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, the Company granted to Mr. Eshleman 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.

On July 24, 2025, the Company issued a NQSO to each of the Company’s seven reelected outside (non-management) directors for the purchase, under the Company’s 2003 Outside Directors Stock Plan (the “2003 Plan”), of up to 10,000 shares of the Company’s Common Stock. Dr. Louis Centofanti and Mark Duff, each an executive officer of the Company as well as a director, were not eligible to receive an option under the 2003 Plan. Each NQSO granted has a four-year term and vests at 25% per year over a four-year4 period, commencing on the first anniversary of the grant date. The exercise price of each NQSO is $12.23 per share, which was equal to the fair market value of the Company’s Common Stock on the day preceding the grant date, in accordance with the 2003 Plan.

The following table summarizes stock-based compensation recognized for the three and nine months ended September 30, 2025, and 2024 for our employee and director stock options.

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

As of September 30, 2025, the Company had approximately $2,131,000 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 3.0 years.

The summary of the Company’s stock option plans as of September 30, 2025, and September 30, 2024, and changes during the periods then ended, are presented below. The Company’s plans consist of the 2017 Plan and the 2003 Plan:

 Schedule of Stock Options Roll Forward

During the nine months ended September 30, 2025, the Company issued a total of 38,256 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 $359,000 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 nine months ended September 30, 2025, the Company issued an aggregate 40,208 shares of its Common Stock from cashless exercises of options for the purchase of 67,000 shares of the Company’s Common Stock ranging from $3.15 to $7.75 per share. Additionally, the Company issued an aggregate 21,700 shares of its Common Stock from cash exercises of options for the purchase of 21,700 shares of the Company’s Common Stock, at exercise prices ranging from $3.15 and $4.19 per share, resulting in proceeds of approximately $79,000.

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 September 30, 2025.