XML 34 R19.htm IDEA: XBRL DOCUMENT
v3.24.2.u1

STOCK BASED COMPENSATION | 6 Months Ended
--- | ---
Jun. 30, 2024
Share-Based Payment Arrangement [Abstract] |
STOCK BASED COMPENSATION | NOTE 11 – STOCK BASED COMPENSATION During 2007, the Board of Directors of the Company adopted the 2007 Employee Stock Plan (“2007 Plan”) that was approved by the shareholders. Under the 2007 Plan, the Company is authorized to grant options to purchase up to 10,000,000 shares of common stock to directors, officers, employees and consultants who provide services to the Company. The 2007 Plan is intended to permit stock options granted to employees under the 2007 Plan to qualify as incentive stock options under Section 422 of the Internal Revenue Code of 1986, as amended (“Incentive Stock Options”). All options granted under the 2007 Plan, which are not intended to qualify as Incentive Stock Options are deemed to be non-qualified options (“Non-Statutory Stock Options”). Effective June 24, 2016, the 2007 Plan was terminated. As of June 30, 2024, options to purchase 2,063,000 shares of common stock have been issued and are outstanding. During 2016, the Board of Directors of the Company adopted the 2016 Plan that was approved by the shareholders at the 2016 annual meeting of shareholders on May 20, 2016. Under the 2016 Plan, the Company is authorized to grant awards of incentive and non-qualified stock options and restricted stock to purchase up to 3,000,000 shares of common stock to employees, directors and consultants. Effective May 16, 2019, the number of shares of the Company’s common stock available for issuance under the 2016 Plan was increased from 3,000,000 to 8,000,000 shares. Effective May 25, 2023, the number of shares of the Company’s common stock available for issuance under the 2016 Plan was increased from 8,000,000 to 13,000,000 shares and awards of restricted stock units are authorized for issuance. As of June 30, 2024, options to purchase 6,905,057 shares of common stock have been issued and are outstanding and 221,649 restricted shares of common stock are issued. As of June 30, 2024, 4,167,059 shares of common stock remain available for grants under the 2016 Plan. Both plans are administered by the Company’s Board of Directors or its compensation committee which determines the persons to whom awards will be granted, the number of awards to be granted, and the specific terms of each grant. Subject to the provisions regarding Ten Percent Shareholders, (as defined in the 2016 Plan), the exercise price per share of each option cannot be less than 100% of the fair market value of a share of common stock on the date of grant. Options granted under the 2016 Plan are generally exercisable for a period of 10 years from the date of grant and may vest on the grant date, another specified date or over a period of time. The Company uses the Black-Scholes option pricing model to calculate the grant-date fair value of an award, with the following assumptions for 2024: no dividend yield in all years, expected volatility, based on the Company’s historical volatility, 76.3% to 77.1%, risk-free interest rate between 3.91% to 4.28% and expected option life of 10 years. Prior to May 2018, the expected life is based on the estimated average of the life of options using the “simplified” method, as prescribed in FASB ASC 718, due to insufficient historical exercise activity during recent years. Starting in May 2018, the expected life is based on the legal contractual life of options. As of June 30, 2024, there was $3,777,227 of unrecognized compensation expense related to non-vested market-based share awards that is expected to be recognized through June 2027. Share-based compensation was recognized as follows:
Schedule of share-based compensation |  |  |  |  |  |
|  | For the Six |  |  | For the Six |
|  | Months Ending |  |  | Months Ending |
|  | June 30, 2024 |  |  | June 30, 2023 |
2007 Employee Stock Option Plan |  | $ | — |  |  | $ | — |
2016 Equity Incentive Plan |  |  | 2,337,460 |  |  |  | 3,389,804 |
2016 Equity Incentive Plan restricted stock awards |  |  | 203,521 |  |  |  | 133,854 |
Warrants |  |  | — |  |  |  | — |
Total share-based compensation |  | $ | 2,540,981 |  |  | $ | 3,523,658 |
The following tables summarize all stock option and warrant activity of the Company during the six months ended June 30, 2024:
Schedule of stock option and warrant activity |  |  |  |  |  |  |  |  |  |
|  |  |  | Non-Qualified Stock Options and Warrants Outstanding and Exercisable |
|  |  |  | Number of |  |  |  | Exercise |  |  |  | Weighted Average |
|  |  |  | Shares |  |  |  | Price |  |  |  | Exercise Price |
Outstanding, December 31, 2023 |  |  |  | 8,809,807 |  |  |  | $0.51 - $16.81 |  |  | $ | 2.76 |
Granted |  |  |  | 1,041,000 |  |  |  | $3.46 - $5.00 |  |  | $ | 4.75 |
Forfeited |  |  |  | (8,750 | ) |  |  | $7.12 - $7.25 |  |  | $ | 7.23 |
Exercised |  |  |  | (374,000 | ) |  |  | $0.57 - $1.15 |  |  | $ | 0.66 |
Outstanding, June 30, 2024 |  |  |  | 9,468,057 |  |  |  | $0.51 - $16.81 |  |  | $ | 3.06 |
Exercisable, June 30, 2024 |  |  |  | 8,255,683 |  |  |  | $0.51 - $16.81 |  |  | $ | 2.80 |
The aggregate intrinsic value of options and warrants outstanding and exercisable as of June 30, 2024 was $11,508,333. The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying options and warrants and the closing stock price of $2.99 for the Company’s common stock on June 30, 2024. During the six-month period ending June 30, 2024, 355,000 options were exercised for proceeds of $231,000 and 19,000 warrants were exercised for proceeds of $14,250.
Schedule of non-qualified stock options and warrants outstanding |  |  |  |  |  |
Non-Qualified Stock Options and Warrants Outstanding
Range of Exercise Prices |  | Number Outstanding Currently Exercisable at June 30, 2024 |  | Weighted Average Remaining Contractual Life |  |  | Weighted Average Exercise Price of Options and Warrants Currently Exercisable
$0.51 - $16.81 |  | 8,255,683 |  | 5.5 Years |  |  | $2.80
Restricted Stock Awards On March 16, 2023, the Compensation Committee of the Board of Directors approved grants totaling 99,616 Restricted Stock Awards to the Company’s four outside directors. Each RSA had a grant date fair value of $5.22 which shall be amortized on a straight-line basis over the vesting period into director’s compensation expenses within the Consolidated Statement of Comprehensive Loss. Such RSAs were granted under the 2016 Equity Incentive Plan (“2016 Plan”) and vest in total 8,338 shares on March 16, 2023, with the remaining vesting in 33 equal monthly installments in total of 2,766 shares beginning April 1, 2023. On August 1, 2023, the Compensation Committee of the Board of Directors approved a grant totaling 6,238 Restricted Stock Awards to the Company’s outside director. The new RSA had a grant date fair value of $6.68 which shall be amortized on a straight-line basis over the vesting period into director’s compensation expenses within the Consolidated Statement of Comprehensive Loss. Such RSA was granted under the 2016 Plan. 218 shares from this grant vested on August 1, with the remaining vesting in 28 equal monthly installments in total of 215 shares beginning September 1, 2023. On June 18, 2024, the Compensation Committee of the Board of Directors approved grants totaling 92,475 Restricted Stock Awards to the Company’s five outside directors. Each RSA had a grant date fair value of $3.33 which shall be amortized on a straight-line basis over the vesting period into director’s compensation expenses within the Consolidated Statement of Comprehensive Loss. Such RSAs were granted under the 2016 Equity Incentive Plan (“2016 Plan”) and vest in total 15,455 shares on June 18, 2024, with the remaining vesting in 10 equal quarterly installments in total of 7,702 shares beginning July 1, 2024. Upon the occurrence of a Change in Control, 100% of the unvested Restricted Stock shall vest as of the date of the Change in Control. Upon vesting, the restrictions on the shares lapse. The fair value of restricted stock awards is estimated by the market price of the Company’s common stock at the date of grant. Restricted stock activity during the six-month period ending June 30, 2024 is as follows:
Schedule of fair value of restricted stock awards |  |  |  |  |  |
|  |  |  |  | Weighted Average |
|  | Number of |  |  | Grant Date Fair |
|  | Shares |  |  | Value per Share |
Non-vested, beginning of period |  |  | 78,452 |  |  | $ | 5.71 |
Granted |  |  | 92,475 |  |  |  | 3.33 |
Vested |  |  | (33,341 | ) |  |  | 4.40 |
Cancelled and forfeited |  |  | — |  |  |  | — |
Non-vested, end of period |  |  | 137,586 |  |  | $ | 4.43 |
Restricted stock awards are being amortized to expense over the vesting period. As of June 30, 2024 and 2023, the unamortized value of the RSAs was $536,714 and $231,803, respectively.

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/exampleRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 718 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (l) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480429/718-10-50-2 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration