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Shareholders' Equity

12 Months Ended

Dec. 31, 2019

Stockholders' Equity Note [Abstract]

Shareholders' Equity

13. SHAREHOLDERS’ EQUITY

At-the-Market Offering

In January 2018, the Company entered into a common stock sales agreement with a financial institution pursuant to which the Company could 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 year ended December 31, 2018, the Company issued 128,853 shares of common stock at an average price of $14.10 for total net proceeds before offering expenses of approximately $1.8 million. Offering expenses, including broker fees and legal costs related to the at-the-market offering totaled $151 thousand. In January 2019, the Company terminated the at-the-market offering.

Warrants

In December 2016, the Company completed a registered direct offering of 100,000 shares of common stock at a net gross price of $15.00 per share. Concurrently, the investors received warrants to purchase 100,000 shares of common stock of the Company at an exercise price of $20.05 per share, subject to adjustment, for a period of five years from closing. The total net proceeds received by the Company were 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 have been classified as liabilities due to features in the warrant agreement that give the warrant holder an option to require the Company to redeem the warrant at a calculated fair value in the event of a “Fundamental Transaction,” as defined in the warrant agreement. The fair value of the warrants was $73 thousand and $425 thousand at December 31, 2019 and December 31, 2018, respectively

As a result of common stock issuances made during the year ended December 31, 2018, the warrant exercise price was reduced from $20.50 to $11.30 per share pursuant to the original warrant agreement.

Stock Option Plans

From time to time, the Company may grant 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.

Total stock-based compensation expense related to stock options was $41 thousand and $53 thousand for the year ended December 31, 2019 and 2018, respectively. As of December 31, 2019, all stock options had vested. During the year ended December 31, 2019, no stock options were granted, exercised or expired. As the result of an employee termination during the period, 500 unvested stock options were forfeited. For the year ended December 31, 2018, no stock options were granted, exercised or forfeited, however, 6,922 stock options expired during the period. Presented below is information about stock options outstanding and exercisable as of December 31, 2019 and December 31, 2018. All shares and prices per share have been adjusted for a one share-for-ten shares reverse stock split that took effect on January 6, 2020:

		2019								2018
		Shares				Price ⁽¹⁾				Shares				Price ⁽¹⁾

Outstanding, beginning of year			32,046			$	65.20				38,968			$	80.50
Granted			-				-				-				-
Forfeited			(500	)			11.60				-				-
Expired			-				-				(6,922	)			151.20
Exercised			-				-				-				-

Outstanding, end of year			31,546			$	66.10				32,046			$	65.20

Exercisable, end of year			31,546			$	66.10				26,546			$	76.30

⁽¹⁾

Represents the weighted average price.

The following table summarizes information for stock options outstanding and for stock options exercisable at December 31, 2019. All shares and prices per share have been adjusted for a one share-for-ten shares reverse stock split that took effect on January 6, 2020:

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

	16,500			$	7.20			$	11.60			$	10.00				7.8				16,500			$	10.00
	10,629				90.00				124.80				106.20				4.3				10,629				106.20
	2,917				139.20				171.00				147.40				2.4				2,917				147.40
	1,500				226.20				302.40				240.30				3.5				1,500				240.30

	31,546			$	7.20			$	302.40			$	66.10				5.9				31,546			$	66.10

During the year ended December 31, 2019, the Company did not grant restricted or unrestricted shares to employees or directors. During the year ended December 31, 2018 the Company granted 48,516 unrestricted shares of common stock to employees and recorded $0.6 million of stock-based compensation expense. For the year ended December 31, 2019 there was no stock based compensation expense related to stock grants. For the year ended December 31, 2018 total stock-based compensation related to stock grants was $0.6 million. As of December 31, 2019, there was no unrecognized expense related to common stock grants.