Stock-Based Compensation |
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| Stock-Based Compensation | Stock-Based Compensation We grant stock-based awards under our 2024 Incentive Stock Plan (the “2024 Plan”). The shares issued as a result of stock-based compensation transactions generally have been funded with the issuance of new shares of our common stock.
We may grant the following types of incentive awards under the 2024 Plan: (i) non-qualified stock options; (ii) incentive stock options; (iii) stock appreciation rights; (iv) restricted stock; and (v) restricted stock units. Each award granted under the 2024 Plan is subject to an award agreement that incorporates, as applicable, the exercise price, the term of the award, the periods of restriction, the number of shares to which the award pertains, and such other terms and conditions as the plan committee determines. Awards granted under the 2024 Plan are classified as equity awards, which are recorded in stockholders’ equity in our consolidated balance sheets. Through December 31, 2025, we have granted under the 2024 Plan (i) non-qualified stock options; (ii) incentive stock options; and (iii) restricted stock. There were no stock appreciation rights or restricted stock units granted under the 2024 Plan as of December 31, 2025. As of December 31, 2025, 1,725,057 shares of common stock remained available for issuance under the 2024 Plan.
Stock Options
Our closing price on the date of grant is the basis of fair value of its common stock used in determining the value of share-based awards. To the extent that the value of our share-based awards involves a measure of volatility, we use available historical volatility of our common stock over a period of time corresponding to the expected stock option term. We use the simplified method to calculate the expected term of stock option grants to employees. Accordingly, the expected life of the options granted is based on the average of the vesting term, which is generally four years and the contractual term, which is generally ten years. The risk-free interest rate is based on United States Treasury yields in effect at the date of grant for periods corresponding to the expected stock option term. Forfeitures are estimated based on historical and forecasted turnover, which is approximately 5%.
We did not grant any options during the year ended December 31, 2025. We have computed the fair value of all options granted using the Black-Scholes-Merton model during the year ended December 31, 2024, using the following assumptions:
The information below summarizes the stock options activity:
The weighted-average grant-date fair value of our stock options granted during the year ended December 31, 2024 was $6.21.
The aggregate fair value of our stock options vested during 2025 and 2024 was $157 thousand and $319 thousand, respectively.
We recognize compensation costs ratably over the period of service using the straight-line method. Forfeitures are estimated based on historical and forecasted turnover, which is approximately 5%. For the years ended December 31, 2025 and 2024, stock-based compensation expense for stock options was $73 thousand and $141 thousand, respectively.
Unrecognized stock-based compensation expense for stock options as of December 31, 2025 was $166 thousand, which is expected to be recognized ratably over the next 2.8 years.
Restricted Stock
Restricted stock awards granted to employees generally vest in four equal annual installments. Restricted stock awards granted to non-employee directors vest on the earlier of (i) one year from the grant date and (ii) the date of the next annual meeting of the shareholders of our company occurring after the date of grant.
The information below summarizes the restricted stock activity:
For the years ended December 31, 2025 and 2024, stock-based compensation expense for restricted stock was $1.2 million and $1.5 million, respectively. Unrecognized stock-based compensation expense for restricted stock awards as of December 31, 2025 was $2.9 million to be recognized ratably over 2.9 years.
Tax Benefits
Net income (loss) for 2025 and 2024 included pre-tax expense related to stock-based compensation of $1.3 million and $1.7 million, respectively. We recognized federal income tax benefits of zero and $0.1 million from the exercises of stock options and restricted stock awards for 2025 and 2024, respectively.
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