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STOCK-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2021
Share-based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | NOTE 4 — STOCK-BASED COMPENSATION The Company has two equity incentive plans: the 2015 Stock Option Plan, as amended (the “2015 Plan”) and the 2021 Omnibus Equity Incentive Plan (the “2021 Plan”). As of December 31, 2021, there were options to purchase 3,672,500 shares of the Company’s common stock outstanding to certain executives, key employees and consultants under the 2015 Plan, of which 2,000,000 were issued during the twelve months ended December 31, 2021. Additional options may be issued under the 2015 Plan as outstanding options are forfeited, subject to a maximum 6,000,000 available for issuance under the 2015 Plan. The 2021 Plan provides for the grant of up to 1,000,000 incentive stock options, nonqualified stock options, stock awards, restricted stock awards, restricted stock units and/or stock appreciation rights to employees, consultants and directors. As of December 31, 2021, there had been issued 59,658 shares of common stock as directors fees under the 2021 Plan. Prior to January 1, 2021, each non-employee director of the Company was eligible to receive $50,000 annually (effective January 1, 2019), plus $10,000 for chairing a Board committee (effective February 20, 2019), all to be paid quarterly half in cash and half in common stock. The Chairman of the Board was eligible to receive an additional $50,000 annually (effective October 1, 2019), all to be paid in common stock. Effective January 1, 2021, each non-employee director of the Company (other than the Chairman of the Board) and Board advisor were eligible to receive of $75,000 annually, to be paid quarterly $12,500 in cash and $6,250 in common stock. The Chairman of the Board is eligible to receive $100,000 annually, to be paid quarterly $12,500 in cash and $12,500 in common stock. Effective May 18, 2021, each non-employee director of the Company (other than the Chairman of the Board) and Board advisor are eligible to receive of $110,000 annually, to be paid quarterly $12,500 in cash and $15,000 in common stock. The Chairman of the Board is eligible to receive $140,000 annually, to be paid quarterly $12,500 in cash and $22,500 in common stock. All payments were and are pro-rated for partial service. On May 20, 2020, the Company entered into a Settlement Agreement with EMED Technologies Corporation (“EMED”) to settle all claims in connection with all pending litigation matters between them. Pursuant to the Settlement Agreement, the Company issued to EMED (i) 95,238 restricted stock units, which vested on May 21, 2020, and 95,238 restricted stock units, which vested on January 1, 2021, and (ii) an option to purchase up to 400,000 shares of the Company’s common stock at an exercise price of $11.21 per share prior to February 1, 2021, which was not exercised. On April 12, 2021, pursuant to an employment agreement entered into on March 15, 2021, with Linda Tharby, the Company’s President and Chief Executive Officer, the Company issued three restricted stock awards for an aggregate 1,000,000 shares of common stock for an aggregate stock price of $3,310,000 and each vesting subject to employment on the respective vesting date. These awards were issued as an inducement employment. 2015 STOCK OPTION PLAN, as amended Time-Based Stock Options The per share weighted average fair value of stock options granted during the years ended December 31, 2021, and December 31, 2020 was $2.85 and $6.53, respectively. The fair value of each award is estimated on the grant date using the Black-Scholes option pricing model with the following weighted average assumptions used for grants in the years ended December 31, 2021, and December 31, 2020. Historical information was the primary basis for the selection of the expected volatility, expected dividend yield and the expected lives of the options. The risk-free interest rate was selected based upon yields of the U.S. Treasury issues with a term equal to the expected life of the option being valued. The following table summarizes the assumptions used in determining fair value. These assumptions are subjective and generally require significant analysis and judgment to develop. We have recognized tax benefits associated with stock-based compensation of $175,257 and $62,393 for the years ended December 31, 2021 and 2020, respectively. Schedule of fair value of the stock options granted Black-Scholes option valuation model
|  | December 31, 2021 |  | December 31, 2020 |
Dividend yield |  |  | 0.00% |  |  | 0.00% |
Expected volatility |  |  | 74.01 – 77.91% |  |  | 62.11 - 62.18% |
Weighted-average volatility |  |  | — |  |  | — |
Expected dividends |  |  | — |  |  | — |
Expected term (in years) |  |  | 10 Years |  |  | 10 Years |
Risk-free rate |  |  | 1.20-1.62% |  |  | 0.63 - 0.64% |
The following table summarizes the status of the Company’s stock option plan: Schedule of stock option plan
|  | December 31, 2021 |  | December 31, 2020 |
|  | Shares |  | Weighted Average Exercise Price |  | Shares |  | Weighted Average Exercise Price |
Outstanding at January 1 |  |  | 2,922,494 |  | $ | 2.46 |  |  | 3,647,000 |  | $ | 1.32 |
Granted |  |  | 2,000,000 |  | $ | 3.64 |  |  | 360,000 |  | $ | 9.54 |
Exercised |  |  | 1,062,500 |  | $ | 1.19 |  |  | 884,506 |  | $ | 0.71 |
Forfeited |  |  | 187,494 |  | $ | 3.36 |  |  | 200,000 |  | $ | 2.09 |
Outstanding at year end |  |  | 3,672,500 |  | $ | 3.42 |  |  | 2,922,494 |  | $ | 2.46 |
Options exercisable |  |  | 983,750 |  | $ | 2.73 |  |  | 906,244 |  | $ | 1.40 |
Weighted average fair value of options granted during the period |  |  | — |  | $ | 2.85 |  |  | — |  | $ | 6.53 |
Stock-based compensation expense |  |  | — |  | $ | 2,457,788 |  |  | — |  | $ | 874,869 |
Total stock-based compensation expense, net of forfeitures, for stock option awards totaled $2,457,788 and $874,869 for the years ended December 31, 2021, and 2020, respectively. Cash received from option exercises for the years ended December 31, 2021, and 2020 was $1,261,251 and $95,880, respectively. We have recognized tax benefits associated with options exercised of $665,700 and zero for the years ended December 31, 2021 and 2020, respectively. The weighted-average grant-date fair value of options granted during the years ended December 31, 2021, and 2020, was $5,699,986 and $2,350,264, respectively. The total intrinsic value of options exercised during the years ended December 31, 2021, and 2020, was $697,920 and $397,962, respectively. The following table presents information pertaining to options outstanding as of December 31, 2021: Schedule of information pertaining to options outstanding
Range of Exercise Price |  | Number Outstanding |  | Weighted Average Remaining Contractual Life |  | Weighted Average Exercise Price |  | Number Exercisable |  | Weighted Average Exercise Price |
$1.57 - $9.76 |  | 3,672,500 |  | 8.5 years |  | $ | 3.42 |  | 983,750 |  | $ | 2.73 |
As of December 31, 2021, there was $6,158,501 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2015 Plan. That cost is expected to be recognized over a weighted-average period of 46 months. The total fair value of shares vested was $1,923,179 and $803,171 at December 31, 2021, and December 31, 2020, respectively. Performance-Based Stock Options There were no performance-based stock options granted during the twelve months ended December 31, 2021, and 2020. The following table summarizes the status of the 2015 Plan with respect to performance-based stock options as of December 31, 2021: Schedule of performance base options outstanding
|  | December 31, 2021 |  |  | December 31, 2020 |
|  | Shares |  | Weighted Average Exercise Price |  |  | Shares |  | Weighted Average Exercise Price |
Outstanding at January 1 |  | 1,000,000 |  | $ | 1.70 |  |  |  | 1,000,000 |  | $ | 1.70 |
Granted |  | — |  | $ | — |  |  |  | — |  | $ | — |
Exercised |  | — |  | $ | — |  |  |  | — |  | $ | — |
Forfeited |  | 1,000,000 |  | $ | 1.70 |  |  |  | — |  | $ | — |
Outstanding at year end |  | — |  | $ | — |  |  |  | 1,000,000 |  | $ | 1.70 |
Options exercisable |  | — |  | $ | — |  |  |  | 333,333 |  | $ | 1.70 |
Weighted average fair value of options granted during the period |  | — |  | $ | — |  |  |  | — |  | $ | — |
Stock-based compensation expense |  | — |  | $ | (408,747 | ) |  |  | — |  | $ | 502,904 |
Total performance stock-based compensation expense totaled $(408,747) and $502,904 for the years ended December 2021 and 2020, respectively. All performance-based stock options were forfeited as of December31, 2021, and there was no unrecognized compensation cost remaining. RESTRICTED STOCK AWARDS On April 12, 2021, pursuant to an employment agreement entered into on March 15, 2021, with Linda Tharby, the Company’s President and Chief Executive Officer and as an inducement to her employment, the Company issued three restricted stock awards for an aggregate 1,000,000 shares of common stock for an aggregate stock price of $3,310,000 and each vesting subject to employment on the respective vesting date. The following table summarizes the activities for our unvested restricted stock awards for the twelve months ended December 31, 2021, and 2020.
|  | Twelve Months Ended December 31, |
|  | 2021 |  | 2020 |
|  | Shares |  | Weighted Average Grant-Date Fair Value |  | Shares |  | Weighted Average Grant-Date Fair Value |
Unvested at January 1 |  | — |  | $ | — |  | — |  | $ | — |
Granted |  | 1,000,000 |  | $ | 3.01 |  | — |  | $ | — |
Vested |  | — |  | $ | — |  | — |  | $ | — |
Forfeited/canceled |  | — |  | $ | — |  | — |  | $ | — |
Unvested at December 31 |  | 1,000,000 |  | $ | 3.01 |  | — |  | $ | — |
As of December 31, 2021, there was $2,299,726 of unrecognized compensation cost related to unvested employee restricted shares. This amount is expected to be recognized over a weighted-average period of 39 months. We have recognized tax benefits associated with restricted stock award compensation of $47,220 and zero for the twelve months ended December 31, 2021 and 2020, respectively.

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- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 + Details
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