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STOCK-BASED COMPENSATION PLANS

12 Months Ended

Mar. 31, 2025

Stock-based Compensation Plans

STOCK-BASED COMPENSATION PLANS

11. STOCK-BASED COMPENSATION PLANS

The Company maintains the 2021 Equity Incentive Plan (the “2021 Plan”), which provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units and performance units and performance shares to employees, directors and consultants of the Company or any parent or subsidiary of the Company. The purpose of the 2021 Plan is to enable the Company to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to employees, directors and consultants of the Company or any parent or subsidiary of the Company, and to promote the success of the Company’s business. The Company has 2,519,750 unallocated shares available to grant from the 2021 Plan as of March 31, 2025. The Company has historically granted stock options to non-employees in exchange for the provision of services, both under the 2021 Plan and outside of the 2021 Plan.

The Company has granted stock options and time-based restricted stock units (“time-based RSUs”). Stock options granted to date generally have a four4-year vesting period and vest at a rate of 25% each year on the anniversary date of the grant. Stock options generally expire on the earlier of ten years from the date of grant, or a specified period of time following termination. Time-based RSUs generally vest over a period of four years in accordance with the terms and conditions established by the board of directors, and are based on continued service.

Time-based RSUs

The fair value of time-based RSUs is determined using the closing price of the Company’s common stock on the date of grant, reduced by the present value of dividends not received during the vesting period. For the time-based RSUs granted during the years ended March 31, 2025 and 2024, the expected annual dividend yield was 0.0%.

A summary of time-based RSU activity is presented below:

SCHEDULE OF TIME-BASED RSU ACTIVITY

						Weighted-
						Average
						Grant Date
		Shares				Fair Value

Outstanding at March 31, 2023			-				-
Granted			300,000			$	4.10
Vested			(75,000	)			4.10
Outstanding at March 31, 2024			225,000				4.10
Granted			1,105,866				1.11
Vested			(285,449	)			3.31
Forfeited			(445,417	)			2.78
Outstanding at March 31, 2025			600,000			$	0.99

The total stock compensation expense recognized related to vesting of time-based RSUs for the years ended March 31, 2025 and 2024, was $619 and $429, respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling, general and administrative expenses. As of March 31, 2025, the total unrecognized stock-based compensation for time-based RSUs totaled $530 and are expected to be recognized over a weighted average period of 3.7 years.

Stock Options

The fair value of the share option awards was estimated using the Black-Scholes method using the closing price of the Company’s common stock on the date of grant based on the following weighted-average assumptions:

		Year Ended				Year Ended
		March 31, 2025				March 31, 2024

Expected option term			10.0 years				5.0 - 10.0 years
Stock price volatility			138.4	%			129.1	%
Risk free interest rate			2.09	%			1.74-1.81	%
Expected annual dividend yield			0.0	%			0.0	%
Forfeiture rate			29.9	%			25.7	%

A summary of stock option activity is presented below:

SCHEDULE OF STOCK OPTION ACTIVITY

										Weighted-
						Weighted-				Average
						Average				Remaining				Aggregate
						Exercise				Contractual				Intrinsic
		Options				Price				Life (Years)				Value

Outstanding at March 31, 2023			299,956			$	1.60				1.94			$	1,320
Granted			808,400				4.10
Forfeited			-				-
Exercised			-				-
Outstanding at March 31, 2024			1,108,356				3.42				3.45			$	595
Granted			688,194				2.15
Forfeited			(790,000	)			3.59
Exercised			-				-
Outstanding at March 31, 2025			1,006,550			$	2.42				2.85			$	178
Vested and expected to vest March 31, 2025			874,724			$	3.13				6.89			$	178
Exercisable at March 31, 2025			562,910			$	3.22				5.77			$	178

The total stock compensation expense recognized related to vesting of stock options for the years ended March 31, 2025 and March 31, 2024 was $715 and $310, respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling, general and administrative expenses. As of March 31, 2025 the total unrecognized stock-based compensation for stock options was $1,035 and is expected to be recognized over a weighted average period of 2.85 years.