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Capital Stock, Stock Plans and Stock Based Compensation | 6 Months Ended
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Jun. 30, 2021
Share-based Payment Arrangement [Abstract] |
Capital Stock, Stock Plans and Stock Based Compensation | 6. Capital Stock, Stock Plans and Stock Based Compensation The Company has certain stock option plans under which it may award incentive stock options (“ISOs”) and/or non-qualified stock options (“NQSOs”) to employees, officers, outside directors, and outside consultants. On May 4, 2021, the Company granted 6,000 NQSOs from the Company’s 2003 Outside Directors Stock Plan (“2003 Plan”) to a new director elected by the Company’s Board of Directors (“Board”) to fill a vacancy on the Board. The options granted were for a contractual term of ten years with a vesting period of six months. The exercise price of the options was $7.50 per share, which was equal to the Company’s closing stock price per share the day preceding the grant date, pursuant to the 2003 Plan. The Company granted a NQSO to Robert Ferguson on July 27, 2017 from the Company’s 2017 Stock Option Plan (“2017 Plan”) for the purchase of up to 100,000 shares of the Company’s Common Stock (“Ferguson Stock Option”) in connection with his work as a consultant to the Company’s Test Bed Initiative (“TBI”) at our Perma-Fix Northwest Richland, Inc. (“PFNWR”) facility at an exercise price of $3.65 per share, which was the fair market value of the Company’s Common Stock on the date of grant. The term of the Ferguson Stock Option is seven years from the grant date. The vesting of the Ferguson Stock Option is subject to the achievement of three separate milestones by certain dates. The 10,000 options under the first milestone were exercised by Robert Ferguson in 2018. The vesting date for the second and third milestones for the purchase of up to 30,000 and 60,000 shares of the Company’s Common Stock was previously extended to December 31, 2021 and December 31, 2022, respectively. The Company has not recognized compensation costs (fair value of approximately $262,000 at June 30, 2021) for the remaining 90,000 Ferguson Stock Option under the remaining two milestones since achievement of the performance obligation under each of the two remaining milestones is uncertain at June 30, 2021. All other terms of the Ferguson Stock Option remain unchanged. The Company estimates fair value of stock options using the Black-Scholes valuation model. Assumptions used to estimate the fair value of stock options granted include the exercise price of the award, the expected term, the expected volatility of the Company’s stock over the option’s expected term, the risk-free interest rate over the option’s expected term, and the expected annual dividend yield. The fair value of the options granted on May 4, 2021 as discussed above and the related assumptions used in the Black-Scholes option model used to value the options granted were as follows: Schedule of Stock Options Valuation Assumptions
|  |  | Outside Director Stock Options Granted |
|  |  | May 4, 2021 |
Weighted-average fair value per option |  | $ | 4.97 |
Risk -free interest rate (1) |  |  | 1.61 | %
Expected volatility of stock (2) |  |  | 55.91 | %
Dividend yield |  |  | None |
Expected option life (3) |  |  | 10.0 years |
(1) | The risk-free interest rate is based on the U.S. Treasury yield in effect at the grant date over the expected term of the option.
(2) | The expected volatility is based on historical volatility from our traded Common Stock over the expected term of the option.
(3) | The expected option life is based on historical exercises and post-vesting data.
The following table summarizes stock-based compensation recognized for the three and six months ended June 30, 2021 and 2020 for our employee and director stock options. Schedule of Share-based Compensation, Allocation of Recognized Period Costs
|  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
|  | Three Months Ended |  |  | Six Months Ended |
Stock Options |  | June 30, |  |  | June 30, |
|  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Employee Stock Options |  | $ | 33,000 |  |  | $ | 33,000 |  |  | $ | 66,000 |  |  | $ | 65,000 |
Director Stock Options |  |  | 9,000 |  |  |  | 15,000 |  |  |  | 21,000 |  |  |  | 27,000 |
Total |  | $ | 42,000 |  |  | $ | 48,000 |  |  | $ | 87,000 |  |  | $ | 92,000 |
Stock-based compensation |  | $ | 42,000 |  |  | $ | 48,000 |  |  | $ | 87,000 |  |  | $ | 92,000 |
At June 30, 2021, the Company has approximately $215,000 of total unrecognized compensation costs related to unvested options for employee and directors. The weighted average period over which the unrecognized compensation costs are expected to be recognized is approximately 1.6 years. The summary of the Company’s total Stock Option Plans as of June 30, 2021 and June 30, 2020, and changes during the periods then ended, are presented below. The Company’s Plans consist of the 2010 Stock Option Plan, the 2017 Plans and the 2003 Plan: Schedule of Stock Options Roll Forward
|  | Shares |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value (4) |
Options outstanding January 1, 2021 |  |  | 658,400 |  |  | $ | 3.87 |  |  |  |  |  |  |  |  |
Granted |  |  | 6,000 |  |  | $ | 7.50 |  |  |  |  |  |  |  |  |
Exercised |  |  | (500 | ) |  | $ | 3.15 |  |  |  |  |  |  | $ | 2,175 |
Forfeited/expired |  |  | (1,500 | ) |  | $ | 3.15 |  |  |  |  |  |  |  |  |
Options outstanding end of period (1) |  |  | 662,400 |  |  | $ | 3.90 |  |  |  | 3.1 |  |  | $ | 2,153,595 |
Options exercisable at June 30, 2021(2) |  |  | 391,900 |  |  | $ | 4.08 |  |  |  | 3.1 |  |  | $ | 1,202,495 |
|  | Shares |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value (4) |
Options outstanding January 1, 2020 |  |  | 681,300 |  |  | $ | 3.84 |  |  |  |  |  |  |  |  |
Granted |  |  | 6,000 |  |  | $ | 7.00 |  |  |  |  |  |  |  | 16,060 |
Exercised |  |  | (12,500 | ) |  | $ | 3.47 |  |  |  |  |  |  |  |  |
Forfeited/expired |  |  | (20,000 | ) |  | $ | 3.45 |  |  |  |  |  |  |  |  |
Options outstanding end of period (3) |  |  | 654,800 |  |  | $ | 3.88 |  |  |  | 3.7 |  |  | $ | 1,685,031 |
Options exercisable as of June 30, 2020(3) |  |  | 306,800 |  |  | $ | 4.20 |  |  |  | 3.6 |  |  | $ | 711,306 |
(1) | Options with exercise prices ranging from $2.79 to $7.50
(2) | Options with exercise prices ranging from $2.79 to $7.29
(3) | Options with exercise prices ranging from $2.79 to $8.40
(4) | The intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price.
During the six months ended June 30, 2021, the Company issued a total of 26,427 shares of its Common Stock under the 2003 Plan to its outside directors as compensation for serving on our Board. The Company has recorded approximately $221,000 in compensation expenses (included in selling, general and administration (“SG&A”) expenses) in connection with the issuance of shares of its Common Stock to outside directors. See “Note 15 – Subsequent Events - 2003 Plan” for a discussion of an amendment to the 2003 Plan as approved by the Company’s Stockholder at the Company’s 2021 Annual Meeting of Stockholders held on July 20, 2021. During the six months ended June 30, 2021, the Company issued 290 shares of its Common Stock from a cashless exercise of an option for the purchase of 500 shares of the Company’s Common Stock at $3.15 per share.

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