v3.26.1
Subsequent Events
6 Months Ended
Jun. 30, 2026
Subsequent Events [Abstract]  
Subsequent Events
Note 14 – Subsequent Events
The Company has evaluated subsequent events through August 13, 2026, the date the financial statements were available to be issued, and identified the following
Warrants Exchanged for Common Stock
Subsequent to June 30, 2026, the Company entered into conversion and exchange agreements with nineteen holders of its price-protected preferred stock, price-protected warrants, and alternate cashless exercise warrants, pursuant to a voluntary exchange offered on substantially the same economic terms to all holders of such securities (the "Voluntary Exchange"). The Voluntary Exchange was undertaken to simplify the Company's capital structure; no cash was paid in either direction, no per-share price was stated or implied, and no other warrant or other instrument of the Company was repriced, amended, or extended in connection therewith. These agreements supersede and replace the conversion and exchange agreements
entered into with certain holders in late 2025, which by their terms expired and became null and void when the Company did not complete an uplisting of its common stock to a national securities exchange on or before May 31, 2026.
Pursuant to these agreements, (i) holders converted an aggregate of 5,385 shares of Series G Preferred Stock, 887 shares of Series A Preferred Stock, 331 shares of Series H Preferred Stock, and 14,812 shares of Series I Preferred Stock into an aggregate of 614,890 shares of the Company's common stock; (ii) holders exchanged an aggregate of 442,258 price-protected warrants for 442,258 shares of common stock on a one-for-one basis; and (iii) holders exercised an aggregate of 83,033 alternate cashless exercise warrants at their stated multipliers for an aggregate of 284,582 shares of common stock.
In addition, on July 14 and July 15, 2026, certain officers and employees of the Company converted an aggregate of 2,262 shares of Series H Preferred Stock into an aggregate of 44,009 shares of common stock pursuant to the conversion terms of the Series H certificate of designation, and exercised outstanding warrants containing alternate cashless exercise provisions, resulting in the cancellation of an aggregate of 114,060 warrants and the issuance of an aggregate of 456,240 shares of common stock; no cash proceeds were received by the Company in connection therewith. In total, subsequent to June 30, 2026, the Company issued or became obligated to issue an aggregate of 1,841,979 shares of common stock in connection with the foregoing conversions, exchanges, and exercises.
Issuance of Stock Options and Repricing of Stock Options
On August 10, 2026, subsequent to June 30, 2026, the Board of Directors, by unanimous written consent, approved a repricing of all stock options then outstanding under the Company's 2026 Omnibus Securities and Incentive Plan (the "2026 Plan") and the issuance of an additional tranche of options under the 2026 Plan. All share and per-share amounts below are stated on a post-split basis, giving effect to the one-for-twenty (1-for-20) reverse stock split of the Company's common stock effected during 2026.
The Board amended the exercise price of each of the 1,283,500 options outstanding under the 2026 Plan (the "2026 Options"), whether vested or unvested, reducing the exercise price to $1.83 per share. Prior to the amendment, the 2026 Options carried exercise prices ranging from $6.00 to $12.00 per share. No other term of the 2026 Options was modified; the number of options, grant dates, vesting terms, expiration dates and all other terms and conditions remain unchanged, and no options were cancelled, forfeited, exchanged or regranted in connection with the repricing. On August 10, 2026, the closing sale price of the Company's common stock on the OTC Markets OTC Link was $1.70 per share, the amended exercise price of $1.83 per share exceeds the closing price, with the result that the repriced options were out of the money and had no intrinsic value as of the date of the amendment.
The repricing will be accounted for as a modification under ASC 718, Compensation — Stock Compensation. Incremental compensation cost, if any, will be measured as the excess of the fair value of each modified award immediately after modification over the fair value of the original award immediately before modification, in each case measured as of the August 10, 2026 modification date. Incremental cost associated with vested awards will be recognized immediately, and incremental cost associated with unvested awards will be recognized over the remaining requisite service period. The Company estimates the incremental compensation cost resulting from the repricing to not be material.
The Board also approved the issuance of an aggregate of 546,250 non-qualified stock options under the 2026 Plan (the "Eighth Tranche Options") at an exercise price of $1.83 per share, which exceeded the closing sale price of the common stock on the grant date. Following the issuance, 200,400 common-share equivalents remain available for issuance under the 2026 Plan. The Eighth Tranche Options will be measured at grant-date fair value in accordance with ASC 718, and, because the Eighth Tranche Options vested in full upon grant, the related compensation cost of approximately $929,000 will be recognized in its entirety during the third quarter of 2026.
Because these transactions occurred after June 30, 2026, they have no effect on the accompanying financial statements as of and for the period ended June 30, 2026, and the related compensation cost will be reflected in periods subsequent to that date.
Common stock issued for consulting services
Effective July 9, 2026, subsequent to June 30, 2026, the Company entered into a two-month consulting agreement under which it agreed to issue 115,000 shares of common stock to an investor-relations advisor as compensation for advisory services. The shares are restricted securities subject to a six-month holding period under Rule 144. The Company accounted for the issuance as a share-based payment to a nonemployee under ASC 718.
Sale of VTAK Series D Preferred Shares
On July 24, 2026, the Company entered into and closed a Securities Exchange and Purchase Agreement with two Investors (collectively, the “Investors”), pursuant to which the Company monetized 5,092 of the 5,778 shares of VTAK Series D Convertible Preferred Stock received as consideration in the Fly Flyte Transaction. Under that agreement, (i) the Company sold 4,217 of such shares (aggregate stated value $4,217,000) to the Investors for an aggregate cash purchase price of $2,989,266, and (ii) the Company transferred an additional 875 of such shares (aggregate stated value $875,000) to the Investors in full satisfaction, extinguishment and discharge of the entire outstanding principal amount of the Company’s Senior Convertible Promissory Notes held by the Investors, inclusive of original issue discount, together with all accrued and unpaid interest, fees and premiums thereunder. Effective upon the closing, all warrants held by the Investors were terminated, cancelled and extinguished in their entirety.