The Company maintains a stock incentive plan that permits the granting of incentive stock options or nonqualified stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards, and other stock-based awards. The equity-based awards for employees generally vest over a four-year period. For initial equity-based awards granted to employees, the first vest is generally a one-year cliff vest, followed by monthly vesting for the final three years. Thereafter, annual equity-based awards granted to employees typically vest monthly over the four-year vest term, except for restricted stock units which vest annually over a four year period. The initial equity-based awards granted to the Company’s non-employee, independent directors upon appointment to the board of directors vest over a three-year period, with the first vest being a one-year cliff, followed by monthly vesting over the remaining two years. Thereafter, annual equity-based awards granted to the Company’s non-employee, independent directors cliff vest after one year from the date of grant.

The following table summarizes the stock option activity for the nine months ended September 30, 2025 (in thousands, except share and per share data):


	Number of Shares			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at January 1, 2025		3,992,335		$	4.99		6.86	$	19,318
Granted		1,439,255		$	7.81
Exercised		(20,677	)	$	2.37
Forfeited		(67,769	)	$	7.64
Expired		(32,536	)	$	10.78
Outstanding at September 30, 2025		5,310,608		$	5.69		6.95	$	16,469
Exercisable at September 30, 2025		3,083,268		$	2.31		6.07	$	12,332
Vested and expected to vest at September 30, 2025		5,025,926		$	3.74		7.16	$	14,836

The weighted average assumptions used in the Black-Scholes pricing model for stock options granted during the three and nine months ended September 30, 2025 and 2024, were as follows:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2025			2024			2025			2024
Estimated dividend yield		-	%		-	%		-	%		-	%
Weighted-average expected stock price volatility		36.58	%		36.05	%		36.06	%		35.91	%
Weighted-average risk-free interest rate		4.16	%		3.49	%		4.33	%		4.33	%
Expected average term of options (in years)		6.25			6.25			6.16			6.25
Weighted-average fair value of common stock	$	4.44		$	4.40		$	7.81		$	2.86
Weighted-average fair value per option	$	1.94		$	1.84		$	3.39		$	1.24

The following table summarizes the restricted stock unit activity for the nine months ended September 30, 2025 (in thousands, except share and per share data):


	Number of Shares			Weighted Average Grant Date Fair Value per Share		Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at January 1, 2025		127,611		$	3.47		0.84	$	1,066
Granted		—		$	—
Vested		(82,538	)	$	2.42
Forfeited		—		$	—
Outstanding at September 30, 2025		45,073		$	5.41		0.91	$	279
Vested and expected to vest at September 30, 2025		45,073		$	5.41		0.91	$	279

The Company maintains an employee stock purchase plan (ESPP) that authorizes the issuance of shares of common stock pursuant to purchase rights granted to eligible employees. Unless otherwise determined by the Company’s board of directors, shares of the Company’s common stock will be purchased for the accounts of employees participating in the Company’s ESPP at a price per share equal to the lesser of (i) 85% of the fair market value of a share of the Company’s common stock on the first day of an offering; or (ii) 85% of the fair market value of a share of the Company’s common stock on the date of purchase. Offering periods are generally six months long; offering periods begin on June 1 and December 1 of each year. The Company issued zero and 11,518 shares of common stock under the ESPP during the three and nine months ended September 30, 2025 and zero and 54,314 shares of common stock under the ESPP during the three and nine months ended September 30, 2024.

In January 2024, the Company’s board of directors approved a one-time repricing of certain previously granted and still outstanding vested and unvested stock option awards held by eligible employees, executive officers, and non-employee directors. As a result, the exercise price for these awards was lowered to $2.97 per share effective September 14, 2025, which was the closing price of the Company’s common stock as reported on the Nasdaq Global Stock Market on March 14, 2024, so long as the holder remained employed by the Company or continued to serve as a member of the board of directors through September 14, 2025, absent earlier trigger events defined in the option repricing plan. No other terms of the stock options were modified, and the stock options continue to vest according to their original vesting schedules and retain their original expiration dates. As a result of the repricing, 1,557,301 vested and unvested stock options outstanding as of September 14, 2025, with original exercise prices ranging from $3.02 to $27.49, were repriced.

The repricing on March 14, 2024, resulted in incremental stock-based compensation expense of $0.9 million, of which $0.5 million related to vested stock option awards and was expensed on the repricing date. The remaining $0.4 million related to unvested stock option awards and is being amortized on a straight-line basis over the weighted-average vesting period of those awards of approximately 2.38 years as of March 14, 2024.

Stock-based compensation expense included in the accompanying condensed financial statements was as follows (in thousands):


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2025		2024		2025		2024
Cost of sales	$	29	$	10	$	85	$	89
Research and development		14		18		13		65
Sales and marketing		61		33		166		162
General and administrative		746		699		2,388		2,584
Total stock-based compensation expense	$	850	$	760	$	2,652	$	2,900

Stock-based compensation expense related to stock options was $0.8 million and $2.5 million for the three and nine months ended September 30, 2025, respectively, and $0.7 million and $2.7 million for the three and nine months ended September 30, 2024, respectively. Unrecognized compensation expense related to stock options was $5.4 million at September 30, 2025, which is expected to be recognized as expense over the weighted-average period of 2.71 years.

Stock-based compensation expense related to restricted stock units was not significant and $0.1 million for the three and nine months ended September 30, 2025, and $0.1 million and $0.2 million for each of the three and nine months ended September 30, 2024. Unrecognized compensation expense related to restricted stock units was $0.2 million at September 30, 2025, which is expected to be recognized as expense over the weighted-average period of 1.41 years.

Stock-based compensation expense related to the ESPP was not significant for either the three and nine months ended September 30, 2025 and 2024. Total compensation cost related to the ESPP not yet recognized was not significant at September 30, 2025. As of September 30, 2025, an insignificant amount has been withheld on behalf of employees for future purchases under the ESPP.