XML 20 R10.htm IDEA: XBRL DOCUMENT
v3.22.2.2

STOCK-BASED COMPENSATION | 9 Months Ended
--- | ---
Sep. 30, 2022
Share-Based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | NOTE 4 — STOCK-BASED COMPENSATION The Company has three equity incentive plans: the 2015 Stock Option Plan, as amended (the “2015 Plan”), the 2021 Omnibus Equity Incentive Plan (the “2021 Plan”), and the Non-Employee Director Compensation Plan. The Company has also issued restricted stock as employment inducement awards to its Chief Executive Officer. As of September 30, 2022, there were options to purchase 2,650,000 shares of the Company’s common stock outstanding to certain executives, key employees and consultants under the 2015 Plan, of which zero were issued during the three months ended September 30, 2022 and 295,000 were issued during the nine months ended September 30, 2022. 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. During the three and nine months ended September 30, 2022, there were issued zero and 97,100 shares of common stock, respectively, as director compensation and 475,000 options to purchase shares of common stock as executive compensation under the 2021 Plan. As of September 30, 2022, there had been issued 20,988 shares of common stock as directors fees under the 2021 Plan. 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. From May 18, 2021 to May 6, 2022, non-employee director compensation was paid pursuant to the 2021 Plan. Since May 6, 2022, non-employee director compensation has been paid pursuant to the Non-Employee Director Compensation Plan. All payments were and are pro-rated for partial service. 2015 STOCK OPTION PLAN, as amended Time Based Stock Options The per share weighted average fair value of stock options granted during the nine months ended September 30, 2022 and September 30, 2021 was $2.10 and $2.93, 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 nine months ended September 30, 2022 and September 30, 2021. 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. We have recognized tax benefits associated with stock-based compensation of $151,736 and $56,102 for the nine months ended September 30, 2022 and 2021, respectively. Schedule of time based stock options
|  | September 30, |
|  | 2022 |  | 2021 |
Dividend yield |  |  | 0.00% |  |  | 0.00% |
Expected Volatility |  |  | 65.9% - 77.5% |  |  | 74.01% - 76.77% |
Weighted-average volatility |  |  | — |  |  | — |
Expected dividends |  |  | — |  |  | — |
Expected term (in years) |  |  | 10 |  |  | 10 |
Risk-free rate |  |  | 1.81% - 2.99% |  |  | 1.20% - 1.62% |
The following table summarizes the status of the 2015 Plan with respect to time based stock options: Schedule of status of time based stock options
|  | Nine Months Ended September 30, |
|  | 2022 |  | 2021 |
|  | Shares |  | Weighted Average Exercise Price |  | Shares |  | Weighted Average Exercise Price |
Outstanding at January 1 |  | 3,672,500 |  | $ | 3.42 |  |  | 2,922,494 |  | $ | 2.46 |
Granted |  | 295,000 |  | $ | 2.70 |  |  | 1,650,000 |  | $ | 3.75 |
Exercised |  | 831,250 |  | $ | 1.57 |  |  | 1,000,000 |  | $ | 1.23 |
Forfeited |  | 486,250 |  | $ | 2.73 |  |  | 187,494 |  | $ | 3.36 |
Outstanding at September 30 |  | 2,650,000 |  | $ | 4.05 |  |  | 3,385,000 |  | $ | 3.39 |
Options exercisable at September 30 |  | 825,000 |  | $ | 4.41 |  |  | 1,005,625 |  | $ | 2.65 |
Weighted average fair value of options granted during the period |  | — |  | $ | 2.10 |  |  | — |  | $ | 2.93 |
Stock-based compensation expense |  | — |  | $ | 1,465,567 |  |  | — |  | $ | 1,934,935 |
Total stock-based compensation expense was $1,465,567 and $1,934,935 for the nine months ended September 30, 2022, and 2021, respectively. Cash received from option exercises for the nine months ended September 30, 2022, and 2021 was $314,000 and $1,230,000, respectively. The weighted-average grant-date fair value of options granted during the nine months ended September 30, 2022, and 2021 was $0.6 million and $4.8 million, respectively. There were 831,250 options exercised during the nine months ended September 30, 2022, and 1.0 million during the nine months ended September 30, 2021. The following table presents information pertaining to options outstanding at September 30, 2022: 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-$9.49 |  | 2,650,000 |  | 8.1 years |  | $ | 4.05 |  | 825,000 |  | $ | 4.41 |
As of September 30, 2022, there was $4,581,923 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted-average period of 45 months. The total fair value of shares vested as of September 30, 2022, and September 30, 2021, was $2,679,152 and $1,909,141, respectively. Performance Based Stock Options There were no performance based stock options granted during the nine months ended September 30, 2022, and 2021. The following table summarizes the status of the 2015 Plan with respect to performance based stock options: Schedule of performance base stock options
|  | Nine Months Ended September 30, |
|  | 2022 |  | 2021 |
|  | Shares |  | Weighted Average Exercise Price |  | Shares |  | Weighted Average Exercise Price |
Outstanding at January 1 |  | — |  | $ | — |  | 1,000,000 |  | $ | 1.70 |
Granted |  | — |  | $ | — |  | — |  | $ | — |
