Sales Performance - In 2025, syringes accounted for 65.1% of total sales, with EasyPoint® products contributing 31.2% and other products at 3.7%[110] - Domestic sales represented 84.2% of revenues in 2025, with a 9.7% increase driven by higher sales of VanishPoint® and EasyPoint® needles; international revenues surged by 64.0%[130] - Overall unit sales increased by 23.3%, while total revenues rose by 15.8% in 2025[130] Financial Performance - Gross profit margins improved slightly from (3.1)% in 2024 to 0.1% in 2025, despite a loss from operations of $21.2 million[132] - Cash flow used by operations was $7.1 million in 2025, primarily due to a net loss for the year[135] - Tariff expenses amounted to approximately $1.8 million in 2025, significantly impacting the cost of manufactured products[131] Securities and Assets - The unrealized loss on debt and equity securities was $5.0 million, while a realized gain of $5.6 million was recorded from the sale of these securities[133] - As of December 31, 2025, the company held $34.4 million in debt and equity securities, representing 24.1% of total assets[122] Production and Future Expectations - The company incurred approximately $1 million in costs for converting equipment to produce 0.5 mL syringes domestically, which accounted for 11% of overall domestic unit sales in 2025[138] - The company anticipates that commercial quantities of domestically produced 0.5 mL syringes will be available in the second half of 2026[116] Customer Rebates and Estimates - As of December 31, 2025, the total potential future credits to be issued due to prior purchases not yet claimed is estimated at $2.4 million[145] - The company relies on historical trends and assumptions regarding customer rebates to estimate liabilities for future claims[145] - The establishment of reserves for contractual obligations is based on an understanding of sales distribution channels and product categories[145] - Historical redemption rates and inventory turnover rates are considered in the estimation process for customer rebates[145] - The company does not expect significant changes to the current inputs and assumptions used in rebate estimate calculations[145] - There is an inherent risk that estimates and underlying assumptions may not reflect actual future results, potentially impacting future financial outcomes[145] - Adjustments to reserves may have a material impact on future results if estimates or assumptions are incorrect[145] - The company examines the results of estimates against actual historical results to refine future assumptions[145] - The estimates for customer rebates involve a combination of historical data and tracking information provided by distributors[145] - The company is responsible for developing estimates in accordance with U.S. GAAP for reported assets, liabilities, revenues, and expenses[145]

Financial Performance - Net income for 2025 was $2,090,778, a significant recovery from a net loss of $2,170,420 in 2024[329]. - Comprehensive income for 2025 was $3,639,914, a substantial increase from $696,906 in 2024[329]. - Total interest income increased to $43,009,122 in 2025, up from $41,749,745 in 2024, representing a growth of approximately 3.0%[327]. - Net interest income after recovery of provision for credit losses rose to $15,600,822 in 2025, compared to $10,699,210 in 2024, marking an increase of about 46.0%[327]. - Total non-interest income increased to $1,768,156 in 2025, up from $1,348,404 in 2024, reflecting a growth of approximately 31.1%[327]. - Total non-interest expenses rose to $15,296,478 in 2025, compared to $14,589,603 in 2024, indicating an increase of about 4.8%[327]. - Basic earnings per share (EPS) for 2025 was $0.17, while the diluted EPS was also $0.17, compared to a basic and diluted EPS of $(0.17) in 2024[342]. Assets and Liabilities - The company's assets decreased by $66.5 million, or 6.8%, from $971.5 million at December 31, 2024, to $904.9 million at December 31, 2025, primarily due to increases in cash and cash equivalents[178]. - Total liabilities decreased to $764.04 million in 2025 from $834.20 million in 2024, reflecting a reduction of about 8.4%[325]. - Total stockholders' equity increased to $140.91 million in 2025 from $137.29 million in 2024, marking an increase of approximately 2%[325]. - The company held $145,878,693 in total securities, with a fair value of $140,307,447 after accounting for unrealized losses of $6,114,261[404]. Deposits and Liquidity - Certificates of deposit comprised $493.9 million or 75.7% of total deposits at December 31, 2025, with $441.3 million due within one year[171]. - The company’s total deposits rose to $652.45 million in 2025, up from $642.19 million in 2024, indicating a growth of about 1.97%[325]. - Non-interest bearing deposits decreased to $28.18 million in 2025 from $32.68 million in 2024, a decline of approximately 13.7%[325]. - Interest-bearing deposits increased to $624.27 million in 2025, compared to $609.51 million in 2024, reflecting an increase of about 2.4%[325]. - Available liquidity at December 31, 2024, was approximately $211.3 million, including $35.6 million in cash and $136.6 million in secured borrowing capacity[174]. Loans and Credit Quality - The company's loan portfolio totaled $650.2 million as of December 31, 2025, with an allowance for credit losses (ACL) of $2.5 million, indicating a slight decrease in ACL from $2.62 million in 2024[319]. - Total loans decreased from $714,337,185 in 2024 to $650,175,556 in 2025, representing a decline of approximately 9%[414]. - The net loans for 2025 were reported at $647,645,607, down from $711,716,236 in 2024, indicating a reduction of about 9%[414]. - The total recorded investment in loans past due 90 days or more was $26,807,218 as of December 31, 2025, compared to $14,339,179 in 2024, indicating a significant increase[424]. - The total balance of residential first mortgage loans classified as "Pass" was $441,476,903 as of December 31, 2025, reflecting a stable credit quality[430]. Regulatory and Compliance - The company is subject to stringent capital requirements, including a common equity Tier 1 capital ratio of 7.0% and a total capital ratio of 10.5%[198]. - The company has opted to comply with a community bank leverage ratio of 9% to meet capital requirements[200]. - Non-compliance with laws such as the USA PATRIOT Act could result in fines or sanctions, impacting operations[202]. - Regulatory compliance costs and changes in laws could adversely affect operations and increase operational costs[194]. Market Conditions and Risks - Inflation levels exceeded the Federal Reserve Board's long-term target of 2.0%, impacting asset values and customer repayment abilities[166]. - A deterioration in economic conditions could lead to increased loan delinquencies and a decrease in demand for the company's products and services[170]. - The company faces strong competition in loan and deposit markets, which may pressure net interest income and profitability[193]. - Cybersecurity threats are evolving, with increased risks of breaches and attacks that could materially impact financial condition and operations[187]. Investments and Securities - The amortized cost of securities available for sale as of December 31, 2025 was $160,717,376, with gross unrealized losses of $4,150,464[403]. - The company purchased $60,062,086 in securities available for sale in 2025, down from $76,764,024 in 2024[333]. - The company did not sell any securities available for sale in 2025, while in 2024, it sold 16 securities with a book value of $38.2 million, realizing losses of $5.2 million[407]. Personnel and Management - The company relies on key personnel for managing revenue-generating functions, and loss of such staff could adversely affect income and increase hiring costs[184]. - The company has provisions in its bylaws that may delay or block takeover attempts, including a restriction on voting more than 10% of shares by any person other than Bogota Financial, MHC[210].

Revenue and Income - The Trust received no Royalty Income from Hilcorp in the fiscal year ended December 31, 2025, compared to $6.9 million in Royalty Income for the fiscal year ended December 31, 2024[40]. - The Trust reported gross revenue of $48,896,125 in 2024 and $73,576,384 in 2025, indicating a significant increase in revenue over the two years[54]. - Royalty Income for 2025 was $12,809,471, compared to a loss of $11,986,710 in 2024, indicating a significant recovery in profitability[192]. - Gross Proceeds from natural gas production increased to $71,760,694 in 2025 from $46,502,870 in 2024, reflecting a growth of approximately 54%[192]. - Royalty Income for Q4 2025 was $0, down from $6,945,974 in Q4 2024, indicating a substantial decline in revenue generation[233]. Production and Costs - Excess Production Costs incurred from January through March 2025 amounted to $491,938 gross ($368,954 net to the Trust)[40]. - Total production costs for the Subject Interests in 2025 were $82,014,920, with average production costs per unit at $2.8669[118]. - Total production costs for 2025 were $60,766,913, slightly down from $60,882,835 in 2024, indicating stable cost management[192]. - Lease operating expenses and property taxes increased by $2.6 million, or 8.3%, to $33.4 million for the year ended December 31, 2025, compared to $30.8 million for 2024[196]. - Monthly lease operating expenses averaged $3.0 million in Q4 2025, down from $7.5 million in Q4 2024, reflecting a decrease in operational costs[222]. Financial Position and Reserves - The Trust's corpus was approximately $2.3 million and $2.7 million as of December 31, 2025 and 2024, respectively[40]. - The Trust's cash reserves were $23,298 as of December 31, 2025, down from $1,800,000 as of April 30, 2024[42]. - The cumulative balance of Excess Production Costs as of December 31, 2025, was approximately $8,438,536 gross ($6,328,902 net to the Trust), which must be recovered from future Net Proceeds before Royalty Income is paid[199]. - The Trust's cash reserves fell to $23,298 in 2025 from $760,920 in 2024, highlighting liquidity challenges[233]. - The anticipated deficit in income raises substantial doubt about the Trust's ability to continue as a going concern within one year after the issuance date of the financial statements[211]. Capital Expenditures and Investments - The Trust's 2026 capital expenditures for the Subject Interests are estimated to be approximately $14.0 million, with $11.5 million allocated to new vertical and horizontal drilling projects[115]. - Capital expenditures decreased by approximately $3.1 million to $20.8 million for the year ended December 31, 2025, compared to $23.9 million for 2024, with spending focused on completion of two horizontal wells and seven new vertical drill projects[195]. - Hilcorp's 2026 capital expenditures for the Subject Interests are estimated at approximately $14.0 million, with $11.5 million allocated to new drilling projects[180]. Regulatory and Environmental Factors - The Trust's operations are subject to extensive governmental regulations, which could impact production and revenue[84]. - The EPA proposed adding nine PFAS compounds to its list of hazardous constituents, which could increase production costs and affect Royalty income[142]. - The Trust is subject to stringent environmental regulations that may impose significant compliance costs and liabilities related to contamination and waste management[141]. - The Inflation Reduction Act (IRA) aims to reduce U.S. greenhouse gas (GHG) emissions by approximately 40% by 2030 compared to 2005 levels, with a target of achieving a net-zero economy by 2050[151]. - The ultimate impact of climate change regulations on Royalty and Royalty Income paid to the Trust by Hilcorp remains uncertain due to potential increases in production costs[154]. Operational Risks and Dependencies - The Trust's distributions are highly dependent on oil and gas prices, which can fluctuate widely due to various external factors[62]. - The Trust's financial health is at risk if Hilcorp or any third-party operator faces bankruptcy, which could disrupt operations and decrease distributions[69]. - The Trust's ability to generate revenue is influenced by the performance of Hilcorp, which operates the majority of the Subject Interests[55]. - The Trust cannot acquire new natural gas and oil assets, making it reliant on the existing Subject Interests for Royalty Income[178]. - The Trust's distributions may be considered a return of capital due to the depleting nature of mineral properties[73]. Production Performance - For the year ended December 31, 2025, the production from Subject Interests was 28,412,786 Mcf of natural gas and 32,458 Bbls of oil, with average prices of $2.53 per Mcf and $55.94 per Bbl respectively[117]. - Gas production increased to 6,787,814 Mcf in Q4 2025 from 5,671,899 Mcf in Q4 2024, representing a growth of approximately 19.7%[220]. - Oil production also increased to 8,681 Bbls in Q4 2025, up from 6,718 Bbls in Q4 2024, maintaining a consistent daily production rate of 73 Bbls[220]. Tax and Income Classification - Trust Unit Holders are subject to U.S. federal income taxes on their share of the Trust's income, regardless of cash distributions received[94]. - The classification of the Trust's income as portfolio income may limit the ability to offset passive losses, affecting Unit Holders[165].

