debt to common stock

Conversion of preferred stock to common stock

3 unchanged sentences

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024

THREETHREE MONTHS ENDED MARCH 31, 2026 AND 2025

Description of the Business and Basis of Presentation

15 unchanged sentences

Class Over Inc.

(“Classover NJ”) was formed on September 16, 2020 in New Jersey, which was 100% controlled by the sole owner Hui Luo.

(“Classover NJ”) was formed on June 16, 2020 in New Jersey, which was 100% controlled by the sole owner Hui Luo.

Classover NJ is an online enrichment program that offers over 20 courses taught by certified instructors.

5 unchanged sentences

GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”), regarding financial reporting, and include all normal and recurring adjustments that management of the Company considers necessary for a fair presentation of its financial position and operating results.

The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of results to be expected for any other interim period or for the full year of 2025.

The results of operations for the three months ended March 31, 2026 are not necessarily indicative of results to be expected for any other interim period or for the full year of 2026.

Accordingly, these statements should be read in conjunction with the Company’s audited financial statements and notes thereto as of and for the years ended December 31, 2025 and 2024.

6 unchanged sentences

Liquidity and Going Concern

As of September 30, 2025, the Company had cash of $ 3,428,824 , current liabilities of $ 2,520,276 , a working capital of $ 935,642 and a stockholders’ equity of $ 5,400,035 .

For the three months ended September 30, 2025 and 2024, the Company had income (loss) of $ 2,520,989 and $ 176,620 , respectively, and for the nine months ended September 30, 2025 and 2024, the Company had losses of $ 1,642,387 and $ 516,528 , respectively.

As of March 31, 2026, the Company had cash of $ 2,116,631 , current liabilities of $ 2,260,061 , a working capital deficit of $ 125,316 and a stockholders’ equity of $ 3,678,295 .

For the three months ended March 31, 2026 and 2025, the Company had loss of $ 4,187,534 and $ 297,207 , respectively.

The continuing losses raise substantial doubt about the ability of the Company to continue as a going concern.

The Company completed business combination with Battery Future Acquisition Corp (the “BFAC”) on April 3, 2025 and received $ 1,075,936 from BFAC’s trust account.

Additionally, the Company received an aggregate of $ 4,700,000 from PIPE investors following the business combination, and entered into an equity purchase facility agreement (the “FPFA”) with Solana Strategic Holdings LLC (the “Solana”) for up to an aggregate of $ 400 million in newly issued shares of the Company’s Class B common stock.

Moreover, on May 30, 2025, the Company entered into a Securities Purchase Agreement with an investor and the Company may sell to the investor up to an aggregate of $ 500 million in newly issued senior secured convertible notes (the “Notes”).

Additionally, on May 30, 2025, the Company entered into a Securities Purchase Agreement with an investor and the Company may sell to the investor up to an aggregate of $ 500 million in newly issued senior secured convertible notes (the “Notes”).

On June 6, 2025, the Company consummated the initial closing of $ 11 million of Notes.

Management of the Company has evaluated the mitigation plans and determined that the current working capital, cash position, the FPFA, and Notes available for future issuance are sufficient to support its continuous operations and to meet its payment obligations when liabilities fall due within the next twelve months from the date of issuance of these combined and consolidated financial statements.

Management of the Company has evaluated the mitigation plans and determined that the current working capital, cash position, and Notes available for future issuance are sufficient to support its continuous operations and to meet its payment obligations when liabilities fall due within the next twelve months from the date of issuance of these combined and consolidated financial statements.

Accordingly, the Company’s combined and consolidated financial statements are prepared on going concern basis, which assumes that the Company will continue in operation for the foreseeable future and, accordingly, will be able to realize its assets and discharge its liabilities in the normal course of operations as they come due.

6 unchanged sentences

Revenue Recognition

The Company has nine predominant sources of revenue:

The Company has three predominant sources of revenue:

time-based subscriptions, credit-based subscriptions to our online courses, and marketing consulting services.

34 unchanged sentences

The following table shows the breakout between cash on hand and bank deposits.

September 30,

March 31, 2026

December 31, 2025

Bank deposits

3 unchanged sentences

Accounts considered uncollectible are written off against the allowance after exhaustive efforts at collection is made.

As of September 30,2025, there was no allowance for deposits.

As of March 31,2026, there was no allowance for deposits.

Property and Equipment

12 unchanged sentences

In determining the gain (loss) to be recognized upon sale, the Company calculates the difference between the sales price and carrying value of the crypto assets with WAC method.

Certain digital assets are pledged as collateral under the Company’s Senior Secured Convertible Notes.

Pursuant to the terms of the Securities Purchase Agreement and related Security Documents, approximately 80% of the net proceeds from the issuance of the Notes are required to be used to acquire specified digital assets and deposited into a controlled collateral account for the benefit of the noteholder.

These pledged digital assets are subject to a first priority security interest and are held in a block control account while the Notes remain outstanding.

Digital assets that are subject to contractual restrictions or are pledged as collateral and not available for general corporate purposes are classified as restricted digital assets.

Restricted digital assets are presented separately on the Company’s consolidated balance sheets or disclosed parenthetically within digital assets.

The Company earns staking rewards from certain digital assets held by the Company.

Staking rewards are recognized as income when earned and measured at fair value at the time of receipt.

Such rewards are not subject to contractual restrictions and are classified as unrestricted digital assets.

Intangible assets

13 unchanged sentences

The second step is to measure the tax benefit as the largest amount that is 50% likely of being realized upon settlement with a taxing authority.

There were no amounts recorded at September 30, 2025 and December 31, 2024 related to uncertain tax positions.

There were no amounts recorded at March 31, 2026 and 2025 related to uncertain tax positions.

Fair Value of Financial Instruments

10 unchanged sentences

Advertising Costs

Advertising costs amounted to $ 11,250 and $ 6,303 for the three months ended September 30, 2025 and 2024, respectively, and $ 29,839 and $ 49,726 for the nine months ended September 30, 2025 and 2024.

Advertising costs amounted to $ 5,075 and $ 7,402 for the three months ended March 31, 2026 and 2025, respectively.

Advertising costs are expensed as incurred and included in selling expenses.

30 unchanged sentences

Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

For the three and nine months ended September 30, 2025 and 2024, the convertible notes payable were excluded from the calculation of diluted EPS as their inclusion would have been anti-dilutive.

For the three months ended March 31, 2026 and 2025, the convertible notes payable were excluded from the calculation of diluted EPS as their inclusion would have been anti-dilutive.

Recently Adopted Accounting Pronouncements

11 unchanged sentences

Property and Equipment, net

Property and equipment consists of the following as of September 30, 2025 and December 31, 2024:

September 30,

Property and equipment consists of the following as of March 31, 2026 and December 31, 2025:

March 31, 2026

December 31, 2025

Computers and electronic equipment

4 unchanged sentences

Total property and equipment, net

Depreciation expense was $ 16,224 and $ 15,222 for the three months ended September 30, 2025 and 2024, respectively, and $ 48,666 and $ 38,602 for the nine months ended September 30, 2025 and 2024, respectively.

Depreciation expense was $ 14,748 and $ 16,221 for the three months ended March 31, 2026 and 2025, respectively.

Depreciation expense is included within general and administrative expenses in the Company’s statements of operations.

2 unchanged sentences

Cash is carried at cost, which approximates fair value due to its short-term nature.

The Company accounts for its crypto assets, which are currently comprised solely of Solana, as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other and ASU 2023-08.

The Company accounts for its crypto assets, which are currently primarily consisting of Solana and Worldcoin, as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other and ASU 2023-08.

The Company’s crypto assets are initially recorded at cost and subsequently are measured at fair value as of each reporting period.

1 unchanged sentence

Changes in fair value are recognized in the Company’s consolidated statement of operations.

As of March 31, 2026, digital assets with a fair value of $ 4,729,446 were pledged as collateral under the Company’s Senior Secured Convertible Notes.

Pursuant to the terms of the Securities Purchase Agreement, approximately 80 % of the net proceeds from the issuance of the Notes were required to be used to acquire specified digital assets and deposited into a controlled collateral account for the benefit of the noteholder.

Such digital assets are subject to a first priority security interest and are not available for general corporate purposes while the notes remain outstanding.

The following table summarizes the Company’s digital asset holdings, as of:

September 30,

Number of Solana

Crypto asset carrying value

Unrealized gain (loss) on crypto assets

March 31, 2026

December 31, 2025

Number of Solana-purchased (restricted)

Number of Solana- Staking rewards

Number of World Coin purchased

Number of World Coin - Staking rewards

Crypto asset purchased carrying value

Staking rewards

Unrealized gain (loss) on crypto assets

( 4,009,841 )

( 1,565,173 )

Total investment accounts

3 unchanged sentences

Cash consideration of $ 1,250,000 ;

Issuance of 800,000 shares of the Company’s Class B common stock valued at $ 2.94 , totaling $ 2,352,000 , based on the fair value of the shares on the acquisition date;

Issuance of warrants to purchase 739,278 shares of Class B common stock, with an exercise price of $ 0.01 per share and an expiration date of June 30, 2030.

The pre-funded warrants are exercisable on a cash or cashless basis and are subject to a 9.9 % beneficial ownership blocker.

The fair value of the warrants on the acquisition date was estimated at $2.94 using the Black-Scholes option pricing model with the following assumptions:

Issuance of 16,000 shares of the Company’s Class B common stock (reflecting the March 2026 reverse stock split;

800,000 shares on a pre-split basis, valued at $ 2.94 , totaling $ 2,352,000 , based on the fair value of the shares on the acquisition date);

Issuance of warrants to purchase 14,786 shares of Class B common stock (reflecting the March 2026 reverse stock split;

739,278 shares on a pre-split basis, with an exercise price of $ 0.01 per share and an expiration date of June 30, 2030.

The pre-funded warrants are exercisable on a cash or cashless basis and are subject to a 9.9 % beneficial ownership blocker.) The fair value of the warrants on the acquisition date was estimated at $ 2.94 using the Black-Scholes option pricing model with the following assumptions:

Expected term:

8 unchanged sentences

The acquired IP is recorded as an intangible asset and is being amortized over its estimated useful life of 10 years.

Amortization expense related to the acquired IP for the three and nine months ended September 30, 2025 was $ 144,387 .

Future amortization of the Company’s intangible assets is presented below:

Amortization expense related to the acquired IP for the three months ended March 31, 2026 was $ 105,947 .

During the year ended December 31, 2025, the Company identified indicators of impairment related to the IP.

The Company performed a recoverability test by comparing the carrying amount of the IP to the estimated undiscounted future cash flows.

As a result of this analysis, the Company determined that the carrying amount was not recoverable.

Accordingly, the Company recorded an impairment loss of $ 1,460,704 for the year ended December 31, 2025, representing the excess of the carrying amount over the estimated fair value of the IP.

No additional impairment loss was recorded for the three months ended March 31, 2026.

The fair value of the Company’s patented technology was determined in accordance with ASC 820 using an income approach, specifically the relief-from-royalty method.

Under this method, the fair value was estimated based on the present value of projected future royalty savings attributable to the ownership of the patented technology.

The valuation incorporated significant assumptions, including forecasted revenues provided by management, royalty rates ranging from approximately 5.0 % to 12.0 % based on comparable licensing transactions, and a discount rate of approximately 23.0 %, which reflects the Company’s weighted average cost of capital and the risks associated with achieving the projected cash flows.

The fair value measurement is classified as Level 3 within the fair value hierarchy due to the use of significant unobservable inputs

As of March 31, 2026, the fair value of the patented technology was determined to be $ 3,920,053 .

Following the impairment, the Company revised the remaining useful life and amortization of the intangible asset.

Future amortization is expected to be as follows:

Year ended December 31,

1 unchanged sentence

On November 1, 2022, the Company recognized approximately $ 2.2 million of right of use (“ROU”) assets and operating lease liabilities based on the present value of the future minimum rental payments of the sublease, using an incremental borrowing rate of 4 %.

As of September 30, 2025, the Company’s operating sublease had a remaining lease term of approximately 4.1 years.

For the three and nine months ended September 30, 2025 and 2024, rent expense for the operating sublease was $ 90,253 and $ 270,758 , respectively.

The Company’s sublease obligations as of September 30, 2025 are presented below:

As of March 31, 2026, the Company’s operating sublease had a remaining lease term of approximately 3.6 years.

For the quarter ended March 31, 2026 and 2025, rent expense for the operating sublease was $ 90,253 .

The Company’s sublease obligations as of March 31, 2026 are presented below:

Year ending December 31,

9 unchanged sentences

Billed and uncollected operating lease receivables will be included in due from related parties which are stated at their estimated net realizable value.

For the three months ended September 30, 2025 and 2024, the Company’s income from these subleases totaled $ 26,684 and $ 23,471 respectively, and for the nine months ended September 30, 2025 and 2024 the Company’s income from these subleases totaled $ 76,604 and $ 48,471 , respectively (which has been reflected as a reduction of general and administrative expenses in the accompanying consolidated Statements of Operations).

For the three months ended March 31, 2026 and 2025, the Company’s income from these subleases totaled $ 4,666 and $ 24,854 respectively (which has been reflected as a reduction of general and administrative expenses in the accompanying consolidated Statements of Operations).

Accrued Liabilities and Other Payables

Accrued liabilities and other payables consisted of the following:

September 30,

March 31, 2026

December 31, 2025

Credit card payable

Payroll tax payable

The Company had $ 701,957 income tax provision for the nine months ended September 30, 2025 and 2024.

September 30,

The Company had nil income tax provision for the three months ended March 31, 2026 and 2025.

For the three months ended

Deferred income tax expense

Current income tax expense

The Company has the following deferred tax assets (liabilities) as of September 30, 2025 and December 31 2024:

September 30,

The Company has the following deferred tax assets (liabilities) as of March 31, 2026 and December 31 2025:

As of March 31 , 2026

As of December 31, 2025

Net operating loss carryforwards

Change in fair value of warrants

Change in fair value of crypto assets

Change in fair value of convertible debt

Impairment loss on intangible assets

Other expense temporary difference

Total deferred tax assets

Change in fair value of crypto assets

Deferred tax liability- Depreciation

( 3,437,194 )

( 2,574,113 )

Net deferred tax liability

3 unchanged sentences

The Company has provided a valuation allowance for the net deferred tax asset as it is not more likely than not that the asset will be realized.

The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the periods ended September 30, 2025 and 2024:

September 30,

The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the periods ended March 31, 2026 and 2025:

March 31, 2026

March 31, 2025

Federal statutory rate

Nondeductible expense

Valuation allowance

Effective income tax rate

The effective tax rate for the nine months ended September 30, 2025 and 2024 is less than the statutory rate primarily as a result of the valuation allowance for net deferred tax assets.

No uncertain tax benefits have been recorded for the three and nine months ended September 30, 2025 and 2024

The effective tax rate for the three months ended March 31, 2026 and 2025 is less than the statutory rate primarily as a result of the valuation allowance for net deferred tax assets.

