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STOCK OPTION PLANS
 9 Months Ended
Sep. 30, 2025
Share-Based Payment Arrangement [Abstract]  
STOCK OPTION PLANS

NOTE 8 — STOCK OPTION PLANS

 

Milestone Scientific Inc., the Amended and Restated 2020 Equity Incentive Plan, provides for awards of restricted common, stock restricted stock units, options to purchase and other awards. On June 28, 2023 the plan was amended and restated (the “2020 Plan”) to increase the maximum shares that can be issued thereunder to 11,500,000 shares of common stock. The plan expires in June 2031. Options may be granted to employees, directors, and consultants of Milestone Scientific for the purchase of shares of common stock at a price not less than the fair market value of common stock on the date of grant. Generally, options become exercisable over three years from the grant date and expire five years after the date of grant. 

 

Milestone Scientific recognizes compensation expenses over the requisite service period and in the case of performance-based options over the period of the expected performance. For the three and nine months ended September 30, 2025, Milestone Scientific recognized approximately $362,000 and $691,000 of total employee compensation cost, respectively, recorded in general and administrative expenses on the statement of operations. For the three and nine months ended September 30, 2024, Milestone Scientific recognized approximately $172,000 and $530,000 of total employee compensation cost, respectively, recorded in general and administrative expenses on the statement of operations.

 

As of September 30, 2025, there was $1.6 million of total unrecognized compensation cost related to non-vested options. Milestone Scientific expects to recognize these costs over a weighted average period of 0.50 years.

 

A summary of option activity for employees under the plans and changes during the nine months ended September 30, 2025 is presented below:

 

   Number of Options   Weighted Averaged Exercise Price $   Weighted Average Remaining Contractual Life (Years)  

Aggregate Intrinsic Options

Value $

 
Options outstanding at January 1, 2025   2,951,989    2.29    4.54    - 
Granted during 2025   4,000,000    0.48    9.85    - 
Exercised during 2025   -    -    -    - 
Forfeited or expired during 2025   (216,296)   1.52    -    - 
Options outstanding September 30, 2025   6,735,693    1.25    7.53    - 
Exercisable, September 30, 2025   2,735,694    2.10    4.76    - 

 

The Company used the following assumptions to calculate the fair value of the stock option grants using the Black-Scholes option pricing model on the measurement date during the nine month period ended September 30, 2025 risk free interest rate of 1.75%, Volatility of 86.6% (which is based on the Company’s historical volatility over the expected term), expected term of 5 years, 0% dividend rate and closing price of the stock of $0.45-$0.50.

 

 

A summary of option activity for non-employees under the plans and changes during the nine months ended September 30, 2025 is presented below:

 

   Number of Options   Weighted Averaged Exercise Price $   Weighted Average Remaining Contractual Life (Years)   Aggregate Intrinsic Options Value $ 
Options outstanding at January 1, 2025   99,996    1.74    2.12    5,750 
Granted during 2025   16,666    0.94    4.69      
Exercised during 2025   -    -           
Forfeited or expired during 2025   (24,999)   1.70           
Options outstanding September 30, 2025   91,663    1.60    2.42    0 
Exercisable, September 30, 2025   72,214    1.79    1.97    0 

 

The fair value of the non-employee options was estimated on the date of grant using the Black Scholes option-pricing model at the date of grant. For the three and nine months ended September 30, 2025, Milestone Scientific recognized approximately $1,300 and $9,300 expenses related to non-employee options, respectively.  For the three and nine months ended September 30, 2024, Milestone Scientific recognized approximately $7,000 and $9,200, respectively of expense related to non-employee options.

 

The Company used the following assumptions to calculate the fair value of the stock option grants using the Black-Scholes option pricing model on the measurement date during the nine month period ended September 30, 2025 risk free interest rate of 1% , Volatility of 85.79%-86.29% (which is based on the Company’s historical volatility over the expected term), expected term of 5 years, 0% dividend rate and closing price of the stock of $0.93-$0.94.

 

A summary of the restricted stock under the plans and changes during the nine months ended September 30, 2025 is presented below:

 

   Number of Shares   Weighted Average Grant-Date Fair Value per Award 
Non-vested as January 1, 2025   365,171    0.89 
Granted   -    - 
Vested   (337,081)   0.89 
Cancelled   (28,090)   0.89 
Non-vested as September 30, 2025   -    - 

 

The Company granted 730,340 restricted stock awards with a fair market value of $0.89 per share. Such restricted stock vests as follows: 25% on the grant date in June 2024, and 25% quarterly, on the first day of the following months: October 2024, January 2025, and April 2025. These awards vest immediately upon a change of control as defined in the agreements. For the nine months ended September 30, 2025, the Company recognized approximately $0 and $155,500, respectively, for restricted stock expenses recorded in general and administrative expenses on the statement of operations. As of September 30, 2025, there was no unrecognized compensation expense.