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Note 15 - Equity-based Compensation | 9 Months Ended
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Sep. 30, 2022
Notes to Financial Statements |
Share-Based Payment Arrangement [Text Block] | NOTE 15. EQUITY-BASED COMPENSATION Equity Compensation Plans In October 2007, the Company adopted the 2007 Omnibus Incentive Plan (the “2007 Plan”) to provide for the granting of equity awards, such as stock options, unrestricted and restricted common stock, stock units, dividend equivalent rights, and stock appreciation rights to employees, directors and outside consultants, as determined by the Board. The 2007 Plan expired on March 15, 2017. Upon expiration, new awards cannot be issued pursuant to the 2007 Plan, but outstanding awards continue to be governed by its terms. Stock options granted under the 2007 Plan expire no later than ten years from the date of grant. All stock options outstanding under the 2007 Plan were fully vested as of September 30, 2022. In March 2017, the Company adopted the 2017 Omnibus Incentive Plan (the “2017 Plan”), which was approved by stockholders on June 2, 2017, to provide for the granting of equity awards, such as nonqualified stock options (“NQSOs”), incentive stock options (“ISOs”), restricted stock, performance shares, stock appreciation rights (“SARs”), RSUs and other share-based awards to employees, directors, and consultants, as determined by the Board. The 2017 Plan does not affect awards previously granted under the 2007 Plan. Upon adoption, the 2017 Plan allowed for awards of up to 2,318,486 shares of the Company’s common stock, plus an automatic annual increase in the number of shares authorized for awards on the first day of each of the Company’s fiscal years beginning January 1, 2018 through January 1, 2027 equal to (i) 4% of the number of shares of common stock outstanding on the last day of the immediately preceding fiscal year or (ii) such lesser number of shares of common stock than provided for in Section 4(a)(i) of the 2017 Plan as determined by the Board. On March 6, 2022, the number of shares available for future awards under the 2017 Plan was increased by 1,910,634 shares. As of September 30, 2022, there were 3,049,127 shares available for future awards under the 2017 Plan. Under the terms of the 2017 Plan, the exercise price of NQSOs, ISOs and SARs may not be less than 100% of the fair market value of the common stock on the date of grant and, if ISOs are granted to an owner of more than 10% of the Company’s stock, then not less than 110% of the fair market value of the common stock on the date of grant. The term of awards will not be longer than ten years, or in the case of ISOs, not longer than five years with respect to holders of more than 10% of the Company’s stock. Stock options granted to employees generally vest over four years, while options granted to directors and consultants typically vest over a shorter period, subject to continued service. The Company issues new shares to satisfy option exercises for awards issued under the 2007 Plan and the 2017 Plan. Stock Option Summary The following table summarizes information about the Company’s stock options outstanding at September 30, 2022 and activity during the period ended September 30, 2022:
(in thousands, except years and per share data) |  | Awards |  |  | Weighted- Average Exercise Price |  |  | Weighted- Average Remaining Contractual Life (years) |  |  | Aggregate Intrinsic Value |
Outstanding at December 31, 2021 |  |  | 4,449 |  |  | $ | 1.39 |  |  |  | 7.6 |  |  | $ | 460 |
Options granted |  |  | 626 |  |  | $ | 0.28 |  |  |  |  |  |  |  |  |
Restricted stock units granted |  |  | 180 |  |  | $ | — |  |  |  |  |  |  |  |  |
Restricted stock units vested |  |  | (120 | ) |  | $ | — |  |  |  |  |  |  |  |  |
Options forfeited/cancelled |  |  | (362 | ) |  | $ | 3.50 |  |  |  |  |  |  |  |  |
Restricted stock units cancelled |  |  | (30 | ) |  | $ | — |  |  |  |  |  |  |  |  |
Outstanding at September 30, 2022 |  |  | 4,743 |  |  | $ | 1.07 |  |  |  | 7.8 |  |  | $ | 135 |
Vested and expected to vest at September 30, 2022 |  |  | 3,492 |  |  | $ | 1.42 |  |  |  | 7.4 |  |  | $ | 20 |
Vested at September 30, 2022 |  |  | 2,068 |  |  | $ | 2.06 |  |  |  | 6.3 |  |  | $ | — |
Exercisable at September 30, 2022 |  |  | 2,068 |  |  | $ | 2.06 |  |  |  | 6.3 |  |  | $ | — |
The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock option awards and the closing market price of the Company’s common stock as quoted on the NYSE American as of September 30, 2022 for options that have a quoted market price in excess of the exercise price. There were no stock option awards exercised during the three and nine months ended September 30, 2022. The Company received no cash payments for the exercise of stock options during the three and nine months ended September 30, 2022. As of September 30, 2022, total unrecognized compensation cost related to unvested stock options and restricted stock units was approximately $0.6 million. This amount is expected to be recognized as stock-based compensation expense in the Company’s unaudited condensed consolidated statements of operations and comprehensive loss over the remaining weighted average vesting period of 2.30 years. Stock Option Awards to Employees and Directors The Company grants options to purchase common stock to its employees and directors at prices equal to or greater than the market value of the stock on the dates the options are granted. The Company has estimated the value of stock option awards as of the date of grant by applying the Black-Scholes option pricing model using the single-option valuation approach. The application of this valuation model involves assumptions that are judgmental and subjective in nature. See Note 2, “Summary of Significant Accounting Policies,” for a description of the accounting policies that the Company applied to value its stock-based awards. During the nine months ended September 30, 2022 and 2021, the Company granted options to employees and directors to purchase an aggregate of 626,000 and 291,000 shares of common stock, respectively. The weighted-average assumptions used in determining the value of options are as follows:
|  | Nine Months Ended September 30, |
Assumption |  | 2022 |  |  | 2021 |
Expected price volatility |  |  | 158.04 | % |  |  | 163.95 | %
Expected term (in years) |  |  | 6.45 |  |  |  | 6.19 |
Risk-free interest rate |  |  | 2.29 | % |  |  | 0.92 | %
Dividend yield |  |  | 0.00 | % |  |  | 0.00 | %
Weighted-average fair value of options granted during the period |  | $ | 0.27 |  |  | $ | 0.71 |
Expected Price Volatility—This is a measure of the amount by which the stock price has fluctuated or is expected to fluctuate. The computation of expected volatility was based on the historical volatility of our own stock. Expected Term—This is the period of time over which the options granted are expected to remain outstanding. The expected life assumption is based on the Company’s historical data. Risk-Free Interest Rate—This is the U.S. Treasury rate for the week of the grant having a term approximating the expected life of the option. Dividend Yield—We have not made any dividend payments nor do we have plans to pay dividends in the foreseeable future. Forfeitures are estimated at the time of grant and reduce compensation expense ratably over the vesting period. This estimate is adjusted periodically based on the extent to which actual forfeitures differ, or are expected to differ, from the previous estimate. During the nine months ended September 30, 2022, the Company granted 180,000 shares of restricted stock to employees and directors. During the nine months ended September 30, 2021, the Company granted 1,228,359 shares of restricted stock to employees and directors. For the three months ended September 30, 2022, the Company recognized a reversal of stock-based compensation expense of $208 thousand for stock-based awards to employees and directors. For the three months ended September 30, 2021, the Company recognized stock-based compensation expense $151 thousand for stock-based awards to employees and directors. For the nine months ended September 30, 2022 and 2021, the Company recognized stock-based compensation expense of $130 thousand and $523 thousand, respectively, for stock-based awards to employees and directors. Stock-Based Awards to Non-Employees During the nine months ended September 30, 2022 and 2021, the Company did not grant options exercisable for shares of common stock to non-employees in exchange for advisory and consulting services. When the Company grants stock options, the stock options are recorded at their fair value on the grant date and recognized over the respective service or vesting period. The fair value of the stock options that are granted is calculated using the Black-Scholes option pricing model. In addition, during the nine months ended September 30, 2022 and 2021, the Company did not grant restricted stock to non-employees. For the three months ended September 30, 2022, the Company recognized no stock-based compensation expense as compared to a stock-based compensation expense of $73 thousand for the three months ended September 30, 2021, related to non-employee stock option grants. For the nine months ended September 30, 2022, the Company recognized a nominal stock-based compensation expense as compared to stock-based compensation expense of $180 thousand for the nine months ended September 30, 2021, related to non-employee stock option grants. Summary of Stock-Based Compensation Expense A summary of the stock-based compensation expense included in results of operations for the options and restricted stock awards discussed above is as follows (in thousands):
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Research and development |  | $ | 5 |  |  | $ | 2 |  |  | $ | 14 |  |  | $ | 8 |
Sales and marketing |  |  | 12 |  |  |  | 53 |  |  |  | 37 |  |  |  | 118 |
General and administrative |  |  | (225 | ) |  |  | 169 |  |  |  | 79 |  |  |  | 576 |
Total stock-based compensation expense |  | $ | (208 | ) |  | $ | 224 |  |  | $ | 130 |  |  | $ | 702 |

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