v3.26.3
Note 7 - Equity and Stock-based Compensation
 9 Months Ended
Sep. 30, 2026
Notes to Financial Statements  
Equity [Text Block]

Note 7 – Equity and Stock-Based Compensation

 

Under the Second Amended and Restated Certificate of Incorporation, we have the authority to issue a total of 101,000,000 shares of capital stock, consisting of 100,000,000 shares of common stock and 1,000,000 shares of preferred stock, par value $0.0001 per share, which will have such rights, powers and preferences as the Board of Directors shall determine. 

 

Issuance of Common Stock for Vendor Services Rendered

 

During the nine months ended September 30, 2026, we issued 50,861 shares of common stock in exchange for services rendered from a vendor totaling $61,500.

 

Stock-Based Compensation

 

In July 2016, the Board of Directors approved the 2016 Omnibus Incentive Plan (the “Plan”), and in November 2016, holders of a majority of our capital stock approved the Plan, as amended and restated, which provides for the grant of equity and cash incentive awards to officers, directors and employees of, and consultants to, Nuo Therapeutics and its subsidiaries. Further, in March 2022, the Board approved an amendment to the Plan to increase the shares available to 4,250,000 and remove an annual evergreen provision, which was approved by the holders of a majority of our outstanding common stock and which became effective in June 2022. The Plan provided for a duration of ten years and, accordingly, our ability to issue new stock options and other awards under the Plan ended on July 1, 2026.

 

A summary of stock option activity under the Plan during the nine months ended September 30, 2026 is presented below: 

 

Stock Options – 2016 Omnibus Plan

  

Shares

    

Weighted

Average
Exercise
Price

    

Weighted
Average
Remaining
Contractual
Term

  
                         

Outstanding at January 1, 2026

     2,380,582     $ 0.73       5.84  

Granted

     1,125,000       1.13       10.0  

Exercised

     (816,875 )     0.68       -  

Forfeited or expired

     (200,625 )     1.13       -  

Outstanding at September 30, 2026

     2,488,082     $ 0.89       7.59  

Exercisable at September 30, 2026

     1,308,915     $ 0.69       5.80  

 

During the nine months ended September 30, 2026, 1,125,000 stock options were granted to senior management, members of the board of directors, and employees of which (i) 90,000 were granted to independent members of the board of directors with vesting occurring on the one-year anniversary of the grant, (ii) 760,000 were granted pursuant to a three-year vesting schedule, and (iii) 275,000 options contained vesting provisions through December 31, 2028 pursuant to the achievement of either certain commercial sales targets for the years ended December 31, 2026 and 2027 or certain reimbursement coverage milestones. The fair value of the employee options vesting over the three-year vesting schedule was approximately $430,000 while the performance-based options had a fair value of approximately $222,700. Fair value of the options granted to senior management and members of the board of directors was $188,000.

 

During the nine months ended September 30, 2026, 816,875 options were exercised on a cashless basis resulting in the issuance of 343,994 shares of common stock. The aggregate intrinsic value for outstanding and exercisable options as of September 30, 2026 was approximately $855,000 and $734,000, respectively. During the nine months ended September 30, 2025, 176,000 stock options were granted to employees and a third-party consultant. The fair value of the options to vest over three years was approximately $105,900.

 

For the three months ended September 30, 2026 and 2025, we recorded stock-based compensation expense of $89,238 and $19,915, respectively. For the nine months ended September 30, 2026 and 2025, we recorded stock-based compensation expense of $154,255 and $62,459, respectively. As of September 30, 2026, there was approximately $787,000 unrecognized compensation cost related to the non-vested stock options of which $581,000 is expected to be recognized prior to year-end 2029 over a weighted average period of 2.5 years while the recognition of approximately $206,000 is subject to the achievement of the performance-based vesting provisions.