{"url_path":"/sec/usbc/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 EXECUTIVE COMPENSATION.","topic":"sec","document":{"doc_type":"10-K/A","doc_date":"2026-04-27","source_url":"https://www.sec.gov/Archives/edgar/data/1074828/0001074828-26-000020-index.html","accession_number":"0001074828-26-000020","cik":"0001074828","ticker":"USBC","issuer_name":"USBC, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1074828/0001074828-26-000020-index.html","primary_entity_key":"0001074828","primary_entity_name":"USBC, Inc."},"word_count":4955,"has_tables":true,"body_markdown":"ITEM 11. EXECUTIVE COMPENSATION.\n\nWe are a “smaller reporting company” and the following compensation disclosure is intended to comply with the requirements applicable to smaller reporting companies.\n\nThe tabular disclosure and the accompanying narrative discussion provide information on our compensation arrangements on behalf of, and compensation paid to, our named executive officers for services rendered in all capacities during the transition period from October 1, 2025 to December 31, 2025 (the “Transition Period”) and the fiscal years ended September 30, 2025 and September 30, 2024. Because the Company changed its fiscal year end from September 30 to December 31, the Transition Period is presented as a separate reporting period, and the amounts reported for the Transition Period have not been annualized or restated.\n\nSummary Compensation Table\n\nThe following table sets forth information concerning the compensation awarded to, earned by or paid to our named executive officers during the Transition Period and the fiscal years ended September 30, 2025 and September 30, 2024.\n\nNamePrincipal PositionFiscal YearSalary\n($)Bonus\n($) Stock\nAwards\n($)\nOption\n\nAwards\n\n($) (7)\nAll\nOther\nCompensation\n($) Total\n($)\n\nRobert Gregory Kidd (1)(2)Chairman and CEOTransition Period1 — — — — 1 \n\n2025— — — — — — \n\nKitty Payne (1)(3)(8)\nChief Financial OfficerTransition Period80,000 22,400 — 288,354 — 390,754 \n\n202548,889 — — 111,074 — 159,963 \n\nKirk Chapman (1)(4)(8)\nFormer Chief Operating Officer\nTransition Period80,000 — — 1,151,980 — 1,231,980 \n\n202548,889 — — 443,056 — 491,945 \n\nRonald P. Erickson (5)\nFormer President, Science Division, SVP\nTransition Period93,750 — — 51,087 — 144,837 \n\n2025355,562 — 1,189,500 — 811,486 2,356,548 \n\n2024453,125 100,000 — 894,202 205,000 1,652,327 \n\nPeter J. Conley (6)\nFormer CFO and SVP, Intellectual Property\n2025355,562 — 75,750 — 400,000 831,312 \n\n2024371,877 125,000 — 307,254 — 804,131 \n\n(1)Mr. Kidd, Ms. Payne, and Mr. Chapman were the Company’s only named executive officers during the Transition Period. They were also named executive officers during the fiscal year ended September 30, 2025. Mr. Erickson and Mr. Conley were named executive officers during the fiscal years ended September 30, 2025 and September 30, 2024. Mr. Erickson was not an executive officer of the Company at any time during the Transition Period.\n\n(2)Mr. Kidd began serving as the Company’s Chief Executive Officer effective August 6, 2025. Mr. Kidd is entitled to an annual salary of $1 pursuant to his Employment Agreement (as defined below).\n\n(3)Ms. Payne began serving as the Company’s Chief Financial Officer effective August 6, 2025. Ms. Payne is entitled to an annual salary of $320,000 pursuant to her Employment Agreement (as defined below). The amount reported for Ms. Payne in the Bonus column for the Transition Period reflects a discretionary cash bonus of $22,400.\n\n13\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\n(4)Mr. Chapman served as the Company’s Chief Operating Officer from August 6, 2025 to December 15, 2025. Mr. Chapman was entitled to an annual salary of $320,000 pursuant to his Employment Agreement (as defined below). Mr. Chapman terminated his employment with the Company effective December 31, 2025 and received severance benefits for the period from December 16, 2025 to December 31, 2025, pursuant to the terms of a Separation and General Release Agreement he entered into with the Company dated January 6, 2026 (the “Chapman Separation Agreement”). For a summary of the benefits Mr. Chapman received pursuant to the Chapman Separation Agreement, see the section titled “Separation Agreement with Mr. Chapman” below.\n\n(5)Mr. Erickson concluded his service as the Company’s President, Science Division and Senior Vice President on March 27, 2026, a position he assumed on August 6, 2025 when he ceased serving as Chief Executive Officer and Chairman of the Board of Directors of the Company and which continued throughout the Transition Period. See the Company’s Annual Report on Form 10-K for the fiscal years ended September 30, 2025 and 2024, Item 11 “Executive Compensation” filed with the SEC on December 19, 2025 and the “Executive Compensation” section of the Company’s definitive proxy statement filed with the SEC on August 26, 2025 for additional information about Mr. Erickson’s compensation for the fiscal years ended September 30, 2025 and September 30, 2024.\n\n(6)Mr. Conley ceased serving as the Company’s Chief Financial Officer and Senior Vice President, Intellectual Property on August 6, 2025. See the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025, Item 11 “Executive Compensation” filed with the SEC on December 19, 2025 and the “Executive Compensation” section of the Company’s definitive proxy statement filed with the SEC on August 26, 2025 for additional information about Mr. Conley’s compensation for the fiscal years ended September 30, 2025 and September 30, 2024.\n\n(7)These amounts reflect the aggregate grant date vested fair value of the equity awards granted to the executive officers covered in this disclosure during the Transition Period and the fiscal years ended September 30, 2025 and 2024, as computed in accordance with the FASB Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”) and are not intended to represent the value, if any, that has been or will be actually realized by the applicable executive officer. For Ms. Payne and Mr. Chapman, the amounts in this column also represent $22,264 and $88,807 respectively, in incremental fair value attributable to the repricing of their equity awards on October 7, 2025. For more information relating to the repricing of certain stock option grants, see the section entitled “Stock Option Repricing” below.\n\n(8)As discussed in the section titled “Stock Option Repricing” below, the Board (i) approved the repricing of the stock options granted to Ms. Payne and Mr. Chapman during the fiscal year ended September 30, 2025 on October 7, 2025 and (ii) further approved the repricing of all stock options granted to Ms. Payne (including the options granted during the Transition Period) effective March 18, 2026. The repricing of these stock options was accounted for as a modification in accordance with FASB ASC Topic 718 and did not result in the issuance of new grants. The Company recognized incremental stock-based compensation expense as a result of the repricing.\n\nEmployment and Separation Agreements\n\nRobert Gregory Kidd, Kitty Payne, and Kirk Chapman\n\nIn connection with their respective appointments as Chief Executive Officer, Chief Financial Officer and Chief Operating Officer, each of Mr. Kidd, Ms. Payne, and Mr. Chapman entered into substantially identical employment agreements with the Company, each dated August 6, 2025 (the “Employment Agreements”).\n\nPursuant to the terms of the Employment Agreements, Mr. Kidd and Ms. Payne, are and Mr. Chapman was, entitled to receive an annual base salary of $1 per annum for Mr. Kidd and $320,000 per annum for each of Ms. Payne and Mr. Chapman, which, in each case, is subject to our review from time to time.\n\nPursuant to their respective Employment Agreements, Mr. Kidd and Ms. Payne are each bound by an indefinite confidentiality obligation, a non-competition covenant during employment and for 12 months post-termination, a non-solicitation covenant with respect to Company personnel and business partners during employment and for 12 months post-termination, an assignment of intellectual property requirement, and indefinite non-disparagement obligations. Mr. Chapman is subject to substantially similar obligations under his Employment Agreement and, except as expressly modified by Mr. Chapman’s Separation Agreement, his obligations upon termination of employment and restrictive covenants as set forth in his Employment Agreement remain in full force and effect.\n\n14\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\nEither we, Mr. Kidd, or Ms. Payne, respectively, may terminate their respective employment relationship at any time, with or without cause, upon written notice to the other party. If employment of Mr. Kidd or Ms. Payne is terminated without Cause or for Good Reason (as each term is defined in the Employment Agreements), Mr. Kidd and Ms. Payne will receive, respectively, subject to execution, delivery, and non-revocation of a general release of claims against the Company, (i) (x) an amount equal to 12 months’ of their respective annual base salary payable in equal installments as salary continuation payments (or in the event of a termination of employment