Form 4: CEO Emeritus Sells AERG Shares After Option Exercise

APPLIED ENERGETICS, INC. CEO Emeritus Gregory Quarles exercised stock options and immediately sold the resulting common stock.

Summary

• Gregory James Quarles, CEO Emeritus and Director of APPLIED ENERGETICS, INC. (AERG), executed a transaction under a Rule 10b5-1 plan.
• On January 21, 2026, Quarles exercised 6,600 non-qualified stock options with an exercise price of $0.35 per share.
• Immediately following the exercise, he sold 6,600 shares of common stock at a weighted average price of $1.87 per share.
• The sale price ranged from $1.8753 to $1.88.
• Following these transactions, Quarles directly owns 0 shares of common stock.
• He continues to beneficially own 4,843,400 non-qualified stock options and 1,954,545 unvested Restricted Stock Units.

Sentiment

Score: 5

Explanation: The filing reports a pre-scheduled insider transaction (exercise of options and sale of shares) under a Rule 10b5-1 plan, which is a routine event for executives managing their equity compensation and personal finances. It does not inherently convey strong positive or negative sentiment about the company's operational performance or future prospects.

Positives

• The executive realized a profit of $1.52 per share ($1.87 sale price $0.35 exercise price) from his equity compensation.
• The transaction was executed under a Rule 10b5-1 plan, indicating a pre-scheduled and planned event rather than a reaction to new, non-public information.

Negatives

• An insider sale, even under a 10b5-1 plan, reduces the executive's direct equity stake in the company, which some investors may perceive negatively.

Future Outlook

NA

Management Comments

• The reporting person undertakes to provide to the SEC staff, upon request, full information regarding the number of shares and prices at which the transaction was effected.
• The option was issued in exchange for services rendered as an officer and director of the company.
• Restricted Stock Units are subject to vesting, and none of them were vested at the time of this filing.

Industry Context

NA

Related Party Transactions

• Gregory James Quarles, CEO Emeritus and Director, exercised 6,600 stock options and sold 6,600 shares of common stock of APPLIED ENERGETICS, INC. on January 21, 2026.

Stakeholder Impact

• Shareholders: May observe a reduction in direct insider ownership, though the transaction was pre-planned under a Rule 10b5-1 plan.
• Management (Gregory James Quarles): Realized a profit of $10,032 from his equity compensation.

Key Dates

Recommendation

This Form 4 details a pre-scheduled insider transaction under a 10b5-1 plan, where the CEO Emeritus exercised options and sold shares. Such transactions are typically for personal financial planning and do not usually signal a change in the company's fundamental outlook or warrant a strong buy/sell recommendation. The company's core business performance and future prospects are not addressed in this filing, thus a 'hold' recommendation is appropriate as this specific filing does not provide new information to alter an existing investment thesis.

Keywords

APPLIED ENERGETICS, AERG, insider transaction, Form 4, stock options, CEO Emeritus, stock sale, Rule 10b5-1