No uncertain tax benefits have been recorded for the three months ended March 31, 2026 and 2025.

On March 27, 2020, the “Coronavirus Aid, Relief and Economic Security (CARES) Act” (the “Act”) was signed into law.

1 unchanged sentence

The Company analyzed the provisions of the Act and determined there was no significant impact to its income taxes for the periods presented.

As of September 30, 2025, Classover NJ and Classover Holdings, Inc.

As of March 31, 2026, Classover NJ and Classover Holdings, Inc.

has approximately $ 8,379,483 and $ 846,608 in federal net operating loss carryforwards, respectively.

2 unchanged sentences

Related parties

As of September 30, 2025 and December 31, 2024, The Company has related party transactions with the following affiliates and affiliated entities:

As of March 31, 2026 and 2025, The Company has related party transactions with the following affiliates and affiliated entities:

Related Party Name

1 unchanged sentence

Spouse of Hui Luo

Genius Kid Class LLC

An entity controlled by Yi Liu

Dream Legal Group, Inc

4 unchanged sentences

Due from related parties

September 30,

March 31, 2026

December 31, 2025

Dream Legal Group, Inc.

1 unchanged sentence

Due to related parties

September 30,

Luo Hui-accrued interest on promissory note

Luo Hui – promissory note, due on August 15, 2025;

at a rate of 4% per annum

March 31, 2026

December 31, 2025

Due to Dream Go Inc.

Total due to related parties - current

The following table represents related party transactions for the nine months ended September 30, 2025 and 2024:

The following table represents related party transactions for the quarter ended March 31, 2026 and 2025:

Three Months Ended

Nine Months Ended

Business Purpose of Transaction

September 30,

Dream Legal Group, Inc

Sublease income

Genius Kid Class LLC

Consulting revenue

Interest expense

1 unchanged sentence

Sublease income has been reflected as a reduction of general and administrative expenses in the accompanying consolidated statements of operations.

As of September 30, 2025 and December 31, 2024, the Company has the following ROU assets and operating lease liabilities recognized from related party under ASC 842 (Note 4):

September 30,

As of March 31, 2026 and December 31, 2025, the Company has the following ROU assets and operating lease liabilities recognized from related party under ASC 842 (Note 4):

March 31, 2026

December 31, 2025

Short term obligation under operating leases

5 unchanged sentences

Convertible notes

Conversion of convertible notes in connection with the Business Combination

Convertible notes payable is comprised of the following as of December 31, 2024:

Interest Rate

Conversion Cap

Maturity Date

December 31, 2024

Upon the closing of the business combination, the above notes $ 1,750,000 and accrued interest payable $ 19,072 were converted to 4,433,122 Class B Common Shares.

2025 Convertible Notes

6 unchanged sentences

The Notes are due on the two-year anniversary of the date of issuance unless earlier converted or repaid.

Description of 2025 Convertible Note:

Description of 2025 Convertible Note upon issuance:

7.0 % per annum, quarterly, PIK-eligible

6 unchanged sentences

20% for operations

The Company elected the fair value option for 2025 convertible notes.

The fair value of the convertible notes are remeasured at each balance sheet date and any changes are recorded in the consolidated statements of operations.

For the three and nine months ended September 30, 2025, the Company recorded a change in the fair value of 2025 convertible notes in the amount of a loss of $ 249,508 and $ 510,138 .

For the three and nine months ended September 30, 2025, interest expense related to the 2025 Convertible Note is $ 194,082 and $ 244,712 .

During the fourth quarter ended December 31, 2025, the Company converted an aggregate principal amount of $ 3,225,000 of convertible notes into equity securities in accordance with the terms of the note agreements.

Upon conversion, $ 2,000,000 of the notes were converted into 2,000 shares of Series C Preferred Stock, and $ 1,225,000 of the notes were converted into 53,526 shares of Class B Common Stock (reflecting the March 2026 reverse stock split;

2,675,975 shares on a pre-split basis).

The Company had elected the fair value option for the convertible notes in accordance with ASC 825-10, Financial Instruments.

Accordingly, the convertible notes were measured at fair value at each reporting date, with changes in fair value recognized in earnings.

At the conversion date, the equity instruments issued were measured based on the quoted market price of the Company’s common stock on the conversion date.

The fair value of the Series C Preferred Stock and Class B Common Stock issued upon conversion was $ 2,109,774 and $ 1,496,183 , respectively.

During the three months ended March 31, 2026, the Company converted an aggregate principal amount of $ 2,742,500 of convertible notes into equity securities in accordance with the terms of the note agreements.

Upon conversion, $ 2,742,500 of the notes were converted into 529,749 shares of Class B Common Stock (reflecting the March 2026 reverse stock split;

26,487,424 shares on a pre-split basis).

The Company had elected the fair value option for the convertible notes in accordance with ASC 825-10, Financial Instruments.

Accordingly, the convertible notes were measured at fair value at each reporting date, with changes in fair value recognized in earnings.