without Cause or for Good Reason within 24 months following a Change in Control (as defined in the Employment Agreements), a payment equal to (x) 1.5 times their respective annual base salary), plus (y) their respective annual bonus for the most recent fiscal year payable in a lump sum)), (ii) an amount equal to any earned bonus for the fiscal year in which termination occurs, and (iii) reimbursement for COBRA premiums paid for each executive and his or her dependents for the 12 month (or in the event of a termination of employment without Cause or for Good Reason within 24 months following a Change in Control, 18 month) period following the date of termination. Mr. Chapman resigned from his position as Chief Operating Officer on December 15, 2025 and entered into the Chapman Separation Agreement in connection with the termination of his employment.\n\nOn December 15, 2025, the Company and Kirk Chapman mutually agreed that Mr. Chapman would depart from his position as Chief Operating Officer, effective immediately. The departure was not the result of any disagreement with the Company on any matter related to the Company’s operations, policies or practices.\n\nIn connection with Mr. Chapman’s departure from his role as Chief Operating Officer, the Company and Mr. Chapman entered into the “Chapman Separation Agreement.” The Chapman Separation Agreement provides that Mr. Chapman will receive severance benefits equal to his annual base salary of $320,000 per annum payable in substantially equal installments on the Company’s regular payroll dates until the earlier of: (i) December 31, 2026 and (ii) the date that Mr. Chapman commences “Other Employment or Service”, which the Chapman Separation Agreement generally defines as any direct or indirect engagement of Mr. Chapman’s services by any individual, partnership, joint venture, corporation, limited liability company, firm, group, or other entity as an employee, consultant, advisor, independent contractor, director, partner, shareholder, member, joint venturer or in any other capacity.\n\nRonald P. Erickson\n\nOn August 6, 2025, we entered into an employment agreement with Mr. Erickson that superseded and replaced the Erickson Employment Agreement effective April 10, 2018, as amended by the Erickson Amendment executed on June 5, 2025 (the “New Erickson Employment Agreement”). The New Erickson Employment Agreement provided that Mr. Erickson would serve as President of the Science Division and Senior Vice President of the Company for an annual base salary of $375,000. Mr. Erickson was eligible to receive (i) an annual discretionary bonus from time to time, subject to approval of the Board of Directors or the compensation committee, and (ii) grants of other equity awards that from time to time. Mr. Erickson was also entitled to participate in all group employment benefits that were offered by the Company from time to time, subject to the terms and conditions of such benefit plans, including any eligibility requirements.\n\nOn March 27, 2026, Mr. Erickson concluded his service as President, Science Division, Senior Vice President of the Company and resigned his position as a member of the Board. In connection with Mr. Erickson’s departure from his role as President, Science Division, Senior Vice President, the Company and Mr. Erickson entered into the “Erickson Separation Agreement.” In accordance with the terms of the New Erickson Employment Agreement, in consideration of Mr. Erickson’s execution, delivery, and non-revocation of a general release of claims against the Company, the Erickson Separation Agreement provides that Mr. Erickson will receive severance benefits equal to his annual base salary of $375,000 per annum payable in substantially equal installments on the Company’s regular payroll dates for one year. Pursuant to the New Erickson Employment Agreement, Mr. Erickson remains subject to an indefinite confidentiality obligation, a non-competition covenant for 12 months post-termination, a non-solicitation covenant with respect to Company personnel and business partners for 12 months post-termination, assignment of intellectual property, and indefinite non-disparagement obligations.\n\n15\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\nPeter J. Conley\n\nMr. Conley ceased serving as Chief Financial Officer and Senior Vice President of Intellectual Property on August 6, 2025. Pursuant to the Company’s employment agreement with Mr. Conley, as amended by the Conley Amendment executed on June 5, 2025 (the “Conley Employment Agreement”), in exchange for Mr. Conley’s execution and delivery of a Separation and General Release Agreement in favor of the Company dated August 26, 2025, the Company agreed to provide severance to Mr. Conley in an amount equal to 12 months of his then-current annual base salary of $400,000, less applicable withholdings and deductions, in exchange for a general release of claims against the Company and other customary covenants, including, among others, confidentiality, non-disparagement, and cooperation provisions. Mr. Conley’s equity awards were to be treated in accordance with the existing terms and conditions of each applicable award agreement. See the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025, Exhibit No. 10.31, filed with the SEC on December 19, 2025, for more information on the terms and conditions of the Separation and General Release Agreement.\n\nOutstanding Equity Awards at Fiscal Year-End\n\nThe following table includes certain information with respect to the value of all unexercised stock options and unvested shares of restricted stock previously awarded to the executive officers identified in the Summary Compensation Table above as of December 31, 2025, the last day of the Transition Period. \n\nOption AwardsStock Awards\n\nNameNumber of\nSecurities\nUnderlying\nUnexercised\nOptions\nExercisable\n(#)\nNumber of\n\nSecurities\n\nUnderlying\n\nUnexercised\n\nOptions\n\nUnexercisable\n\n(#)\n\nOption\n\nExercise\n\nPrice\n\n($)\nOption\nExpiration\nDateNumber of\nShares of\nStock that\nhave not\nVested\n(#)Market Value\nof Shares of\nStock that\nhave not\nVested\n$\nEquity\n\nIncentive Plan-\n\nNumber of Shares\n\nof Stock that\n\nhave not\n\nVested\n\n(#)\n\nEquity\n\nIncentive Plan-\n\nMarket Value\n\nof Shares of Stock\n\nthat have not\n\nVested\n\n$\n\nRobert Gregory Kidd— — — 0— — — — \n\nKitty Payne (1)— 3,750,000 $1.10 10/7/2035— — — — \n\nKirk Chapman (2)— — — — — — — \n\nRonald P. Erickson (3)— — — — 167,500 105,525 — — \n\n(1)On August 6, 2025, we issued a stock option grant to Ms. Payne for 1,790,000 shares at an exercise price of $2.45 per share. The stock option grant expires in ten years. The grant date fair value of these options was determined to be $1.62 per share. The stock option grant vests as to 25% of the shares on the one-year anniversary of the grant date, with the remaining shares vesting quarterly over the following three years. On October 7, 2025, the option was repriced to reduce the exercise price from $2.45 to $1.10 per share and the expiration date of the option was extended to ten years from the repricing date. The repricing did not change the original vesting commencement date or vesting schedule, each of which continued to be measured from the August 6, 2025 grant date. On October 7, 2025, we issued a stock option grant to Ms. Payne for 1,960,000 shares at an exercise price of $1.10 per share under the same vesting terms and expiration as the options granted on August 6, 2025. On March 18, 2026, all of Ms. Payne’s outstanding options were repriced to reduce the exercise price of such options from $1.10 to $0.37 per share, and the expiration date of such options was extended to ten years from the repricing date. This repricing likewise did not change the original vesting commencement date or vesting schedule of the applicable award. For additional information on the repricing of Ms. Payne’s stock options, see the section titled “Stock Option Repricing” below.\n\n(2)Mr. Chapman held no outstanding equity awards as of December 31, 2025. All unvested option awards were forfeited upon termination of employment.\n\n16\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\n(3)On August 6, 2025, following stockholder approval, we issued 335,000 shares of restricted stock to Mr. Erickson pursuant to a grant previously approved by the Board of Directors on June 4, 2025. Fifty percent (50%) of the shares vested in full on August 6, 2025, and the remaining 50% (the “Restricted Shares”) vest in eight quarterly installments on the date six months after August 6, 2025, subject to Mr. Erickson’s continued employment through each applicable vesting date. The restricted shares were to vest in full upon (i) a sale of all or substantially all of our sensor-related intellectual property or (ii) an involuntary termination of Mr. Erickson’s employment. On March 27, 2026, Mr. Erickson concluded his service to the Company as President, Science Division, Senior Vice President and member of the Board as part of the divestiture of the legacy sensor technology business, resulting in the immediate vesting of the 167,500 unvested restricted shares.\n\nAdditional Narrative Disclosure\n\nStock Option Repricing\n\nOn October 7, 2025, in accordance with the terms of the Amended and Restated USBC, Inc. 2021 Equity Incentive Plan (the “2021 Equity Plan”), to restore the incentive value of the stock options and motivate and retain the Company’s employees, including its executive officers, the Board of Directors approved all repricing of the outstanding stock options granted on August 6, 2025, including the stock options for the purchase of 1,790,000 and 7,140,000 shares of common stock held by Ms. Payne and Mr. Chapman, respectively. Consequently, the exercise price of the repriced stock options was reduced from $2.45 to $1.10 per share and the expiration date of such options was modified to extend the 10-year term to October 6, 2035. Such stock options were to continue to vest as to 25% of the shares subject to the options on August 6, 2026 with the remaining shares vesting in equal quarterly installments over the three-year period following the initial vesting date, subject to the continued employment of the optionee through each applicable vesting date.\n\nOn March 18, 2026, in accordance with the terms of the 2021 Equity Plan, to restore the incentive value of the stock options and motivate and retain the Company’s employees, including its executive officers, the Board of Directors approved all repricing of the outstanding stock options granted on August 6, 2025 and October 7, 2025, including options granted to Ms. Payne on August 6, 2025 and October 7, 2025. Consequently, the exercise price of the repriced stock options was reduced from $1.10 to $0.37 per share and the expiration date of such options was modified to extend the 10-year term to March 18, 2036. The exercise price of the repriced stock options was reset to the closing market price of the Company’s common stock on the repricing date. The repricing were approved in response to the decline in the Company’s stock price. Such stock options were to continue to vest as set forth in their applicable stock option agreements, subject to the continued employment of Ms. Payne through each applicable vesting date.\n\nThe stock options repricing was accounted for as a modification in accordance with FASB ASC Topic 718 and did not result in the issuance of new grants. The Company recognized incremental stock-based compensation expense as a result of the repricing.\n\nRetirement Benefits\n\nWe have not maintained, and do not currently maintain, a defined benefit pension plan, or a nonqualified deferred compensation plan or provide other retirement benefits to our named executive officers. \n\nWe maintain a 401(k) plan and/or other health and welfare benefit plans in which our named executive officers are eligible to participate.\n\nPotential Payments upon Termination or Change in Control\n\nThe post-employment compensation arrangements for the executive officers identified in the Summary Compensation Table above as of December 31, 2025, the last day of the Transition Period, are described in the section titled “Employment and Separation Agreements” above. The estimated payments and benefits for these executive officers in the event of a termination of employment or a change in control of the Company as of December 31, 2025 were as follows:\n\n17\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\nRobert Gregory Kidd\n\nUnder the terms of Mr. Kidd’s Employment Agreement in the event of the termination of his employment by the Company without Cause, or his resignation for Good Reason (as such terms are defined in Mr. Kidd’s Employment Agreement), Mr. Kidd is entitled to a severance payment of $1.00 (representing his annual base salary as of such date) payable in equal installments over a 12 month period as salary continuation payments, plus an additional amount representing any annual unpaid discretionary bonus to be determined at the time of such termination of employment, payable in a lump sum, and reimbursement of COBRA premiums paid for Mr. Kidd and his dependent(s) over a 12 month period. The estimated amount of such payments as of December 31, 2025 was $1.00.\n\nIf Mr. Kidd’s termination occurs under such circumstances within 24 months following a Change in Control (as defined in Mr. Kidd’s Employment Agreements), Mr. Kidd is instead entitled to (i) a lump sum severance payment equal to (x) 1.5 times his annual base salary), plus (y) an amount equal to his annual bonus for the most recent fiscal year)), (ii) an amount equal to any earned bonus for the fiscal year in which termination occurs, and (iii) reimbursement of COBRA premiums for Mr. Kidd and his dependent(s) for 18 months. The estimated amount of such payments as of December 31, 2025 was $1.50.