Company: OPGN
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001829126-25-008771
Chunk: 56

Company: OPGEN INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 8
Chunk 56
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 to the customer. The Company had no material incremental costs to obtain customer contracts in any period presented.

Deferred revenue results from amounts billed in advance to customers or cash received from customers in advance of services being provided.

Research and development costs, net

Research and development costs are expensed as incurred. Research and development costs primarily consist of fees to expand and innovate CapForce’s digital investment banking platform, salaries and related expenses for personnel, and fees paid to consultants and outside service providers. Prior to the Company’s repositioning, research and development costs also included laboratory supplies and development materials.

    11

Stock-based compensation

Stock-based compensation expense is recognized
at fair value. The fair value of stock-based compensation to employees and directors is estimated on the date of grant including using
the Black-Scholes model for stock options. The resulting fair value is recognized ratably over the requisite service period, which is
generally the vesting period of the award. For all time-vesting awards granted, expense is amortized using the straight-line attribution
method. The Company accounts for forfeitures as they occur.

Option valuation models, including the Black-Scholes model, require the input of highly subjective assumptions, and changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility and the expected life of the award.

Income taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is established when necessary to reduce deferred income tax assets to the amount expected to be realized.

Tax benefits are initially recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions are initially, and subsequently, measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon ultimate settlement with the tax authority, assuming full knowledge of the position and all relevant facts.

The Company had federal net operating loss (“NOL”) carryforwards of approximately $227.1