12. STOCKHOLDERS’ EQUITY

Common Stock Issuances

From February of 2016 to April of 2021, we sold the aggregate of 4,553,017 shares of common stock in six different transactions raising gross proceeds of $26,714,403 at the weighted average price of $5.87 per share. These funds have been essential to funding our business growth plans.

On April 9, 2024, our shelf registration on Form S-3 relating to the offer, issuance and sale by the Company of up to $20,000,000 of securities was declared effective by the Securities and Exchange Commission (SEC). Also on April 9, 2024, we entered into an At-The-Market (ATM) Agreement with Craig-Hallum Capital Group LLC, pursuant to which we may offer and sell up to $11,000,000 of shares of our common stock. Net proceeds through December 31, 2024 from 1,228,227 shares sold pursuant to the ATM Agreement (net of the upfront legal, accounting and other fees), less sales commissions of $139,562, were $4,356,188. Net proceeds during the six-month period ended June 30, 2025 from 63,230 shares sold pursuant to the ATM Agreement (net of legal, accounting and other fees), less sales commissions of $10,489, were $281,446.

Stock Option Plans

In June of 2010, our stockholders approved the 2010 Stock Option and Incentive Plan (the “2010 Plan”) pursuant to the provisions of the Internal Revenue Code of 1986, under which employees and certain service providers may be granted options to purchase shares of the Company’s common stock at no less than fair market value on the date of grant. At that time, 300,000 shares of common stock were reserved for issuance under the 2010 Plan and subsequently no additional shares have been reserved for the 2010 Plan. Vesting requirements are determined by the Compensation and Stock Option Committee of the Board of Directors on a case-by-case basis. All options granted under the 2010 Plan expire no later than 10 years from the date of grant. The 2010 Plan expired in June of 2020, after which date no further options can be granted under the 2010 Plan. However, options outstanding under the 2010 Plan at that time can be exercised in accordance with their terms. As of June 30, 2025 and December 31, 2024, there were 182,500 and 183,500 options outstanding under the 2010 Plan, respectively.

In June of 2017, our stockholders approved the 2017 Stock Option and Incentive Plan (the “2017 Plan”) pursuant to the provisions of the Internal Revenue Code of 1986, under which employees and certain service providers may be granted options to purchase shares of the Company’s common stock at no less than fair market value on the date of grant. At that time, 300,000 shares of common stock were reserved for issuance under the 2017 Plan. An amendment to the 2017 Plan increasing the number of shares reserved for issuance under the 2017 Plan from 300,000 shares to 650,000 shares was approved by a vote of stockholders at the Annual Meeting of Stockholders in June of 2022. A further proposed amendment to the 2017 Plan increasing the number of shares reserved for issuance under the 2017 Plan from 650,000 shares to 900,000 shares was not approved by a vote of stockholders at the Annual Meeting of Stockholders in June of 2025. Vesting requirements are determined by the Compensation and Stock Option Committee of the Board of Directors on a case-by-case basis. All options granted under the 2017 Plan expire no later than 10 years from the date of grant. The 2017 Plan expires in March of 2027, after which date no further options can be granted under the 2017 Plan. However, options outstanding under the 2017 Plan at that time can be exercised in accordance with their terms. As of June 30, 2025 and December 31, 2024, there were 534,500 and 480,500 options outstanding under the 2017 Plan, respectively.

Activity under the stock option plans described above was as follows:

The following table displays additional information about the stock option plans described above:

During the three-month and six-month periods ended June 30, 2025, one director exercised stock options covering 15,000 shares by the surrender of 11,470 shares of common stock with a fair market value of $72,146 at the time of exercise and the payment of $3.70 in cash. The aggregate intrinsic value of options exercised during the six-month period ended June 30, 2025, and the year ended December 31, 2024, approximated $22,200 and $0, respectively. No stock options were exercised during the three-month and six-month periods ended June 30, 2024. The weighted average remaining life of the options outstanding under the 2010 Plan and the 2017 Plan as of June 30, 2025 was approximately 4 years and 11 months. The weighted average remaining life of the options exercisable under these plans as of June 30, 2025 was approximately 3 years and 3 months. The exercise price of the options outstanding under these plans as of June 30, 2025, ranged from $3.60 to $10.04 per share. The weighted-average grant date fair values of options granted during the six-month periods ended June 30, 2025 and 2024 were $2.81 and $2.02 per share, respectively. As of June 30, 2025, total unrecognized stock-based compensation related to non-vested stock options aggregated $514,375 which will be recognized over a weighted average remaining period of approximately 1 year and 9 months. The fair value of each stock option grant has been estimated on the date of grant using the Black-Scholes option pricing model, for the purpose discussed in Note 2(n), with the following weighted-average assumptions:

Common Stock Rights Plan

In September of 1995, our Board of Directors adopted a Common Stock Rights Plan (the “Rights Plan”) and declared a dividend of one common share purchase right (a “Right”) for each of the then outstanding shares of the common stock of the Company. Each Right entitled the registered holder to purchase from the Company one share of common stock at an initial purchase price of $70.00 per share, subject to adjustment. The description and terms of the Rights were set forth in a Rights Agreement between the Company and Equiniti Trust Company, LLC, as Rights Agent. At various times over the years, our Board of Directors, which has the authority to amend the Rights Plan, voted to authorize amendments to the Rights Plan to extend the expiration date of the Rights Plan. During 2024, our Board of Directors determined not to further extend the Rights Plan because these plans are generally considered not to be stockholder friendly. With no further extension, the Rights Plan expired as of September 19, 2024. No shares were issued under the Rights Plan while it was in effect.