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Stockholder's Equity | 3 Months Ended
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Mar. 31, 2020
Equity [Abstract] |
Stockholder's Equity |
14. | Stockholder’s Equity
|  | Common Stock |  |  | Paid-in |  |  | Accumulated |  |  | Total Stockholders’ |
|  | Shares |  |  | Amount |  |  | Capital |  |  | Deficit |  |  | Equity |
Balance, December 31, 2019 |  |  | 9,675,028 |  |  | $ | 967 |  |  | $ | 51,566,438 |  |  | $ | (44,234,087 | ) |  | $ | 7,333,318 |
Issuance of common stock for services by third parties |  |  | 11,460 |  |  |  | 1 |  |  |  | 36,670 |  |  |  | - |  |  |  | 36,671 |
Issuance of common stock for services by employees |  |  | 79,338 |  |  |  | 8 |  |  |  | 253,868 |  |  |  | - |  |  |  | 253,876 |
Amortization of non-deal warrant grants |  |  | - |  |  |  | - |  |  |  | 7,976 |  |  |  | - |  |  |  | 7,976 |
Issuance of warrants for secured credit facility |  |  | - |  |  |  | - |  |  |  | 97,800 |  |  |  | - |  |  |  | 97,800 |
Stock-based compensation |  |  | - |  |  |  | - |  |  |  | 60,159 |  |  |  | - |  |  |  | 60,159 |
Net loss attributable to common shareholders |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (3,508,549 | ) |  |  | (3,508,549 | )
Balance, March 31, 2020 |  |  | 9,765,826 |  |  | $ | 976 |  |  | $ | 52,022,911 |  |  | $ | (47,742,636 | ) |  | $ | 4,281,251 |
Issuance of Common Stock In January 2020, the Company issued 90,798 shares of common stock to directors, employees and consultants for stock-based compensation of $290,547. The shares were valued using the closing share price of our common stock on the date of grant of $3.20 per share. Stock-Based Compensation On September 8, 2016, the Company adopted the 2016 Equity Incentive Plan (the “2016 Plan”). Pursuant to the terms of the plan, on January 1, 2020, the number of shares available for grant under the 2016 Plan reset to 2,887,005 shares, equal to 8% of the number of outstanding shares of the Company’s capital stock, calculated on an as-converted basis, on December 31 of the preceding calendar year, and then added to the prior year plan amount. As of March 31, 2020, there have been 640,825 options and 618,135 restricted stock units (“RSUs”) issued under the 2016 Plan, with vesting schedules varying between immediate and five (5) years from the grant date. On January 29, 2015, the Company adopted the 2015 Stock Incentive Plan (the 2015 Plan). The total number of shares available for the grant of either stock options or compensation stock under the 2015 Plan is 50,000 shares, subject to adjustment. The exercise price per share of each stock option will not be less than 20 percent of the fair market value of the Company’s common stock on the date of grant. At March 31, 2020, there were 5,417 options issued under the Plan outstanding, which options vest at the rate of at least 25 percent in the first year, starting 6-months after the grant date, and 75% in year two. The Company also issues, from time to time, options that are not registered under a formal option plan. At March 31, 2020, there were no options outstanding that were not issued under the Plans. A summary of all stock option activity at and for the three months ended March 31, 2020 is presented below:
|  | # of Options |  |  | Weighted- Average Exercise Price |
Outstanding at December 31, 2019 |  |  | 784,101 |  |  | $ | 5.65 |
Options granted |  |  | - |  |  | $ | - |
Options exercised |  |  | - |  |  | $ | - |
Options canceled |  |  | (199,001 | ) |  | $ | 6.92 |
Outstanding at March 31, 2020 |  |  | 585,100 |  |  | $ | 5.22 |
Exercisable at March 31, 2020 |  |  | 429,975 |  |  | $ | 5.03 |
The aggregate intrinsic value of options outstanding at March 31, 2020 was $0. At March 31, 2020, there were 155,125 unvested options with an aggregate grant date fair value of $383,412. The unvested options will vest in accordance with the vesting schedule in each respective option agreement, which varies between immediate and five (5) years from the grant date. The aggregate intrinsic value of unvested options at March 31, 2020 was $0. During the three months ended March 31, 2020, 36,264 options became vested. The Company uses the Black-Scholes valuation model to measure the grant-date fair value of stock options. The grant-date fair value of stock options issued to employees is recognized on a straight-line basis over the requisite service period. Stock-based awards issued to nonemployees are recorded at fair value on the measurement date and are subject to periodic market adjustments as the underlying stock-based awards vest. To determine the fair value of stock options using the Black-Scholes valuation model, the calculation takes into consideration the effect of the following:
| ● | Exercise price of the option
| ● | Fair value of the Company’s common stock on the date of grant
| ● | Expected term of the option
| ● | Expected volatility over the expected term of the option
| ● | Risk-free interest rate for the expected term of the option
The calculation includes several assumptions that require management’s judgment. The expected term of the options is calculated using the simplified method described in GAAP. The simplified method defines the expected term as the average of the contractual term and the vesting period. Estimated volatility is derived from volatility calculated using historical closing prices of common shares of similar entities whose share prices are publicly available for the expected term of the options. The risk-free interest rate is based on the U.S. Treasury constant maturities in effect at the time of grant for the expected term of the options. The Company did not issue any additional options during the three months ended March 31, 2020. For the three months ended March 31, 2020 and 2019, total stock compensation expense related to stock options was $60,159 and $191,856, respectively. At March 31, 2020, the total compensation cost related to stock options not yet recognized is approximately $383,412, which is expected to be recognized over a weighted-average period of approximately 1.63 years. Warrants During the three months ended March 31, 2020, the Company issued an aggregate of 100,000 common stock warrants in connection with the Secured Credit Facility from Live Oak Bank. The estimated fair value of the warrants of $97,800 was recorded as debt issuance cost and will be amortized to interest expense over the maturity period of the secured credit facility, with $24,450 recorded in the three months ended March 31, 2020. Warrants issued to three shareholders during 2017 and 2018 vest quarterly for 3 years and resulted in $7,976 worth of amortization expense for the quarter ending March 31, 2020. The estimated fair value of the warrants at issuance was based on a combination of closing market trading price on the date of issuance for the warrants, and the Black-Scholes option-pricing model using the weighted-average assumptions below:
Volatility |  |  | 40 | %
Risk-free interest rate |  |  | 1.54 | %
Expected term (in years) |  |  | 5.0 |
Expected dividend yield |  |  | - |
Fair value of common stock |  | $ | 3.20 |
No warrants were exercised during the three months ended March 31, 2020. A summary of activity in warrants is as follows:
|  | Warrants |  |  | Weighted Average Remaining Life |  |  | Weighted Average Exercise Price |  |  | Aggregate Intrinsic Value |
Outstanding at December 31, 2019 |  |  | 736,559 |  |  |  | 1.18 years |  |  | $ | 6.95 |  |  | $ | - |
Three months ended March 31, 2020: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Granted |  |  | 100,000 |  |  |  | 4.79 years |  |  | $ | 3.94 |  |  | $ | - |
Exercised |  |  | - |  |  |  | - |  |  | $ | - |  |  |  | - |
Forfeited and cancelled |  |  | (146,262 | ) |  |  | 2.00 years |  |  | $ | 7.80 |  |  |  | - |
Outstanding at March 31, 2020 |  |  | 690,297 |  |  |  | 1.32 years |  |  | $ | 6.95 |  |  | $ | - |

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
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