Company: ECIA
Filing Date: 2025-08-15
Form Type: 10-Q
Source: 0001079973-25-001326
Chunk: 11

Company: ENCISION INC
Filing Date: 2025-08-15
Form: 10-Q
Item: Item 8
Chunk 11
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2027

    23,794

    2028

    7,931

    Total

    $
    49,571

Aside from the line of credit, operating lease, EIDL
loan, and U.S. Bank loans, the Company does not have any material contractual commitments requiring settlement in the future.

The Company is subject to regulation by the United
States Food and Drug Administration ("FDA"). The FDA provides regulations governing the manufacture and sale of our products
and regularly inspects the Company and other manufacturers to determine compliance with these regulations. The Company believes that it
was in substantial compliance with all known regulations at June 30, 2025. FDA inspections are conducted periodically at the discretion
of the FDA. The latest inspection by the FDA occurred in October 2019.

Note 5.	SHARE-BASED COMPENSATION

The provisions of ASC 718-10-55 requires the measurement
and recognition of compensation expense for all share-based payment awards made to our employees and directors, including employee stock
options and RSUs, based on estimated fair values. The following table summarizes stock-based compensation expenses related to employee
stock options for the three months ended June 30, 2025, and 2024, which were allocated as follows:

    Schedule of stock-based compensation expense 

    Three Months Ended 

    June 30, 2025  
    June 30, 2024 
  
    Cost of sales 
    $142  
    $201 
  
    Sales and marketing 
     1,361  
     1,619 
  
    General and administrative 
     10,327  
     10,474 
  
    Research and development 
     289  
     80 
  
    Stock-based compensation expense 
    $12,119  
    $12,374 

Share-based compensation cost for stock options is
measured at the grant date, based on the fair value as calculated by the Black-Scholes-Merton ("BSM") option-pricing model.
The BSM option-pricing model requires the use of actual employee exercise behavior data and the application of a number of assumptions,
including expected volatility, risk-free interest rate, and expected dividends. There were 90,000 stock options granted 99,332 stock options
forfeited and no stock options exercised during the three months ending June 30, 2025. As of June 30, 2025, approximately