XML 29 R18.htm IDEA: XBRL DOCUMENT v3.7.0.1
STOCKHOLDERS' EQUITY
 3 Months Ended
Mar. 31, 2017
Equity [Abstract]  
Stockholders Equity Note Disclosure [Text Block]
NOTE 13. STOCKHOLDERS’ EQUITY
 
On May 25, 2016, we effected a one-for-ten reverse stock split of our common stock. Our consolidated financial statements and disclosures reflect for this change in capital structure for all periods presented.
 
On June 12, 2015 and June 13, 2016, our shareholders approved 100,000,000 increases in our authorized common stock to 300,000,000 and  400,000,000, respectively.
 
Equity Incentive Plan Activity
 
On December 5, 2013, our shareholders approved the Net Element International, Inc. 2013 Equity Incentive Plan (the “2013 Plan”). Awards under the 2013 Plan may be granted in any one or all of the following forms: (i) incentive stock options meeting the requirements of Section 422 of the Internal Revenue Code of 1986, as amended; (ii) non-qualified stock options (unless otherwise indicated, references to “Options” include both Incentive Stock Options and Non-Qualified Stock Options); (iii) stock appreciation rights, which may be awarded either in tandem with Options or on a stand-alone basis; (iv) shares of common stock that are restricted; (v) units representing shares of common stock; (vi) units that do not represent shares of common stock but which may be paid in the form of common stock; and (vii) shares of common stock that are not subject to any conditions to vesting. The maximum aggregate number of shares of common stock available for award under the 2013 Plan at March 31, 2017 and December 31, 2016 was 207,938 and 1,280,258, respectively. The 2013 Plan is administered by the compensation committee.
 
On February 28, 2017, the Compensation Committee (the “Committee”) of our Board of Directors approved and authorized grants of the following equity awards to our employees and consultants of the Company pursuant to the 2013 Plan, as amended:
 
(i)
451,054 qualified options to acquire shares of our common stock (50% of such options vesting immediately and the balance 50% of such options vesting in 4 equal proportions quarterly after the grant date) and
 
(ii)
626,678 restricted shares of our common stock (50% of such shares vesting immediately and the balance 50% of such shares vesting in 4 equal proportions quarterly after the grant date).
 
Awards Outside the 2013 Plan
 
On February 28, 2017, the Committee awarded to Oleg Firer, our Chief Executive Officer, 471,388 restricted shares of our common stock as performance bonus subject to shareholder approval.
 
Other Stock Issuance
 
Pursuant to the earn out installment provisions of the PayOnline purchase agreement, we issued an additional 130,823 shares of our common stock and paid $108,583 during March 2017. We accrued but not yet issued 20,161 shares to our independent directors for payment of services during the first quarter of 2017.
 
Agreement with ESOUSA Holdings
 
On July 6, 2016, we entered into a common stock purchase agreement (“Purchase Agreement”), with ESOUSA Holdings, LLC, a New York limited liability company (“ESOUSA”), which provides that ESOUSA is committed to purchase up to an aggregate of $10 million of our shares of common stock over the 30-month term of the Purchase Agreement. In consideration for entering into the Purchase Agreement, we paid shares of our common stock with a value equivalent $200,000 as a commitment fee to ESOUSA. The number of shares was calculated using the average of volume weighted average price for our common stock during the 3 trading day period immediately preceding the date of issuance of such shares. Accordingly, on August 31, 2016, we issued 131,171 shares of our common stock to ESOUSA based on the price of $1.5247 per share. 
 
In connection with the ESOUSA Purchase Agreement, we issued the following shares of our common stock to ESOUSA during the three months ended March 31, 2017:
 
Issue
 
Number of
 
Purchase
 
Share
 
Date
 
Shares
 
Amount
 
Price
 
January 19, 2017
 
 
240,964
 
$
200,000
 
$
0.83
 
January 25, 2017
 
 
176,471
 
 
150,000
 
 
0.85
 
February 8, 2017
 
 
1,161,442
 
 
1,000,000
 
 
0.86
 
March 27, 2017
 
 
103,790
 
 
87,132
 
 
0.84
 
Totals
 
 
1,682,667
 
$
1,437,132
 
$
0.85