Note 12: Equity-Based Compensation

The 2018 Equity Incentive Plan, effective September 12, 2018, as amended and restated on August 19, 2019 (the “2018 Equity Incentive Plan”) authorizes the grant of (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii) Stock Appreciation Rights, (iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance Stock Awards, (vii) Performance Cash Awards, and (viii) Other Stock Awards. After the 100:1 reverse stock split which was effective on June 12, 2025, a maximum of 8,980 shares of common stock were reserved for potential issuance pursuant to awards under the 2018 Equity Incentive Plan. The number of shares of the Company’s common stock available for grant and issuance under the 2018 Equity Incentive Plan is subject to an annual increase on July 1 of each calendar year, by an amount equal to two percent (2%) of the then outstanding shares of the Company’s common stock (the “2018 Plan Evergreen Provision”). On July 1, 2025, the number of shares of the Company’s common stock available for grant and issuance under the 2018 Equity Incentive Plan increased by an additional 15,283 shares. As a result of the 2018 Plan Evergreen Provisions, a maximum of 24,263 shares of common stock is reserved for potential issuance pursuant to awards under the 2018 Equity Incentive Plan as of June 30, 2026. Subsequently, on July 1, 2026, the number of shares of the Company’s common stock available for grant and issuance under the 2018 Plan increased by 580,661 shares. Unless sooner terminated, the 2018 Equity Incentive Plan will continue in effect for a period of 10 years from its effective date. During the six months ended June 30, 2026, and 2025, there were no options granted.

As part of the Company’s cash conservation strategy, the Company issued common stock as a substitute for cash salaries to certain executives and directors. For the year ended December 31, 2025, there were 4,242 shares issued as compensation totaling $60 thousand. During the six months ended June 30, 2026, there were no shares issued related to the cash conservation program. This compensation is included in the overall equity-based compensation expense.

The fair value of each option and equity warrant award is estimated on the date of grant using a Black-Scholes-Merton option pricing valuation model. Expected volatility is based on the historical volatility of the price of the Company’s stock. The risk-free interest rate is based on U.S. Treasury issues with a term equal to the expected life of the option and equity warrant. The Company uses historical data to estimate expected dividend yield, expected life and forfeiture rates.

Stock options activity during the three months ended June 30, 2026, was as follows:

Stock option activity for employees:

 Schedule of Stock Option Activity

Stock option activity for non-employees:

 Schedule of Stock Option Activity

Stock options activity during the six months ended June 30, 2026, was as follows:

Stock option activity for employees:

Stock option activity for non-employees:

There was no unvested stock option activity for employees and non-employees.

Stock-based compensation expense was $0 and $60 thousand for the six months ended June 30, 2026 and 2025, respectively, and is recognized in a decrease in general and administrative expenses.