Note 5 - Stockholders' Equity, Options, and Warrants

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Equity [Text Block]

(5)       Stockholders’ Equity, Options, and Warrants

Employee Stock Purchase Plan

The Company has an employee stock purchase plan pursuant to which employees of the Company may participate to purchase shares of common stock at a discount. During the nine months ended September 30, 2025 and 2024, the Company issued 521,102 and 290,625 shares of common stock, respectively, to employees under the employee stock purchase plan for proceeds of $14,883 and $8,627, respectively. As of  September 30, 2025, 1,314,527 shares of common stock remain available for issuance under the employee stock purchase plan.

Stock-Based Compensation Plans

2015 Incentive Plan - In April 2015, the Company’s Board of Directors approved the International Isotopes Inc. 2015 Incentive Plan (as amended, the 2015 Plan), which was subsequently approved by the Company’s shareholders in July 2015. The 2015 Plan was amended and restated in July 2018 to increase the number of shares authorized for issuance under the 2015 Plan by an additional 20,000,000 shares. The 2015 Plan provides for the grant of incentive and non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and units, and other stock or cash-based awards. At September 30, 2025, there were 18,900,685 shares available for grant and 48,538,185 shares available for issuance under the 2015 Plan.

Employee/Director Grants - The Company accounts for issuances of stock-based compensation to employees by recognizing, as compensation expense, the cost of employee services received in exchange for equity awards. The compensation expense is based on the grant date fair value of the award. Stock option compensation expense is recognized over the period during which an employee is required to provide service in exchange for the award (the vesting period).

Non-Employee Grants - The Company accounts for its issuances of stock-based compensation to non-employees by recognizing compensation expense based on the grant date fair value of the award. Stock option compensation expense is recognized over the vesting period for the award.

Option awards outstanding as of  September 30, 2025, and changes during the nine months ended September 30, 2025, were as follows:

					Weighted
			Weighted		Average
			Average		Remaining		Aggregate
Fixed Options	Shares		Exercise Price		Contractual Life		Intrinsic Value
Outstanding at December 31, 2024		26,087,500	$	0.05		6.1
Granted		725,000		0.05
Exercised		—		—
Expired		—		—
Forfeited		175,000		0.04
Outstanding at September 30, 2025		26,637,500		0.05		5.4	$	445,800
Exercisable at September 30, 2025		20,322,500	$	0.05		4.4	$	310,950

The intrinsic value of outstanding and exercisable shares is based on the closing price of the Company’s common stock on the OTCQB of $0.06 per share on September 30, 2025.

As of  September 30, 2025, there was $58,492 of unrecognized compensation expense related to stock options that will be recognized over a weighted-average period of 1.77 years.

Total stock-based compensation expense for the nine months ended September 30, 2025 and 2024 was $95,364 and $136,601, respectively.

During the nine months ended September 30, 2025, the Company granted an aggregate of 725,000 qualified stock options to nine of its employees. These options vest over a five-year period with the first vesting on the first anniversary of the date of grant, with an expiration at the ten-year anniversary for each grant. The exercise price for these granted options was between $0.04 and $0.11 per share. The options issued during the nine months ended September 30, 2025 have a fair value of $25,116 as estimated on the date of issue using the Black-Scholes options pricing model with the following weighted-average assumptions: risk free interest rate of 3.95% to 4.52%, expected dividend yield rate of 0%, expected volatility of 72.53% to 85.29% and an expected life between 5 and 7 years.

Restricted Stock Units outstanding as of  September 30, 2025, and changes during the nine months ended September 30, 2025, were as follows:

Non-Vested Restricted Stock Units	Number of restricted stock units			Weighted average grant-date fair value
Outstanding at December 31, 2024		5,250,000		$	0.04
Granted		—
Vested and Exercised		(2,250,000	)		0.04
Forfeited / Cancelled		—
Outstanding at September 30, 2025		3,000,000		$	0.04

As of  September 30, 2025, there was $21,788 of unrecognized compensation expense related to Restricted Stock Units that will be recognized over a weighted-average period of 0.545 years.

Preferred Stock

At September 30, 2025, there were 4,063 total shares of the Series C Preferred Stock outstanding. The Series C Preferred Stock are convertible at the option of the investors at any time into shares of the Company's common stock at an initial conversion price equal to $0.10 per share, subject to adjustment. At any time after February 17, 2019, if the volume-weighted average closing price of the Company’s common stock over a period of 90 consecutive trading days is greater than $0.25 per share, the Company may redeem all or any portion of the outstanding Series C Preferred Stock at the original purchase price per share ($1,000) plus any accrued and unpaid dividends, payable in shares of common stock. All outstanding shares of Series C Preferred Stock were to be redeemed by the Company on February 17, 2022 at the original purchase price per share, payable in cash or shares of common stock, at the option of the holder. In February 2022, based on approval of a majority of the Preferred C Holders, the Company extended the redemption date of the Series C Preferred Stock to February 17, 2023. In December 2022, based on approval of a majority of the Preferred C Holders, the Company extended the redemption date of the Series C Preferred Stock to February 17, 2025. In September 2024, based on approval of a majority of the Preferred C Holders, the Company extended the redemption date of the Series C Preferred Stock to February 17, 2027. Holders of Series C Preferred Stock do not have any voting rights, except as required by law and in connection with certain events as set forth in the Statement of Designation of the Series C Preferred Stock.

During the nine months ended September 30, 2025 and 2024, dividends paid to holders of the Series C Preferred Stock totaled $243,780 and $243,030 respectively. Some holders of the Series C Preferred Stock elected to settle their dividend payments with shares of the Company’s common stock in lieu of cash. For the nine months ended September 30, 2025 and 2024, the Company issued an aggregate of 1,743,457 and 1,808,400 shares of common stock in lieu of dividend payments of $90,660 and $90,420, respectively, with the remaining dividend payable settled in cash of $153,120 and $152,610, respectively.