Revenue and Income - Total royalty income for 2025 was $11,555,301, a significant decrease from $26,963,365 in 2024 and $29,010,704 in 2023[175] - Oil royalty income for 2025 was $10,399,771, accounting for 90% of total royalty income, while gas royalty income was $1,155,530, making up 10%[175] - Distributable income for 2025 was $14,300,162, or $0.31 per Unit, which includes a $4.5 million partial settlement from Blackbeard[187] - Royalty income for the fourth quarter of 2025 was $2,652,251, or $0.06 per Unit, a decrease from $3,784,959, or $0.08 per Unit, in the fourth quarter of 2024[190] Capital Expenditures and Expenses - Total capital expenditures for 2025 were approximately $228.7 million, compared to $109.4 million in 2024 and $120.4 million in 2023[182] - Lease operating expenses and property taxes for the Waddell Ranch properties in 2025 amounted to approximately $98.0 million, up from $82.2 million in 2024[183] - The Trust received no royalty income from the Waddell Ranch properties for the year 2025 due to large capital expenditures and workovers[176] Production and Sales - Oil and gas production for the Underlying Properties increased approximately 56% and 46% respectively from 2024 to 2025, attributed to new development and increased capital expenditures[181] - Oil sales for Waddell Ranch properties in October 2025 were 326,081 Bbls, compared to 198,955 Bbls in October 2024, representing a 64% increase[192] - Gas sales for Waddell Ranch properties in October 2025 were 1,429,268 Mcf, compared to 1,181,264 Mcf in October 2024, indicating a 21% increase[192] - For Texas Royalty properties, total oil sales in October 2025 were 14,323 Bbls, compared to 16,103 Bbls in October 2024, a decrease of 11%[193] Pricing Trends - Average price of oil decreased to $65.95 per barrel in 2025 from $75.88 in 2024, while the average price of gas increased to $1.78 per Mcf from $1.45[176] - Average realized price per Bbl for oil in October 2025 was $63.15, down from $77.35 in October 2024, reflecting an 18% decrease[192] - Average realized price per Mcf for gas in October 2025 was $1.57, down from $2.01 in October 2024, showing a 22% decrease[192] - Average realized price per Bbl for oil in October 2025 was $65.08, down from $77.19 in October 2024, a decrease of 16%[193] - Average realized price per Mcf for gas in October 2025 was $8.10, compared to $10.02 in October 2024, a decrease of 19%[193] Assets and Liabilities - Total assets for the fourth quarter of 2025 were $1,877,733, a decrease from $2,158,851 in November 2025[192] - Total liabilities for the fourth quarter of 2025 were $1,715,167, down from $1,996,428 in November 2025[192] Distributions - Distributions declared in December 2025 were $615,176, a decline from $896,437 in November 2025[192] Future Outlook - As of March 16, 2026, NYMEX posted oil prices were approximately $93.39 per barrel, indicating potential future revenue adjustments for the Trust[177]

Financial Performance - Net profits income for 2025 was $5,738,240, a 13% decrease from $6,563,177 in 2024, primarily due to lower oil prices and decreased production[133]. - Total revenues for 2025 were $14,589,185, compared to $17,319,388 in 2024, reflecting a decline in both oil and gas sales[130]. - Distributable income for 2025 was $4,490,844, down 21% from $5,677,818 in 2024, resulting in a distributable income per unit of $0.748474[184]. - Trust administration expense decreased to $847,078 in 2025 from $945,612 in 2024, indicating improved cost management[134]. - Net profits income for Q4 2025 was $1,629,528, an 11% increase from $1,462,841 in Q4 2024, attributed to higher gas production and prices, despite lower oil prices[144]. Production and Reserves - Approximately 51% of the net profits income received by the Trust during 2025 was attributable to natural gas, with 66% of the Trust's estimated future net cash flows from proved reserves at December 31, 2025[31]. - The Trust's total proved reserves as of December 31, 2025, consist of 931,000 Bbls of oil and 10,872,000 Mcf of gas, with net profits interests reserves of 297,000 Bbls of oil and 9,431,000 Mcf of gas[87]. - Oil production for 2025 is projected at 148,068 Bbls, down from 164,996 Bbls in 2024 and 192,119 Bbls in 2023, representing a decrease of 10.5% and 23% respectively[93]. - Gas production for 2025 is projected at 1,099,910 Mcf, a decrease from 1,216,905 Mcf in 2024 and 1,773,864 Mcf in 2023, reflecting a decline of 9.6% and 38% respectively[92]. - Estimated proved reserves for the net profits interests are based on estimates of reserves for the underlying properties and can be significantly affected by changes in oil and gas prices[41]. Costs and Expenses - Total costs deducted in the calculation of net profits income decreased by 18% from $9.8 million in 2024 to $8.0 million in 2025, driven by reduced development costs, taxes, and production expenses[141]. - Higher production expenses and development costs without concurrent increases in revenue will directly decrease the net proceeds payable to the Trust from properties underlying the 75% net profits interests[38]. - The Trust incurred administration expenses and earned interest income on funds held for distribution during 2025[104]. - The average production cost per BOE for oil is expected to be $2.29 in 2025, slightly down from $2.33 in 2024 and significantly up from $1.67 in 2023[1]. Market and Pricing - The Trust's monthly cash distributions are highly dependent on the prices realized from the sale of natural gas and oil, which can fluctuate widely due to uncontrollable factors[37]. - Average sales price for oil in 2025 is expected to be $70.43 per Bbl, a decrease from $78.78 in 2024 and $79.50 in 2023[1]. - Average gas price increased by 11% to $4.40 per Mcf in 2025 from $3.97 per Mcf in 2024, influenced by various market factors[139]. - Federal regulation impacts the pricing and sales of oil and gas, with market-sensitive prices being the norm for sales from underlying properties[95]. Risks and Liabilities - The Trust's financial performance is subject to various risk factors, including geopolitical instability and market price fluctuations for oil and natural gas[40]. - The Trust's operational risks include natural disasters and mechanical failures, which could interrupt operations and reduce distributions[42]. - Cybersecurity threats pose a risk to the Trust's business, with potential material adverse effects on financial condition and operations[66]. - The Trust is not liable for any production costs or liabilities attributable to the underlying properties, and any overpayment of net profits income will reduce future distributions until recovered[24]. Trust Structure and Governance - Trust unitholders have limited voting rights and cannot influence the operations or future development of the underlying properties[51]. - The Trust's only cash requirement is for declared monthly distributions, funded by net profits income after administration expenses[150]. - The Trust has no equity compensation plans and did not purchase any units during the reporting period[128]. - The Trust's financial statements are prepared on a modified cash basis, differing from U.S. GAAP, which impacts revenue recognition and expense recording[191]. Future Outlook - The Trust will terminate if it fails to generate gross revenues of at least $1,000,000 per year over any successive two-year period[49]. - The estimated natural production decline rate for underlying oil and gas properties is approximately 6 to 8 percent per year[137]. - The Trust's assets are depleting, and if no successful development projects are undertaken, the assets may deplete faster than expected, potentially ceasing to produce in commercial quantities[46].

Company Overview - The Company was incorporated on February 21, 2013, to acquire all outstanding shares of the Bank and became its holding company[16]. - Virginia National Bank, the principal operating subsidiary, commenced operations on July 29, 1998, and offers a full range of banking services including checking accounts, loans, and trust services[18][24][25]. - As of December 31, 2025, the Company employed 140 full-time and 8 part-time employees, with women making up 75% and racial and ethnic minorities 22% of the workforce[35]. - The Company formed Masonry Capital Management, LLC in 2018, which will provide an annual revenue-share amount for six years after its membership interests are sold[22]. Regulatory Environment - The Company is regulated under the Bank Holding Company Act (BHCA) and is subject to supervision by the Federal Reserve and the SEC[17][38]. - The Company is subject to extensive regulations that may impact its operations and earnings, particularly in light of recent changes in federal and state laws[39][41]. - The Company expects to continue being treated as a small bank holding company under the Federal Reserve's policy statement, exempting it from certain regulatory capital requirements[62]. - The Bank is subject to compliance costs and obligations related to various laws and regulations, which may require significant resources[79]. - The Company must comply with the Office of Foreign Assets Control regulations to avoid serious legal and financial consequences[82]. - The CFPB remains an active regulatory agency with broad authority to pursue enforcement actions despite ongoing challenges[92]. - The Company complies with "qualified mortgage rules" and TILA requirements as a small creditor with assets below $2 billion[95]. Financial Performance - Net income for the year ended December 31, 2025, was $19.3 million, or $3.55 per diluted share, a 13.5% increase from $17.0 million, or $3.15 per diluted share in 2024[184]. - Net interest income (GAAP) for 2025 was $51.5 million, up from $46.4 million in 2024, with net interest income (FTE) (non-GAAP) at $51.9 million compared to $46.7 million in 2024[184][189]. - The efficiency ratio (FTE) (non-GAAP) improved to 57.6% in 2025 from 62.0% in 2024, reflecting better management of expenses relative to income[185]. - Return on average assets increased to 1.19% in 2025 from 1.06% in 2024, while return on average equity rose to 11.19% from 10.78%[184]. - The Bank segment earned net income of $19.6 million in 2025, a $2.3 million increase compared to $17.2 million in 2024[187]. - Average equity to average assets improved to 10.60% in 2025 from 9.80% in 2024, indicating stronger capital management[184]. - Cash dividend payout ratio decreased to 39.48% in 2025 from 41.80% in 2024, suggesting a shift in capital allocation strategy[184]. - The Company’s tangible book value per share increased to $32.21 in 2025 from $27.70 in 2024, reflecting growth in shareholder equity[181]. Capital and Liquidity - The Company's Tier 1 capital ratio was 19.60% as of December 31, 2025, exceeding the minimum requirement[58]. - The Bank's CET1 capital ratio was 19.36% as of December 31, 2025, also exceeding the minimum requirement of 6.5%[59]. - The FDIC's basic limit on deposit insurance coverage is $250,000 per depositor[67]. - Approximately 27.4% of the Company's deposits were uninsured as of December 31, 2025, posing liquidity risks and potential deposit outflows[121]. - The Company may need to raise additional capital in the future, which could be challenging due to market conditions and competition for investors[122]. Risk Management - The Company manages credit risk through consistent underwriting standards and a continuous quality assessment process[107]. - The Company faces significant risks related to borrowers' ability to repay loans, which could lead to increased nonperforming loans and adversely affect financial condition[114]. - Market risks include fluctuations in interest rates and credit quality, which could impact the Company's investment securities portfolio and overall earnings[115]. - Economic downturns and inflation could negatively affect profitability, leading to increased loan delinquencies and financial stress on borrowers[116]. - Cybersecurity risks pose a significant threat, as breaches could result in legal claims, regulatory penalties, and damage to the Company's reputation[139]. Operational Challenges - The Company is at risk of operational disruptions due to reliance on internal systems and third-party technology, which could adversely affect business operations and financial results[131]. - The unexpected loss of key management personnel could adversely affect the Company's growth and profitability[136]. - The Company relies on third-party vendors for critical business operations, and any issues with these vendors could disrupt service delivery and harm the Company's reputation[137]. - The Company faces challenges in integrating and implementing new technologies, which are essential for maintaining competitiveness in the financial services market[143]. Employee and Talent Development - The Company has a commitment to attract and retain high-performing employees through competitive compensation and benefits programs[34]. - The Finance Career & Leadership Academy (FCLA) was created to develop young talent in the financial industry, offering free training and potential career opportunities[31][33]. - The company had 144 full-time equivalent employees at the end of 2025, down from 146 at the end of 2024, indicating a reduction in headcount[210]. Shareholder Information - The Company is currently paying a quarterly cash dividend of $0.36 per share, with total dividends of $1.41 and $1.32 per share for the years ended December 31, 2025 and 2024, respectively[151][170]. - The Company's Board approved a share repurchase plan of up to 5% of outstanding common stock, with the first repurchases occurring in February 2024[171]. - The trading volume of the Company's common stock on the Nasdaq Capital Market is relatively low compared to larger companies, affecting liquidity[155].

Financial Performance - For fiscal 2026, net revenues decreased by $49.1 million, or 15.4%, to $269.7 million from $318.8 million in fiscal 2025[228] - VB Direct segment revenues decreased by $29.8 million, or 11.6%, to $227.8 million, with comparable sales down by $28.6 million, or 11.6%[229] - VB Indirect segment revenues decreased by $19.3 million, or 31.5%, to $41.9 million, primarily due to a decline in specialty and key account orders[231] - Gross profit for fiscal 2026 was $125.0 million, representing 46.4% of net revenues, down from 49.8% in fiscal 2025[226] - For fiscal 2026, gross profit decreased by $33.8 million, or 21.3%, to $125.0 million, with a gross profit margin of 46.4% compared to 49.8% in fiscal 2025[232] - Operating loss from continuing operations increased by $3.1 million, or 10.8%, to $(31.9) million, with an operating loss margin of (11.8)% for fiscal 2026[235] - Net loss from continuing operations decreased by $0.7 million, or 2.1%, to $(32.7) million for fiscal 2026[242] - Loss from discontinued operations decreased by $13.6 million, or 47.4%, to $(15.2) million in fiscal 2026[243] - Total net loss decreased by $14.3 million, or 23.1%, to $(47.8) million for fiscal 2026[244] Expenses and Cost Management - Selling, general, and administrative expenses (SG&A) were $158.1 million, or 58.6% of net revenues, compared to 59.1% in fiscal 2025[226] - SG&A expenses for fiscal 2026 decreased by $30.4 million, or 16.1%, to $158.1 million, representing 58.7% of net revenues, down from 59.1% in fiscal 2025[233] - The company implemented strategic price increases in late fiscal 2022 through fiscal 2024 and continued in fiscal 2026 to mitigate inflationary pressures[223] Store Operations - The company closed 12 underperforming full-line stores and one outlet store, ending the fiscal year with 29 full-line and 86 outlet locations[214] - Comparable sales, including e-commerce, decreased by 11.6% in fiscal 2026, following a 16.6% decrease in fiscal 2025[227] Cash Flow and Financial Flexibility - Net cash used in operating activities was $10.0 million in fiscal 2026, a decrease from $14.1 million in fiscal 2025, primarily due to a $14.3 million decrease in net loss[264] - Net cash used in investing activities was $1.5 million in fiscal 2026, down from $10.4 million in fiscal 2025, attributed to a $7.1 million reduction in spending on property, plant, and equipment[266] - Net cash used in financing activities decreased to $0.2 million in fiscal 2026 from $22.5 million in fiscal 2025, mainly due to a $21.8 million reduction in common stock repurchases[267] - The company has no debt outstanding under its $75.0 million asset-based revolving credit agreement as of January 31, 2026, providing additional financial flexibility[260] - As of January 31, 2026, the company had no borrowings outstanding under its Credit Agreement and had availability of $58.6 million[270] Strategic Initiatives - The company is focusing on Project Sunshine to enhance market position and streamline operations, aiming for improved agility and customer experience[210] - The macroeconomic environment has been challenging, with inflationary pressures impacting consumer discretionary spending and increasing digital media costs[220] Impairments and Adjustments - The company recorded impairment charges of $1.0 million in fiscal 2026, compared to $2.4 million in fiscal 2025[277] - The balance of inventory adjustments was $6.0 million as of January 31, 2026, compared to $0.7 million for the prior fiscal year[276] - The company recorded a loss on the sale of business amounting to $15.2 million during fiscal 2026[264] Foreign Exchange and Funding - The company has not been materially impacted by changes in foreign exchange rates, as purchases and sales are primarily denominated in U.S. dollars[280] - The company expects to fund material cash requirements using cash on hand, cash from operations, and borrowings under the Credit Agreement[271]

Public Offering and Financial Proceeds - The company completed its Public Offering on November 13, 2023, raising gross proceeds of $345.0 million from the sale of 34,500,000 units at $10.00 per unit, incurring transaction costs of approximately $20.4 million[302]. - The underwriters received an underwriting discount of $6,900,000 and deferred underwriting commissions of approximately $12,075,000, contingent upon the completion of an initial business combination[319][320]. Financial Performance and Income - As of December 31, 2025, the company reported a net income of $10,468,766, consisting of $15,967,259 in interest income from the Trust Account, offset by general and administrative expenses of $5,498,493[313]. - Cash used in operating activities for the year ended December 31, 2025, was $1,316,889, primarily due to general and administrative expenses funded by a note payable through the Sponsor and affiliates[315]. - The company incurred $120,000 in administrative costs for both the years ended December 31, 2025, and 2024, for office space and support services[321]. Liquidity and Financial Challenges - The company had a cash balance of $1 and a working capital deficit of $17,114,663 as of December 31, 2025, indicating significant liquidity challenges[314]. - The company has until the Extended Termination Date to complete a business combination or cease operations, raising concerns about its ability to continue as a going concern[317]. - Approximately $17.4 million was removed from the Trust Account to pay shareholders who redeemed their public shares during the Extension Meeting held on November 10, 2025[308]. Debt and Financial Obligations - The company issued an unsecured promissory note of $1,500,000 to its Sponsor on August 28, 2024, to cover costs related to the initial business combination[322]. - As of December 31, 2025, the outstanding balance under the Extension Promissory Note was $1,316,889, indicating ongoing financial obligations[311]. - The Company issued an Extension Promissory Note requiring Warrant Holdings Sponsor to deposit $658,444.74 into the Trust Account starting November 13, 2025, and monthly thereafter until certain conditions are met[326]. - As of December 31, 2025, the Company had $1,316,889 outstanding under the Extension Promissory Note[326]. Accounting and Reporting Standards - The Company qualifies as an "emerging growth company" under the JOBS Act, allowing it to delay the adoption of new or revised accounting standards[331]. - The exemptions for being an "emerging growth company" will apply for five years following the completion of the Public Offering or until the Company no longer qualifies[332]. - Management does not believe that any recently issued accounting standards would materially affect the Company's financial statements[329]. - The preparation of financial statements requires management to make estimates that could materially differ from actual results[328]. - The Company is classified as a smaller reporting company and is not required to provide certain disclosures about market risk[333]. Off-Balance Sheet Arrangements - The Company does not have any off-balance sheet arrangements as of the date of the Annual Report[330].

