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Stock Options and Restricted Stock Units
 9 Months Ended
Sep. 30, 2025
Stock Options and Restricted Stock Units [Abstract]  
Stock Options and Restricted Stock Units

Note 7. STOCK OPTIONS AND RESTRICTED STOCK UNITS

 

Stock-Based Compensation

 

Stock Options

 

In June 2025, the shareholders of the Company approved the amendment to the 2022 Equity Incentive Plan (“2022 Plan”) to increase the number of shares authorized to be used under the plan by 250,000 shares, from 650,000 shares to 900,000 shares.

 

In September 2024, the shareholders of the Company approved the amendment to the 2022 Equity Incentive Plan (“2022 Plan”) to increase the number of shares authorized to be used under the plan by 300,000 shares, from 350,000 shares to 650,000 shares.

 

The Company recorded stock-based compensation expense for certain employees and members of the Company’s Board of Directors of $0 and $87,000 for the three months ended September 30, 2025 and 2024, respectively and $22,000 and $122,000 for the nine months ended September 30, 2025 and 2024, respectively in its condensed consolidated statements of operations, and such amounts were included as a component of operating expenses.

A summary of the status of the Company’s stock options as of September 30, 2025 and December 31, 2024, and changes during the periods then ended are presented below:

 

   Options   Wtd. Avg.
Exercise
Price		 
Balance, January 1, 2024   461,870   $8.34 
Granted during the period   80,000    3.75 
Exercised during the period   (15,229)   3.45 
Terminated/Expired during the period   (109,638)   9.86 
Balance, December 31, 2024   417,003   $7.00 
Granted during the period   
-
    
-
 
Exercised during the period   
-
    
-
 
Terminated/Expired during the period   (43,900)   10.28 
Balance, September 30, 2025   373,103   $6.61 
           
Exercisable at September 30, 2025   373,103   $6.61 

 

The following table summarizes information about outstanding stock options at September 30, 2025:

 

Range of Exercise Price  Number
Outstanding		   Wtd.Avg,
Life		  Wtd. Avg.
Exercise
Price		 
$3.43 - $23.80   373,103   2.4 Years  $6.61 

 

The following table summarizes information about outstanding stock options at December 31, 2024:

 

Range of Exercise Price  Number
Outstanding		   Wtd.Avg,
Life		  Wtd. Avg.
Exercise
Price		 
$3.43 - $23.80   417,003   2.8 Years  $7.00 

 

As of September 30, 2025, there was $0 of unrecognized compensation cost related to non-vested stock option awards.

 

The aggregate intrinsic value at September 30, 2025 based on the Company’s closing stock price of $3.13 was $0. The aggregate intrinsic value at December 31, 2024 based on the Company’s closing stock price of $4.07 was approximately $121,000. The aggregate intrinsic value was calculated based on the positive difference between the closing market price of the Company’s Common Stock and the exercise prices of the underlying options.

 

Restricted Stock Units (“RSUs”)

 

A summary of the status of the Company’s RSUs as of September 30, 2025 is presented below:

 

   Number of
Units		   Wtd. Avg.
Grant Date Fair
Value per
Unit		 
Unvested units as of January 1, 2025   285,628   $6.06 
Granted during the period   
-
    
-
 
Vested during the period   (95,210)   6.06 
Forfeited During the period   
-
    
-
 
Unvested Units as of September 30, 2025   190,418   $6.06 
           
Vested as of September 30, 2025   
-
   $
-
 

The Company recorded stock-based compensation expense of $152,000 and $63,000 for the three months ended September 30, 2025 and 2024, respectively, and $722,000 and $63,000 for the nine months ended September 30, 2025 and 2024, respectively, in its condensed consolidated statements of operations, and such amounts were included as a component of operating expenses.

 

The fair value of the RSUs vested during the nine months ended September 30, 2025 was $318,000. All of the RSUs vested were net settled such that the Company withheld shares with a value equivalent to the employees’ obligation for the applicable income and other employment taxes, and remitted cash to the appropriate taxing authorities. The total shares withheld were 38,018, and were valued on their vesting date as determined by the Company’s closing stock price. Total payments to taxing authorities for tax obligations were $127,000.

 

As of September 30, 2025, there was $529,000 of unrecognized compensation cost related to non-vested RSUs, which is to be recognized over the remaining weighted average vesting period of 1.5 years.