(12) Stock-Based Compensation

 

The Company is authorized to grant stock options, stock grants and other forms of equity-based compensation under its 2018 Equity Incentive Plan, as amended (the “Plan”). The Plan was approved by the Company shareholders and provides or the issuance of shares of the Company’s common stocks from equity-based awards. At the Company’s annual shareholders meeting held on April 29, 2025, shareholders approved an amendment to the Plan to increase the number of shares authorized for issuance by 500,000 shares, increasing the total number of shares authorized under the Plan from 1,050,000 shares. As of December 31, 2025, the Company was authorized to issue up to 1,550,000 shares of common stock under the Plan, of which 728,627 shares remained available for future grants.

 

During the year ended December 31, 2025, the Company recorded stock-based compensation expense of $579,000 with respect to 132,861 shares issued to a director for services performed; and $296,000 with respect to 62,171 shares issued to certain employees for services performed.

 

During the year ended December 31, 2024, the Company recorded stock-based compensation expense of $185,000 with respect to 42,610 shares issued to a director for services performed; and $305,000 with respect to 73,050 shares issued to certain employees for services performed.

 

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 26, 2025
2023Mar 8, 2024
2022Mar 6, 2023

About Stock Compensation Disclosures

Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.

Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.