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Shareholders' Equity

3 Months Ended

Mar. 31, 2018

Stockholders' Equity Note [Abstract]

Shareholders' Equity

9. SHAREHOLDERS’ EQUITY

Preferred Stock

The Company’s articles of incorporation authorize the issuance of up to 100,000 shares of preferred stock, $0.01 par value. Shares of preferred stock may be issued with such dividend, liquidation, voting and conversion features as may be determined by the Board of Directors without shareholder approval. The Company is authorized to issue 50,000 shares of Series P preferred stock in connection with a shareholder rights plan that expired in 2011. In February 2016 the Board of Directors approved the designation of 50,000 shares of Series A Convertible Preferred Stock in connection with the disposition of the Company’s mining segment.

Common Stock

On January 5, 2018, we entered into a common stock sales agreement with a financial institution pursuant to which we may offer and sell, through the sales agent, common stock representing an aggregate offering price of up to $2.5 million through an at-the-market continuous offering program. During the quarter ended March 31, 2018 we issued an aggregate of 640,163 shares of common stock through our continuous at-the-market offering program at an average price of $1.47 per share for total proceeds of approximately $0.9 million.

Warrants

On December 21, 2016, the Company completed a registered direct offering of 1,000,000 shares of common stock at a net gross price of $1.50 per share. Concurrently, the investors received warrants to purchase 1,000,000 shares of Common Stock of the Company at an exercise price of $2.05 per share, subject to adjustment, for a period of five years from closing. The total net proceeds received by the Company was approximately $1.32 million. The fair value of the warrants upon issuance was $1.24 million, with the remaining $0.08 million being attributed to common stock. The warrants contain a dilutive issuance and other liability provisions which cause the warrants to be accounted for as a liability. Such warrant instruments are initially recorded as a liability and are accounted for at fair value with changes in fair value reported in earnings. As of March 31, 2018, the Company had a warrant liability of $0.9 million. As a result of common stock issuances made during the three months ended March 31, 2018, the warrant exercise price was reduced from $2.05 to $1.13 per share pursuant to the original warrant agreement.

Stock Options

From time to time, the Company grants stock options under its incentive plan covering shares of common stock to employees of the Company. Stock options, when exercised, are settled through the payment of the exercise price in exchange for new shares of stock underlying the option. These awards typically expire ten years from the grant date.

For the three months ended March 31, 2018 and 2017, total stock-based compensation expense related to stock options was $0.01 million and $0.1 million respectively. As of March 31, 2018, there was $0.08 million of unrecognized expense related to unvested stock options, which will be recognized as stock-based compensation expense through November 2019. For the three months ended March 31, 2018, no stock options were granted, exercised, forfeited or expired. Presented below is information about stock options outstanding and exercisable as of March 31, 2018 and December 31, 2017:

		March 31, 2018								December 31, 2017
		Shares				Price ⁽¹⁾				Shares				Price ⁽¹⁾

Stock options outstanding			389,687			$	8.05				389,687			$	8.05

Stock options exercisable			279,687			$	10.76				274,132			$	10.79

⁽¹⁾

Represents the weighted average price.

The following table summarizes information for stock options outstanding and exercisable at March 31, 2018:

Options Outstanding																				Options Exercisable
Number				Exercise Price												Remaining				Number				Weighted
of				Range								Weighted				Contractual				of				Average
Shares				Low				High				Average				Term (years)				Shares				Exercise Price

	56,786			$	9.00			$	9.00			$	9.00				6.8				56,786			$	9.00
	49,504				12.48				12.48				12.48				5.3				49,504				12.48
	98,396				13.92				17.10				15.01				1.6				98,396				15.01
	15,001				22.62				30.24				24.03				5.3				15,001				24.03
	60,000				0.72				0.72				0.72				9.4				60,000				0.72
	110,000				1.16				1.16				1.16				9.6				-				-

	389,687			$	0.72			$	30.24			$	8.05				6.4				279,687			$	10.76

As of March 31, 2018, 981,008 shares are available for future grants under the Company’s stock option plans.