Exercised |  | — |  | $ | — |  | — |  | $ | — |
Forfeited |  | — |  | $ | — |  | — |  | $ | — |
Outstanding at September 30 |  | — |  | $ | — |  | 1,000,000 |  | $ | 1.70 |
Options exercisable at September 30 |  | — |  | $ | — |  | — |  | $ | — |
Weighted average fair value of options granted during the period |  | — |  | $ | — |  | — |  | $ | — |
Stock-based compensation expense |  | — |  | $ | — |  | — |  | $ | (408,747 | )
Total performance stock-based compensation expense totaled zero and ($408,747) for the nine months ended September 30, 2022, and 2021, respectively. All performance based stock options were forfeited as of September 30, 2021, and there was no unrecognized compensation cost remaining. 2021 STOCK OPTION PLAN, as amended Time Based Stock Options The per share weighted average fair value of stock options granted during the nine months ended September 30, 2022 and September 30, 2021 was $1.99 and $0 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 nine months ended September 30, 2022 and September 30, 2021. 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. We have recognized tax benefits associated with stock-based compensation of $20,677 and $0 for the nine months ended September 30, 2022 and 2021, respectively. Schedule of time based stock options
|  | September 30, |
|  | 2022 |  | 2021 |
Dividend yield |  |  | 0.00% |  |  | 0.00% |
Expected Volatility |  |  | 65.9% |  |  | 0% - 0% |
Weighted-average volatility |  |  | — |  |  | — |
Expected dividends |  |  | — |  |  | — |
Expected term (in years) |  |  | 10 |  |  | 0 |
Risk-free rate |  |  | 2.99% |  |  | 0% - 0% |
The following table summarizes the status of the 2021 Plan with respect to time based stock options: Schedule of status of time based stock options
|  | Nine Months Ended September 30, |
|  | 2022 |  | 2021 |
|  | Shares |  | Weighted Average Exercise Price |  | Shares |  | Weighted Average Exercise Price |
Outstanding at January 1 |  | 0 |  | $ | 0 |  |  | — |  | $ | — |
Granted |  | 475,000 |  | $ | 2.67 |  |  | — |  | $ | — |
Exercised |  | 0 |  | $ | — |  |  | — |  | $ | — |
Forfeited |  | 0 |  | $ | — |  |  | — |  | $ | — |
Outstanding at September 30 |  | 475,000 |  | $ | 2.67 |  |  | — |  | $ | — |
Options exercisable at September 30 |  | 0 |  | $ | — |  |  | — |  | $ | — |
Weighted average fair value of options granted during the period |  | — |  | $ | 1.99 |  |  | — |  | $ | — |
Stock-based compensation expense |  | — |  | $ | 98,460 |  |  | — |  | $ | — |
Total stock-based compensation expense was $98,460 and $0 for the nine months ended September 30, 2022, and 2021, respectively. There were no options exercised during the nine months ended September 30, 2022 and September 30, 2021. The weighted-average grant-date fair value of options granted during the nine months ended September 30, 2022, and 2021 was $0.95 million and $0 million, respectively. There were zero options exercised during the nine months ended September 30, 2022, and September 30, 2021. The following table presents information pertaining to options outstanding at September 30, 2022: 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 |
$2.67 |  | 475,000 |  | 9.6 years |  | $ | 2.67 |  | 0 |  | $ | 0 |
As of September 30, 2022, there was $846,755 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the 2021 Plan. That cost is expected to be recognized over a weighted-average period of 48 months. The total fair value of shares vested as of September 30, 2022, and September 30, 2021, was zero and zero, respectively. RESTRICTED STOCK AWARDS The following table summarizes the activities for our restricted stock awards for the nine months ended September 30, 2022, and 2021. Schedule of activities for restricted stock awards
|  | Nine Months Ended September 30, |
|  | 2022 |  | 2021 |
|  | Shares |  | Weighted Average Grant-Date Fair Value |  | Shares |  | Weighted Average Grant-Date Fair Value |
Unvested at January 1 |  | — |  | $ | — |  | — |  | $ | — |
Granted |  | 1,000,000 |  | $ | 3.01 |  | 1,000,000 |  | $ | 3.01 |
Vested |  | 50,000 |  | $ | 3.31 |  | — |  | $ | — |
Forfeited/canceled |  | — |  | $ | — |  | — |  | $ | — |
Unvested at September 30 |  | 950,000 |  | $ | 2.99 |  | 1,000,000 |  | $ | 3.01 |
As of September 30, 2022, and 2021, there was $1,788,565 and $2,379,089 of unrecognized compensation cost related to unvested employee restricted shares. This amount is expected to be recognized over a weighted-average period of 21 months. We have recognized tax benefits associated with restricted stock award compensation of $107,344 and $30,554 for the nine months ended September 30, 2022 and 2021, respectively.

X
- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI https://asc.fasb.org/topic&trid=2228938 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (l) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 4: http://www.xbrl.org/2003/role/exampleRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a)(1) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2)(i) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (h)(2) -URI https://asc.fasb.org/extlink&oid=128089324&loc=d3e5070-113901 + 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