XML 26 R15.htm IDEA: XBRL DOCUMENT
v3.20.2

Note 7 - Stockholders' Equity | 6 Months Ended
--- | ---
Jun. 30, 2020
Notes to Financial Statements |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 7 - STOCKHOLDERS' EQUITY Common Stock – The Company has 25,000,000 authorized shares of common stock, $0.001 par value. As of June 30, 2020 and 2019, respectively, there were 21,649,213 and 20,547,668 common shares issued and outstanding. Voting -- Holders of common stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders, including the election of directors, and do not have any right to cumulate votes in the election of directors. Dividends -- Subject to the rights and preferences of the holders of any series of preferred stock, if any, which may at the time be outstanding, holders of common stock are entitled to receive ratably such dividends as our Board of Directors from time to time may declare out of funds legally available. Liquidation Rights -- In the event of any liquidation, dissolution or winding-up of affairs, after payment of all of our debts and liabilities and subject to the rights and preferences of the holders of any outstanding shares of any series of our preferred stock, the holders of common stock will be entitled to share ratably in the distribution of any of our remaining assets. Other Matters -- Holders of common stock have no conversion, preemptive or other subscription rights, and there are no redemption rights or sinking fund provisions with respect to our common stock. All of the issued and outstanding shares of common stock on the date of this Annual report are validly issued, fully paid and non-assessable. Preferred Stock -- Our Board of Directors has the authority to issue preferred stock in one or more classes or series and to fix the designations, powers, preferences and rights, the qualifications, limitations or restrictions thereof, including dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, redemption prices, liquidation preferences and the number of shares constituting any class or series, without further vote or action by the stockholders. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control without further action by the stockholders and may adversely affect the voting and other rights of the holders of common stock. The Company has 2,500,000 authorized Preferred stock, $0.001 par value. As of June 30, 2020, and 2019 there were 0 mandatory convertible preferred shares issued and outstanding. Stock Issuance Since January 1, 2020, the Company has made the following issuances of common stock: On January 15, 2020, the Company issued an additional 8,212 shares of restricted stock valued at $45,000 for services provided by the Board of Directors. The Company will recognize the stock-based compensation of the award over the requisite service period. The shares vested immediately. On May 21, 2020, the Company completed a Securities Purchase Agreement with certain accredited investors in a private placement pursuant to which the Company issued and sold an aggregate of 1,085,000 shares of common stock, par value $0.001 per share, at a purchase price of $5.00 per share for gross proceeds of $4,744,048 including costs of $680,952 for placement fees, lawyer fees, auditor fees and other costs related to the capital raise, and a prefunded warrant to purchase an aggregate of 515,000 shares of Common Stock, at a purchase price of $5.00 per share for gross proceeds of $2,575,000. On June 6, 2020, the Company issued an additional 8,333 shares of restricted stock valued at $69,333 for services provided by the Board of Directors. The Company will recognize the stock-based compensation of the award over the requisite service period. The shares vested immediately. For the six months ended June 30, 2020 and 2019, the Company has recorded stock-based compensation expense of $223,557 and $151,611, respectively. Warrants In connection with the Securities Purchase Agreement entered in May 2020, a prefunded warrant (“the Warrant”) to purchase an aggregate of 515,000 shares of Common Stock at a purchase price of $5.00 per share was issued. Subject to certain beneficial ownership limitations, the Warrant is immediately exercisable and may be exercised for no additional consideration. The Warrant does not expire. A holder of the Warrant will not have the right to exercise any portion of the Warrant if the holder together with Affiliates and Attribution Parties (as such terms are defined in the Warrant) would beneficially own in excess of 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrant. However, upon notice from the holder to the Company, the holder may decrease or increase the beneficial ownership limitation, which may not exceed 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrant, provided that any increase in the beneficial ownership limitation will not take effect until 61 days following notice to the Company. In accordance with Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”), the fair value of these warrants is classified as a liability on the Company’s Consolidated Balance Sheet because, according to the warrant’s terms, a fundamental transaction could give rise to an obligation of the Company to pay cash to its warrant holders. Corresponding changes in the fair value of the warrants are recognized in earnings on the Company’s Consolidated Statement of Operations in each subsequent period. For warrants classified as a liability, the following is a summary of the periodic changes in their fair value during the six months ended June 30, 2020:
|  | June 30, 2020 |
Warrants outstanding January 1, 2020 |  |  | - |
Prefunded warrants issued May 2020 |  |  | 515,000 |
Exercises and conversions |  |  | - |
Warrants outstanding June 30, 2020 |  |  | 515,000 |
The following table summarizes the fair value measurement of the warrant liability.
