6. Capital Stock, Stock Plans 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.

On January 19, 2023, the Company granted ISOs to certain employees for the purchase, under the Company’s 2017 Stock Option Plan (the “2017 Plan”), of up to an aggregate 295,000 shares of the Company’s common stock, par value $.001 per share (the “Common Stock”). The total ISOs granted included an ISO for each of the Company’s executive officers for the purchase set forth in his respective ISO Agreement, as follows: 70,000 shares for the Chief Executive Officer (“CEO”); 40,000 shares for the Chief Financial Officer (“CFO”); 30,000 shares for the Executive Vice President (“EVP”) of Strategic Initiatives; 30,000 shares for the EVP of Waste Treatment Operations; and 30,000 shares for the EVP of Nuclear and Technical Services. Each of the ISOs granted has a contractual term of six years with one-fifth yearly vesting over a five-year period. The exercise price of each ISO is $3.95 per share, which was equal to the fair market value of the Company’s Common Stock on the date of grant.

On July 20, 2023, 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 is for a contractual term of ten years with one-fourth vesting annually over a four-year period. The exercise price of each NQSO is $9.81 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.

On July 27, 2017, the Company granted a NQSO from the Company’s 2017 Plan to Robert Ferguson, for the purchase of up to 100,000 shares of the Company’s Common Stock (“Ferguson Stock Option”), at an exercise price of $3.65 per share, which was the fair market value of the Company’s Common Stock on the date of grant. The Ferguson Stock Option was granted in connection with Mr. Ferguson’s work as a consultant to the Company’s Test Bed Initiative (“TBI”) at our Perma-Fix of Northwest Richland, Inc. facility. The term of the Ferguson Stock Option was seven years from the grant date, with vesting subject to the achievement of three separate milestones by certain dates, the achievement of which would entitle Mr. Ferguson to purchase, respectively, 10,000, 30,000, and 60,000 shares of the Company’s Common Stock issuable under the Ferguson Stock Option. Mr. Ferguson achieved the first milestone during the first vesting period, and was issued 10,000 shares of the Company’s Common Stock pursuant to his exercise of the vested portion of the stock option. Upon the death of Mr. Ferguson, the balance of the shares issuable under the Ferguson Stock Option was forfeited in accordance with the terms of the option.

The following table summarizes stock-based compensation recognized for the three and nine months ended September 30, 2023 and 2022 for our employee and director stock options.

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

At September 30, 2023, the Company had approximately $1,947,000 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 3.4 years.

The summary of the Company’s stock option plans as of September 30, 2023 and September 30, 2022, 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, 2023, the Company issued a total of 54,202 shares of its Common Stock under the 2003 Plan to its outside directors as compensation for serving on our 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, 2023, the Company issued an aggregate 163,933 shares of its Common Stock from cashless exercises of options for the purchases of 244,000 shares of the Company’s Common Stock, at exercise prices ranging from $3.60 per share to $7.005 per share. Additionally, the Company issued 38,400 shares of its Common Stock from the cash exercise of options for the purchase of 38,400 shares of the Company’s Common Stock, at exercise prices ranging from at $2.785 per share to $7.005 per share resulting in proceeds of approximately $150,000.

In connection with a $2,500,000 loan that the Company received from Mr. Robert Ferguson (the “Ferguson Loan”) on April 1, 2019, the Company issued a warrant to Mr. Ferguson for the purchase of up to 60,000 shares of our Common Stock at an exercise price of $3.51 per share. The warrant expires on April 1, 2024 and remains outstanding at September 30, 2023. Upon Mr. Ferguson’s death, the warrant transferred to Mr. Ferguson’s heirs. The Ferguson Loan was paid in full in December 2020.