Note 12 – Stock-based Compensation

Omnibus Incentive Plan

The Company issues stock-based awards under its Company’s 2016 Omnibus Incentive Plan, as amended, which enables the Company to grant stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock, other stock-based awards and cash awards to associates, directors, consultants, and advisors of the Company and its affiliates, and to improve the ability of the Company to attract, retain, and motivate individuals upon whom the Company’s sustained growth and financial success depend, by providing such persons with an opportunity to acquire or increase their proprietary interest in the Company. Stock options granted under the 2016 Plan may be non-qualified stock options or incentive stock options, within the meaning of Section 422(b) of the Internal Revenue Code of 1986, except that stock options granted to outside directors and any consultants or advisers providing services to the Company or an affiliate shall in all cases be non-qualified stock options. The option price must be at least 100% of the fair market value on the date of grant and if issued to a 10% or greater shareholder must be 110% of the fair market value on the date of the grant.

The 2016 Plan is to be administered by the Board, which has discretion over the awards and grants thereunder. No awards may be issued after April 26, 2028.

The number of shares authorized to be issued under the Plan is automatically adjusted from time to time when the Company issues additional shares of common stock or securities that are convertible or exercisable into shares of common stock (other than pursuant to the Plan) such that shares authorized under the plan after such issuance shall be equal to at least 20% of the issued and outstanding shares of the Company on a fully diluted basis. As of December 31, 2025 there are 220,150 shares authorized to be issued and 33,678 remaining available for future issuance under the Plan.

Stock Options

The fair value of each option grant is estimated at the grant date using the Black Scholes method. The following assumptions were used in estimating fair value:

 Schedule of Stock Options Assumptions in Estimated Fair Value 

A summary of the option activity is presented below:

 Schedule of Stock Option Activity 

The Company includes stock-based compensation expense in selling, general and administrative expenses, and recognized $3.4 million and $4.1 million during the years ended December 31, 2025 and 2024, respectively.

As of December 31, 2025, there was $3.2 million of unrecognized stock-based compensation expense related to outstanding stock options that will be recognized over the weighted average remaining vesting period of 1.6 years.

Restricted Stock Units

The Company also issues restricted shares and restricted stock units under the 2016 Plan. As of December 31, 2024, there were 11,428 restricted stock units issued and outstanding. As of December 31, 2025, vesting conditions required for the restricted stock units was not achieved and the restricted stock units were cancelled.