Table of Contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

Commission File Number 0-12346

IRONSTONE GROUP,PROPERTIES, INC.

(Exact nameName of Registrant as specified in its charter)

909 Montgomery Street, San Francisco, California 94133

(Address of principal executive offices, including zip code)

(415) 551-8600

(Registrant’s telephone number, including area code)

NONESecurities registered under Section 12(b) of the Exchange Act:

(Former name, former address and former fiscal year,None

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $0.01 par value

Indicate by check mark if changed since last report)the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐No☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐No☒

Indicate by check mark whether the registrantRegistrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrantRegistrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X]   No [ ]☒No☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained in this form, and no disclosure will be contained, to the best of the Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☒

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website,Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [X]☒ No [ ]☐

Indicate by check mark whether the registrantRegistrant is a large accelerated filer, an accelerated filer a non-accelerated filer. or a smaller reporting company. See the definition of “large accelerated filer,” “accelerated filer,” “non-accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (asas defined in Rule 12b-2 of the Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act) Yes [  ]   No [X]Act. ☐

As of November 13th, 2015,8, 2021 2,191,689 shares of Common Stock, $0.01 par value, were outstanding.

TABLE OF CONTENTS

1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business Activities

Ironstone Group, Inc. and subsidiaries have no operations but arepurchases business interests where the Company has a relationship and influence; examples include being a current or prior board of director member, providing seed level capital, and serving in an advisory capacity. Currently Ironstone Group, Inc. is seeking appropriate business combination opportunities. Ironstone Group, Inc.,Inc, (“Ironstone” or the “Company”) is a Delaware corporation, that was incorporated in 1972.

Name Change

On September 30, 2021 as part of bringing Ironstone Group, Inc. back into good standing in the State of Delaware where the Company is incorporated, Ironstone Group, Inc. changed its name to Ironstone Properties, Inc. During the time which Ironstone Group, Inc. was in “Void status” in the State of Delaware, another entity assumed the same name with “LLC”. Rather than negotiate with the other entity to be able to continue using the name “Ironstone Group, Inc.” the Board of Directors elected to rename the Company Ironstone Properties, Inc. hence forth. As of September 30, 2021 Ironstone Properties, Inc is in good standing with the Secretary of State of Delaware. The Company will continue to trade under the ticker symbol “IRNS”. Existing shares of formerly Ironstone Group Inc., will be recognized as Ironstone Properties, Inc.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of Ironstone Group, Inc. and its subsidiaries, AcadiEnergy, Inc., Belt Perry Associates, Inc., DeMoss Corporation, and TaxNet, Inc., (collectively the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation.

Basis of Presentation

The unaudited condensed consolidated financial statements included herein have been prepared by the Company in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures, normally included in financial statements prepared in accordance with U.S. GAAP, have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position of the Company as of September 30, 2015, 2021 and December 31, 2020, the results of its operations for the three and nine month periods ended September 30, 2015 2021 and September 30, 2014 2020 and nine months ending September 30, 2021 and September 30, 2020 and its cash flows for the nine month periods ended September 30, 2015 2021 and September 30, 2014. 2020. The results of operations for the periods presented are not necessarily indicative of those that may be expected for the full year. The condensed consolidated financial statements presented herein have been prepared by management, without audit by independent auditors who do not express an opinion thereon and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014. The December 31, 2014 condensed consolidated balance sheet data was derived from audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014 but does not include all disclosures required for annual periods. The last audited annual report on Form 10-K was for the fiscal year ended December 31, 2014.

There have been no significant changes in the Company’s significant accounting policies from those were disclosed in its Annual Report on Form 10-K10-K for the fiscal year ended December 31, 2014.

Going Concern

These financial statements contemplate the realization of assets and the satisfaction of liabilities in the normal course of business. Ironstone Group has incurred losses and negative cash flows from operations over the last ten years. The Company has operated in the past principally with the assistance of loans from private institutions and related party individuals. The on-going accrual of unpaid interest on external and related party debt, excluding the LOC, continues to increase the financial risk to the Company as a going concern. Conversion of a material portion of the outstanding debt to equity will help alleviate such financial pressure. The financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Marketable and Non-Marketable Securities

Marketable and non-marketable securities have been classified by management as available for sale in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 320, marketable securities are recorded at fair value and any unrealized gains and losses are excluded from earnings and reported as a separate component of stockholders’ equity until realized. The fair value of the Company’s marketable securities and investments at September 30, 2015 2021 and December 31, 2014 is2020 are based on quoted market prices. For the purpose of computing realized gains and losses, cost is identified on a specific identification basis. For marketable securities for which there is an other-than-temporary impairment, an impairment loss is recognized as a realized loss, and related adjustments are not made for recovery in value. The Company has not realized any such impairment losses to date.