Financial Performance - For the year ended December 31, 2025, the company reported a net income of $10,468,766, consisting of $15,967,259 in interest income from the Trust Account, offset by general and administrative expenses of $5,498,493 [313]. - The company incurred $1,316,889 in cash used for operating activities for the year ended December 31, 2025, primarily due to general and administrative expenses funded by a note payable [315]. - The company has not generated any operating revenues to date and does not expect to do so until after completing an initial business combination [312]. Liquidity and Financial Obligations - As of December 31, 2025, the company had a cash balance of $1 and a working capital deficit of $17,114,663, indicating significant liquidity challenges [314]. - The company issued an unsecured promissory note of $1,500,000 to cover costs related to the initial business combination, which is repayable upon consummation of the business combination [322]. - As of December 31, 2025, the outstanding balance under the Extension Promissory Note was $1,316,889, indicating ongoing financial obligations [311]. - The Company issued an Extension Promissory Note requiring Warrant Holdings Sponsor to deposit $658,444.74 into the Trust Account starting November 13, 2025, and monthly thereafter until certain conditions are met [326]. - As of December 31, 2025, the Company had $1,316,889 outstanding under the Extension Promissory Note [326]. Business Operations and Future Outlook - The company has until the Extended Termination Date to complete a business combination or cease operations, raising substantial doubt about its ability to continue as a going concern [317]. - The underwriters received an underwriting discount of $6,900,000 and deferred underwriting commissions of approximately $12,075,000, contingent upon the completion of an initial business combination [319][320]. Accounting and Reporting - The Company qualifies as an "emerging growth company" under the JOBS Act, allowing it to delay the adoption of new or revised accounting standards [331]. - The exemptions for emerging growth companies will apply for five years following the completion of the Public Offering or until the Company no longer qualifies [332]. - Management does not believe that any recently issued accounting standards would materially affect the Company's financial statements [329]. - The preparation of financial statements requires management to make estimates that could materially differ from actual results [328]. - The Company is classified as a smaller reporting company and is not required to provide certain disclosures about market risk [333]. Administrative Costs - The company incurred $120,000 in administrative costs for both the years ended December 31, 2025 and 2024, related to office space and support services [321]. Public Offering - The company completed its Public Offering on November 13, 2023, raising gross proceeds of $345.0 million from the sale of 34,500,000 units, including 4,500,000 units from the underwriters' overallotment option [302].

Financial Performance - Monopar reported a net loss of $5.2 million, or $0.61 per share, for Q4 2025, a significant decrease from a net loss of $10.9 million, or $2.23 per share, in Q4 2024[10]. - For the full year 2025, Monopar's net loss was $13.7 million, or $1.85 per share, compared to a net loss of $15.6 million, or $4.11 per share, in 2024[10]. Cash and Investments - Cash, cash equivalents, and short-term investments as of December 31, 2025, were $140.4 million, expected to support operations through at least December 31, 2027[9]. Research and Development (R&D) Expenses - Research and Development (R&D) expenses for Q4 2025 were $3.9 million, down from $9.9 million in Q4 2024, primarily due to the absence of one-time expenses from 2024[11]. - R&D expenses for the full year 2025 totaled $9.9 million, compared to $13.0 million in 2024, reflecting a shift in focus following the in-licensing of ALXN1840[12]. General and Administrative (G&A) Expenses - General and Administrative (G&A) expenses for Q4 2025 were $2.2 million, up from $1.2 million in Q4 2024, driven by higher personnel expenses and legal fees[13]. - G&A expenses for the full year 2025 were $6.8 million, compared to $3.2 million in 2024, attributed to increased personnel costs and other G&A expenses[14]. Drug Development and Regulatory Plans - Monopar plans to submit a New Drug Application (NDA) for ALXN1840 for Wilson disease in mid-2026, following positive interactions with the FDA[5]. - The company presented long-term efficacy and safety data for ALXN1840 at EASL 2025, involving 255 patients with a median treatment duration of 2.63 years[6]. Capital Raising - Monopar completed a public offering in 2025, generating approximately $91.9 million, strengthening its balance sheet for future operations[7].