At the conversion date, the equity instruments issued were measured based on the quoted market price of the Company’s common stock on the conversion date.

The fair value of the Class B Common Stock issued upon conversion was $ 3,899,856 .

Immediately prior to conversion, the carrying value of the convertible notes approximated their fair value.

As a result, the derecognition of the convertible notes and issuance of equity securities did not result in a material gain or loss upon conversion.

The carrying value of the notes was reclassified to equity upon issuance of the shares.

The Company elected the fair value option (“FVO”) under ASC 825 for its senior secured convertible notes issued on June 6, 2025.

Accordingly, the convertible notes are measured at fair value at each reporting date, with changes in fair value recognized in earnings within other income (expense), net.

The fair value of the convertible notes was estimated using a lattice (binomial tree) model, which captures the hybrid nature of the instrument, including the embedded conversion feature, issuer redemption option, payment-in-kind (“PIK”) interest accretion, floor-price reset provisions, and contractual call premiums.

The valuation incorporates market participant assumptions consistent with ASC 820 and is classified within Level 3 of the fair value hierarchy due to the use of significant unobservable inputs.

As of March 31, 2026 and December 31, 2025, the aggregate contractual principal amount of the convertible notes was $ 5,162,521 and $ 5,032,500 .

Level 3 Quantitative Inputs

The significant inputs used in the valuation as of December 31, 2025 were as follows:

December 31, 2025

March 31, 2026

Risk-free rate

Remaining contractual term

PIK interest rate

Conversion price (floor)

Redemption premium

The Company applied a contractual floor conversion price of $ 0.74 per share, as the market-price reset formula would otherwise have resulted in a lower conversion price based on 95 % of the lowest six-day VWAP.

The Company did not separately isolate the portion of the fair value change attributable to instrument-specific credit risk.

The fair value measurement primarily reflects changes in the Company’s stock price, expected volatility, time to maturity, collateral coverage triggers, conversion reset provisions, and other market-based factors.

No separate credit spread or own-credit adjustment was applied in the valuation model.

The fair value of the convertible notes is sensitive to changes in expected volatility, which represents a significant unobservable input.

Based on the sensitivity analysis performed as of December 31, 2025, a hypothetical 10 % increase in expected volatility would have decreased the fair value by approximately $ 220,805 , while a 10 % decrease would have decreased the fair value adjustment to approximately $ 44,519 , with all other assumptions held constant.

Based on the sensitivity analysis performed as of March 31, 2026, increasing volatility from 94 % to 120 % would decrease the fair value by approximately $ 128,332 , while decreasing volatility from 94 % to 80 % would increase the fair value by approximately $ 149,096 .

The following table summarizes the changes in the fair value of the Company’s convertible notes classified within Level 3 of the fair value hierarchy:

Fair value at December 31, 2024

Initial recognition at principal amount

Changes in fair value recognized in earnings

Conversion into common and preferred stock

( 3,605,957 )

Fair value at December 31, 2025

Changes in fair value recognized in earnings

Conversion into common stock

( 3,899,856 )

Fair value at March 31, 2026

Warrant Liabilities

In connection with the Reorganization Merger, the Company has assumed 17,250,000 warrants outstanding from BFAC public shareholders.

In connection with the Reorganization Merger, the Company has assumed 345,000 warrants outstanding (reflecting the March 2026 reverse stock split;

17,250,000 warrants on a pre-split basis) from BFAC public shareholders.

Each whole warrant entitles the holder to purchase one ordinary share at a price of $ 11.50 per share, subject to adjustment as described below, commencing 30 days after the completion of its initial business combination, and expiring five years from after the completion of an initial business combination.

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In addition, if (a) the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of its initial business combination at a newly issued price of less than $ 9.20 per share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founders’ shares held by the Company’s initial shareholders or such affiliates, as applicable, prior to such issuance), (b) the aggregate gross proceeds from such issuances represent more than 60 % of the total equity proceeds, and interest thereon, available for the funding of the initial business combination on the date of the consummation of the Company’s initial business combination (net of redemptions), and (c) the volume weighted average trading price of the Company’s ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates its initial business combination is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115 % of the higher of the market value and the newly issued price, and the $18.00 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 180% of the higher of the market value and the newly issued price.

The Company accounts for the 17,250,000 warrants issued in connection with the Public Offering of BFAC in accordance with the guidance contained in ASC 815-40.

The Company accounts for the 345,000 warrants (reflecting the March 2026 reverse stock split;

17,250,000 warrants on a pre-split basis) issued in connection with the Public Offering of BFAC in accordance with the guidance contained in ASC 815-40.

Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability.

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The following table presents the changes in the fair value of warrant liabilities:

Fair value as of April 4, 2025 (Reorganization Merger Date)

Fair value as of December 31, 2025

Change in fair value

Fair value as of September 30 , 202 5

Fair value as of March 31, 2026

Recurring f air v alue m easurements

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Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

The following tables present fair value information as of September 30, 2025, the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:

September 30 , 2025

The following tables present fair value information as of March 31, 2026, the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:

March 31, 2026

Investment- Crypto asset

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Convertible notes payable

December 31, 2025

Investment- Crypto asset

Warrant liabilities

Convertible notes payable

Segment information and revenue analysis

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Three Months Ended

Nine Months Ended

September 30,

March 31, 2026

March 31, 2025

Time-based subscriptions

Credit-based subscriptions

Marketing revenues (related party)

Total revenues

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The Company establishes an accrued liability for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable.

