Note 4. Marketable securities

On June 7, 2026, the Company entered into a Securities Purchase Agreement with Volato Group, Inc. ("Volato"), whereby the Company agreed to purchase 2,941,176 unregistered shares of Volato common stock, par value $0.0001 per share, ("Volato Shares") at a purchase price of $0.34 per share, for an aggregate cash purchase price of $1 million in a private placement transaction. As consideration for the Company’s participation in the transaction as the Lead Investor, Volato agreed to deliver to the Company 451,901 shares of registered common stock of flyExclusive Inc. (“FLYX”) (“FLYX Shares”), par value $0.0001 per share. In connection with the transaction, the Company and Volato entered into a Registration Rights Agreement pursuant to which Volato agreed to register for resale the Volato Shares. As of July 2, 2026, the Volato Shares were registered with the SEC and the registration statement had been declared effective. 

On June 18, 2026, all closing conditions were met and the Volato Shares and FLYX Shares were issued on that date. The Company acquired a minority equity interest in Volato and FLYX. The investments are passive in nature, such the Company does not participate in the management nor operations of Volato and FLYX. Accordingly, the Company does not have the ability to exercise significant influence over the investees and accounts for the investments as equity securities under ASC 321.

The Company initially recognized each investment at its fair value on  June 18, 2026. Because the aggregate fair value of the Volato Shares and FLYX Shares of $1.5 million exceeded the $1.0 million of cash consideration transferred to Volato, the Company recognized a day 1 gain of approximately $0.5 million upon issuance. The Volato Shares and FLYX Shares represent equity securities with readily determinable fair values that are remeasured at fair value each reporting period with changes in fair value recorded under unrealized gains and losses on marketable securities, net in the condensed consolidated statements of operations. The fair value of the Volato Shares and FLYX Shares is measured on a recurring basis using quoted prices in active markets; accordingly, the Company classifies both investments as Level 1 within the fair value hierarchy under ASC 820. 

The Volato and FLYX Shares are classified as current assets and presented as marketable securities in the condensed consolidated balance sheet, totaling $1.2 million as of June 30, 2026. The Company classifies these securities as current assets based on its intent and ability to sell them within one year.

The following table represents gains and losses on our investments in marketable securities presented in our condensed consolidated statements of 0perations: