6. Capital Stock, Stock Plans, Warrants and Stock Based Compensation

The Company has certain stock option plans under which it may award incentive stock options (“ISOs”) and/or non-qualified stock options (“NQSOs”) to employees, officers, outside directors, and outside consultants.

In connection with the appointment of Mr. Troy Eshleman to the position of Chief Operating Officer (“COO”) by the Company’s Board of Directors (the “Board”) on January 23, 2025 (see further information in “Note 13 – Executive Compensation” regarding this appointment), the Compensation and Stock Option Committee (the “Compensation Committee”) recommended, and the Board approved, the grant to Mr. Eshleman of an ISO for the purchase, under the Company’s 2017 Stock Option Plan (the “2017 Plan”), of up to 50,000 shares of the Company’s common stock, $.001 (the “Common Stock”). The ISO has a six-year6 term and vests at 20% per year over a five-year5 period, commencing on the first anniversary of the grant date. The exercise price of the ISO is $10.70 per share, which equals the closing price of the Company’s Common Stock as quoted on NASDAQ on the grant date.

The following table summarizes stock-based compensation recognized for the three months ended March 31, 2025, and 2024 for our employee and director stock options.

 Schedule of Share-based Compensation, Allocation of Recognized Period Costs

As March 31, 2025, the Company had approximately $2,004,000 of total unrecognized compensation costs related to unvested options for employee and directors. The weighted average period over which the unrecognized compensation costs are expected to be recognized is approximately 3.1 years.

The summary of the Company’s total Stock Option Plans as of March 31, 2025, and March 31, 2024, along with changes during the periods then ended, is presented below. The Company’s Plans consist of the 2017 Plan and the 2003 Outside Directors Stock Plan (the “2003 Plan”):

 Schedule of Stock Options Roll Forward

During the three months ended March 31, 2025, the Company issued a total of 10,565 shares of its Common Stock under the 2003 Plan to its outside directors as compensation for serving on the Company’s Board. The Company recorded approximately $117,000 in compensation expenses (included in selling, general and administration (“SG&A”) expenses) in connection with the issuance of shares of its Common Stock to outside directors.

During the three months ended March 31, 2025, the Company issued an aggregate 28,091 shares of its Common Stock from cashless exercises of options for the purchase of 40,000 shares of the Company’s Common Stock at $3.15 per share. Additionally, the Company issued an aggregate 12,500 shares of its Common Stock from cash exercises of options for the purchase of 12,500 shares of the Company’s Common Stock, at exercise prices of $3.15 and $3.95 per share, resulting in proceeds of approximately $41,000.

In connection with the Company’s sales of its Common Stock in May 2024 and December 2024, the Company issued warrants to certain underwriter, placement agents and their designees to purchase up to an aggregate 188,038 shares of the Company’s Common Stock at exercise prices of $11.50 and $12.19 per share. These warrants remained outstanding as of March 31, 2025.