Note 10— Stock Based Compensation Plan

The Company’s share-based compensation plan, approved by stockholders on June 17, 2025 (“2025 Plan”), provides for the grant of share-based awards in the form of incentive stock options, non-incentive stock options, restricted stock awards and restricted stock units to directors and employees. The Company reserved 425,000 shares of voting common stock for issuance under the 2025 Plan, all of which was available for grant in future periods as of June 30, 2025. Stock options to be granted under the 2025 Plan typically vest over five years and expire 10 years from the grant date. Under the 2025 Plan, the exercise price of options may not be less than 100% of fair

market value at the grant date with a maximum term for an option award of 10 years from the grant date. The Company’s Compensation Committee administers the 2025 Plan and has the authority to determine the terms and conditions of each award thereunder.

The Company’s previous share-based compensation plan, the 2015 Stock Option Plan (“2015 Plan”), provided for the grant of share-based awards in the form of incentive stock options, non-incentive stock options, restricted stock and restricted stock units to directors and employees. The 2015 Plan provided for awards of up to 976,211 shares of voting common stock. The plan expired on April 28, 2025 and was replaced by the 2025 Plan. Share based-awards outstanding prior to April 28, 2025 were granted under the 2015 Plan and shall be subject to the provisions of the 2015 Plan.

The table below provides a summary of the stock options activity for the six months ended June 30, 2025.

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The aggregate intrinsic value of stock options in the table above represents the total amount by which the current market value of the underlying stock exceeds the exercise price of the option that would have been received by the Company had all option holders exercised their options on June 30, 2025. The intrinsic value of options exercised was $125 thousand and $253 thousand for the three and six months ended June 30, 2025, respectively, and $116 thousand and $570 thousand for the three and six months ended June 30, 2024. These amounts and the intrinsic values noted above change based on changes in the market value of the Company’s voting common stock.

There were no options granted during the three or six months ended June 30, 2025 or June 30, 2024.

The Company did not record any share-based compensation expense applicable to the Company’s share-based compensation plans for stock options during the three and six months ended June 30, 2025 or June 30, 2024.  

The Company does not have any unrecognized share-based compensation expense related to nonvested options as of June 30, 2025.

The table below provides a summary of the restricted stock awards activity for the six months ended June 30, 2025.

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Compensation expense for restricted stock grants is recognized over the vesting period of the awards based on the fair value of the Company’s voting common stock at issue date. The fair value of the stock was determined using the closing stock price on the day of grant. The restricted stock grants vest over two to five years. The Company awarded restricted stock grants for 1,250 shares of common stock during the six months ended June 30, 2025.

Share-based compensation expense applicable to the Company’s share-based compensation plans for restricted stock grants was $120 thousand and $133 thousand for the three months ended June 30, 2025 and June 30, 2024, respectively. The total fair value of the shares, which vested during the three months ended June 30, 2025 and June 30, 2024, was $6 thousand and $7 thousand, respectively.

Share-based compensation expense applicable to the Company’s share-based compensation plans for restricted stock grants was $238 thousand and $265 thousand for the six months ended June 30, 2025 and June 30, 2024, respectively. The total fair value of the shares, which vested during the six months ended June 30, 2025 and June 30, 2024, was $56 thousand and $56 thousand, respectively.

Unrecognized share-based compensation expense related to nonvested restricted stock grants amounted to $858 thousand as of June 30, 2025. This amount is expected to be recognized over a weighted-average period of 1.85 years.