Stockholders' Equity |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stockholders’ Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STOCKHOLDERS' EQUITY |
NOTE 11 - STOCKHOLDERS’ EQUITY
On February 22, 2024, the Company engaged a merchant bank in a consultative capacity to advise on capital funding and strategic initiatives which include the prospective sale of the Company. The Company had agreed to pay a fee equal to 1.5% of the transaction value upon closing. On March 18, 2025, the Company terminated this agreement due to the incapacity of the principal of the merchant bank.
On May 7, 2025, the Company engaged a new investment banker to advise on capital funding and strategic alternatives which include the prospective sale of the Company. The Company agreed to pay a fee equal to 1.75% or 2.00% of the transaction value upon closing, which is dependent upon the aggregate consideration received. There is a minimum fee threshold amount of $1,000,000. fees were paid to this new investment banker for the year ended December 31, 2025.
Option Amendments and Adjustments During the years ended December 31, 2024 and 2025, the Board of Directors approved modifications to certain outstanding, fully vested stock options primarily to extend their contractual expiration dates. In 2024, the Company extended the terms of approximately 1.98 million options with exercise prices ranging from $0.90 to $1.70 per share. The extensions generally lengthened the contractual term to December 31, 2025. The incremental fair value resulting from these modifications totaled approximately $396,000, which was recognized as compensation expense during the year ended December 31, 2024.
During the year ended December 31, 2025, the Company extended the terms of approximately 7.55 million options with exercise prices ranging from $0.25 to $1.67 per share. The extensions generally lengthened the contractual term to December 31, 2026 and December 31, 2027. The incremental fair value resulting from these modifications totaled approximately $1.56 million, which was recognized as compensation expense during the year ended December 31, 2025. The incremental fair value of the modified awards was determined using the Black-Scholes option pricing model.
Significant assumptions used in the valuation of the modified awards during 2024 and 2025 included:
Issuance of Restricted Shares A restricted stock award (“RSA”) is an award of common shares that is subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. The grantee cannot transfer the shares before the restricted shares vest. Shares of nonvested restricted stock have the same voting rights as common stock, are entitled to receive dividends and other distributions thereon and are considered to be currently issued and outstanding. The Company’s restricted stock awards generally vest over a period of one year. The Company expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant, straight-line over the period during which the restrictions lapse. For these purposes, the fair market value of the restricted stock is determined based on the closing price of the Company’s common stock on the grant date. There were no RSAs granted during the year ended December 31, 2025.
On May 16, 2024, the Company granted the Chief Executive Officer, who is also a Board Member, 300,000 shares of the Company’s common stock with an aggregate fair value of $307,500 as a performance-based bonus award pursuant to the raising of capital. The aggregate fair value of the shares was expensed immediately.
On November 14, 2024, the Company granted the Chief Executive Officer, who is also a Board Member, 100,000 shares of the Company’s common stock with an aggregate fair value of $99,000 as a performance-based bonus award. The aggregate fair value of the shares was expensed immediately. |
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