STOCK-BASED COMPENSATION

9 Months Ended

Nov. 30, 2025

Equity [Abstract]

STOCK-BASED COMPENSATION

NOTE 5: STOCK-BASED COMPENSATION

Stock Options - In May 2023, the Company’s Board of Directors authorized the creation of the 2023 Stock Incentive Plan (the “2023 Plan”) pursuant to which the Company may grant up to 2,500,000 options or shares to officers, directors, employees and consultants of the Company and its subsidiaries. The Company’s shareholders approved the adoption of the 2023 Plan in August 2023. The 2023 Plan replaced the 2013 Stock Incentive Plan (the “2013 Plan”) under which no additional options or shares could be granted after June 2023. At November 30, 2025, 395,201 and 195,810 options were outstanding, respectively, under the 2023 Plan and the 2013 Plan.

The Company accounts for stock-based compensation under ASC 718, “Share Based Payments.” which requires companies to expense the value of employee stock options and similar awards.

During the nine months ended November 30, 2025, the Company granted options to acquire 154,328 shares to employees exercisable at prices ranging from $3.25 to $3.77 and options to acquire 35,088 shares to non-employee membersof the board of directors with an exercise price of $3.25. The options granted to employees and directors vest over three years and expire ten years from the date of grant. The options granted during the first nine months of fiscal 2025 had a combined weighted average grant date fair value of $3.26 per share.

The weighted-average fair value of options are estimated on the date of grant using the Black-Scholes options-pricing model. The weighted-average Black-Scholes assumptions are as follows:

		Nine Months Ended November 30, 2025
Expected Life			5 - 8 years
Risk free interest rate			3.81% - 4.32%
Expected volatility			54.49% - 56.95%
Expected dividend yield			0%

For the three and nine months ended November 30, 2025 and 2024, net income and earnings per share reflect the actual deduction for stock-based compensation expense. For the three months ended November 30, 2025 and 2024, the Company recognized approximately $86,000 and $79,000 of stock based compensation expense, respectively. For the nine months ended November 30, 2025 and 2024, the Company recognized approximately $232,000 and $176,000 of stock based compensation expense, respectively. Such amounts are included in general and administrative expenses on the unaudited condensed consolidated statements of income. Total compensation expense related to non-vested options not yet recognized as of November 30, 2025 was $538,000 and will be recognized over the next three years based on vesting date. The amount of future stock option compensation expense could be affected by any future option grants or by any forfeitures.

The aggregate intrinsic value of the Company’s vested and exercisable options at November 30, 2025 was approximately $52,000.