SHARE-BASED COMPENSATION

9 Months Ended

Sep. 30, 2024

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

NOTE 10 – SHARE-BASED COMPENSATION

For share-based awards granted, we have recognized compensation expense based on the estimated grant date fair value method. For these awards we have recognized compensation expense using a straight-line amortization method and reduced for estimated forfeitures.

The impact on our results of operations of recording share-based compensation, net of forfeitures, for the three and nine months ended September 30, 2024 and 2023, respectively, were as follows:

	Three Months Ended				Nine Months Ended
	September 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
(in thousands)
Cost of goods sold	$	26	$	24	$	86	$	72
Research and development		69		64		215		193
Selling, general & administrative		209		212		666		664
Total share-based compensation	$	304	$	300	$	967	$	929

Equity awards granted during the three and nine months ended September 30, 2024 and 2023 were as follows:

	Three Months Ended				Nine Months Ended
	September 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Restricted Stock Units		2,500		75,000		234,150		357,100
Performance Stock Units		-		5,000		119,000		30,000
Stock Option Units		200,000		-		200,000		-

Non-employee directors Restricted Stock Units (“RSUs”) typically vest over the earlier of one year or the next annual meeting of shareholders and Non-Qualified stock options vest over three years and have a six-year exercise period. Employee RSUs typically vest annually over three or four years and employee Non-Qualified stock options typically vest quarterly over four years and have a six-year exercise period.

Performance Stock Units (“PSUs”) granted in 2024, cliff vest at the end of the performance period based on performance metrics which includes cumulative revenue growth, EBITDA attainment and other project-based milestone targets over the three-year period ending December 31, 2026 with a performance threshold, target, and maximum.

Stock option inducement grant of 200,000 shares was awarded to William Wentworth, new President and CEO, effective on the first day of employment. These options have a four-year quarterly vesting period and a six-year term and will be paid at the Fair Market Value (average of the high and low for the day) on the date of the grant. All other terms of the equity award are stated in the applicable award agreement.

The remaining unamortized expected future equity compensation expense and remaining amortization period associated with award grants of unvested options, PSUs and RSUs at September 30, 2024 and 2023 are:

	September 30, 2024		September 30, 2023
Unamortized future equity compensation expense (in thousands)	$	2,401	$	2,731
Remaining weighted average amortization period (in years)		2.24		2.60