Form 4: American Rebel Grants Preferred Stock to President/COO

American Rebel Holdings Inc. issued Series D Convertible Preferred Stock valued at over $520,000 to President and COO Corey Lambrecht for accrued compensation.

Summary

• Corey Allen Lambrecht, President, COO, and Director of American Rebel Holdings Inc. (AREB), acquired Series D Convertible Preferred Stock.
• The transaction occurred on December 31, 2025.
• A total of 69,381 shares of Series D Convertible Preferred Stock were issued.
• Each share of Series D Convertible Preferred Stock is valued at $7.50 per share.
• The preferred stock is convertible into 5 shares of Common Stock per preferred share, at an effective conversion price of $1.50 per common share.
• The total value of the issuance was $520,351.28, settling accrued bonuses, other owed amounts, and accrued board member fees.
• Upon conversion, these preferred shares would represent 346,905 shares of Common Stock.
• The issuance was made pursuant to the Issuer's Amended and Restated 2025 Stock Incentive Plan.
• There is no expiration date for the Series D Convertible Preferred Stock.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While settling debt without cash is positive for liquidity, the potential for future dilution from the convertible preferred stock introduces a neutral to slightly negative aspect for common shareholders. It's a standard compensation mechanism.

Positives

• The company settled $520,351.28 in accrued compensation and fees without expending cash, preserving liquidity.
• Issuing equity to a key executive like the President and COO can align management's interests with those of shareholders.

Negatives

• The issuance of convertible preferred stock introduces potential future dilution for existing common shareholders if converted.
• Settling significant accrued compensation with equity rather than cash may suggest constraints on the company's cash flow.

Risks

• Potential dilution of common stock: The conversion of 69,381 Series D Preferred Shares into 346,905 Common Shares could dilute the ownership percentage of existing common shareholders.
• Impact on common stock price: Future conversion and potential sale of the underlying common stock by the insider could exert downward pressure on the common stock price.

Future Outlook

The Series D Convertible Preferred Stock has no expiration date, indicating a long-term equity holding for the executive with potential for future conversion into common stock.

Industry Context

This transaction reflects a common practice in corporate finance where companies use equity, particularly convertible preferred stock, to compensate executives and settle liabilities, especially when cash flow is a consideration. It aligns the executive's financial interests with the long-term performance of the company, a standard incentive mechanism across various industries.

Comparison to Industry Standards

• Issuing convertible preferred stock for executive compensation is a recognized method, often used by growth-stage companies or those managing cash flow, similar to practices seen in technology startups or emerging market companies.
• The conversion ratio and effective conversion price of $1.50 per common share should be evaluated against the company's current market price for common stock and peer group compensation structures to assess its competitiveness and potential dilutive impact.
• The use of a stock incentive plan for such issuances is standard corporate governance, ensuring that equity grants are formalized and approved.

Corporate Governance

Related Party Transactions

• Issuance of Series D Convertible Preferred Stock to Corey Allen Lambrecht, who serves as President, COO, and Director of American Rebel Holdings Inc., for accrued bonuses, other owed amounts, and accrued board member fees.

Stakeholder Impact

• Shareholders: Potential for dilution of common stock if the preferred shares are converted, which could impact earnings per share and stock price.
• Management (Corey Allen Lambrecht): Increased equity stake in the company, aligning personal financial interests with the company's long-term performance.

Next Steps

• Potential future conversion of the Series D Convertible Preferred Stock into common stock by Corey Allen Lambrecht.

Key Dates

Keywords

American Rebel Holdings, AREB, Corey Lambrecht, Series D Convertible Preferred Stock, Insider Transaction, Executive Compensation, Equity Issuance, Stock Incentive Plan, Dilution, Corporate Governance