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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2024
Stock-Based Compensation  
Stock-Based Compensation

Note 5 – Stock-Based Compensation

Under the terms of our 2016 Omnibus Incentive Plan, directors, officers and key employees could be granted restricted stock units and stock awards, as well as non-qualified or incentive stock options, at the discretion of the compensation committee of the Board of Directors.

All stock-based payments to directors and employees, including grants of stock options and stock purchase rights, are recognized in the financial statements based on their respective grant-date (measurement date) fair values. We calculate the compensation cost of full-value awards such as restricted stock units and stock awards based on the market value of the underlying stock at the date of the grant. The fair value of stock option awards is estimated at the date of grant using the Black-Scholes option pricing model; however, the value calculated using an option pricing model may not be indicative of the fair value observed in a willing buyer/willing seller market transaction, or actually realized by the employee upon exercise. Expected volatility used to estimate the fair value of options granted is based on the historical volatility of our common stock. The risk-free interest rate is based on the United States Treasury constant maturity rate for the expected life of the stock option. The expected life of a stock award is the period of time that the award is expected to be outstanding.

We recognize compensation expense for all stock-based awards on a straight-line basis over the requisite service period for the entire award. The amount of compensation expense recognized through the end of each reporting period is equal to the portion of the grant-date value of the awards that have vested, or for partially vested awards, the value of the portion of the award that is ultimately expected to vest for which the requisite services have been provided. The benefits of tax deductions in excess of recognized compensation cost are reported as a financing cash flow.

The stock-based compensation expense recorded in the years ended December 31, 2024 and 2023 is comprised of $15,000 in each of 2024 and 2023 for shares of common stock issued to members of the Board of Directors as partial compensation for their service as a director, and approximately $19,000 in 2024 for the restricted stock units described below.

In May 2024, the compensation committee of the Company’s Board of Directors approved the Company’s grant of 31,250 restricted stock units to certain employees under the Interlink Electronics, Inc. 2016 Omnibus Incentive Plan. A summary of the status of the Company’s nonvested restricted stock units as of and for the year ended December 31, 2024, is as follows:

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Weighted-

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Average

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Grant-Date

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Fair Value

Nonvested Restricted Stock Units

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Shares

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(per share)

Nonvested at January 1, 2024

 

—

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$

—

Granted

 

31,250

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4.35

Vested

 

—

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—

Forfeited

 

—

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—

Nonvested at December 31, 2024

 

31,250

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$

4.35

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As of December 31, 2024, there was approximately $117,000 of total unrecognized compensation cost related to nonvested restricted stock units. That cost is expected to be recognized over a weighted-average period of 4.1 years.