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Stockholders Equity
 6 Months Ended
Jun. 30, 2023
Stockholders Equity  
Stockholders' Equity

(12) Stockholders’ Equity

 

The total number of shares of stock this Corporation is authorized to issue shall be five hundred one million (501,000,000) shares, par value $0.001 per share. Our authorized capital stock consists of 500,000,000 shares of common stock and 1,000,000 shares of blank check preferred stock.

 

Preferred Stock

 

On July 10, 2013, the Board of Directors of the Company approved a certificate of amendment to the articles of incorporation and changed the authorized capital stock of the Company to include and authorize 500,000 shares of Preferred Stock, par value $0.001 per share. On October 7, 2020, the Board of Directors of the Company approved a certificate of amendment to the articles of incorporation and changed the total number of authorized shares of Preferred Stock to be 1,000,000 shares, $0.001 per share.

 

On October 7, 2020, our Board of Directors and our stockholders approved a resolution to amend and restate the certificate of designation of preferences, rights and limitations of Series A Convertible Preferred Stock to restate that there are 401,000 shares of the Company’s blank check Preferred Stock designated as Series A Convertible Preferred Stock. The amended and restated certificate clarifies that the Series A Convertible Preferred Stock convert at a rate of five shares of the Company’s common stock for every share of Series A Convertible Preferred Stock, and also restates that the Series A Convertible Preferred Stock shall be entitled to vote on all matters submitted to shareholders of the Company for each share of Series A Convertible Preferred Stock owned on the record date for the determination of shareholders entitled to vote on such matter or, if no such record date is established, on the date such vote is taken or any written consent of shareholders is solicited. The number of votes entitled to be cast by the holders of the Series A Convertible Preferred Stock equals that number of votes that, together with votes otherwise entitled to be cast by the holders of the Series A Convertible Preferred Stock at a meeting, whether by virtue of stock ownership, proxies, voting trust agreements or otherwise, entitle the holders to exercise 51% of all votes entitled to be cast to approve any action which Nevada law provides may or must be approved by vote or consent of the holders of common stock entitled to vote.

Common Stock:

 

The Company originally authorized 50,000,000 shares of common stock with a par value of $0.001. Effective May 20, 2014, the Company increased its authorized shares of common stock from 50,000,000 to 500,000,000.

 

On February 17, 2021, the Company priced its underwritten public offering of 1,371,428 units at $7.00 per unit. Each unit issued in the offering consisted of one share of common stock and one warrant. Concurrently, AmpliTech effected a 1-for-20 reverse split of its outstanding common stock and uplisted to the Nasdaq Capital Market, where its common stock and warrants trade under the symbols “AMPG” and “AMPGW,” respectively.

 

2020 Equity Incentive Plan:

 

In October 2020, the Board of Directors and shareholders adopted the Company's 2020 Equity Incentive Plan (the "2020 Plan"), effective as of December 14, 2020. Under the 2020 Plan, the Company reserved 1,250,000 shares of common stock to grant shares of the Company's common stock to employees and individuals who perform services for the Company. The purpose of the 2020 Plan is to attract and retain the best available personnel for positions of substantial responsibility, to provide incentives to individuals who perform services for the Company, and to promote the success of the Company's business. The 2020 Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units, Performance Shares, and other stock or cash awards as the Board of Directors may determine.

 

Stock Options:

 

On February 27, 2023, the Company granted one employee ten-year stock options to purchase 2,000 shares of common stock according to the Company’s 2020 Plan. The stock options vest in equal quarterly installments over five years commencing on May 27, 2023, with an exercise price of $2.59 per share. The Company has calculated these options estimated fair market value at $4,800 using the Black-Scholes model, with the following assumptions: expected term of 7.46 years, stock price of $2.59, exercise price of $2.59, volatility of 126.8%, risk-free rate of 4.08%, and no forfeiture rate.

 

On May 1, 2023, the Company granted one employee ten-year stock options to purchase 5,000 shares of common stock according to the Company’s 2020 Plan. The stock options vest in equal quarterly installments over five years commencing on August 1, 2023, with an exercise price of $3.19 per share. The Company has calculated these options estimated fair market value at $14,800 using the Black-Scholes model, with the following assumptions: expected term of 7.51 years, stock price of $3.19, exercise price of $3.19, volatility of 126.0%, risk-free rate of 3.62%, and no forfeiture rate.

On June 5, 2023, the Company granted one employee ten-year stock options to purchase 2,000 shares of common stock according to the Company’s 2020 Plan. The stock options vest in equal quarterly installments over three years commencing on September 5, 2023, with an exercise price of $2.40 per share. The Company has calculated these options estimated fair market value at $4,200 using the Black-Scholes model, with the following assumptions: expected term of 5.50 years, stock price of $2.40, exercise price of $2.40, volatility of 127.3%, risk-free rate of 3.82%, and no forfeiture rate.