Securities determined to be non-marketable by the Company do not have readily determinable fair values. The Company estimates the fair value of these instruments using various pricing models and the information available to the Company that it deems most relevant. Among the factors considered by the Company in determining the fair value of financial instruments are discounted anticipated cash flows, the cost, terms and liquidity of the instrument, the financial condition, operating results and credit ratings of the issuer or underlying company, the quoted market price of publicly traded securities with similar duration and yield, the Black-Scholes Options Valuation methodology adjusted for active market, the share price of recent round of financings by an outsider, and other considerations on a case-by-case basis and other factors generally pertinent to the valuation of financial instruments.

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Use of Estimates

The preparation of financial statements in conformity with USU.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates made in the financial statements relate to the valuation of the Company’s non-marketable investments. Actual results could differ from those estimates.

Income Taxes

The Company and its wholly owned subsidiaries file a consolidated federal income tax return. Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred income taxes. Deferred income taxes are recognized for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future. Deferred income taxes are also recognized for net operating loss carryforwards that are available to offset future taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. As of September 30, 2015 2021 and December 2014, 31, 2020, a full valuation allowance has been recorded to offset loss carryforwards as, in management’s opinion, there is uncertainty as to whether or not the companyCompany will be able to generate taxable income in the future.

The Company follows the authoritative guidance on accounting for and disclosure of uncertainty in tax positions, which requires the Company to determine whether a tax position of Ironstone is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. For tax positions meeting the more likely than not threshold, the tax amount recognized in the financial statements is reduced by the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant taxing authority. The Company has determined that there is no effect on the financial statements from this authoritative guidance.

The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it operates. In the normal course of business, the Company is subject to examination by federal, state, local, and foreign jurisdictions, where applicable. As of September 30, 2015, 2021, the tax years that remain subject to examination by the major tax jurisdictions under the statute of limitations areis from the year 20102017 forward for Federal and from the year 20092016 forward for California (with limited exceptions).

During the nine months ended September 30, 2015 and 2014, the Company did not recognize any interest or penalties related to income taxes in its consolidated statement

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (concluded)

Stock-Based Compensation

Ironstone recognizes the fair value of stock options granted on a straight-line basis over the requisite service period of the option grant, which is the standard vesting term of fourthree years.

The full impact of stock-based compensation in the future is dependent upon, among other things, the total number of stock options granted, the fair value of the stock options at the time of grant and the tax benefit that Ironstone may or may not receive from stock-based expenses. Additionally, stock-based compensation requires the use of an option-pricing model to determine the fair value of stock option awards. This determination of fair value is affected by Ironstone’s stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include but are not limited to Ironstone’s expected stock price volatility over the term of the awards.

Basic and Diluted Loss per Share

Basic loss per share (“EPS”) excludes dilution and is computed by dividing net income (loss) applicable to common shareholders by the weighted average number of common shares actually outstanding during the period. Diluted EPS reflects the dilution from potentially dilutive securities, except where inclusion of such potentially dilutive securities would have an anti-dilutive effect, using the average stock price during the period in the computation and because of the net loss for the periods presented.

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In August 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-15,2014-15, ““Disclosure of Uncertainties about an Entity’sEntity’s Ability to Continue as a Going Concern”Concern” (“ASU 2014-15”2014-15”). ASU 2014-152014-15 introduces an explicit requirement for management to assess and provide certain disclosures if there is substantial doubt about an entity’s ability to continue as a going concern. ASU 2014-152014-15 is effective for the annual period ending after December 15, 2016. The Company continues to evaluate the impact that the adoption ofhas adopted ASU 2014-15 will have on the Company’s consolidated financial statements.2014-15.

