Note 12 - Other Equity Transactions |
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Dec. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
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| Equity [Text Block] |
12. Other Equity Transactions
On January 25, 2024, the Company redeemed its "Interests" of FG Holdings LLC and withdrew from FG Holdings LLC. In exchange for its Interests, the Company received 52,000 shares of its own Common Stock that was held by FGF, with an approximate fair value of $650 on the date of the transaction and recorded a realized loss of $91 on the investment during the first quarter of 2024. The shares received by the Company are held as treasury stock.
On November 6, 2023, the Company entered into a Master Supply Agreement (the "MSA") and Transition Services Agreement (the "TSA," and together with the MSA, the "Agreements") with East West Manufacturing, LLC, a Georgia limited liability company ("East West"). Pursuant to the Agreements, the Company issued a warrant to East West with a -year term to purchase up to 135,300 shares of the Company's common stock at an exercise price per share of $15.00. The warrant was classified as a component of permanent equity in the Company's Consolidated Balance Sheets as it was a freestanding financial instrument that was immediately exercisable, did not embody an obligation for the Company to repurchase its own shares and permitted the holders to receive a fixed number of shares of common stock upon exercise. In May 2025, East West exercised its warrant in full.
The Company used the Black-Scholes-Merton option valuation model to calculate the fair value of a stock warrant grant, using the assumptions noted in the following table. Expected volatilities are based on the historical volatility of the Company’s common stock over the period of time, commensurate with the expected life of the stock warrant. The dividend yield assumption is based on the Company’s expectations of no dividend payouts at the grant date. The stock price was the closing price of the common stock on the date of the warrant agreement and the strike price and the expected term was defined in the warrant agreement. The risk-free interest rate is derived from the 90 day U.S. Treasury rate at the date of the stock warrant grant.
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