At September 30, 2025, the Company was not involved in any material legal proceedings regarding claims or legal actions against the Company.

As of September 30, 2025, the total number of shares which the Company shall have the authority to issue is five hundred and ten million ( 510,000,000 ) shares, which include 50,000,000 shares of Class A common stock, par value $ 0.0001 per share, 450,000,000 shares of Class B common stock, par value $ 0.0001 per share, and 10,000,000 shares of preferred stock.

At March 31, 2026, the Company was not involved in any material legal proceedings regarding claims or legal actions against the Company.

As of March 31, 2026, the total number of shares which the Company shall have the authority to issue is 51,000,000 shares (reflecting the March 2026 reverse stock split;

510,000,000 shares on a pre-split basis), which include 1,000,000 shares of Class A common stock (reflecting the March 2026 reverse stock split;

50,000,000 shares on a pre-split basis, par value $ 0.0001 per share), 40,000,000 shares of Class B common stock (reflecting the March 2026 reverse stock split;

200,000,000 shares on a pre-split basis, par value $ 0.0001 per share, par value $ 0.0001 per share), and 10,000,000 shares of preferred stock.

The Preferred Stock authorized by this Certificate of Incorporation may be issued in series.

Each Series A Preferred Shares are convertible to Class B Common Shares on a 1 to 1 basis, and each Series B Preferred Shares are convertible to Class B Common Shares on a 1 to 100 basis.

Each Series A Preferred Shares are convertible to Class B Common Shares on a 50 to 1 basis , Each Series B and Series C Preferred Shares are convertible to Class B Common Shares.

The conversion price of Series B Preferred Shares are the greater of 92% of the lowest Volume Weighted Average Price (“VMAP”) of the stock price five days before conversion, or adjusted floor price.

The conversion price of Series C Preferred Shares are the lower of 95% of the lowest VMAP of the stock price six days before conversion, or initial conversion price.

Holders of shares of Common Stock will exclusively possess all voting power with respect to the Company and are entitled vote on all matters submitted to the Company’s stockholders for their vote or approval.

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Former Classover DE shareholders received 12,500,000 shares of Company’s equity, including:

6,535,014 Class A common shares to Hui Luo

1,531,864 Class B common shares to other Classover shareholders

130,701 Class A common shares to Hui Luo (reflecting the March 2026 reverse stock split;

6,535,014 shares on a pre-split basis)

30,638 Class B common shares to other Classover shareholders (reflecting the March 2026 reverse stock split;

1,531,864 shares on a pre-split basis)

1,000,000 Series A Preferred Shares to Classover equity holders

4,433,122 Class B common shares to convertible note holders upon conversion

BFAC Sponsor received 9,600,000 Class B common shares

Remaining BFAC IPO investors were issued 168,356 Class B common shares, representing residual trust shares post-redemptions (3,683,125 original shares less 3,514,769 redeemed)

17,250,000 warrants were exchanged 1-for-1 with original BFAC warrant holders

88,663 Class B common shares to convertible note holders upon conversion (reflecting the March 2026 reverse stock split;

4,433,122 shares on a pre-split basis)

BFAC Sponsor received 192,021 Class B common shares (reflecting the March 2026 reverse stock split;

9,600,000 shares on a pre-split basis)

Remaining BFAC IPO investors were issued 3,368 Class B common shares (reflecting the March 2026 reverse stock split;

168,356 shares on a pre-split basis), representing residual trust shares post-redemptions (3,683,125 original shares less 3,514,769 redeemed )

345,000 warrants (reflecting the March 2026 reverse stock split;

17,250,000 warrants on a pre-split basis were exchanged 1-for-1 with original BFAC warrant holders )

These equity issuances were part of the reverse recapitalization and accounted for in accordance with ASC 805-40.

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Shares issued in connection with the Company’s Merger on April, 4, 2025:

Common Share- reflecting the March 2026 reverse stock split

Common Share- on a pre-split basis

Holders of BFAC public shareholders – Class B

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$5,000,000 was delivered, less $300,000 in transaction costs, with net proceeds of $4,700,000 .

On May 30, 2025, the Company issued 25,000 Class B common shares to the investor as consideration for waving specific financing restrictions under the PIPE agreement.

On May 30, 2025, the Company issued 500 Class B common shares (reflecting the March 2026 reverse stock split;

25,000 shares on a pre-split basis) to the investor as consideration for waving specific financing restrictions under the PIPE agreement.

Shares issued as contract modifications are recorded at fair value and $ 66,500 expense was recorded when the waiver becomes effective, per ASC 470 and ASC 505.

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The 2024 Incentive Plan provides for the future issuance of shares of the Company’s Class B Common Shares, representing 8% of the number of shares of the Company’s Common Stock outstanding following the Business Combination (after giving effect to the Redemption).

Accordingly, the 2024 Incentive Plan is eligible to issue up to 3,268,668 Class B Common Shares.

On April 17, 2025, 820,000 shares were granted as equity-based compensation to two employees of the Company, which will be vested over three years.

On April 28, 2025, 100,000 shares were issued to a third-party advisor for advisory services which will be vested over one year.

On September 6, 2025, 4,000 shares were issued to a third-party advisor for advisory services which was fully vested.

Accordingly, the 2024 Incentive Plan is eligible to issue up to 65,373 Class B Common Shares (reflecting the March 2026 reverse stock split;

3,268,668 shares on a pre-split basis).

On April 17, 2025, 16,400 shares (reflecting the March 2026 reverse stock split;

820,000 shares on a pre-split basis) were granted as equity-based compensation to two employees of the Company, which will be vested over three years.

On April 28, 2025, 2,000 shares (reflecting the March 2026 reverse stock split;

100,000 shares on a pre-split basis) were issued to a third-party advisor for advisory services which will be vested over one year.

On September 6, 2025, 80 shares (reflecting the March 2026 reverse stock split;

4,000 shares on a pre-split basis) were issued to a third-party advisor for advisory services which was fully vested.

On October 28, 2025, 200 shares (reflecting the March 2026 reverse stock split;

10,000 shares on a pre-split basis) were issued to a third-party advisor to collaborate on joint branding, public relations initiatives, and exploration of blockchain-based educational products which will be vested over one year.

On October 31, 2025, 60 shares (reflecting the March 2026 reverse stock split;

3,000 shares on a pre-split basis) were issued to a third-party advisor for advisory services to provide strategic and technical guidance related to the Company’s AI education initiatives which will be vested over 90 days.

On January 21, 2026, 28,000 shares (reflecting the March 2026 reverse stock split;

1,400,000 shares on a pre-split basis) were issued to three employees of the Company which will be vested over four years.

2025 Incentive Plan

On January 9, 2026, the Company registered 100,000 shares (reflecting the March 2026 reverse stock split;

5,000,000 shares on a pre-split basis), issuable pursuant to the Company’s 2025 Long-Term Incentive Equity Plan (the “2025 Incentive Plan”) .

The purpose of the Classover Holdings, Inc.

2025 Incentive Plan (“Plan”) is to enable the Company to offer to its employees, officers, directors and consultants whose past, present and/or potential future contributions to the Company and its Subsidiaries have been, are or will be important to the success of the Company, an opportunity to acquire a proprietary interest in the Company, or be paid incentive compensation, including incentive compensation measured by reference to the value of Common Stock, thereby strengthening their commitment to the Company and aligning their interests with those of the Company's stockholders

On January 21, 2026, 15,000 shares (reflecting the March 2026 reverse stock split;

750,000 shares on a pre-split basis) were granted as equity-based compensation to two employees of the Company, which will be vested over four years.

Shares were measured at fair value on grant date under ASC 718.

Compensation cost is recognized ratably over the vesting period.

During the three and nine months ended September 30, 2025, stock compensation cost were $ 174,343 and $ 311,620 .

For the three months ended March 31, 2026, stock compensation cost under 2024 and 2025 inventive plan was $ 188,960 .

There was no stock compensation for the three months ended March 31, 2025.

Other equity transactions

On April 17, 2025, 190,000 shares were issued to a professional service provider as part of an outstanding bill payment amount to $ 430,000 .

On June 30, 2025, 415,131 Series A Preferred Shares were converted into an equivalent number of Class B common shares on a 1:1 basis .

On April 17, 2025, 3,800 shares (reflecting the March 2026 reverse stock split;

190,000 shares on a pre-split basis) were issued to a professional service provider as part of an outstanding bill payment amount to $ 430,000 .

On June 30, 2025, 415,131 Series A Preferred Shares were converted into 8,304 Class B common shares (reflecting the March 2026 reverse stock split;

415,131 shares on a pre-split basis on a 1:1 basis).

The conversion was accounted for as an equity-for-equity exchange under ASC 505 .

No gain or loss recognized.

On June 30, 2025, the Company acquired intellectual property using $ 1,250,000 cash, 800,000 Class B common shares and 739,278 warrants.

On June 30, 2025, the Company acquired intellectual property using $ 1,250,000 cash, 16,000 Class B common shares (reflecting the March 2026 reverse stock split;

800,000 shares on a pre-split basis) and 14,786 warrants (reflecting the March 2026 reverse stock split;

739,278 warrants on a pre-split basis).

The transaction was accounted for under ASC 805-50 as an asset acquisition.

Shares and warrants were valued at fair value on grant date.

On October 9, 2025, 62,068 series A preferred shares were canceled, in exchange, the company issued 11,938 class B common shares (reflecting the March 2026 reverse stock split;

596,808 shares on a pre-split basis) to the investors

On December 22, 2025, the company's shareholders approved a few proposals through a special meeting:

redomestiacate the company from Delaware Corporation to Nevada Corporation, b) adopt the new incentive plan - 2025 Long-Term Incentive Equity Plan, a total of 100,000 shares of Class B stock (reflecting the March 2026 reverse stock split;

5,000,000 shares on a pre-split basis) is reserved for employee, the size of pool is subject to increase at the time the market cap of the company hits certain milestones.

c) approve to execute a reverse stock split of all outstanding shares, including Class A and Class B, at a ratio from 1-for-2, to 1-for-50, to be determined by board of directors .

2,675,975 shares on a pre-split basis).

The Company had elected the fair value option for the convertible notes in accordance with ASC 825-10, Financial Instruments.

Accordingly, the convertible notes were measured at fair value at each reporting date, with changes in fair value recognized in earnings.

At the conversion date, the equity instruments issued were measured based on the quoted market price of the Company’s common stock on the conversion date.

The fair value of the Series C Preferred Stock and Class B Common Stock issued upon conversion was $ 2,109,774 and $ 1,496,183 , respectively.

Immediately prior to conversion, the carrying value of the convertible notes approximated their fair value.

As a result, the derecognition of the convertible notes and issuance of equity securities did not result in a material gain or loss upon conversion.

The carrying value of the notes was reclassified to equity upon issuance of the shares.

ranking senior to common but subordinate to Series B Preferred, Each Series C convertible preferred share entitled to 7 % annual dividends payable every quarter in Class B common shares, and can be converted to class B common at $ 0.2029 .

During the fourth quarter ended December 31, 2025, the Company received several conversion notices from a holder of its Series B Convertible Preferred Stock to convert 2,225 shares of Series B Convertible Preferred Stock into 68,936 shares (reflecting the March 2026 reverse stock split;

3,446,349 shares on a pre-split basis)of the Company’s Class B common stock in accordance with the terms of the Certificate of Designations governing the Series B Convertible Preferred Stock.

Upon conversion, the Company recorded the par value of the Class B common stock issued as common stock, with the remaining amount recorded as additional paid-in capital.

During the three months ended March 31, 2026, the Company converted an aggregate principal amount of $2,742,500 of convertible notes into equity securities in accordance with the terms of the note agreements.

Upon conversion, $2,742,500 of the notes were converted into 529,749 shares of Class B Common Stock (reflecting the March 2026 reverse stock split;

26,487,424 shares on a pre-split basis).

The Company had elected the fair value option for the convertible notes in accordance with ASC 825-10, Financial Instruments.

Accordingly, the convertible notes were measured at fair value at each reporting date, with changes in fair value recognized in earnings.

At the conversion date, the equity instruments issued were measured based on the quoted market price of the Company’s common stock on the conversion date.

The fair value of the Class B Common Stock issued upon conversion was $ 3,899,857 .

During the three months ended March 31, 2026, the Company received several conversion notices from a holder of its Series B Convertible Preferred Stock to convert 900 shares of Series B Convertible Preferred Stock into 93,104 shares (reflecting the March 2026 reverse stock split ;

4,655,200 shares on a pre-split basis) of the Company’s Class B common stock in accordance with the terms of the Certificate of Designations governing the Series B Convertible Preferred Stock.

Upon conversion, the Company recorded the par value of the Class B common stock issued as common stock, with the remaining amount recorded as additional paid-in capital.

On February 10, 2026, the Company's board authorized to repurchase up to $ 2,000,000 Class B common shares.

The repurchase program does not obligate the Company to acquire any particular amount of shares of Class B common stock.

On March 6, 2026, the Company terminated an Equity Purchase Facility Agreement (the “EPFA”) with Solana Strategic Holdings LLC (the “Investor”) pursuant to which, subject to certain conditions precedent contained therein, the Company had the right to issue and sell to the Investor up to an aggregate of $ 400 million in newly issued shares of the Company’s Class B common stock, par value $0.0001 per share.

Concentration of risk

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The insurance coverage for cash deposits at each bank is $ 250,000 .

As of September 30, 2025, a cash balance of $ 2,659,724 deposited with three financial institutions was uninsured.

As of March 31, 2026, a cash balance of $ 1,049,764 deposited with three financial institutions was uninsured.

Management believes that the financial institutions that hold the Company’s deposits are financially credit worthy and, accordingly, minimal credit risk exists with respect to those balances.

Customer concentration risk

For the three and nine months ended September 30, 2025 and 2024, no customer accounted for more than 10 % of the Company’s total revenues.

For the three months ended March 31, 2026 and 2025, no customer accounted for more than 10 % of the Company’s total revenues.

Vendor concentration risk

For the three and nine months ended September 30, 2025 and 2024, no vendor accounted for over 10 % of the Company’s total purchases.

For the three months ended March 31, 2026 and 2025, no vendor accounted for over 10 % of the Company’s total purchases.

Subsequent Event

In April 2026, 1,875 shares of Series B Preferred Stock were converted into 1,291,763 shares of Class B Common Stock per the existing agreement。

In April and May 2026, an aggregate of $ 5,032,500 convertible debt was converted into 5,346,878 shares of Class B common stock per the existing agreement。

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements