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Note 15 - Stock-based Compensation | 3 Months Ended
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Feb. 28, 2023
Notes to Financial Statements |
Share-Based Payment Arrangement [Text Block] |
15. | STOCK-BASED COMPENSATION
2020 Plan On October 23, 2020, the Board approved and on November 19, 2020 the stockholders approved the Byrna Technologies Inc. 2020 Equity Incentive Plan (the “2020 Plan”). The aggregate number of shares of common stock available for issuance in connection with options and other awards granted under the 2020 Plan was 2,500,000. On April 26, 2022, the Company’s Board of Directors approved and on June 17, 2022 the Company's stockholders approved the increase of the number of shares of common stock available for issuance under the 2020 Plan by 1,300,000 shares to a total of 3,800,000 shares. The 2020 Plan is administered by the Compensation Committee of the Board. The Compensation Committee determines the persons to whom options to purchase shares of common stock, stock appreciation rights (“SARs”), restricted stock units (“RSUs”), and restricted or unrestricted shares of common stock may be granted. Persons eligible to receive awards under the 2020 Plan are employees, officers, directors, consultants, advisors and other individual service providers of the Company. Awards are at the discretion of the Compensation Committee. Stock-Based Compensation Expense Stock-based compensation costs are recognized as expense over the employee's requisite service period, on a straight-line basis. Total stock-based compensation expense was $1.5 million and $0.8 million for the three months ended February 28, 2023 and 2022, respectively. Total stock-based compensation expense was recorded in Operating expenses in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Loss. Restricted Stock Units During the three months ended February 28, 2023 and 2022, the Company did not grant any RSUs. Stock-based compensation expense for the RSUs for the three months ended February 28, 2023 and 2022, was $1.0 million and $0.7 million, respectively. During the three months ended February 28, 2023, the Company settled 13,636 RSUs by issuing 13,636 shares of common stock to current board members for 2022 services. During the three months ended February 28, 2023, 37,708 RSUs were forfeited due to terminated employees. These RSU's did not vest. As a result, the expenses of $0.01 million were reversed, and going forward no expenses will be recognized. The forfeited RSUs were returned to the pool of shares available for issuance under the 2020 Plan. As of February 28, 2023, there was $3.2 million of unrecognized stock-based compensation cost related to unvested RSUs which is expected to be recognized over a weighted average of 1.6 years. The following table summarizes the RSU activity during the three months ended February 28, 2023:
|  | RSUs |
Unvested and outstanding as of November 30, 2022 |  |  | 1,314,909 |
Issued |  |  | (13,636 | )
Forfeited |  |  | (37,708 | )
Unvested and outstanding at February 28, 2023 |  |  | 1,263,565 |
Stock Options During the three months ended February 28, 2023 and 2022, the Company granted options to employees and directors to purchase 249,999 and 0 shares of common stock, respectively. The Company recorded stock-based compensation expense for options granted to its employees and directors of $0.5 million and $0.1 million during the three months ended February 28, 2023 and 2022, respectively. As of February 28, 2023, there was $4.4 million of unrecognized stock-based compensation cost related to unvested stock options which is expected to be recognized over a weighted average period of 2.3 years. Stock Option Valuation The fair value of stock options at the date of grant was estimated using the Black Scholes option pricing model. The expected volatility is based upon historical volatility of the Company's stock. The expected term for the options is based upon observation of actual time elapsed between employees. The assumption that the Company used to determine the grant-date fair value of stock options granted for the three months ended February 28, 2023 were as follows:
Risk free rate |  | 3.63% - 3.79%
Expected dividends | $ | 0.0
Expected volatility |  | 76.1% - 77.0%
Expected life (in years) |  | 6.5
Market price of the Company’s common stock on date of grant | $ | 6.35 - 6.37
The following table summarizes option activity under the 2020 Plan during the three months ended February 28, 2023:
|  |  |  |  |  | Weighted-Average |
|  | Stock |  |  | Exercise Price Per Stock |
|  | Options |  |  | Option |
Outstanding, November 30, 2022 |  |  | 1,297,750 |  |  | $ | 6.75 |
Granted |  |  | 249,999 |  |  |  | 8.96 |
Exercised |  |  | — |  |  |  | — |
Forfeited |  |  | (33,333 | ) |  |  | 8.96 |
Outstanding, February 28, 2023 |  |  | 1,514,416 |  |  | $ | 7.06 |
Exercisable, February 28, 2023 |  |  | 267,001 |  |  | $ | 1.63 |

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