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Capital Stock, Stock Plans, Warrants and Stock Based Compensation | 3 Months Ended
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Mar. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Capital Stock, Stock Plans, Warrants and Stock Based Compensation | 6. Capital Stock, Stock Plans, Warrants 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 January 18, 2024, the Company granted ISOs to certain employees under the 2017 Stock Option Plan (“2017 Plan”), for the purchase of up to an aggregate of 45,000 shares of the Company’s common stock, par value $.001 (the “Common Stock”). Each ISO granted is for a contractual term of six years with one-fifth vesting annually over a five-year period. The exercise price of the ISO is $7.75 per share, which was equal to the fair market value of the Company’s Common Stock on the date of grant. The following table summarizes stock-based compensation recognized for the three months ended March 31, 2024, and 2023 for our employee and director stock options. Schedule of Share-based Compensation, Allocation of Recognized Period Costs
|  | 2024 |  |  | 2023 |
|  | Three Months Ended |
Stock Options |  | March 31, |
|  | 2024 |  |  | 2023 |
Employee Stock Options |  | $ | 91,000 |  |  | $ | 86,000 |
Director Stock Options |  |  | 61,000 |  |  |  | 32,000 |
Total |  | $ | 152,000 |  |  | $ | 118,000 |
At March 31, 2024, the Company had approximately $1,823,000 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 3.2 years. The summary of the Company’s total Stock Option Plans as of March 31, 2024 and March 31, 2023, and changes during the periods then ended, are presented below. The Company’s Plans consist of the 2017 Plan and the 2003 Outside Directors Stock Plan (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, 2024 |  |  | 994,500 |  |  | $ | 5.57 |  |  |  |  |  |  |  | - |
Granted |  |  | 45,000 |  |  | $ | 7.75 |  |  |  |  |  |  |  |  |
Exercised |  |  | (43,500 | ) |  | $ | 5.61 |  |  |  |  |  |  | $ | 212,410 |
Forfeited |  |  | (11,000 | ) |  | $ | 7.01 |  |  |  |  |  |  |  |  |
Options outstanding end of period (1) |  |  | 985,000 |  |  | $ | 5.66 |  |  |  | 4.8 |  |  | $ | 6,139,346 |
Options exercisable at March 31, 2024(2) |  |  | 350,300 |  |  | $ | 5.06 |  |  |  | 3.8 |  |  | $ | 2,391,576 |
|  | Shares |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value (4) |
Options outstanding January 1, 2023 |  |  | 1,018,400 |  |  | $ | 5.02 |  |  |  |  |  |  |  | - |
Granted |  |  | 295,000 |  |  | $ | 3.95 |  |  |  |  |  |  |  |  |
Exercised |  |  | (44,400 | ) |  | $ | 3.56 |  |  |  |  |  |  | $ | 370,196 |
Forfeited/expired |  |  | (4,500 | ) |  | $ | 3.90 |  |  |  |  |  |  |  |  |
Options outstanding end of period (3) |  |  | 1,264,500 |  |  | $ | 4.83 |  |  |  | 4.2 |  |  | $ | 8,791,279 |
Options exercisable at March 31, 2023(3) |  |  | 499,500 |  |  | $ | 4.30 |  |  |  | 2.3 |  |  | $ | 6,047,029 |
(1) | Options with exercise prices ranging from $3.15 to $9.81
(2) | Options with exercise prices ranging from $3.15 to $7.50
(3) | Options with exercise prices ranging from $2.79 to $7.50
(4) | The intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option.
During the three months ended March 31, 2024, the Company issued a total of 14,963 shares of its Common Stock under the 2003 Plan to its outside directors as compensation for serving on our Board of Directors (the “Board”). The Company recorded approximately $118,000 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. During the three months ended March 31, 2024, the Company issued an aggregate 12,916 shares of its Common Stock from cashless exercises of options for the purchase of 25,000 shares of the Company’s Common Stock ranging from $3.15 per share to $7.005 per share. Additionally, the Company issued 18,500 shares of its Common Stock from the cash exercises of options for the purchase of 18,500 shares of the Company’s Common Stock, at exercise prices ranging from $3.95 per share to $7.005 per share, resulting in proceeds of approximately $104,000. In connection with a $2,500,000 loan that the Company received from Mr. Robert Ferguson (the “Ferguson Loan”) on April 1, 2019, the Company issued a warrant to Mr. Ferguson (the “Ferguson Warrant”) for the purchase of up to 60,000 shares of our Common Stock at an exercise price of $3.51 per share. The Ferguson Loan was paid in full in December 2020. Upon Mr. Ferguson’s death, the Ferguson Warrant was transferred equally to Mr. Ferguson’s two heirs with each holding a Warrant for the purchase of up to 30,000 shares of the Company’s Common Stock, as permitted under the Ferguson Warrant. One of the Warrants was exercised by Mr. Ferguson’s heir in 2023. On March, 22, 2024, the remaining Warrant was exercised by Mr. Ferguson’s heir for the purchase of 30,000 shares of the Company’s Common Stock, resulting in proceeds received by the Company of approximately $105,000.

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