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Stockholders' Equity

9 Months Ended

Sep. 30, 2025

Stockholders’ Equity [Abstract]

Stockholders' Equity

10. 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 “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 Plan 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 Plan 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 September 30, 2025, a total of 12,755 shares of the Company’s common stock may be issued pursuant to outstanding options awarded under the 2011 Plan; however, no additional awards may be granted under such 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 September 30, 2025, a total of 643,102 shares of the Company’s common stock may be issued pursuant to outstanding options awarded under the 2016 Plan; however, no additional awards may be granted under such plan.

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 nine months ended September 30, 2025:

Expected volatility		124 – 146	%
Expected life of option (in years)		5.1 – 6.2
Risk free interest rate		4.4	%
Expected dividend yield		0.0	%

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 adjusts to reflect actual forfeitures as the stock-based awards vest.

The following table summarizes stock option activity during the nine months ended September 30, 2025:

						Weighted
						Average
		Number of				Exercise
		Options				Price
Stock Options:
Outstanding at January 1, 2025			618,898			$	3.04
Granted during the period			275,000				1.98
Cancelled/Forfeited, during the period			(81,982	)			4.17
Expired, during the period			(116,611	)			3.44
Outstanding at September 30, 2025			695,305			$	2.42
Exercisable at September 30, 2025			569,430			$	2.51

At September 30, 2025, there was $197,446 of total unrecognized compensation expense related to stock options, which is expected to be recognized over a weighted average period of 2.6 years.

On September 30, 2025, the aggregate intrinsic value of stock options that were outstanding and exercisable was $45,520 and $43,889, respectively. On September 30, 2024, the aggregate intrinsic value of stock options that were outstanding and exercisable was $423,850 and $259,295, 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 nine months ended September 30, 2025, the Company granted stock options to members of the Board of Directors (the “Board”) to purchase an aggregate of 100,000 shares of common stock at a weighted average exercise price of $1.94 per share. The stock options vest in four equal quarterly installments on the last day of each calendar quarter in 2025 and have a term of ten years. During the nine months ended September 30, 2025, the Company also granted options to employees to purchase an aggregate of 175,000 shares of common stock. These options vest in various tranches, ranging from equally over four years to fifty percent at grant date with the remaining balance vesting during the third quarter of fiscal 2025. The options have a term of ten years and have an exercise price of $2.01. The aggregate fair value for the options granted during the nine months ended September 30, 2025 and 2024 was $545,550 and $72,240, respectively.

Stock-based compensation expense for the Company’s stock options for the three and nine months ended September 30, 2025 totaled $43,916 and $289,305, respectively. Stock-based compensation expense for the Company’s stock options for the three and nine months ended September 30, 2024, totaled $32,250 and $124,130, respectively. The stock-based compensation expense 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 expires on the one-year anniversary of such date. Shares may be repurchased from time-to-time in open market transactions at prevailing market prices, in privately negotiated transactions or by other means in accordance with federal securities laws, including Rule 10b5-1 programs, and the Stock Repurchase Plan may be suspended or discontinued at any time. The actual timing, number and value of shares repurchased will be determined by a committee of the Board at its discretion and will depend on a number of factors, including the market price of the Company’s common stock, general market and economic conditions, alternative investment opportunities and other corporate considerations. For the nine months ended September 30, 2025, 151,258 shares of common stock were repurchased by the Company pursuant to the Stock Repurchase Plan at an average price of $1.99 per share, or an aggregate of $301,048.

Charter Amendment

On May 8, 2025, at the Annual Meeting, the Company’s stockholders approved an amendment to the Company’s Certificate of Incorporation, as amended, to increase the Company’s shares of authorized common stock from 25,000,000 to 50,000,000. The amendment was filed with the Secretary of State of the State of Delaware on May 8, 2025.

Treasury Shares

As of September 30, 2025 and December 31, 2024, the Company had 793,221 and 641,963 shares of its common stock, respectively, classified as treasury shares on the Company’s consolidated balance sheets.