Stock Based Compensation Accounting Policy

The Trust records all equity-based incentive grants to officers and non-employee members of the Trust’s Board of Trustees in general and administrative expenses in the Trust’s Consolidated Statement of Operations based on their fair value determined on the date of grant. Share-based compensation expense is recognized on a straight-line basis over the vesting term of the outstanding equity awards.

Principles of Consolidation

The accompanying consolidated financial statements include Power REIT and its wholly-owned subsidiaries. All intercompany balances have been eliminated in consolidation.

Loss per Common Share

Basic net loss per common share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding. Diluted net loss per common share is computed similar to basic net loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. The dilutive effect of the Trust’s options is computed using the treasury stock method. As of each of March 31, 2026 and December 31, 2025, the total number of common stock equivalents was 187,500, composed entirely of stock options.

The following table sets forth the computation of basic and diluted loss per common share:

	2026			2025
	Three Months Ended
	March 31,
	2026			2025

Numerator:

Net loss	$	(893,272	)	$	(1,413,112	)
Preferred Stock Dividends		(163,207	)		(163,207	)
Numerator for basic and diluted EPS - loss available to common shareholders	$	(1,056,479	)	$	(1,576,319	)

Denominator:
Denominator for basic and diluted EPS - Weighted average shares		3,672,274			3,389,661

Basic and diluted loss per common share	$	(0.29	)	$	(0.47	)

Depreciation

Depreciation is computed using the straight-line method over the estimated useful lives of 20 years for greenhouses, 10 years for the MIP, 39 years for auxiliary buildings, except for PW CA Canndescent, LLC for which it was determined that the buildings have a useful life of 37 years. For the three months ended March 31, 2026 and 2025, approximately $11,000 and $3,000 depreciation expense was recorded, respectively.

Impairment of Long-Lived Assets

Real estate investments and related intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the property might not be recoverable, which is referred to as a “triggering event.” A property to be held and used is considered impaired only if management’s estimate of the aggregate future cash flows, less estimated capital expenditures, to be generated by the property, undiscounted and without interest charges, are less than the carrying value of the property. This estimate takes into consideration factors such as expected future operating income, trends and prospects, as well as the effects of demand, competition and other factors.

If there is a triggering event in relation to a property to be held and used, the Trust will estimate the aggregate future cash flows, less estimated capital expenditures, to be generated by the property, undiscounted and without interest charges. In addition, this estimate may consider a probability weighted cash flow estimation approach when alternative courses of action to recover the carrying amount of a long-lived asset are under consideration or when a range of possible values is estimated.

The determination of undiscounted cash flows requires significant estimates by management, including the expected course of action at the balance sheet date that would lead to such cash flows. Subsequent changes in estimated undiscounted cash flows arising from changes in the anticipated action to be taken with respect to the property could impact the determination of whether an impairment exists and whether the effects could materially affect the Trust’s net income. To the extent estimated undiscounted cash flows are less than the carrying value of the property, the loss will be measured as the excess of the carrying amount of the property over the estimated fair value of the property.

While the Trust believes its estimates of future cash flows are reasonable, different assumptions regarding a number of factors, including market rents, listing prices, economic conditions, and occupancies, could significantly affect these estimates. When impairment exists, the long-lived asset is adjusted to an estimate of fair value. In estimating fair value, if appraisal reports are available, the Trust uses the sales comparable approach methodology where applicable within appraisal reports; when appraisal reports are not available, the Trust uses opinions of value from brokers involved with listing properties for sale and other market value information available to it. The Trust will record an impairment charge if it believes that there is other than a temporary decline in market value below the carrying value of the investment. During the three months ended March 31, 2026 and 2025, an impairment charge was expensed in the amount of approximately $247,000 and $0, respectively

Any decline in the estimated fair values of the Trust’s assets could result in impairment charges in the future. It is possible that such impairments, if required, could be material.

Intangibles

A portion of the acquisition price of the assets acquired by PW Regulus Solar, LLC (“PWRS”) has been allocated on the Trust’s consolidated balance sheets between Land and Intangibles’ fair values at the date of acquisition. The total amount of in-place lease intangible assets established was approximately $4,714,000, which is amortized over a 20.7-year period. For each of the three months ended March 31, 2026 and 2025, approximately $57,000 of the intangibles was amortized.

Intangible Assets are evaluated whenever events or circumstances indicate the carrying value of these assets may not be recoverable. There were no impairment charges recorded for Intangible Assets for the three ended March 31, 2026 and 2025.

The following table provides a summary of the Intangible Assets:

SCHEDULE OF INTANGIBLE ASSETS

	For the Years Ended December 31,
				Accumulated Amortization		Accumulated Amortization
		Cost		Through 12/31/25		Through 3/31/2026		Net Book Value

Asset Intangibles - PWRS	$	4,713,548	$	2,664,103	$	56,872	$	1,992,573

The following table provides a summary of the current estimate of future amortization of Intangible Assets for the subsequent years ending December 31:


2026 (9 month remaining)	$	170,616
2027	$	227,488
2028	$	227,488
2029	$	227,488
2030	$	227,488
Thereafter	$	912,005
Total	$	1,992,573

Fair Value

Fair value represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Trust measures its financial assets and liabilities in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value.

	○	Level 1 – valuations for assets and liabilities traded in active exchange markets, or interest in open-end mutual funds that allow a company to sell its ownership interest back at net asset value on a daily basis. Valuations are obtained from readily available pricing sources for market transactions involving identical assets, liabilities or funds.

	○	Level 2 – valuations for assets and liabilities traded in less active dealer, or broker markets, such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active. Level 2 includes U.S. Treasury, U.S. government and agency debt securities, and certain corporate obligations. Valuations are usually obtained from third party pricing services for identical or comparable assets or liabilities.

	○	Level 3 – valuations for assets and liabilities that are derived from other valuation methodologies, such as option pricing models, discounted cash flow models and similar techniques, and not based on market exchange, dealer, or broker traded transactions. Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.

In determining fair value, the Trust utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considering counterparty credit risk.

The carrying amounts of Power REIT’s financial instruments, including cash and cash equivalents, prepaid expenses, and accounts payable approximate fair value because of their relatively short-term maturities. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates. As of March 31, 2026 and December 31, 2025, the Trust owns publicly traded REIT securities with a fair market value of $52,160 and $86,537, respectively, based on the closing prices of those dates.

Other Income

Other income included in total revenue for the three months ended March 31, 2026 and 2025 is approximately $36,000 and $46,000, respectively, consisting of interest income.

Interest Expense

Interest expense for the three months ended March 31, 2026 related to the PW PWV Loan (defined below) and the 2015 PWRS Loan (defined below) was approximately $168,000 and $74,000, respectively, compared to interest expense for the three months ended March 31, 2025 that was approximately $171,000, $79,000 and $749,000 related to the PW PWV Loan, the 2015 PWRS Loan and the Greenhouse Loan that was resolved on April 11, 2025, respectively

Preferred Stock

As of March 31, 2026, the Trust has issued approximately $8.5 million of its Series A Preferred Stock. The shares of Series A Preferred Stock have no stated maturity, are not currently subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless they are redeemed, repurchased or converted.

Impact of New Accounting Pronouncements

The Trust has evaluated all recent accounting pronouncements and believes either they are not applicable or that none of them will have a significant effect on the Trust’s financial statements.