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Stock Options and Award Programs | 12 Months Ended
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Dec. 31, 2020
Share-based Payment Arrangement [Abstract] |
Stock Options and Award Programs | The Company’s stock incentive plan is administered by the Compensation Committee and authorizes the grant or award of incentive stock options, non-qualified stock options (NQSO), restricted stock awards (RSA), stock appreciation rights, dividend equivalent rights, performance unit awards and phantom shares. The Company issues new shares of common stock upon the exercise of stock options. Any shares associated with options forfeited are added back to the number of shares that underlie stock options to be granted under the stock incentive plan. The Company has issued restricted stock awards and non-qualified stock option awards as described below. Valuation of Stock Awards Restricted Stock. The Company records the fair value of all restricted stock awards based on the grant date fair value and amortizes stock compensation on a straight-line basis over the vesting period. Restricted stock award shares are issued when vested and included in the total number of common shares issued and outstanding. During the years ended December 31, 2020 and 2019, the Company granted 231,873 RSAs and 66,274 RSAs, respectively. Non-Qualified Stock Options. The Company estimates the fair value of nonqualified stock awards using a Black-Scholes Option Pricing model (“Black-Scholes model”). The fair value of each stock award is estimated on the date of grant using the Black-Scholes model, which requires an assumption of dividend yield, risk free interest rates, volatility, forfeiture rates and expected option life. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. Expected volatilities are based on the historical volatility of our common stock over the expected option term. The expected term of options granted is based on analyses of historical employee termination rates and option exercises. The Company did not grant NQSOs during December 31, 2020. There were 2,500 of non-qualified stock option awards granted to a non-employee as compensation for investor relations services during December 31, 2019. Restricted Stock Awards A summary of RSA activity as of December 31, 2020 and 2019, and changes for the years then ended are set forth below:
|  | 2020 |  |  | 2019 |
NON-VESTED AWARDS |  |  |  |  |  |
Non-vested awards outstanding, January 1, |  |  | 50,750 |  |  |  | 30,000 |
Granted (+) |  |  | 231,873 |  |  |  | 66,274 |
Cancelled (-) |  |  | - |  |  |  | 5,000 |
Vested (-) |  |  | 108,875 | (1) |  |  | 40,524 |
Non-vested awards outstanding, December 31, |  |  | 173,748 |  |  |  | 50,750 |
Weighted-average remaining contractual life (in years) |  |  | 1.2 |  |  |  | 8.0 |
Unamortized RSA compensation expense |  | $ | 362,426 |  |  | $ | 90,759 |
Aggregate intrinsic value of RSAs non-vested, December 31 |  | $ | 1,683,618 |  |  | $ | 197,925 |
Aggregate intrinsic value of RSAs vested, December 31 |  | $ | 708,920 |  |  | $ | 171,867 |
(1) During the year ended December 31, 2020, the Company is reporting the issuance of RSAs upon vesting instead of at the time of grant. In the prior year, the Company reported RSAs as issued upon grant date. The amount of shares reported as vested upon grant in prior years were 50,750 shares. Non-Qualified Stock Option Awards Option pricing model assumptions for NQSO awards granted were valued using the following assumptions for December 31, 2019 as set forth below:
| YEAR ENDED DECEMBER 31, 2019
| Non-Qualified Stock Option Awards
| Employees | Directors | Non-Employees | Total
Stock options granted | -- | -- | 2,500 | 2,500
Expected dividend yield | -- | -- | 0% | 0%
Expected volatility | -- | -- | 64.5% | 64.5%
Risk-free interest rate | -- | -- | 2.4% | 2.4%
Forfeiture rate | -- | -- | 1.2% | 1.2%
Expected life | -- | -- | 3 years | 3 years
A summary of NQSO activity as of December 31, 2020 and 2019, and changes during the years then ended are set forth below:
|  | 2020 |  |  | 2019 |
|  |  |  |  | Weighted |  |  |  |  |  | Weighted |
|  |  |  |  | Average |  |  |  |  |  | Average |
|  |  |  |  | Grant Date |  |  |  |  |  | Grant Date |
NON-VESTED AWARDS |  | Shares |  |  | Fair Value |  |  | Shares |  |  | Fair Value |
Non-vested balances, January 1, |  |  | 84,166 |  |  | $ | 3.81 |  |  |  | 206,751 |  |  | $ | 3.56 |
Granted (+) |  |  | - |  |  |  | - |  |  |  | 2,500 |  |  | $ | 1.51 |
Cancelled (-) |  |  | 1,666 |  |  | $ | 2.60 |  |  |  | 8,000 |  |  | $ | 3.36 |
Vested/Excercised (-) |  |  | 30,000 |  |  | $ | 3.68 |  |  |  | 117,085 |  |  | $ | 3.35 |
Non-vested balances, December 31, |  |  | 52,500 |  |  | $ | 3.93 |  |  |  | 84,166 |  |  | $ | 3.81 |
|  | 2020 |  |  | 2019 |
|  |  |  |  | Weighted |  |  |  |  |  | Weighted |
|  |  |  |  | Average |  |  |  |  |  | Average |
OUTSTANDING AND EXERCISABLE AWARDS |  | Shares |  |  | Exercise Price |  |  | Shares |  |  | Exercise Price |
Awards outstanding, January 1, |  |  | 350,833 |  |  | $ | 5.89 |  |  |  | 401,333 |  |  | $ | 5.85 |
Granted (+) |  |  | - |  |  |  | - |  |  |  | 2,500 |  |  | $ | 4.10 |
Cancelled (-) |  |  | 11,666 |  |  | $ | 4.47 |  |  |  | 53,000 |  |  | $ | 5.48 |
Expired (-) |  |  | 49,333 |  |  | $ | 6.03 |  |  |  | - |  |  |  | - |
Exercised (-) |  |  | 102,500 |  |  | $ | 6.40 |  |  |  | - |  |  |  | - |
Awards outstanding, December 31, |  |  | 187,334 |  |  | $ | 5.66 |  |  |  | 350,833 |  |  | $ | 5.89 |
Awards vested and expected to vest, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, |  |  | 186,197 |  |  | $ | 5.67 |  |  |  | 331,018 |  |  | $ | 5.89 |
Awards outstanding and exercisable, |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
December 31, |  |  | 134,834 |  |  | $ | 5.37 |  |  |  | 266,667 |  |  | $ | 5.76 |
The weighted-average remaining contractual life and the aggregate intrinsic value (the amount by which the fair value of the Company’s stock exceeds the exercise price of the option) of the stock options outstanding, exercisable, and vested and expected to vest as of December 31, 2020 are as follows:
|  |  |  |  | Vested and |  |  | Outstanding |
|  |  |  |  | Expected to |  |  | and |
|  | Outstanding |  |  | Vest |  |  | Exercisable |
Weighted-average remaining contractual life (in years) |  |  | 1.52 |  |  |  | 1.52 |  |  |  | 1.42 |
Aggregate intrinsic value |  | $ | 853,420 |  |  | $ | 847,465 |  |  | $ | 659,895 |
Stock Compensation Expense Share-based compensation recognized under ASC 718-10 (including restricted stock awards) represents both stock options based expense and stock grant expense. The Company recognized share-based compensation expense for the years then ended December 31 as set forth below:
|  | YEAR ENDED DECEMBER 31, 2020 |  |  | YEAR ENDED DECEMBER 31, 2019 |
|  | Shared-Based Compensation Expense |  |  | Shared-Based Compensation Expense |
|  | Employees |  |  | Directors |  |  | Non-Employees |  |  | Total |  |  | Employees |  |  | Directors |  |  | Non-Employees |  |  | Total |
Restricted stock compensation expense |  | $ | 375,122 |  |  | $ | 329,851 |  |  | $ | - |  |  | $ | 704,973 |  |  | $ | 281,051 |  |  | $ | 100,200 |  |  | $ | - |  |  | $ | 381,251 |
Non-qualified option stock compensation expense |  |  | 98,789 |  |  |  | - |  |  |  | 6,519 |  |  |  | 105,308 |  |  |  | 326,249 |  |  |  | - |  |  |  | 10,487 |  |  |  | 336,736 |
Total share-based compensation before taxes |  | $ | 473,911 |  |  | $ | 329,851 |  |  | $ | 6,519 |  |  | $ | 810,281 |  |  | $ | 607,300 |  |  | $ | 100,200 |  |  | $ | 10,487 |  |  | $ | 717,987 |
At December 31, 2020, the Company had approximately $439,076 of total unamortized compensation expense that will be recognized over the weighted average period of 1.3 years.

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- Definition The entire disclosure for share-based payment arrangement. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 + Details
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