Note 8 - Stock Based Compensation

3 Months Ended

Jun. 30, 2026

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

NOTE 8 — STOCK BASED COMPENSATION

The Company maintains two stock based compensation plans: the Friedman Industries, Incorporated 2016 Restricted Stock Plan (the “2016 Plan”) and the Friedman Industries, Incorporated 2025 Long-Term Incentive Plan (the "2025 Plan"). The plans are administered by the Compensation Committee of the Board of Directors (the “Board”) and continue indefinitely until terminated by the Board or until all shares allowed by the plans have been awarded and earned. All shares authorized under the 2016 Plan have been awarded with some of those shares still under vesting restrictions at  June 30, 2026. Under the 2025 Plan, the Company may award stock-based compensation to employees, non-employee directors and third-party service providers. The 2025 Plan permits the award of stock options, restricted stock awards, restricted stock units, stock appreciation rights and other stock-based awards for up to 550,000 shares of the Company's common stock. As of  June 30, 2026, all stock based compensation issued under the 2025 plan was in the form of restricted stock awards and a total of 416,396 shares were still available to be issued under the plan. Restricted awards entitle recipients to vote and receive non-forfeitable dividends during the restriction period. Because dividends are non-forfeitable, they are reflected in retained earnings. Forfeitures are accounted for upon their occurrence. Because the Company accounts for forfeitures as they occur, the non-forfeitable dividends are reclassified from retained earnings to additional stock compensation for the actual forfeitures that occurred.

The following table summarizes the activity related to restricted stock awards for the three months ended June 30, 2026:

				Weighted Average
	Number of Shares			Grant Date Fair Value Per Share
Unvested at March 31, 2026		142,276		$	16.86
Granted		105,300			23.89
Vested		(17,740	)		14.39
Unvested at June 30, 2026		229,836		$	20.27

The Company measures compensation expense for restricted stock awards at the market price of the common stock as of the grant date. Compensation expense for awards with time based restrictions is recognized over the requisite service period applicable to each award. Compensation expense for awards with performance based restrictions is recognized once it is probable the performance conditions will be satisfied with a cumulative effect adjustment and the remaining expense recognized over the remaining service period. The stock awards granted during the three months ended June 30, 2026 consist of 71,550 time restricted shares with annual ratable vesting over a three year period and 33,750 performance restricted shares with vesting thresholds dependent on the percentage of average earnings before tax to average accounts receivable, inventory and net PP&E over a three year period. The Company recorded compensation expense of approximately $0.2 million and $0.1 million in the three months ended June 30, 2026 and 2025, respectively, relating to the restricted stock issued under the plans. As of June 30, 2026, unrecognized compensation expense related to unvested restricted stock was approximately $3.1 million which is expected to be recognized over a weighted average period of approximately 2.2 years.