\n\nKitty Payne\n\nUnder the terms of Ms. Payne’s Employment Agreement in the event of the termination of her employment by the Company without Cause, or her resignation for Good Reason (as such terms are defined in Ms. Payne’s Employment Agreement), Ms. Payne is entitled to a severance payment of $320,000 (representing her annual base salary as of such date) payable in equal installments over a 12 month period as salary continuation payments, plus an additional amount representing any annual unpaid discretionary bonus to be determined at the time of such termination of employment, payable in a lump sum, and reimbursement of COBRA premiums paid for Ms. Payne and her dependent(s) over a 12 month period. The estimated amount of such payments as of December 31, 2025 was $320,000.\n\nIf Ms. Payne’s termination occurs under such circumstances within 24 months following a Change in Control (as defined in Ms. Payne’s Employment Agreements), Ms. Payne is instead entitled to (i) a lump sum severance payment equal to (x) 1.5 times her annual base salary), plus (y) an amount equal to her annual bonus for the most recent fiscal year)), (ii) an amount equal to any earned bonus for the fiscal year in which termination occurs, and (iii) reimbursement of COBRA premiums for Ms. Payne and her dependent(s) for 18 months. The estimated amount of such payments as of December 31, 2025 was $480,000.\n\nKirk Chapman\n\nAs discussed above, Mr. Chapman terminated employment with the Company effective December 15, 2025. For a summary of the payments and benefits Mr. Chapman is entitled to in connection with his departure, see the section titled “Separation Agreement with Mr. Chapman” above.\n\nRonald P. Erickson\n\nUnder the terms of the New Erickson Employment Agreement, if Mr. Erickson’s employment had been terminated by the Company without Cause, or if he resigned for Good Reason in the event of a termination of his employment by the Company other than for “cause” or by Mr. Erickson for “good reason,” (as defined in the New Erickson Employment Agreement), Mr. Erickson was entitled to a severance payment of $375,000 (representing his annual base salary as of such date), payable in equal installments over a 12-month period as salary continuation payments, plus an additional amount representing any annual unpaid discretionary bonus to be determined at the time of such termination of employment, payable in a lump sum, and reimbursement of COBRA premiums paid for Mr. Erickson and his dependents over a 12-month period. The estimated amount of such payments as of December 31, 2025 was $375,000.\n\nAs discussed above and as described in the Company’s Current Reports on Form 8-K filed with the SEC on April 2, 2026 and April 9, 2026, Mr. Erickson concluded his service as President, Science Division, Senior Vice President of the Company and member of the Company's Board of Directors on March 27, 2026 and is no longer employed by the Company. For a summary of the payments and benefits Mr. Erickson is entitled to in connection with his departure, see the section titled “Ronald Erickson” above, including the description of, and amounts payable under, the Erickson Separation Agreement. In addition, upon Mr. Erickson’s departure, all 167,500 of Mr. Erickson’s unvested restricted shares of Company stock as of March 27, 2026 became fully vested.\n\n18\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\nPeter J. Conley\n\nMr. Conley’s employment with the Company terminated as of August 6, 2025, as described in the Company’s Current Report on Form 8-K filed with the SEC on August 7, 2025. As set forth in the Conley Separation Agreement, Mr. Conley received a payment in the amount of $400,000 (representing his annual base salary as of such date) in consideration of executing a general release of claims against the Company and other customary covenants, including, among others, confidentiality, non-disparagement, and cooperation provisions. Mr. Conley’s equity awards were to be treated in accordance with the existing terms and conditions of each applicable award agreement. See the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025, Exhibit No. 10.31, filed with the SEC on December 19, 2025 for more information on the terms and conditions of the Conley Separation Agreement.\n\nPolicies and Practices for Granting Certain Equity Awards\n\nWe do not have any formal policy that requires us to grant, or avoid granting, stock options at particular times. Consistent with our annual compensation cycle, if options are to be granted, the compensation committee generally seeks to grant annual stock option awards after our Annual Report on Form 10-K has been filed. The timing of any stock option grants in connection with new hires, promotions, or other non-routine grants is tied to the event giving rise to the award (such as an employee’s commencement of employment or promotion effective date). As a result, in all cases, the timing of grants of stock options occurs independent of the release of any material nonpublic information, and we do not time the disclosure of material nonpublic information for the purpose of affecting the value of executive compensation.\n\nExcept as noted below, no stock options were granted to executive officers during the Transition Period during any period beginning four business days before the filing of a periodic report or current report disclosing material non-public information and ending one business day after such filing. On October 7, 2025, we granted stock options to certain executive officers, and on October 8, 2025, we filed a Current Report on Form 8-K. Accordingly, the October 7, 2025 grants occurred during a period beginning four business days before the filing of a Current Report on Form 8-K and ending one business day after such filing.\n\nThe table below provides the information required by Item 402(x) of Regulation S-K regarding the stock option grants made to our non-CEO NEOs during the Transition Period in connection with the release of material nonpublic information. The options were granted with an exercise price equal to the closing market price of our common stock on the date of grant. Each of the stock option grants vests as to 25% of the underlying shares on the one-year anniversary of the grant date, with the remaining shares vesting in quarterly installments over the following three years, subject to the executive’s continued service.\n\nNameGrant DateNumber of shares of common\n stock\nunderlying the award\nExercise\n\nprice of the award\n\n($/share)\nGrant date fair value of the\nawardPercentage change in the closing market price of the securities underlying the award between the trading day ending immediately prior to the disclosure of\nmaterial nonpublic information and the trading day beginning immediately\nfollowing the disclosure of material nonpublic\ninformation\n\nKitty Payne (1)\nOctober 7, 20251,960,000$1.10 $1,419,432 (6.36)%\n\nKirk Chapman (2)\nOctober 7, 20257,860,000$1.10 $5,692,212 (6.36)%\n\n(1) The stock options granted to Ms. Payne on August 6, 2025 were repriced on October 7, 2025, reducing the exercise price from $2.45 per share to $1.10 per share. On March 18, 2026, the Company further repriced all of Ms. Payne’s outstanding options, reducing the exercise price from $1.10 per share to $0.37 per share.\n\n(2) The stock options granted to Mr. Chapman on August 6, 2025 were forfeited on December 31, 2025 in connection with his separation from the Company, in accordance with the terms of his employment separation agreement.\n\n19\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)\n\nDIRECTOR COMPENSATION\n\nOur non-employee directors are compensated with a combination of stock option grants, stock grants and an annual $10,000 cash retainer in consideration of service on our Board of Directors. In setting director compensation, we consider the significant amount of time that directors expend in fulfilling their duties to us as well as the skill-level required by our members of the Board of Directors. We also evaluate the level and mix of our director compensation in light of our financial condition and evolving business strategy.\n\nThe table below sets forth the compensation paid to our non-employee directors during the Transition Period from October 1, 2025 to December 31, 2025. See the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2025, Item 11 “Executive Compensation,” for information on the compensation paid to our directors during the fiscal year ended September 30, 2025.\n\nRobert Gregory Kidd, Linda Jenkinson and Ronald P. Erickson received no compensation for their services as directors. The compensation disclosed in the Summary Compensation Table above represents the total compensation for Mr. Kidd and Mr. Erickson for the Transition Period and the fiscal year ended September 30, 2025.\n\nNameStock\nAwardsOption\nAwardsFees\nPaidTotal\n\nLarry K. Ellingson\n$— $— $7,500 $7,500 \n\nWilliam A. Owens\n— — 7,500 7,500 \n\nJon Pepper\n— — 7,500 7,500 \n\nIchiro Takesako\n— — 7,500 7,500 \n\nTotal\n$— $— $30,000 $30,000 \n\n20\n\n[T](#i0abf1386159c406db09e02be74e4b6b3_7)[able of Contents](#i0abf1386159c406db09e02be74e4b6b3_7)"}