CISO Global, Inc. 10-K

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock is listed for trading on The Nasdaq Stock Market LLC under the symbol “CISO”. As of March 20, 2025, there were 750 holders of record of our common stock, and the last reported sale price of our common stock on The Nasdaq Stock Market LLC on March 20, 2026 was $0.39. A significant number of shares of our common stock are held in either nominee name or street name brokerage accounts, and consequently, we are unable to determine the total number of beneficial owners of our common stock. As of March 20, 2025, there was one holder of our Series B Preferred Stock. Dividend Policy To date, we have paid no dividends on our common stock and do not expect to pay cash dividends in the foreseeable future. We plan to retain all earnings to provide funds for the operations of our company. In the future, our Board of Directors will decide whether to declare and pay dividends based upon our earnings, financial condition, capital requirements, and other factors that our Board of Directors may consider relevant. We are not under any contractual restriction as to present or future ability to pay dividends. Series A Preferred Stock On August 4, 2025, we filed with the Secretary of State of the State of Delaware a Certificate of Designations, Preferences and Rights of Series A Preferred Stock of CISO Global, Inc. (the “Series A Certificate of Designations”). The Series A Certificate of Designations sets forth the rights, preferences, privileges, and restrictions of the shares of Series A Preferred Stock. On August 4, 2025, we entered into Exchange Agreements (each, an “Exchange Agreement,” and collectively, the “Exchange Agreements”) with each of Hensley & Company, d/b/a Hensley Beverage Company (“Hensley”), an entity affiliated with Andrew K. McCain, a director of our company, and JC Associates, Inc. (“J C Associates,” and collectively with Hensley, the “Holders”). Pursuant to the Exchange Agreements, in reliance on the exemption from registration provided by Section 3(a)(9) of the Securities Act and Rule 506(b) of Regulation D as promulgated by the SEC, the Holders exchanged certain outstanding convertible notes, as amended from time to time, with aggregate principal and accrued interest of approximately $9,297,894.54 for an aggregate of 9,297,894 newly authorized shares of Series A Preferred Stock. Upon the closing of the transactions contemplated by the Exchange Agreements, the Exchange Notes were cancelled, and the Holders relinquished all rights, powers, privileges, remedies, or interest under such securities. As a result of this transaction, for the year ended December 31, 2025, the Company recognized a gain on troubled debt restructuring of $5,296,103, which reflects the difference between the carrying value of the Exchange Notes and the estimated fair value of the Series A Preferred Stock issued. Shares of Series A Preferred Stock are convertible into shares of our common stock at any time by our Board of Directors in accordance with the Series A Certificate of Designations. Each share of Series A Preferred Stock convert into shares of common stock, without the payment of additional consideration by the Holder, into such whole number of fully paid and non-assessable shares of common stock, as is determined by (i) multiplying the number of shares of Series A Preferred Stock to be converted by the issuance price ($1.00), (ii) adding to the result all accrued and accumulated and unpaid dividends on such shares of Series A Preferred Stock to be converted, and then (iii) dividing the result by the liquidation value (100% of the issuance price). On November 6, 2025, we converted all 9,297,894 outstanding shares of Series A Preferred Stock, together with $222,815 in accrued and unpaid dividends to 9,520,709 shares of common stock. As a result, as of March 27, 2026, there were no shares of Series A Preferred Stock outstanding. - 34 - Series B Preferred Stock On September 25, 2025, we filed with the Secretary of State of the State of Delaware a Certificate of Designations, Preferences and Rights of Series B Preferred Stock of CISO Global, Inc. (the “Series B Certificate of Designations”). The Series B Certificate of Designations sets forth the rights, preferences, privileges, and restrictions of the shares of Series B Preferred Stock. On September 24, 2025, we entered a purchase agreement with B. Riley, pursuant to which we will have the right to issue and sell to B. Riley, and B. Riley must purchase from us, up to $15.0 million of shares of our newly authorized Series B Preferred Stock. Such sales of Series B Preferred Stock by us to B. Riley, if any, will be subject to certain limitations and conditions set forth in the purchase agreement, and may occur from time to time, at our sole discretion, over the 18-month period commencing September 24, 2025 and terminating on the earliest of (i) March 24, 2027, (ii) the date on which B. Riley shall have made payment of the aggregate purchase price equal to $15.0 million. In no event may we issue or sell to B. Riley under the Purchase Agreement shares of our Series B Preferred Stock that are convertible into an aggregate number of shares of common stock exceeding a customary 9.99% beneficial ownership limitation. Shares of Series B Preferred Stock are convertible into shares of our common stock at any time by B. Riley in accordance with the Series B Certificate of Designations. The initial conversion price for the Series B Preferred Stock is determined by dividing the initial stated value of $1,000 per share (the “Stated Value”) by the applicable conversion price for the Series B Preferred Stock then being converted as of each conversion date (the “Conversion Price”). The Conversion Price equals (a) with respect to the first $500,000 of Stated Value of shares of Series B Preferred Stock being converted, the greater of (x) one hundred and five percent (105%) of the lowest volume weighted average price, as reported by Bloomberg Financial Markets, during the five (5) trading day period immediately preceding and ending on the trading day immediately preceding such conversion date and (y) the minimum conversion price (initially, $0.40), and (b) with respect to all additional shares of Series B Preferred Stock being converted thereafter, the greater of (x) ninety-five percent (95%) of the lowest volume weighted average price during the five (5) trading day period immediately preceding and ending on the trading day immediately preceding such conversion date and (y) the minimum conversion price. During the year ended December 31, 2025, the Company issued 2,396 shares of Series B Preferred Stock to B. Riley pursuant to the Purchase Agreement for cash proceeds of $1,774,935 (net of $525,065 of offering costs). As of December 31, 2025, 315 shares of Series B Preferred Stock had been converted into 624,794 shares of common stock, with 2,081 shares remaining outstanding. For the year ended December 31, 2025, the Company recognized $699,445 of accretion of the carrying value of Series B Preferred Stock to its redemption value with a corresponding decrease to additional paid-in capital. Additional Unregistered Sales of Equity Securities On March 17, 2025, we issued 100,000 shares of our common stock to TraDigital Marketing Group as compensation for investor relations services provided to our company. The shares were privately placed in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D. On September 4, 2025, we issued 310,000 shares of our common stock to FMW Media Works LLC as compensation for marking services provided to our company. The shares were privately placed in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D. On September 19, 2025, we issued 72,927 shares of our common stock to the former equityholders of SB Cyber Technologies, LLC, as additional consideration pursuant to the Equity Purchase Agreement dated as of July 14, 2023. The shares were privately placed in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D. - 35 - ITEM 6. [RESERVED]