Total share-based expense related to stock options, RSUs and common stock awards was approximately $0.1 million and $0.2 million for the years ended December 31, 2025 and 2024, respectively. Share-based expense is classified in the consolidated statements of operations as follows:

Stock Options

The Company grants stock option awards and RSUs to employees and non-employees with varying vesting terms under the Xenetic Biosciences, Inc. Amended and Restated Equity Incentive Plan. The Company measures the fair value of stock option awards using the Black-Scholes option pricing model, which uses the assumptions noted in the tables below, including the risk-free interest rate, expected term, share price volatility, dividend yield and forfeiture rate. The risk-free interest rate is based upon the U.S. Treasury yield curve in effect at the time of grant, with a term that approximates the expected life of the option. For stock options issued in 2025 and 2024 that qualify as “plain vanilla” stock options, the expected term is based on the simplified method. The Company has a limited history of stock option exercises, which does not provide a reasonable basis for the Company to estimate the expected term of employee and non-employee stock options. For all other stock options, the Company estimates the expected life using judgment based on the anticipated research and development milestones of the Company’s clinical projects and behavior of the Company’s employees and non-employees. The expected life of non-employee options is the contractual life of the option.

Employee Stock Options

During the years ended December 31, 2025 and 2024, 10,000 and 30,000 total stock options to purchase shares of common stock were granted by the Company, respectively. The weighted average grant date fair value per option was $1.78 and $3.41, respectively. No employee stock options were exercised during the years ended December 31, 2025 and 2024. During the years ended December 31, 2025 and 2024, 93,231 and 32,535 shares having a weighted average grant date fair value of $57.11 and $40.07 per option, respectively, were forfeited.

During the years ended December 31, 2025 and 2024, 18,749 and 53,750 total stock options vested, respectively, with total fair values of approximately $0.1 million and $0.3 million in December 31, 2025 and 2024, respectively. As of December 31, 2025, there was approximately $0.1 million of unrecognized share-based payments related to employee stock options that are expected to vest. The Company expects to recognize this expense over a weighted-average period of approximately 1.2 years.

Key assumptions used in the Black-Scholes option pricing model for options granted to employees during the years ending December 31, 2025 and 2024 are as follows:

The following is a summary of employee stock option activity for the years ended December 31, 2025 and 2024:

A summary of the status of the Company’s non-vested employee stock option shares as of December 31, 2025, and the changes during the year ended December 31, 2025, is as follows: 

Restricted Stock Units

There were 417 fully vested RSUs with a grant date fair value of $253.70 per share outstanding as of December 31, 2023. No RSUs were granted or expired during the years ended December 31, 2025 and 2024. During the year ended December 31, 2024, the Company issued 417 shares of common stock representing the exercise of all outstanding RSUs. As a result, no RSUs were outstanding at both December 31, 2025 and 2024.

Non-Employee Stock Options

Share-based expense related to stock options granted to non-employees is recognized as the services are rendered on a straight-line basis. The Company determined that the fair value of the stock options is more reliably measurable than the fair value of the services received. No non-employee stock options to purchase shares of common stock were granted or exercised during the years ended December 31, 2025 and 2024. Non-employee stock option grants to purchase 253 shares of common stock expired during the year ended December 31, 2025, representing all remaining outstanding option grants. As a result, no non-employee stock option grants were outstanding as of December 31, 2025. There was no compensation expense related to non-employee options during the years ended December 31, 2025 and December 31, 2024 as all non-employee stock options became were fully vested.

The following is a summary of non-employee stock option activity for the years ended December 31, 2025 and 2024:

Joint Share Ownership Plan

As of December 31, 2025 and 2024, there were approximately 2,701 JSOP awards issued and outstanding to two former senior executives. Under the JSOP, shares in the Company are jointly purchased at fair market value by the participating executives and the trustees of the JSOP trust, with such shares held in the JSOP trust. For U.S. GAAP purposes the awards were valued as employee options and recorded as a reduction in equity as treasury shares until they are exercised by the employee. The JSOP awards are fully vested and have no expiration date. There were no compensation charges during the years ended December 31, 2025 and 2024.