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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation

11. Stock-Based Compensation

 

From time to time, we issue stock options and restricted stock as compensation for services rendered by our directors and employees.

 

Restricted Stock

 

On March 19, 2024, we granted 127,500 shares of restricted common stock to certain employees. The grants of restricted common stock were made in accordance with the 2015 Plan and were subject to vesting, as follows: 42,495 shares vested on March 19, 2024; 42,495 shares vest on April 2, 2025, and 42,510 shares vest on April 2, 2026. As of April 2, 2024, 10,315 shares, representing an amount of $69,525, were cancelled for payment of payroll taxes as part of a cashless grant, in accordance with the 2015 Plan, resulting in a net of 32,180 shares vested. Stock compensation of $136,019 and $669,937 was recorded on the issuance of the common stock for the three and nine months ended September 30, 2024 respectively.

 

Stock Options

 

On August 16, 2024, we granted non-employee directors stock options to purchase 36,000 shares at an exercise price of $8.78 per share, the fair market value of the shares on the grant date, under the 2023 Non-Employee Director Compensation Plan, with 100% vesting upon grant. The total fair value of $241,735 for these stock options was recognized upon grant. On September 4, 2024, we granted employees stock options to purchase 14,500 shares at an exercise price of $10.12 per share, the fair market value of the shares on the grant date, under the 2015 Plan, with annual vesting through 2027 based on service time. The total fair value of $118,347 for these stock options is being recognized over the vesting period. We did not make any stock option grants during the nine months ended September 30, 2023.

 

 

The weighted-average grant date fair value of options granted during the three and nine months ended September 30, 2024 was $7.13. The weighted average assumptions that were used in calculating such values during the nine months ended September 30, 2024, as well as the assumptions that were used in calculating such values, were based on estimates at the grant date in the table as follows:

 

  

Grant Date

August 16, 2024

  

Grant Date

September 4, 2024

 
Risk-free interest rate   3.77%   3.61%
Weighted average expected term   5 years    6 years 
Expected volatility   100.97%   101.00%
Expected dividend yield   0.00%   0.00%

 

A summary of stock option activity during the nine months ended September 30, 2024 and 2023 is as follows:

 

           Weighted-     
       Weighted-   Average     
       Average   Remaining   Aggregate 
   Shares   Exercise   Contractual   Intrinsic 
   Under Option   Price   Life   Value 
Outstanding at January 1, 2024   357,887   $5.69    8 years   $- 
Granted   50,500    9.16           
Forfeited   (4,000)   4.63                  - 
Outstanding at September 30, 2024   404,387   $6.14    7 years   $- 
                     
Exercisable at September 30, 2024   314,888   $5.97    7 years   $- 

 

           Weighted-     
       Weighted-   Average     
       Average   Remaining   Aggregate 
   Shares   Exercise   Contractual   Intrinsic 
   Under Option   Price   Life   Value 
Outstanding at January 1, 2023   365,447   $5.89    8 years   $19,200 
                     
Forfeited   (7,560)   15.34         (19,200)
Outstanding at September 30, 2023   357,887   $5.69    8 years   $- 
                     
Exercisable at September 30, 2023   186,594   $5.60    7 years   $- 

 

During the three and nine months ended September 30, 2024 and 2023, stock-based compensation for options was $354,006 and $584,918, respectively, and $115,456 and $349,073, respectively.

 

As of September 30, 2024 and December 31, 2023, there were $319,148 and $547,981, respectively, of total unrecognized compensation costs related to stock options granted under our stock option agreements. The unrecognized compensation cost is expected to be recognized over a weighted-average period of two years. The total fair value of stock options that vested during the nine months ended September 30, 2024 and 2023 was $696,620 and $467,771, respectively.