Base value of warrants, 515,000 warrants at $5 |  | $ | 2,575,000 |
Fair value adjustment |  |  | 236,900 |
Balance at June 30, 2020 |  | $ | 2,811,900 |
Stock-based Compensation In 2013, the Company’s Board of Directors adopted a Share Incentive Plan (the “Incentive Plan”). Under the terms and conditions of the Incentive Plan, the Board of Directors is empowered to grant shares (Restricted Stock Units “RSUs”) to officers and directors of the Company. At June 30, 2020, 136,632 shares were granted and outstanding under the Incentive Plan. Directors of the company receives share compensation as follows: (i) an initial grant of 25,000 shares of common stock grant that vest over a three-year period at the appointment to the Board, followed by an annual grant of $30,000 in shares of common stock per annum after full vesting of the initial 25,000 share grant. Further the company have granted shares to management for 2020 as part of the Incentive Plan. Total grant is 92,081 shares that vest over a three-year period. The Company recognizes compensation costs for stock grants to Directors and management based on a stock price on the date of the grant. The Company recognized stock-based compensation expense related to share grants of $223,557 and $151,611 for the six months ended June 30, 2020 and 2019, respectively. For the three months period ended June 30, 2020 and 2019 respectively, the stock-based compensation related to share grants was $82,335 and $23,167. On June 30, 2020, the Company had $559,167 of unrecognized compensation cost related to non-vested stock grants. A summary of the status of the RSU's June 30, 2020 and changes during the period is presented below:
|  | June 30, 2020 |
|  | Number of units |  |  | Weighted Average Grant-Date Fair value |  |  | Aggregated Intrinsic Value |
Outstanding, December 31, 2019 |  |  | 133,747 |  |  | $ | 5.47 |  |  | $ | 50,824 |
Granted |  |  | 19,430 |  |  |  | 5.92 |  |  |  | - |
Vested and settled with share issuance |  |  | (16,545 | ) |  |  | 6.91 |  |  |  | - |
Forfeited |  |  | - |  |  |  | - |  |  |  | - |
Outstanding, June 30, 2020 |  |  | 136,632 |  |  | $ | 5.36 |  |  | $ | 13,663 |
Stock Options In August 2015, the Company’s Board of Directors adopted a Stock Option Plan (the “Plan”). Under the terms and conditions of the Plan, the Board of Directors is empowered to grant stock options to employees, officers, and directors of the Company. At June 30, 2020, 25,000 options were granted and outstanding under the Plan. The Company recognizes compensation costs for stock option awards to employees based on the grant-date fair value. The value of each stock option is estimated on the date of grant using the Black-Scholes option-pricing model. The Company recognized stock-based compensation expense related to options of $0 for the six months ended June 30, 2020 and 2019. On June 30, 2020, the Company had $0 of unrecognized compensation cost related to non-vested options. A summary of the status of the options outstanding under the Company’s stock option plans on June 30, 2020 is presented below:
|  |  |  | Options Outstanding |  |  | Options Exercisable |
Exercise Prices |  |  | Number Outstanding |  |  | Weighted Average Remaining Contractual Life (years) |  |  | Weighted Average Exercise Price |  |  | Number Exercisable |  |  | Weighted Average Exercise Price |
$ | 2.96 |  |  |  | 25,000 |  |  |  | 0.12 |  |  | $ | 2.96 |  |  |  | 25,000 |  |  | $ | 2.96 |
Total |  |  |  | 25,000 |  |  |  | 0.12 |  |  | $ | 2.96 |  |  |  | 25,000 |  |  | $ | 2.96 |
A summary of the status of the options on June 30, 2020 and changes during the period is presented below:
|  | June 30, 2020 |
|  | Shares |  |  | Weighted Average Exercise Price |  |  | Average Remaining Life |  |  | Weighted Average Intrinsic Value |
Outstanding at beginning of period |  |  | 25,000 |  |  | $ | 2.96 |  |  |  | 0.62 |  |  | $ | 72,250 |
Granted |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Exercised |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Forfeited |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Expired |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Outstanding at end of period |  |  | 25,000 |  |  | $ | 2.96 |  |  |  | 0.12 |  |  | $ | 62,500 |
Vested and expected to vest |  |  | 25,000 |  |  | $ | 2.96 |  |  |  | 0.12 |  |  | $ | 62,500 |
Exercisable end of period |  |  | 25,000 |  |  | $ | 2.96 |  |  |  | 0.12 |  |  | $ | 62,500 |

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(e)(1)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
Name: | us-gaap_StockholdersEquityNoteDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration