Company: ZRCN
Filing Date: 2025-09-10
Form Type: 10-K
Source: 0001641172-25-027037
Chunk: 458

Company: ZRCN Inc.
Filing Date: 2025-09-10
Form: 10-K
Item: Item 1C
Chunk 458
---
grant date.

During
the year ended March 31, 2025, the Company made distributions of $0.7 million to certain related party shareholders and one director
shareholder for taxes due as a result of the Company converting from an S corporation to a C corporation, of which the total distribution
was paid in cash. During the year ended March 31, 2025, the Company made distributions to shareholders in the amount of $8.2 million,
which was subsequently reinvested into the Company.

See
Note 3 for an illustration of the reported balance and the revised balance for Retained earnings for the period ended March 31,
2024.

13.
Warrants

At
the closing of the Merger, the Company issued certain consultants and advisors warrants to purchase an aggregate of 217,184 shares of
Company common stock (the “Advisor Warrants”). The Advisor Warrants are exercisable any time ten years from the date of issuance,
have an exercise price of $0.20 per share, and are classified within equity. The Company determined the fair value of the Advisor Warrants
of $0.3 million using the intrinsic value method based on a stock price established in the Merger of $1.60 per share.

The
following table provides the activity for all warrants for the years ended March 31, 2025 and 2024:

 Schedule of Warrants Activity

    Total
    Warrants  
    Weighted
                                                                                Average
                                            Remaining Term  
    Weighted
                                                                                Average
                                            Exercise Price 
  
    Outstanding
    as of March 31, 2024 
     217,184  
     9.2  
    $0.20 
  
    Outstanding
    as of March 31, 2025 
     217,184  
     8.2  
    $0.20 

    F-23

ZRCN
                                            Inc.

NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR
THE YEARS ENDED MARCH 31, 2025 AND 2024

14.
Commitments and Contingencies

Legal
Proceedings

Zircon
is engaged in procedures to protect its proprietary rights and has filed complaints with the Federal Trade Commission and the Customs
and Border Patrol.

Zircon
Corporation v. Stanley Black & Decker, Inc.

A
stay, placed on Zircon’s patent infringement suit filed against Stanley Black &