Company: ECIA
Filing Date: 2025-07-10
Form Type: 10-K
Source: 0001079973-25-001132
Chunk: 52

Company: ENCISION INC
Filing Date: 2025-07-10
Form: 10-K
Item: Item 1
Chunk 52
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 about the types of costs and expenses included in certain expense captions presented on the income
statement. The new disclosure requirements are effective for the Company's annual periods for fiscal years beginning after December 15,
2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted, and may be applied either
prospectively or retrospectively. We are currently evaluating the ASU to determine its impact on our consolidated financial statements
and disclosures.

The Company does not believe that issued, but
not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statements.

3. Shareholders’ Equity

Stock Option Plans. We adopted our 2014
Equity Incentive Plan (the “Plan,” as summarized below) to promote our and our shareholders’ interests by helping us
to attract, retain and motivate our key employees and associates. Under the terms of the Plan, the Board of Directors may grant incentive
and non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, and other stock-based
awards. The purchase price of the shares subject to a stock option will be the fair market value of our common stock on the date the stock
option is granted. Generally, vesting of stock options occurs such that 20% becomes exercisable on each anniversary of the date of grant
for each of the five years following the grant date of such option. Generally, all stock options must be exercised within five years from
the date granted. The number of common shares reserved for issuance under the Plan is 1,100,000 shares of common stock, subject to adjustment
for dividend, stock split or other relevant changes in our capitalization.

Under ASC 718, the value of each employee stock
option was estimated on the date of grant using the Black-Scholes model for the purpose of financial information in accordance with ASC
718. The use of a Black-Scholes model requires the use of actual employee exercise behavior data and the use of a number of assumptions
including expected volatility, risk-free interest rate and expected dividends. Employee stock options for 450,000 and 120,000 shares of
stock were granted during fiscal years 2025 and 2024, respectively.

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As of March 31, 2025, $172,841 of total unrecognized
compensation costs related to nonvested stock is expected to be recognized over a period of