In February 2015, August 2018, the FinancialFASB issued Accounting Standards Board ("FASB"Update (“ASU”) issued Accounting Standard Update (ASU) 2015-02, Comprehensive Income2018-13, “Fair Value Measurement (Topic 810)820): Disclosure Framework – AmendmentsChanges to the Consolidation Analysis, which requires an entity to evaluate whether they should consolidateDisclosure Requirements for Fair Value Measurement”. ASU 2018-13 removes certain legaldisclosures, modifies others and introduces additional disclosure requirements for entities. The amendments in this Update are effective for public business entitiesASU 2018-13 for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015. For2019. Amendments on changes in unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other amendments should be applied retrospectively to all other entities, the amendments in this Update areperiods presented upon their effective for fiscal years beginning after December 15, 2016, and for interim periods within fiscal years beginning after December 15, 2017.date. The Company is reviewingadopted the applicability of this amendment.new standard on January 1, 2020. The adoption did not have a material impact on the Company’s financial statements.

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)

2. FAIR VALUE MEASUREMENTS

Fair value is defined under the Financial Accounting Standards Board (“FASB”) Accounting Standards Board (“ASC”) FASB ASC 820, “Fair Value Measurement and Disclosures”. ASC 820 defines fair value, establishes a framework for measuring fair value under U.S. GAAP and enhances disclosures about fair value measurements. Fair value is defined under ASC 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 describes a fair value hierarchy based on three levels of inputs of which the firsttwo are considered observable and the last unobservable, that may be used to measure fair value as follows:

Level1–Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and block discounts are not applied to Level 1 instruments. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these products does not entail a significant degree of judgment.

Level2–Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level3–Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

In all cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level of input that is significant to the fair value measurement.

The Company’s assets and liabilities that are measured at fair value on a non-recurring basis include cash, accounts payable, accrued expenses, and interest payable given their short-term nature. Furthermore, the fair value of the Company’s notes payable are initially measured at fair value given that they are estimated based on current rates that would be available for debt of similar terms.

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

2. FAIR VALUE MEASUREMENTS (continued)

The following tables provide information about the Company’s financial instruments measured at fair value on a recurring basis at as of September 30, 2015 2021 and December 31, 2014 2020 by the fair value hierarchy:

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)

2. FAIR VALUE MEASUREMENTS (concluded)

The following tables presents the Company’s investments measured at fair value using significant unobservable inputs (Level 3)3), including the valuation technique and unobservable inputs used to measure the fair value of those financial instruments:

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

2. FAIR VALUE MEASUREMENTS (concluded)

The following table presents additional information about Level 3 assets measured at fair value on a recurring basis.basis for nine months ended September 30, 2021 and 2020. Both observable and unobservable inputs may be used to determine the fair value of positions that the Company has classified within the Level 3 category. As a result, unrealized gains or (losses) during the period for assets and liabilities within the Level 3 category presented in the tables below may include changes in fair value during the period that were attributable to both observable and unobservable inputs.

3. INVESTMENTS

TangoMe, Inc.

On March 30, 2012, the Company purchased 468,121 shares of Series A Preferred stock from related party William R. Hambrecht at $2.14 per share, resulting in a total investment of $1,000,000.For$1,000,000. For the year ended December 31, 2014,2020 there was 0 valuation gain or loss for TangoMe, Inc., remaining at a valuation of $2,574,666. Updating the Company recorded an unrealized“MESE” valuation system with current available data from TangoMe, Inc., results in a “Best-fit” company valuation of $2.6bn, translating to a valuation of $4,781,521 as of September 30, 2021. This represents a gain of $572,747, bringing$2,206,856 for the total value of the investment in TangoMe, Inc. to $2,574,666 as of December 31, 2014. There was no change in value as of three and nine months ended September 30, 2015, with the valuation remaining at $2,574,666. 2021. The investment fair value is based on similar securities sold to certain related and unrelated third parties. The use ofusing a recent round of financingBest-fit valuation for TangoMe Inc. isas determined by the MESE big data analysis system and SPAC inquiries for TangoMe, Inc. These are the primary significant unobservable inputinputs used in the fair value measurement of the Company’s investment. Significant increases (decreases) in any subsequent rounds of financing would result in a significantly higher (lower) fair value measurement.

Salon Media Group, Inc.

The Company owns 2,006,827 shares of Common Stock of Salon Media Group, Inc (“Salon”) common stock. The investment in common shares of Salon is valued at $0.13 per share, or $260,887, as of September 30, 2015 and December 31, 2014. The Company recorded no gain or loss for the three months ended September 30, 2015 and an unrealized gain of $461,570 for the three months ended September 30, 2014. For the nine months ended September 30, 2015, there was no change in fair value. For the nine months ended September 30, 2014, the Company recorded an unrealized loss of $120,411.

4. RELATED PARTY TRANSACTIONSquarter ended September 30, 2021.

Mr. William R Hambrecht, Chief Executive Officer, is a minority shareholder in Salon Media Group.

Ms. Elizabeth Hambrecht, Director, is currently the interim Chief Financial Officer of Salon Media Group,Buoy Health, Inc. Ms. Hambrecht formerly served as former President and Chief Executive Officer of Salon Media Group, Inc. Ms. Hambrecht is also the sister of a member of the Board of Directors, and is the daughter of the Chief Executive Officer.

On March 17, 2021 the Company purchased 11,233 common shares of the private company Buoy Health, Inc. at $15.92 per share. The total value of the investment was $178,824 at September 30, 2021.

4. RELATED PARTY TRANSACTIONS

On December 31, 2014 the Company combined all the various notes payable, which were issued at various times to Mr. William R. Hambrecht, to one note for $182,000 at 7.75% interest, withinterest. The note payable carried a principal balance of $182,000 as of September 30, 2021 and December 31, 2015 maturity.2020 with additional accrued interest of $119,405 and $108,855 respectively. The loan maturity has been extended to December 31, 2025.

A loan was made to Ironstone Properties, Inc. by William R. Hambrecht resulting from William R. Hambrecht paying the interest on the Bank Letter of Credit from the time period January 2016 through March 2021. The company has non-marketable investments in TangoMe, Inc., and Arcimoto, Inc.loan from William R. Hambrecht interest rate is 7.75%. The valuation of these investments as of loan balances at September 30, 2015 has been calculated based on prices obtained from third party transactions with2021 and December 31, 2020 were $142,313 and $135,625 respectively. Accrued interest at September 30, 2021 was $40,668 and December 31, 2020 was $30,437. Maturity of the aforementioned companies. These third party transactions have been inclusive of entities related to Ironstone Group, Inc.

5. NOTE PAYABLEnote is March 31, 2026.

On March 10, 2021 William R. Hambrecht loaned Ironstone Properties, Inc. $300,000 at 6.0% interest rate with a March 11, 2026 maturity. Interest payable at September 30, 2021 was $10,143.

5. NOTE PAYABLE

On March 31, 2012, the Company received $1,000,000 from a third party and issued a related promissory note. The note carries an 8% interest rate, per annum, and has a maturity date of March 31, 2017. Interest accrues on the balance and converts to separate notes payable on a quarterly basis. The total amounts due under this agreement, including the notes related to accrued interest, are due in full at the end of the term. The note is secured by all of the assets of the Company through an accompanying security agreement. If the Company defaults on the note or security agreement, interest would accrue at 10% per annum. The company was unable to meet its payment obligation by the prescribed deadline, therefore the interest rate stepped up to 10% and interest has been accrued using at the stepped up rate starting April 1, 2017. The gross amountamounts payable under the agreement as of September 30, 2015 2021 and December 31, 2014 2020 were $1,319,620$2,272,237 and $1,243,708,$2,109,857 respectively.

In connection with the note agreement, the Company also issued warrants to this third party to purchase 187,296 shares

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)

Furthermore, the Company has a note payable agreement with a related party, William R. Hambrecht. This note carries a 7.75% interest rate per annum and has a maturity date of December 31, 2015. The note payable carried a principal balance of $182,000 as of September 30, 2015 and December 31, 2014 with additional accrued interest of $34,775 and $24,255 respectively.

The scheduled maturities of notes and LOC payable outstanding as of September 30, 2015 2021 are as follows:

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)accepted. The Company is currently in good standing in the State of Delaware.

During the period March 2017 and March 2021, the company recorded $58,504 of Delaware Franchise tax liabilities and related interest and penalties of $32,577. These items were reversed in a prior period adjustment to retained earnings as they applied to prior years.

7. STOCKHOLDERS’8. STOCKHOLDERS’ EQUITY

Common Stock

On January 2, 2014, the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) with new investors and existing investors (each, a “Share Purchaser” and, collectively, the “Share Purchasers”), pursuant to which, the Company issued and sold to such Share Purchasers 131,429 shares of the Company’s Common Stock, representing approximately 7% of Ironstone’s outstanding equity securities on the date of purchase, for an aggregate purchase price of $230,000.

On May 1, 2014, a third party exercised warrants for 187,296 shares of the Company’s Common Stock. As of September 30, 2014, the Company issued 187,296 shares from the warrant exercise to the third party.

