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Note R - Equity | 12 Months Ended
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Dec. 31, 2020
Notes to Financial Statements |
Stockholders' Equity Note Disclosure [Text Block] | NOTE R — EQUITY 1. Preferred Stock Within the limits and restrictions provided in the Company's Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to 5,000,000 shares of preferred stock, $.0001 par value per share, in one or more series, and to fix, as to any such series, any dividend rate, redemption price, preference on liquidation or dissolution, sinking fund terms, conversion rights, voting rights, and any other preference or special rights and qualifications. 2. Common Stock Effective November 20, 2020, the Company implemented a reverse stock split of its outstanding common stock at a ratio of 1 -for- 8. The number of authorized shares and the par value of the Company's common stock and preferred stock were not affected by the reverse stock split. Stockholders who otherwise would be entitled to receive fractional shares were rounded up to the nearest whole share. The reverse stock split became effective at the opening of trading on November 20, 2020. Holders of common stock have equal rights to receive dividends when, as and if declared by the Board of Directors, out of funds legally available therefor. Holders of common stock have one vote for each share held of record and do not have cumulative voting rights. Holders of common stock are entitled, upon liquidation of the Company, to share ratably in the net assets available for distribution, subject to the rights, if any, of holders of any preferred stock then outstanding. Shares of common stock are not redeemable and have no preemptive or similar rights. All outstanding shares of common stock are fully paid and nonassessable. Issuances of Common Stock On July 23, 2020, the Company completed an underwritten public offering of shares of common stock and warrants resulting in net proceeds of approximately $22.7 million, after deducting underwriting discounts and commissions and estimated offering expenses. 4,264,313 shares of common stock were issued as a result of this offering, and a further 797,038 shares of common stock were issued upon the exercise of 512,500 prefunded warrants and 284,538 warrants exercised in conjunction with the offering. On March 30, 2020, the Company issued 121,500 shares of common stock upon exercise of warrants at $12.00 per share, resulting in proceeds of $1,458,000 to the Company. See Note O Convertible Notes Payable for common stock issuances related to conversion of convertible notes payable and shares of common stock issued for fees in connection with the agreements during fiscal 2020 and 2019. Issuances of Nonvested Stock Nonvested stock consists of shares of common stock that are subject to restrictions on transfer and risk of forfeiture until the fulfillment of specified conditions. The fair value of nonvested shares is determined based on the market price of the Company's common stock on the grant date. Nonvested stock is expensed ratably over the term of the restriction period. The Company issued 38,250 and 3,125 shares of restricted common stock in August and November of 2020, respectively to certain employees and directors of the Company. These shares vest in equal annual installments over a three -year period from the date of grant, and had a fair value on the date of issuance of $198,900, and $11,250, respectively. Nonvested stock compensation for the year ended December 31, 2020 was $23,764. Issuances to Directors, Executive Officers & Consultants During the year ended December 31, 2020, the Company issued 5,270 shares of common stock to its directors in lieu of payment of board fees, valued at $28,511. During the year ended December 31, 2019, the company issued 4,612 shares of common stock to its directors in lieu of payment of board fees, valued at $35,013. Employees ' exercise options During 2020 and 2019, no employee stock options were exercised. 