Note 13 - Stock-based Compensation

9 Months Ended

Sep. 30, 2025

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

Note 13. Stock-Based Compensation

2016 Omnibus Incentive Plan

Prior to the Merger, the Company maintained its 2016 Omnibus Incentive Plan (the “2016 Plan”), under which NeuroRx granted incentive stock options, restricted stock awards, other stock-based awards, or other cash-based awards to employees, directors, and non-employee consultants. The maximum aggregate shares of Common Stock that were subject to awards and issuable under the 2016 Plan was 347,200.

In connection with the Merger, each option of NeuroRx that was outstanding and unexercised immediately prior to the Effective Time (whether vested or unvested) was assumed by BRPA and converted into an option to acquire an adjusted number of shares of Common Stock at an adjusted exercise price per share, based on the Exchange Ratio (of 0.316:1).

Upon the closing of the Merger, the outstanding and unexercised NeuroRx stock options became options to purchase an aggregate 289,542 shares of Common Stock at an average exercise price of $51.00 per share.

2021 Omnibus Incentive Plan

As of  September 30, 2025, 1,050,809 shares of Common Stock are authorized for issuance pursuant to awards under the Company’s 2021 Omnibus Incentive Plan (the “2021 Plan”). As of January 1, 2025, 95,528 shares were added to the 2021 Plan under an evergreen feature that automatically increases the reserve with additional shares of Common Stock for future issuance under the Incentive Plan each calendar year, beginning January 1, 2022 and ending on and including January 1, 2031, equal to the lesser of (A) 1% of the shares of Common Stock outstanding on the final day of the immediately preceding calendar year or (B) a smaller number of shares determined by the Board. On December 28, 2023, the first amendment to the 2021 Plan was executed which increased the maximum number of shares (i) available for issuance under the Plan by an additional 200,000 shares, and (ii) that may be delivered pursuant to the exercise of Incentive Stock Options granted under the 2021 Plan to be equal to 100% of the Share Pool. As of September 30, 2025, an aggregate 1,117,099 shares of Common Stock have been awarded net of forfeitures, and 18,085 shares of Common Stock remain available for issuance under the 2021 Plan. The 2021 Plan permits the granting of incentive stock options, restricted stock awards, other stock-based awards or other cash-based awards to employees, directors, and non-employee consultants.

Option Awards

The fair value of each employee and non-employee stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The Company is a public company and has limited company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the limited company-specific historical volatility and implied volatility. The expected term of the Company’s stock options for employees has been determined utilizing the “simplified” method for awards. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve. Expected dividend yield is zero based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. Additionally, certain options granted contain terms that require all unvested options to immediately vest a) upon the approval of an NDA by the FDA for NRX‑101, or b) immediately preceding a change in control of the Company, whichever occurs first.

On February 7, 2025, the Company issued 50,000 stock options. These shares have a vesting term of three years, an expiration date of ten years from the grant date and were valued at approximately $0.1 million as of the grant date.

On April 9, 2025, the Company issued 497,000 stock options. These shares have a vesting term of three years, an expiration date of ten years from the grant date and were valued at approximately $0.6 million as of the grant date.

The stock options granted during the nine months were valued utilizing the Black-Scholes options pricing model with the following inputs: $1.78-2.94 of stock price, 3.91%-4.31% risk-free rate, 127%-126.76% volatility, 0% dividend rate, and the expected term of 3 years.

The following table summarizes the Company’s employee and non-employee stock option activity under the 2021 Plan for the following periods:

						Weighted
						average
				Weighted		remaining		Aggregate
				average		contractual		intrinsic
	Number of			exercise		life (in		value (in
	shares			price		years)		thousands)
Outstanding as of December 31, 2023		264,983		$	18.30		7.7	$	75
Options granted		—			—		—		—
Forfeited/Expire		(143,150	)		—		—		—
Outstanding as of December 31, 2024		121,833			22.36		7.0		—
Options granted		547,000			1.84		10.0
Forfeited/Expire		(5,380	)		—		—		—
Outstanding as of September 30, 2025		663,453			5.54		9.0		—
Options vested and exercisable as of September 30, 2025		119,281		$	22.52		6.3	$	—

Stock-based compensation expense related to stock options was less than $0.1 million and $0.1 million for the three months ended September 30, 2025 and 2024, respectively. Stock-based compensation expense related to stock options was approximately $0.15 million and approximately $0.1 million for the nine months ended September 30, 2025 and 2024, respectively.

At September 30, 2025, the total unrecognized compensation related to unvested employee and non-employee stock option awards granted was $0.6 million, which the Company expects to recognize over a weighted-average period of approximately 2.49 years.

Restricted Stock Awards

The following table presents the Company’s Restricted Stock Activity:

				Weighted
				Average Grant
				Date Fair
	Awards			Value
Balance as of December 31, 2023 (unvested)		124,166		$	5.20
Granted		—
Vested		(90,833	)	$	4.64
Forfeited		(33,333	)	$	5.20
Balance as of December 31, 2024 (unvested)		—			—
Granted		—		$	—
Vested		—		$	—
Forfeited		—		$	—
Balance as of September 30, 2025 (unvested)		—			—

On July 12, 2022, the board of directors (the “Board”) granted an award of 100,000 restricted shares of the Company as an inducement to the newly appointed chief executive officer, pursuant to a separate Restricted Stock Award Agreement (the “RSA”). The Restricted Stock vested in approximately equal installments over three (3) years from the grant date, subject to continued service through the applicable vesting date.

On December 28, 2023, the Company granted 57,500 RSAs to a consultant for services provided. The RSAs vested after six months from the grant date. The shares were valued on the grant date based on the quoted price of $4.60 or approximately $0.3 million, which was amortized over the vesting term.

Stock-based compensation expense related to RSAs was $0 and less than $0.1 million for the three months ended September 30, 2025 and 2024, respectively. Stock-based compensation expense related to RSAs was $0 and less than $0.1 million for the nine months ended September 30, 2025 and 2024, respectively.

In October 2024, the Company's chief executive officer announced his resignation and as a result, all unvested RSAs were forfeited. Accordingly, the Company does not expect to recognize any further stock-based compensation expense for the balance of unvested RSAs as of December 31, 2024.

The following table summarizes the Company’s recognition of stock-based compensation for the following periods (in thousands):

	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024
	(Unaudited)
Stock-based compensation expense
General and administrative	$	56	$	82	$	123	$	365
Research and development		12		22		24		78
Total stock-based compensation expense	$	68	$	97	$	147	$	339