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Note 11 - Stockholders' Equity
6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Shareholders' Equity and Share-Based Payments [Text Block]

11. STOCKHOLDERS EQUITY

 

Common Stock Issuances

 

In the three and six months ended June 30, 2025, the Company sold shares pursuant to the At-The-Market (ATM) agreement (net of legal, accounting, sales commissions and other fees) for net proceeds of $304,987 and $281,446, respectively. There was no ATM activity during either of the three or six months ended June 30, 2026. 

 

Stock Option Plans

 

On November 7, 2025, the Board of Directors adopted a new 2025 Stock Option and Incentive Plan (the “2025 Plan”), under which employees, directors and other 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. The Board further revised the 2025 Plan on March 26, 2026 and April 7, 2026, including revising the number of shares from 500,000 to 650,000, as well as revisions to the change in control provisions, minimum vesting period and exercise period for retiring directors. The impact of these changes were immaterial to our Financial Statements as of and for the three and six months ending June 30, 2026. The Company’s stockholders approved the 2025 Plan (as so revised) at the  June 11, 2026 Annual Meeting of Stockholders.

 

On January 27, 2026, we granted stock options to purchase 220,000 shares of the Company's common stock to two executive officers of the Company. Such options have a grant-date fair value of $3.51 per share and vest ratably over three years from date of grant. We record stock-based compensation expense on a straight-line basis for all stock options. On January 27, 2026, we granted an additional stock option to purchase 109,500 shares of the Company's common stock to the Company's President and CEO, contingent on achieving certain internal performance metrics. Such option has a grant-date fair value of $3.51 and vests only if and when the Company’s net operating income for four consecutive calendar quarters equals or exceeds 300% of the Company’s audited net operating income for its 2025 fiscal year. As of June 30, 2026, we believe that the vesting of the option is probable. There were no other stock options granted during the three and six months ended June 30, 2026, other than annual grants made to outside Board of Directors and routine grants to employees. Grants made during the three and six months ended June 30, 2025, consisted of annual grants made to outside Board of Directors and routine grants to employees.

 

The fair value of stock options, including performance-based stock options, is estimated on the grant date using a Black-Scholes option-pricing model. We recorded compensation expense pertaining to stock-based awards of $239,867 and $66,714 during the three months ended June 30, 2026 and 2025, respectively and $377,816 and $118,929 during the six months ended June 30, 2026 and 2025. The year over year increases in stock-based compensation expense are due to grants to our executive officers beginning in April 2025.