Note 6 – Stock-Based Compensation Expense

The Company has two equity incentive compensation plans: the 2015 Plan and the 2021 Plan.

2015 Plan

The 2015 Plan was originally adopted by the Board and approved by the Company’s stockholders in 2015. In connection with the Company’s initial public offering in July 2021, the 2015 Plan terminated immediately prior to effectiveness of the 2021 Plan with respect to the grant of future awards. However, the 2015 Plan will continue to govern the terms and conditions of the outstanding awards previously granted under the 2015 Plan.

2021 Plan

On July 28, 2021, the 2021 Plan was adopted and approved by the Board and stockholders. The 2021 Plan provides for the grant of incentive stock options to employees and any subsidiary corporations’ employees, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock, RSUs, and PSUs to employees, directors, and consultants and subsidiary corporations’ employees and consultants. The number of shares of the Company’s common stock originally available for issuance under the 2021 Plan was equal to 6,989,665 shares of common stock.

The number of common shares reserved for issuance under the 2021 Plan will be increased automatically on the first day of each fiscal year beginning with the 2022 fiscal year and ending on the ten year anniversary of the date the Board approved the 2021 Plan, by a number equal to the lesser of: (i) 7,260,406 shares of the Company's common stock; (ii) 4% of the outstanding shares of the Company's common stock on the last day of the immediately preceding fiscal year; or (iii) such other amount as the administrator may determine. The 2021 Plan is administered by the Board, or a duly authorized committee thereof. On January 1, 2026 and 2025, the number of shares available under the 2021 Plan increased by 1,649,680 and 1,617,128 shares of common stock, respectively, pursuant to this feature. As of June 30, 2026, the number of shares of the Company’s common stock available for future issuance and not subject to outstanding awards under the 2021 Plan was equal to 346,566 shares of common stock.

2021 ESPP

On July 28, 2021, the Board and stockholders adopted and approved the 2021 ESPP. As of June 30, 2026, the number of shares of the Company’s common stock available for future issuance under the 2021 ESPP was equal to 292,112 shares of common stock. The initial purchase period began on November 1, 2021.

The 2021 ESPP provides eligible employees of the Company and its subsidiaries with the opportunity to purchase shares of the Company’s common stock at a purchase price equal to 85% of the common stock’s fair market value on the first trading day or last trading day of each purchase period, whichever is lower. The 2021 ESPP provides for two six-month purchase periods every twelve months: May 1 through October 31 and November 1 through April 30.

The number of common shares reserved for issuance under the 2021 ESPP will be increased automatically on the first day of each fiscal year beginning with the 2022 fiscal year, by a number equal to the lesser of: (i) 1,452,081 shares; (ii) 1% of the outstanding shares of the Company's common stock on the last day of the immediately preceding fiscal year; or (iii) such other amount as the administrator may determine. The 2021 ESPP is administered by the Board. The Board determined that no additional shares were reserved for issuance on January 1, 2026 and 2025 pursuant to this feature.

Stock-Based Compensation Expense

The purpose of the 2021 Plan and 2021 ESPP is to provide a means by which eligible recipients of stock awards may be given an opportunity to benefit from increases in the value of the common stock in order to retain or procure the services of the employees, members of the Board and consultants and provide them with an incentive to promote the Company’s success and accomplish corporate goals.

Stock-Based Award Activity

Stock Options

Stock option awards are granted with an exercise price of no less than 100% of estimated fair market value on the date of grant. Time based option awards generally vest over four years as follows, subject to the optionee’s continuing service: (i) one fourth of the total number of shares vest and become exercisable on the one-year anniversary and then 1/48th of the total number of shares subject to the option vest and become exercisable on each monthly anniversary thereafter for the remaining three years, or (ii) 1/48th of the total number of shares subject to the option vest and become exercisable each month over four years.

As of June 30, 2026 and December 31, 2025 the intrinsic value of options vested was less than $0.1 million and $0.8 million, respectively, and of all options outstanding was less than $0.1 million and $1.2 million, respectively. During the six months ended June 30, 2026 and 2025, the total cash received from the exercise of stock options was $0.2 million and $2.1 million, respectively. During the six months ended June 30, 2026 and 2025, the total fair value less strike price of these options was $0.2 million and $4.2 million, respectively.

RSUs and PSUs

As of June 30, 2026, and December 31, 2025, total unrecognized expense related to non-vested RSUs and PSUs was approximately $20.3 million and $17.8 million, respectively. The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.5 years and 2.1 years, respectively.

During the six months ended June 30, 2026, the Company granted PSUs under the plan as follows:

Fair Value Disclosure