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Stockholders’ Equity
 9 Months Ended
Sep. 30, 2022
Equity [Abstract]  
Stockholders’ Equity

Note 6. Stockholders’ Equity

 

The following are changes in stockholders’ equity for the nine months ended September 30, 2021 and September 30, 2022:

 

Barfresh Food Group, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

 

                          
           Additional         
   Common Stock   paid in   Accumulated     
   Shares   Amount   Capital   (Deficit)   Total 
Balance December 31, 2020   11,471,797   $-   $53,224,000   $(50,900,000)  $2,324,000 
Issuance of stock for capital raise   1,282,051    -    6,000,000    -    6,000,000 
Conversion of debt and accrued interest   114,614    -    685,000    -    685,000 
Interest paid in shares   19,377    -    151,000    -    151,000 
Issuance of stock for services   4,579    -    75,000    -    75,000 
Equity based compensation   -    -    52,000    -    52,000 
Net loss   -    -    -    (1,396,000)   (1,396,000)
Balance September 30, 2021   12,892,418   $-   $60,187,000   $(52,296,000)  $7,891,000 

 

           Additional         
   Common Stock   paid in   Accumulated     
   Shares   Amount   Capital   (Deficit)   Total 
Balance December 31, 2021   12,905,112   $-   $60,341,000   $(52,165,000)  $8,176,000 
Shares issued for warrant exercise   986    -    5,000    -    5,000 
Equity based compensation   5,000    -    211,000    -    211,000 
Issuance of stock for services   23,643    -    173,000    -    173,000 
Net loss   -    -    -    (4,339,000)   (4,339,000)
Balance September 30, 2022   12,934,741   $-   $60,730,000   $(56,504,000)  $4,226,000 

 

Warrants

 

During the nine months ended September 30, 2022, 102,852 warrants at a weighted average exercise price of $8.82 per share expired, and 986 warrants at an exercise price of $5.07 per share were exercised for proceeds of approximately $5,000.

 

Equity Incentive Plan

 

Stock Options

 

The following is a summary of stock option activity for the nine months ended September 30, 2022:

 

   Number of Options  

Weighted

average

exercise price per share

  

Remaining

term in

years

 
Outstanding on December 31, 2021   625,016   $7.55    3.8 
Issued   56,980   $5.90      
Cancelled/expired   (17,644)  $5.08      
Outstanding on September 30, 2022   664,352   $7.38    3.2 
                
Exercisable, September 30, 2022   577,242   $7.64    2.7 

 

 

The fair value of the options issued was calculated using the Black-Scholes option pricing model, based on the following:

 

   2022 
Expected term (in years)   5.5 - 8 
Weighted average expected volatility   84.8%
Weighted average risk-free interest rate   2.1%
Expected dividends  $- 
Weighted average grant date fair value per share  $4.53 

 

As of September 30, 2022, the Company has approximately $180,000 of unrecognized share-based compensation expense related to unvested options, which is expected to be recognized over the remaining weighted average period of 2.2 years.

 

Restricted Stock

 

The following is a summary of restricted stock award and restricted stock unit activity for the nine months ended September 30, 2022:

 

  

Number of

shares

  

Weighted

average grant

date fair value

 
Unvested at January 1, 2022   -   $- 
Granted   41,554   $5.27 
Forfeited   (4,631)  $5.38 
Unvested at September 30, 2022   36,923   $5.25 

 

As of September 30, 2022, the Company has approximately $104,000 of unrecognized share-based compensation expense related to restricted stock awards and restricted stock units, which is expected to be recognized over the remaining weighted average period of 2.1 years.

 

Performance Stock Units

 

During the nine months ended September 30, 2022, the Company issued performance share units (“PSUs”) that represent shares potentially issuable in the future. Issuance is based upon Company and individual performance over the remainder of 2022. The PSUs vest only upon the achievement of the applicable performance goals and depending on the particular grantee and achievement on the performance goals, the grantee may earn between 0% and 200% of the target PSUs. The fair value of PSUs is calculated based on the stock price on the date of grant.

 

The following table summarizes the activity for the Company’s unvested PSUs for the nine months ended September 30, 2022:

 

  

Number of

shares

  

Weighted

average grant

date fair value

 
Unvested at January 1, 2022   -   $- 
Granted   123,512   $4.50 
Forfeited   (1,889)  $4.50 
Unvested at September 30, 2022   121,623   $4.50 

 

The stock-based compensation expense recognized each period is dependent upon the Company’s estimate of the number of shares that will ultimately vest based on the achievement of certain performance conditions. Future stock-based compensation for unvested performance-based awards could reach a maximum of $547,000, in 2022 assuming achievement at the maximum level.