5. Stock-based Compensation The following table summarizes total stock-based compensation expense for the three and nine months ended September 30, 2026 and 2025 (in thousands). The research and development expense during the three and nine months ended September 30, 2026 and 2025 were related to the ongoing vesting of stock option awards previously granted to Flaskworks employees, Scientific Advisory Board members, and external consultants. The 2026 expenses were related to the portion of awards vesting during the period that were granted in early 2026 and between 2020 and 2023. The 2025 expenses related entirely to the portion of awards vesting during that period that were granted between 2020 and 2023. | | | | | | | | | | | | | | | | | | | | | | | | | | | | For the three months ended | | For the nine months ended | | | September 30, | | September 30, | | | 2026 | | 2025 | | 2026 | | 2025 | Research and development | | $ | 148 | | $ | 273 | | $ | 617 | | $ | 983 | General and administrative | | | — | | | — | | | — | | | 39 | Total stock-based compensation expense | | $ | 148 | | $ | 273 | | $ | 617 | | $ | 1,022 |
The total unrecognized stock compensation cost (primarily for consultants) was approximately $0.5 million as of September 30, 2026 and will be recognized over the next 1.5 years. Stock Options The following table summarizes stock option activity during the nine months ended September 30, 2026 (amount in thousands, except per share number): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Weighted Average | | | | | | | | | | | Remaining | | | | | | | | Weighted Average | | Contractual Life (in | | | | | | Number of Options | | Exercise Price | | years) | | Total Intrinsic Value | Outstanding as of January 1, 2026 | | 311,768 | | $ | 0.35 | | 4.0 | | $ | 10 | Granted - external consultants (1) | | 2,140 | | | 0.25 | | 4.3 | | | — | Cancelled - employees and board of directors (2) | | (22,878) | | | 0.37 | | — | | | — | Outstanding as of September 30, 2026 | | 291,030 | | $ | 0.34 | | 3.2 | | $ | — | Options vested (3) | | 257,372 | | $ | 0.33 | | 3.2 | | $ | — |
| (1) | During the nine months ended September 30, 2026, the Company granted 2.1 million stock options (the “2026 Options”) with exercise price at $0.25 per share, to certain key external consultants who provide services to the Company. The 2026 Options contain service vesting conditions, which will vest over a service period, generally during the term of consulting agreement. |
| (2) | On March 16, 2026, an aggregate of 22.9 million options was cancelled following the settlement of litigation in the Delaware Court of Chancery. |
| (3) | Not all of the vested options are currently exercisable. 164 million of the 257 million vested stock options are subject to blocking agreements (the “Blocker Letter Agreements”) under which they are subject to certain restrictions on exercise. |
The Black-Scholes option pricing model is used to estimate the fair value of stock options granted. The weighted average assumptions used in calculating the fair values of stock options that were granted during the nine months ended September 30, 2026 and 2025: | | | | | | | | | | | | | | | | | | For the nine months ended | | | | September 30, | | | | 2026 | | 2025 | | Exercise price | | $ | 0.25 | | $ | 0.29 | | Expected term (years) | | | 2.6 | | | 3.2 | | Expected stock price volatility | | | 83 | % | | 77 | % | Risk-free rate | | | 3.5 | % | | 3.8 | % | Dividend yield (per share) | | | 0 | % | | 0 | % |
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