3. Warrants Securities Purchase Agreement dated November 13, 2014: As part of a Securities Purchase Agreement, dated November 13, 2014, by and between the Company and a number of private and institutional investors, the Company issued to certain private investors warrants to purchase 124,610 shares of common stock. The warrants expired in November 2019. Securities Purchase Agreement dated September 23, 2015: On September 23, 2015, the Company issued warrants (the “2015 Warrants”) to purchase 8,681 shares of common stock in connection with the issuance of a promissory note. The warrants were immediately exercisable at an initial exercise price of $28.80 per share and had a term of five years. The 2015 Warrants expired in September 2020. The 2015 Warrants had a "full ratchet" anti-dilution adjustment provision which could be triggered in the event the Company sold or granted any additional shares of common stock, options, warrants or other securities that were convertible into common stock at a price lower than $28.80 per share. The anti-dilution was not triggered by certain “exempt issuances” which among other issuances, includes the issuance of shares of common stock, options or other securities to officers, employees, directors, consultants or service providers. Anti-dilution features were triggered as follows: On February 14, 2020, the February 2020 Note was issued at a conversion price of $9.20 that triggered the anti-dilution provisions included in the 2015 Warrants. In addition, the amendments to the Original Note reduced the conversion price of the Original Note to $5.20 which also triggered the anti-dilution provision of the 2015 Warrants. As a result of the forgoing transactions, the number of shares of common stock issuable upon the full exercise of the 2015 Warrants increased to 48,078, the exercise was reduced to $5.20 per share, and the Company recorded a non-cash deemed dividend in amount of $41,688. Warrants Issued for Services: During the second quarter of 2020, the Company issued a warrant to purchase 15,625 shares of common stock to an investor in payment for a business referral valued at $94,655. During the third quarter of 2020, the Company issued a warrant to purchase 3,125 shares of common stock to a former employee for a business referral valued at $12,921. Warrants Issued with Convertible Notes: In 2020, the Company issued warrants to purchase 415,625 shares in connection with the May 2020 and June 2020 Notes. In 2019, the Company issued a warrant to purchase 250,000 shares in connection with the Securities Purchase Agreement dated July 10, 2019. Valuation Assumptions for Warrants: The Company records the warrants at their fair value which is determined using the Black-Scholes valuation model on the date of the grant. The fair value of each warrant was estimated with the following assumptions:
|  | Year ended December 31, |
|  | 2020 |  |  | 2019 |
Weighted average Risk free interest rate |  |  | 0.33 | % |  |  | 1.82 | %
Weighted average price |  | $ | 9.25 |  |  | $ | 12.00 |
Weighted average exercise period |  |  | 5 |  |  |  | 5 |
Weighted average Volatility of stock price |  |  | 110 | % |  |  | 83 | %
The warrant volatility for each issuance is determined based on the review of the experience of the weighted average of historical daily price changes of the Company's common stock over the expected exercise period. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods corresponding with the years to maturity. A summary of warrant activity is as follows:
|  | Total Warrants |  |  | Weighted average exercise price |  |  | Weighted average remaining life (in years) |  |  | Aggregate intrinsic value |
Outstanding, as of December 31, 2018 |  |  | 472,622 |  |  |  | 12.72 |  |  |  | 2.05 |  |  |  |  |
Granted |  |  | 250,000 |  |  |  | 12.00 |  |  |  |  |  |  |  |  |
Exercised |  |  | — |  |  |  | — |  |  |  |  |  |  |  |  |
Forfeited |  |  | — |  |  |  | — |  |  |  |  |  |  |  |  |
Expired |  |  | (299,063 | ) |  |  | 12.00 |  |  |  |  |  |  |  |  |
Outstanding, as of December 31, 2019 |  |  | 423,559 |  |  |  | 12.80 |  |  |  | 3.94 |  |  |  | — |
Granted – public offering |  |  | 4,264,313 |  |  |  | 5.20 |  |  |  |  |  |  |  |  |
Granted – prefunded warrants from the public offering |  |  | 512,500 |  |  |  | 0.08 |  |  |  |  |  |  |  |  |
Granted – other |  |  | 434,375 |  |  |  | 9.25 |  |  |  |  |  |  |  |  |
Increase due to trigger of anti-dilution provision feature |  |  | 27,244 |  |  |  | 5.20 |  |  |  |  |  |  |  |  |
Exercised – public offering |  |  | (284,538 | ) |  |  | 5.20 |  |  |  |  |  |  |  |  |
Exercised – prefunded warranted from the public offering |  |  | (512,500 | ) |  |  | 0.08 |  |  |  |  |  |  |  |  |
Exercised – other |  |  | (121,500 | ) |  |  | 12.00 |  |  |  |  |  |  |  |  |
Forfeited |  |  | — |  |  |  | — |  |  |  |  |  |  |  |  |
Expired |  |  | (54,066 | ) |  |  | 6.86 |  |  |  |  |  |  |  |  |
Outstanding, as of December 31, 2020 |  |  | 4,689,387 |  |  |  | 6.04 |  |  |  | 4.48 |  |  |  | — |

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- 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
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