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Stockholders' Equity
 9 Months Ended
Sep. 30, 2023
Stockholders' Equity [Abstract]  
STOCKHOLDERS’ EQUITY

NOTE 8 – STOCKHOLDERS’ EQUITY

 

Stock-Based Compensation:

 

Equity plans

 

Under the 2018 Equity Plan, the number of shares issuable under the Plan on the first day of each fiscal year increase by an amount equal to the lower of (i) 100,000 shares (after a later 10 for 1 stock split) or (ii) 5% of the outstanding shares on the last day of the immediately preceding fiscal year. As of September 30, 2023, there were no shares issuable under the 2018 Equity Plan until it automatically replenishes on January 1, 2024.

 

At the Company’s annual meeting on May 17, 2023, the stockholders approved an amendment to the 2021 Equity Plan that, amongst other things, increased the number of the shares available under the 2021 Equity Plan to 10,000,000 shares. As of September 30, 2023, the number of shares reserved under the 2021 Equity Plan was 5,217,548.

 

The Company recognized stock-based compensation expense during the three and nine months ended September 30, 2023, and 2022 as follows:

 

   For the three months ended
September 30,		   For the nine months ended
September 30,		 
   2023   2022   2023   2022 
Performance-based restricted stock awards*  $(812,901)  $163,865   $(479,343)  $517,789 
Service-based restricted stock awards   4,096,717    133,465    4,146,709    439,052 
Stock issued to consultants   
-
    
-
    307,069    
-
 
Common stock warrant expense   500,500    500,500    1,501,500    1,167,833 
Total stock-based compensation  $3,784,316   $797,830   $5,475,935   $2,124,674 

 

*The performance-based restricted stock awards contain reversal of share-based payment expenses from 2021 onwards for forfeited awards due to staff departures.

 

Performance-based awards

 

Performance-based awards generally vest over a three-year performance period upon the successful completion of specified market and performance conditions.

 

The following table presents a summary of the Company’s performance-based awards restricted stock awards activity:

 

   Number of
shares		   Weighted
Average
Remaining
Contractual
Life (in
years)		 
Outstanding as of December 31, 2022   342,310    8.33 
Issued   
-
    
 
 
Exercised   (100,000)   
 
 
Expired/forfeited   (66,765)   
 
 
Outstanding as of September 30, 2023   175,545    8.41 
Exercisable as of September 30, 2023   144,327    6.65 

 

As of September 30, 2023, there was approximately $0.18 million of unrecognized compensation cost related to the performance-based awards, which is expected to be recognized over a remaining weighted-average vesting period of approximately one year.

 

Service-based restricted stock awards

 

Service-based awards generally vest over a one-year service period.

 

The following table presents a summary of the Company’s service-based awards activity:

 

   Number of
shares		   Weighted
Average
Remaining
Contractual
Life
(in years)		 
Outstanding as of December 31, 2022   74,246    8.42 
Issued   6,143,346    
 
 
Exercised   (77,092)   
 
 
Expired/forfeited   (655,619)   
 
 
Outstanding as of September 30, 2023   5,484,881    2.47 
Exercisable as of September 30, 2023   233,014    0.07 

 

As of September 30, 2023, there was approximately $5.56 million of unrecognized compensation cost related to the service-based restricted stock awards, which is expected to be recognized over a remaining weighted-average vesting period of approximately six months.

 

Stock options awards

 

Stock options awards vest upon the successful completion of specified market conditions.

 

The following table presents a summary of the Company’s Stock options awards activity:

 

    Number of
shares		     Weighted
Average
Exercise
Price		     Weighted
Average
Remaining
Contractual
Life
(in years)		  
Outstanding as of December 31, 2022     417     $ 35.90       1.26  
Issued     1,750,000       1.89          
Exercised     -       -          
Expired     -       -          
Outstanding as of September 30, 2023     1,750,417     $ 1.90       9.75  
Exercisable as of September 30, 2023     417     $ 35.90       1.26  

 

The options have no intrinsic value as of Sept 30, 2023 or Dec 31, 2022.

 

Common Stock Warrants

 

A summary of the status of the Company’s outstanding stock warrants and changes during the nine months ended September 30, 2023, is as follows:

 

   Number of
Warrants		   Weighted
Average
Exercise
Price		   Weighted
Average
Remaining
Contractual
Life
(in years)		 
Outstanding as of December 31, 2022   2,825,278    4.17    3.54 
Issued   2,967,512    
-
    - 
Exercised   (246,668)   
-
    - 
Expired   
-
    
-
    - 
Outstanding as of September 30, 2023   5,546,122   $14.31    3.44 
Warrants exercisable as of September 30, 2023   5,546,122   $14.31    3.44 

 

As of September 30, 2023, there was approximately $0.33 million of unrecognized compensation cost related to the warrants issued is expected to be recognized over a remaining weighted-average vesting period of approximately three months.

 

Common Stock

 

During the quarter ended September 30, 2023, there were exercises of restricted stock units and common stock options into 63,334 shares of common stock of the Company.