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Stock Options

6 Months Ended

Jun. 30, 2022

14. Stock Options

In February 2021, the board granted 283,936 stock options to officers, board members, and employees. These options vested immediately and are exercisable at $5.60 for 3 years. Total stock-based compensation recognized on these options was $604,571. In March 2021, the Company granted 3,572 stock options to an individual for services rendered to the Company. These options vested immediately and are exercisable at $5.60 for 3 years. Total stock-based compensation recognized on these options was $9,860 during the six months ended June 30, 2021. No options were granted in the second quarter of 2021 or the first six months of 2022. The fair value of stock option awards granted, and the key assumptions used in the Black-Scholes valuation model to calculate the fair value of the options are as follows:

	February 11, 2021			March 15, 2021
Fair value	$	604,572		$	9,860
Options issued		283,936			3,572
Exercise price	$	5.60		$	5.60
Expected term (in years)		3.0			3.0
Risk-free rate		0.19	%		0.33	%
Volatility		97.9	%		99.3	%

In the first quarter of 2021, 44,643 options were exercised in exchange for 28,196 shares at $5.32 per share in a cashless warrant exercise. In the second quarter of 2021, 7,143 options were exercised in exchange for 3,571 shares at $3.92 per share in a cashless warrant exercise. In the first quarter of 2022, 51,789 options were exercised in exchange for 28,981 shares at an average price of $9.72 per share in a cashless warrant exercise. In the second quarter of 2022, 42,859 options were exercised in exchange for 26,584 shares at an average price of $9.44 per share in a cashless warrant exercise. No stock-based compensation was recognized during the six months ended June 30, 2022. Activity in the Company’s stock options is as follows:

	Number of Options			Weighted average exercise prices
Balance December 31, 2020		150,000		$	1.83
Granted		469,674		$	5.53
Exercised		(101,786	)	$	1.87
Forfeited		(10,713	)	$	5.60
Balance December 31, 2021		507,175		$	5.25
Exercised		(94,648	)	$	1.71
Forfeited		(7,143	)	$	1.96
Balance June 30, 2022		405,384		$	5.67
Outstanding and exercisable at June 30, 2022		405,384		$	5.67

At June 30, 2022, outstanding stock options have a weighted average remaining term of approximately 2.3 years and an intrinsic value of approximately $919,800. Intrinsic value of the options exercised for the six-month period ended June 30, 2022, was $255,993.