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SHAREHOLDERS’ EQUITY

6 Months Ended

Jun. 30, 2021

Equity [Abstract]

SHAREHOLDERS’ EQUITY

11. SHAREHOLDERS’ EQUITY

Common Stock

At June 30, 2021, the Company had 4,676,301 shares of common stock outstanding. On February 17, 2021, the Company sold 1,131,600 shares of common stock for net proceeds of $5.3 million.

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, for a period of five years from the final closing date of June 21, 2017. The warrants include anti-dilution rights. The total net proceeds received by the Company were approximately $1.3 million. The fair value of the warrants upon issuance were $1.2 million, with the remaining $0.1 million being attributed to common stock. On September 29, 2020, the Company received proceeds of $565 thousand related to the exercise of warrants to purchase 50,000 shares of 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 remaining warrants to purchase 50,000 shares of common stock was $119 thousand and $95 thousand at June 30, 2021 and December 31, 2020, respectively.

Pursuant to the original warrant agreement, as a result of common stock issuances at various prices, the warrant exercise price has been reduced from its original $20.50 exercise price to the floor price of $3.92, which is the exercise price of the warrants at June 30, 2021.

Stock Options

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.

For the six months ended June 30, 2021 and 2020, there was no compensation expense related to stock options. As of December 31, 2019, all stock options had vested. No stock options were granted or exercised, during the six months ended June 30, 2021 or 2020. During the six months ended June 30, 2021 and 2020, options to purchase 332 shares and 166 shares, respectively, expired. Presented below is information about stock options outstanding and exercisable as of June 30, 2021 and December 31, 2020:

SCHEDULE OF STOCK OPTIONS ACTIVITY

		June 30, 2021								December 31, 2020
		Shares				Price				Shares				Price

Stock options outstanding and exercisable			31,035			$	62.79				31,367			$	64.78

The following table summarizes information for stock options outstanding and for stock options exercisable at June 30, 2021:

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

	16,500			$	7.20			$	11.60			$	10.00				6.3				16,500			$	10.00
	10,622				90.00				124.80				106.20				2.8				10,622				106.20
	2,913				139.20				171.00				147.39				1.0				2,913				147.39
	1,000				226.20				226.20				226.20				3.2				1,000				226.20

	31,035			$	7.20			$	226.20			$	62.79				4.5				31,035			$	62.79

Restricted Stock

Company grants restricted stock under its incentive plan covering shares of common stock to employees and directors of the Company. The restricted stock awards are time-based awards and are amortized ratably over the requisite service period. Restricted stock vests ratably on each anniversary following the grant date provided the grantee is employed on the vesting date. Restricted stock granted to employees, when vested are net settled through the issuance of shares, net of the number of shares required to pay withholding taxes.

The following table presents the changes in non-vested, time-based restricted stock awards to all employees and directors for the six months ended June 30, 2021:

		Shares				Weighted-Avg. Grant Date Fair Value per Share

Non-vested restricted stock at December 31, 2020			71,000			$	4.89
Granted			150,000			$	4.72
Vested			(47,000	)		$	4.89
Non-vested at June 30, 2021			174,000			$	4.75

The following table presents the stock compensation expense related to restricted stock grants for the three and six months ended June 30, 2021 and 2020:

				2021				2020				2021				2020
		Three Months Ended June 30,									Six Months Ended June 30,
		2021					2020				2021				2020
		(in thousands)

Stock compensation expense		$	116				$	64			$	195			$	106

Total compensation cost related to non-vested time-based awards not yet recognized in the Company’s condensed consolidated statements of operations as of June 30, 2021, is $650 thousand. This cost is expected to be recognized over a weighted average period of 2.6 years.