v3.26.1
Equity
 3 Months Ended
Mar. 31, 2026
Equity [Abstract]  
Equity

11. Equity

 

Preferred Stock

 

As of March 31, 2026, the Company was authorized to issue 20 million shares of preferred stock with a par value of $0.001 per share, of which 600,000 shares had been designated as Series A convertible and 166,000 shares had been issued and are outstanding.

 

In the event of any liquidation, dissolution or winding up of the Company, the holders of preferred stock shall be entitled to receive, prior and in preference to any distribution of any of the assets of the Company to the holders of common stock, an amount equal to $10 for each share of preferred stock, plus all unpaid dividends that have been accrued, accumulated or declared. As of March 31, 2026, the total liquidation preference on the preferred stock is $1,689,050. The Company may redeem the preferred stock from the holders at any time following the second anniversary of the closing of the original purchase of the preferred stock. The Series A Convertible Preferred Stock can be converted to common stock at 80% of the prevailing market price over the previous 30-day period at the option of the Company.

 

Holders of preferred stock are entitled to receive preferential cumulative dividends, only if declared by the board of directors, at a rate of 7% per annum per share of the liquidation preference amount of $10 per share. During the three months ended March 31, 2026 and 2025, the Board of Directors has declared and paid dividends on the preferred stock of $29,050 and $29,050, respectively. As of March 31, 2026 and December 31, 2025, preferred dividends are in arrears by $29,050 and $29,050, respectively.

 

December 31, 2025 dividends in arrears were declared and paid in January 2026. March 31, 2026 dividends in arrears were declared and paid in April 2026.

 

Common Stock

 

As of March 31, 2026 and December 31, 2025, the Company was authorized to issue 100 million shares of common stock with a par value of $0.001 per share, of which 2,940,030 and 3,001,216 shares were issued and outstanding, respectively.

 

In December 2025, the Company repurchased 1,186 shares of its common stock on the open market at an average share price of $1.87. At December 31, 2025, the shares were held in treasury to be retired. In January 2026, the 1,186 shares were retired. In March 2026, the Company repurchased 60,000 shares of its common stock in private negotiations with two shareholders at an average share price of $2.25. In April 2026, the Company repurchased 16,000 shares of its common stock in private negotiations with two shareholders at an average share price of $2.25.

 

In April 2026, the Company issued 6,668 shares to its CEO and CFO based on the achievement of time-based and performance-based targets included in the executive compensation agreements for the year ended December 31, 2025.

 

Stock Options

 

In 2019, the Company’s Board of Directors approved the creation of the 2019 Equity Incentive Plan (the “2019 Plan”). The 2019 Plan provides for the issuance of incentive stock options to designated employees, certain key advisors and non-employee members of the Board of Directors with the opportunity to receive grant awards to acquire, in the aggregate, up to 300,000 shares of the Corporation’s common stock. The following table summarizes information about employee stock options outstanding at March 31, 2025:

      
 Outstanding Options    Vested Options 
 Number Outstanding at March 31, 2026    Weighted Average Remaining Term    Weighted Average Exercise Price    Number Exercisable at March 31, 2026    Weighted Average Remaining Term    Weighted Average Exercise Price 
 91,200    3.92   $0.80    91,200    3.92   $0.80 
 10,000    6.25    4.50    10,000    6.25    4.50 
 10,000    1.25    4.95    10,000    1.25    4.95 
 111,200    3.89 years   $1.51    111,200    3.89 years   $1.51 

 

A summary of information regarding the stock options outstanding is as follows:

                  
    Number of Shares   Weighted Average Exercise Price   Weighted Average Remaining Contractual Term   Intrinsic Value 
 Outstanding at December 31, 2025    111,200   $1.51    4.13 years   $118,560 
 Issued    —    —    —    — 
 Exercised    —    —    —    — 
 Outstanding at March 31, 2026    111,200   $1.51    3.89 years   $136,800 
 Exercisable at March 31, 2026    111,200   $1.51    3.89 years   $136,800 

 

During the three months ended March 31, 2026 and 2025, the Company did not recognize stock option expense. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing price of the Common Stock, which was $2.30 and $1.90 per share on March 31, 2026 and December 31, 2025, respectively.

 

Stock Warrants

 

A summary of information regarding the stock warrants outstanding is as follows:

Schedule of stock warrants                  
    Number of Shares   Weighted Average Exercise Price   Weighted Average Remaining Contractual Term   Intrinsic Value 
 Outstanding at December 31, 2025    235,000   $4.00    0.7 years    — 
 Issued    —    —    —    — 
 Exercised    —    —    —    — 
 Outstanding at March 31, 2026    235,000   $4.00    0.4 years    — 
 Exercisable at March 31, 2026    235,000   $4.00    0.4 years    — 

 

The warrants vested immediately. During the three months ended March 31, 2025 and 2024, the Company recognized no stock warrant expense. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing price of the Common Stock, which was $2.30 and $1.90 per share on March 31, 2026 and December 31, 2025, respectively.