 

On June 12, 2023, the Company granted one employee ten-year stock options to purchase 3,000 shares of common stock according to the Company’s 2020 Plan. The stock options vest in equal quarterly installments over three years commencing on September 12, 2023, with an exercise price of $2.49 per share. The Company has calculated these options estimated fair market value at $6,600 using the Black-Scholes model, with the following assumptions: expected term of 5.50 years, stock price of $2.49, exercise price of $2.49, volatility of 127.0%, risk-free rate of 3.89%, and no forfeiture rate.

 

Below is a table summarizing the changes in stock options outstanding for the six months ended June 30, 2023:

 

 

 

 

 

 

Weighted

 Average

 

 

 

Number of

Options

 

 

Exercise

Price ($)

 

Outstanding at December 31, 2022

 

 

916,000

 

 

$2.49

 

Granted

 

 

12,000

 

 

$2.78

 

Exercised

 

 

-

 

 

 

-

 

Expired

 

 

-

 

 

 

-

 

Outstanding at June 30, 2023

 

 

928,000

 

 

$2.49

 

Exercisable at June 30, 2023

 

 

412,526

 

 

$3.10

 

 

As of June 30, 2023, all outstanding stock options were issued according to the Company's 2020 Plan, and there remain 247,000 shares of common stock available for future issuance under the 2020 Plan. 

 

Stock-based compensation expense related to stock options of $60,063 and $121,287 was recorded for the three and six months ended June 30, 2023. As of June 30, 2023, the remaining unrecognized compensation cost related to non-vested stock options is $894,603 and is expected to be recognized over 5.09 years. The outstanding stock options have a weighted average remaining contractual life of 4.20 years and a total intrinsic value of $267,890.

Warrants:

 

On February 17, 2021, the Company priced its underwritten public offering of 1,371,428 units at $7.00 per unit. Each unit issued in the offering consisted of one share of common stock and one warrant. Concurrently, AmpliTech effected a 1-for-20 reverse split of its outstanding common stock and uplisted to the Nasdaq Capital Market, where its common stock and warrants trade under the symbols “AMPG” and “AMPGW,” respectively.

 

Maxim Group LLC acted as sole book-running manager for the offering and partially exercised its overallotment option to purchase 205,714 warrants at the public offering price. The warrants expire ten years from the date of issuance.

 

Effective April 16, 2021, the Company entered into definitive agreements with certain institutional investors to sell 2,715,000 shares of common stock in a registered direct offering priced at the market under NASDAQ rules.  Concurrently, the Company agreed to issue to the investors, in a private placement, warrants to purchase an aggregate of 1,900,500 shares of common stock at an exercise price of $8.48 per share with a five-year term.

 

On July 20, 2021, in connection with a product development agreement with an unrelated party, the Company issued warrants to purchase 30,000 shares of common stock. The warrants vest in one year from issuance, with an exercise price of $5.00 per share.  The Company has calculated these warrants estimated fair market value at $88,803 using the Black-Scholes model, with the following assumptions: expected term 3.0 years, stock price $3.80, exercise price $5.00, volatility 149.8%, risk-free rate 0.37%, and no forfeiture rate.

 

Below is a table summarizing the changes in warrants outstanding for the six months ended June 30, 2023:

 

 

 

 

 

 

Weighted

Average

 

 

 

Number of

Warrants

 

 

Exercise

Price ($)

 

Outstanding at December 31, 2022

 

 

3,296,942

 

 

$7.83

 

Granted

 

 

-

 

 

 

-

 

Exercised

 

 

-

 

 

 

-

 

Expired

 

 

-

 

 

 

-

 

Outstanding at June 30, 2023

 

 

3,296,942

 

 

$7.83

 

Exercisable at June 30, 2023

 

 

3,296,942

 

 

$7.83

 

The outstanding warrants have a weighted average remaining contractual life of 2.74 years and a total intrinsic value of $0.

 

Restricted Stock Units:

 

On May 20, 2022, 30,000 restricted stock units at an exercise price of $1.96 were issued to a board advisor.  Vesting will occur in equal quarterly installments of 2,500 shares beginning on May 20, 2022.  As of June 30, 2023, 12,500 RSU’s have vested.

 

Below is a table summarizing the changes in restricted stock units outstanding for the six months ended June 30, 2023:

 

 

 

 

 

 

Weighted

Average

 

 

 

Number of

RSU’s

 

 

Exercise

Price ($)

 

Outstanding at December 31, 2022

 

 

22,500

 

 

$1.96

 

Granted

 

 

-

 

 

 

-

 

Exercised

 

 

(5,000)

 

$1.96

 

Expired

 

 

-

 

 

 

-

 

Outstanding at June 30, 2023

 

 

17,500

 

 

$1.96

 

Exercisable at June 30, 2023

 

 

-

 

 

 

-

 

 

Stock-based compensation expense related to restricted stock units of $4,871 and $9,688 was recorded for the three and six months ended June 30, 2023. As of June 30, 2023, the remaining unrecognized compensation cost related to non-vested restricted stock units is $32,169. The outstanding restricted stock units have a weighted average remaining contractual life of 1.65 years and a total intrinsic value of $40,425.