9. Stockholders’ Equity

Intelligent Protection Management Corp. 2025 Long-Term Incentive Plan

On May 8, 2025, at the Company’s 2025 annual meeting of stockholders (the “2025 Annual Meeting”), the Company’s stockholders approved the Intelligent Protection Management Corp. 2025 Long-Term Incentive Plan (the “2025 LTIP”). As a result, the 2025 LTIP became effective on May 8, 2025. Concurrently with the adoption of the 2025 LTIP, the 2016 Plan (defined below) was terminated as to future awards. The 2025 LTIP provides for the granting of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights and other awards that may be granted singly, in combination, or in tandem, and which may be paid in cash, shares of common stock, other consideration, or any combination thereof. Subject to certain adjustments, the maximum aggregate number of shares of common stock that may be delivered pursuant to awards under the 2025 LTIP is 1,200,000 shares, plus any Prior Plan Awards (as defined in the 2025 LTIP).

The Intelligent Protection Management Corp. Amended and Restated 2011 Long-Term Incentive Plan (the “2011 Plan”) was terminated as to future awards on May 16, 2016. As of June 30, 2026, there were no shares of the Company’s common stock issuable pursuant to outstanding options awarded under the 2011 Plan. The Intelligent Protection Management Corp. 2016 Long-Term Incentive Plan (the “2016 Plan”) was terminated as to future awards on May 8, 2025. As of June 30, 2026, a total of 682,550 shares of the Company’s common stock may be issued pursuant to outstanding options awarded under the 2016 Plan.

As of June 30, 2026, a total of 878,655 shares of the Company’s common stock were available for issuance under the 2025 LTIP.

Stock Options

The following table summarizes the assumptions used in the Black-Scholes pricing model to estimate the fair value of the options granted during the six months ended June 30, 2026:

The expected life of the options is the period of time over which employees and non-employees are expected to hold their options prior to exercise. The expected life of options has been determined using the “simplified” method as prescribed by Staff Accounting Bulletin 110, which uses the midpoint between the vesting date and the end of the contractual term. The volatility of the Company’s common stock is calculated using the Company’s historical volatilities beginning at the grant date and going back for a period of time equal to the expected life of the award. The Company estimates potential forfeitures of stock awards and adjusts recorded stock-based compensation expense accordingly. The Company estimates pre-vesting forfeitures primarily based on the Company’s historical experience and is adjusted to reflect actual forfeitures as the stock-based awards vest.

The following table summarizes stock option activity during the six months ended June 30, 2026:

At June 30, 2026, there was $511,773 of total unrecognized compensation expense related to stock options, which is expected to be recognized over a weighted average period of 3.3 years.

On June 30, 2026, the aggregate intrinsic value of stock options that were outstanding and exercisable was $54,840 and $19,320, respectively. On June 30, 2025, the aggregate intrinsic value of stock options that were outstanding and exercisable was $30,270 and $29,070, respectively. The intrinsic value of stock options is calculated based on the exercise price of the underlying awards and the fair value of such awards as of the period-end date.

During the six months ended June 30, 2026, the Company granted stock options to members of the Board of Directors (the “Board”) to purchase an aggregate of 40,000 shares of common stock at a weighted average exercise price of $1.62 per share. The stock options vest in four equal quarterly installments on the last day of each calendar quarter in 2026 and have a term of ten years. During the six months ended June 30, 2026, the Company also granted options to employees to purchase an aggregate of 276,000 shares of common stock. These options vest in equal tranches over a four-year period. The stock options granted during the six months ended June 30, 2026 have a term of ten years, an exercise price of $1.62 per share and a weighted average fair value of $1.41 per share, or $445,439 in the aggregate. During the six months ended June 30, 2025, the Company granted 275,000 stock options to members of the Board and to management. These options in the aggregate had an exercise price of $1.98 per share, a weighted average fair value of $1.79 per share and an aggregate fair value of $545,550. Stock-based compensation expense for the Company’s stock options for the three months ended June 30, 2026 and 2025, totaled $41,572 and $77,760, respectively. Stock-based compensation expense for the Company’s stock options for the six months ended June 30, 2026 and 2025, totaled $65,128 and $245,389, respectively, and is included in “general and administrative expenses” in the condensed consolidated statements of operations.

Series A Preferred Stock

On December 30, 2024, the Company filed with the Secretary of State of the State of Delaware the Certificate of Designations designating the Series A Preferred Stock (the “Certificate of Designations”), and establishing the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications, or terms or conditions of redemption of the shares of Series A Preferred Stock. The total number of authorized shares of Series A Preferred Stock is 9,000,000 shares. On January 2, 2025, as partial consideration for the Acquisition, the Company issued 4,000,000 shares of Series A Preferred Stock.

Stock Repurchase Plan

On May 8, 2025, the Board approved a stock repurchase plan for up to $400,000 of the Company’s outstanding common stock (the “Stock Repurchase Plan”), which expired on the one-year anniversary of such date. For the six months ended June 30, 2026, 50,000 shares of common stock were repurchased by the Company pursuant to the Stock Repurchase Plan at an average price of $1.67 per share, or an aggregate of $83,491, all of which repurchases occurred during the three months ended March 31, 2026.

Treasury Shares

As of June 30, 2026 and December 31, 2025, the Company had 843,221 and 793,221 shares of its common stock, respectively, classified as treasury shares on the Company’s consolidated balance sheets.