Note 7 - Related Party Transactions

9 Months Ended

Sep. 30, 2026

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

7. Related Party Transactions

In the normal course of business, the Company enters into various transactions with affiliated companies. Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party in making financial or operating decisions.

The following tables summarize income and expenses from transactions with related parties for the three and nine months ended September 30, 2026 and 2025:

	Three Months Ended September 30,
	2026				2025
	Income		Expense		Income		Expense
GAMCO Investors, Inc.	$	670	$	—	$	177	$	—
M-tron Industries, Inc.		—		40		—		40
Alpha G Investment Management, Inc.		—		19		—		—
Total	$	670	$	59	$	177	$	40

	Nine Months Ended September 30,
	2026				2025
	Income		Expense		Income		Expense
GAMCO Investors, Inc.	$	1,386	$	—	$	891	$	—
M-tron Industries, Inc.		—		120		—		48
Alpha G Investment Management, Inc.		—		85		—		—
Total	$	1,386	$	205	$	891	$	48

The following table summarizes assets and liabilities with related parties as of  September 30, 2026 and  December 31, 2025:

	September 30, 2026				December 31, 2025
	Assets		Liabilities		Assets		Liabilities
GAMCO Investors, Inc.	$	84,045	$	—	$	36,175	$	—
M-tron Industries, Inc.		—		338		—		227
Alpha G Investment Management, Inc.		—		85		—		—
Total	$	84,045	$	423	$	36,175	$	227

The material agreements whereby the Company generates revenues and expenses with affiliated entities are discussed below:

Investment Activity with GAMCO Investors, Inc.

Certain balances held and invested in various mutual funds are managed or advised by GAMCO Investors, Inc. or one of its subsidiaries (collectively, "GAMCO" or the "Fund Manager"), which is related to the Company through certain of our shareholders. All investments, including those in related party money market mutual funds, are overseen by the independent Audit Committee of the Board of Directors (the "Audit Committee"). The Audit Committee meets regularly to review the alternatives and has determined the current investments most reflect the Company's objective of lower cost, market return and adherence to having a larger proportion of underlying investments directly in United States Treasuries. For the three and nine months ended September 30, 2026 and 2025, the Company paid the Fund Manager a fund management fee of approximately 8 basis points per annum of the asset balances under management. All fund management fees are not paid directly by the Company and are deducted prior to a fund striking its net asset value ("NAV").

As of September 30, 2026, the balance managed by the Fund Manager totaled $84,045, all of which was classified within Cash and cash equivalents on the Condensed Consolidated Balance Sheets. As of December 31, 2025, the balance managed by the Fund Manager totaled $36,175, all of which was classified within Cash and cash equivalents on the Condensed Consolidated Balance Sheets.

For the three months ended September 30, 2026, the Company earned income on its investments managed by the Fund Manager totaling $670, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations. For the three months ended September 30, 2025, the Company earned income on its investments managed by the Fund Manager totaling $177, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations.

For the nine months ended September 30, 2026, the Company earned income on its investments managed by the Fund Manager totaling $1,386, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations. For the nine months ended September 30, 2025, the Company earned income on its investments managed by the Fund Manager totaling $891, all of which was included in Net investment income on the Condensed Consolidated Statements of Operations.

Transactions with M-tron Industries, Inc.

Transitional Administrative and Management Services Agreement

On October 7, 2022, the separation of the M-tron Industries, Inc. ("MtronPTI") business from the Company was completed (the "Separation") and the business became an independent, publicly traded company trading on the NYSE American under the stock symbol "MPTI." The Separation was completed through the Company's distribution (the "Distribution") of 100% of the shares of MtronPTI's common stock to holders of the Company's common stock as of the close of business on September 30, 2022, the record date for the Distribution.

LGL Group and MtronPTI entered into an Amended and Restated Transitional Administrative and Management Services Agreement ("MtronPTI TSA"), which sets out the terms for services to be provided between the two companies post-separation. The current terms result in a net payment of $4 per month to MtronPTI.

For the three months ended September 30, 2026 and 2025, the Company paid MtronPTI $12 under the terms of the MtronPTI TSA, which were recorded in Engineering, selling and administrative on the Condensed Consolidated Statements of Operations. For the nine months ended September 30, 2026 and 2025, the Company paid MtronPTI $36 under the terms of the MtronPTI TSA, which were recorded in Engineering, selling and administrative on the Condensed Consolidated Statements of Operations.

Tax Indemnity and Sharing Agreement

LGL Group and MtronPTI entered into a Tax Indemnity and Sharing Agreement ("MtronPTI Tax Agreement"), which sets out the terms for which party would be responsible for taxes imposed on the Company if the distribution, together with certain related transactions, were to fail to qualify as a tax-free transaction under Internal Revenue Code ("IRC") Sections 355 and 368(a)(1)(D) if such failure were the result of actions taken after the Distribution by the Company or MtronPTI.

For the three and nine months ended September 30, 2026 and 2025, no taxes related to the Distribution have been recorded in the Condensed Consolidated Financial Statements.

Other Transactions

LGL Group and MtronPTI have agreed to share salaries and benefits related to certain employees incurred by LGL Group and/or MtronPTI. For the three and nine months ended September 30, 2026, the Company reimbursed MtronPTI $28 and $84, respectively, of the salaries and benefits of certain employees. For the three and nine months ended September 30, 2025, the Company reimbursed MtronPTI $28 and $12, respectively, of the salaries and benefits of certain employees.

Transactions with Alpha G Investment Management, Inc.

Alpha G Investment Management, Inc. ("Alpha G") is related to the Company through certain of our stockholders. LGL Group and Alpha G agreed to share salaries and benefits related to certain employees incurred by Alpha G. For the three and nine months ended September 30, 2026, the Company recognized $19 and $85, respectively, of expense for its share of these salaries and benefits.

Skyline Instruments Corporation

As described in Note 1 - Overview and Basis of Presentation, Lynch Capital serves as investment advisor to Skyline SPV under the Skyline IAA, with authority over all decisions regarding its assets, including the management, conversion and disposition of the Skyline Note. Under the Side Letter, the Company’s Chief Executive Officer serves on Skyline’s board of directors as Skyline SPV’s designee, with the same rights as other directors and no unilateral voting or veto rights.