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)

Treasury Stock

On September 15, 2003, the Board of Directors authorized the Company to purchase 745,536 shares of Company common stock at $0.70 per share for an aggregate purchase price of $521,875. The repurchase represented 50.11% of the issued and outstanding shares of the Company. During the year ended December 31, 2008, the Company paid $699 for fractional Treasury shares. As of September 30, 2015 2021 and December 31, 2020, the treasury shares are held by the Company.

Preferred Stock

The Company is authorized to issue up to five million5000000 shares of preferred stock without further shareholder approval; the rights, preferences and privileges of which would be determined at the time of issuance. NoNaN shares have been issued as of September 30, 2015 2021 and December 31, 2014.2020.

Stock-Based CompensationStock Option Plans

For the nine months ended September 30, 2015 and September 30, 2014, On April 29, 2021 the Company recorded stock-based compensation expense of $19,413 and $21,533, respectively.is revised its existing Equity Incentive Plan. As of September 30, 2015, Ironstone hadApril 29, 2021, 175,000 options were granted under the Plan, with an aggregateexercise price of $44,713 of stock-based compensation remaining to be expensed over the remaining requisite service period of the underlying options,$1.99 per share, which is expected to be over abased on the weighted average periodprice for the trailing six month average price and an illiquidity discount of 1.75 years. Ironstone currently expects this stock-based compensation balance to be expensed as follows: $6,471 during15%. The options vest straight line over three years and expire seven years following the remaining quarter of fiscal year 2015; $25,884 during fiscal year 2016 and $12,358 during fiscal year 2017.

Stock Option Plans

grant date. The Company has adopted a 2013 Equity Incentive Plan (“Plan”) and 187,296 shares were available for grant under the Plan. The Planplan provides for incentive stock options to be granted at times and prices determined by the Company’s Board of Directors. The stock options are to be granted to directors, officers and employees of the Company, as well as certain consultants and other persons providing services to the Company.

70,000Stock-Based Compensation

For the quarter ended September 30, 2021 the Company recorded stock options were granted on January 30, 2013. The fair valuebased compensation relating to the Equity Incentive Plan of these options granted under the Plan were estimated using the Black-Scholes model with the following price and assumptions: Stock Price $0.20, Exercise Price $0.20, Time to Maturity 6.33 years, Risk-free Interest Rate 0.4%, Annualized Volatility 121%.

IRONSTONE GROUP, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)$62,209.

7. STOCKHOLDERS’ EQUITY (continued)

An additional 100,000 stock options were granted on August 20, 2013. The fair value of these options granted under the Plan were estimated using the Black-Scholes model with following price and assumptions: Stock Price $1.20, Exercise Price $1.20, Time to Maturity 4.0 years, Risk-free Interest Rate 1.0%, Annualized Volatility 93%.

Operating Earnings (Loss) Per Share

Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing the net income(loss)income (loss) for the period by the weighted average number of common and dilutive potential common shares outstanding during the period, if dilutive. Potentially dilutive common equivalent shares are composed of the incremental common shares issuable upon the exercise of stock options. The following is the computations of the basic and diluted net income per share and from operations and the anti-dilutivedilutive common stock equivalents excluded from the computations for the periods presented:

IRONSTONE PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(UNAUDITED)

Comprehensive Earnings (Loss) Per Share

Comprehensive earnings include Operating earnings (loss) above, and securities and options investments held mark-to-market gains (loss).

8. MANAGEMENT’S MANAGEMENT’S PLANS

As reflected in the accompanying financial statements, the Company has net losses and has a negative cash flow from operations. The attainment of profitable operations is dependent upon future events, including liquidity events in privately held investments in excess of purchase price, and or the profitable sale of publicly traded investments. If necessary, to provide liquidity, the Company may seek to sell additional debt or equity securities, or enter into new credit facilities.convert existing privately held debt to equity, providing the debt holders are agreeable to the terms and share conversion price. The Company cannot make assurances that it will be able to complete any financing, liquidity, or liquiditydebt conversion transaction, that such financing, liquidity, or liquiditydebt conversion transaction will be adequate for the Company’s needs, or that a financing, liquidity or liquiditydebt conversion transaction will be completed in a timely manner. Furthermore, the Company may seek to sell its remaining marketable securities to meet its operating needs. However, the fair value of these marketable securities fluctuate, trade volume is limited,fluctuates and may not be adequate for the Company’s needs. Management also believes it will be able to renewThe Company has extended its line of credit payment terms with the lender with similar terms to the recently expired line of credit. If the line of credit is not renewed, management may liquidate securities to satisfy its obligations.