Quarterly report pursuant to Section 13 or 15(d)

Stock Based Compensation

v3.21.2
Stock Based Compensation
9 Months Ended
Sep. 30, 2021
Stock Based Compensation  
Note 12 - Stock Based Compensation

Note 12 - Stock Based Compensation

 

Stock Based Compensation

 

Stock based compensation consists of the amortization of common stock, stock options and warrants issued for prepaid services. For the three months ended September 30, 2021 and 2020, stock based compensation expense amounted to $197,143 and $369,427, respectively. For the nine months ended September 30, 2021 and 2020, stock based compensation expense amounted to $453,051 and $619,176, respectively. Such expense is classified in selling, general and administrative expenses.

 

Common Stock

 

As of January 1, 2020, and pursuant to an advisory agreement dated as of November 20, 2019 and effective as of January 1, 2020 for a term of one year with a nonaffiliated third party, the Company issued 1,000,000 shares of common stock of the Company to such third party as and for the entire compensation to be paid for all services to be rendered during the term. These shares of common stock were valued at $200,000 in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over one year.

 

On March 23, 2021, and pursuant to a consulting agreement dated November 1, 2020, as amended on March 19, 2021, with a nonaffiliated third party, the Company issued 500,000 shares of common stock to such party as part of its compensation thereunder. These shares of common stock were valued at $615,000 in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over ten months.

On March 30, 2021, and pursuant to a business development agreement dated March 30, 2021 with a nonaffiliated third party, the Company issued 25,000 shares of common stock to such party for its compensation thereunder. These shares of common stock were valued at $29,250 in accordance with FASB ASC Topic 718. The fair value of the shares is being amortized to selling, general and administrative expenses within the Company’s condensed consolidated statements of operations over three months.

 

Stock Options

 

The Company accounts for stock-based compensation awards in accordance with the provisions of ASC 718, which addresses the accounting for employee stock options which requires that the cost of all employee stock options, as well as other equity-based compensation arrangements, be reflected in the condensed consolidated financial statements over the vesting period based on the estimated fair value of the awards.

 

A summary of stock option activity for the nine months ended September 30, 2021 is presented below:

 

 

 

Number of

Shares

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining Contractual

Life (years)

 

 

Aggregate

Intrinsic

Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

January 1, 2021

 

 

16,218,326

 

 

$ 0.50

 

 

 

3.57

 

 

$ 3,588,631

 

Grants

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Exercises

 

 

(150,000 )

 

 

0.75

 

 

 

-

 

 

 

-

 

Expirations

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

September 30, 2021

 

 

16,068,326

 

 

$ 0.49

 

 

 

2.87

 

 

$ 3,701,564

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Options exercisable at:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2021

 

 

16,068,326

 

 

$ 0.49

 

 

 

2.87

 

 

$ 3,701,564

 

 

The aggregate intrinsic value in the table above represents the total intrinsic value, based on the Company’s closing stock price of $0.65 as of September 30, 2021, which would have been received by the option holders had all option holders exercised their options as of that date.

 

On May 1, 2021, the Company issued 15,869 shares of common stock to a certain option holder upon the cashless exercise of an option to purchase 25,000 shares of common stock at an exercise price off $0.42 based upon a market price of $1.15 per share as determined under the terms of the option. On June 30, 2021, the Company issued 125,000 shares of common stock to a certain option holder upon a cash exercise of an option to purchase 125,000 shares of common stock at an exercise price of $0.81 or $101,250 in the aggregate.