Annual report pursuant to Section 13 and 15(d)

Stock-based Plans and Stock-based Compensation

v3.22.1
Stock-based Plans and Stock-based Compensation
12 Months Ended
Dec. 31, 2021
Stock-based Plans and Stock-based Compensation [Abstract]  
Stock-based Plans and Stock-based Compensation 9. Stock-based Plans and Stock-based Compensation Stock-based Plans We have the 2010 Incentive Stock Option Plan and the 2013 Incentive Stock Option Plan under which we have granted stock options to our directors, officers and employees. As of December 31, 2021, 6,246,466 shares were authorized under the plans and 30,263,320 shares were available for future grant. We believe that such awards better align the interests of our directors, officers and employees with those of our shareholders. Option awards are generally granted with an exercise price that equals the fair market value of our stock at the date of grant. These option awards generally vest based on four years of continuous service and have 10-year contractual terms. The following table summarizes stock option activity under our stock-based plans as of and for the years ended December 31, 2021 and 2020: Shares Weighted‎Average‎Exercise Price Weighted‎Average‎Remaining‎Contractual‎Term (Years) Aggregate‎Intrinsic ValueOutstanding at December 31, 2019 5,781,884 $ 1.15 7.16 $ 527,868Granted 1,545,000 $ 1.19 — $ —Exercised (15,000) $ 0.48 — $ —Forfeit/canceled (814,068) $ 0.94 — $ —Expired (490,264) $ 1.07 — $ —Outstanding at December 31, 2020 6,007,552 $ 1.20 6.77 $ 4,056,639Granted 637,500 $ 1.56 — $ —Exercised — $ 1.61 — $ —Forfeit/canceled (272,029) $ 2.18 — $ —Expired (126,557) $ 1.17 — $ —Outstanding at December 31, 2021 6,246,466 $ 1.20 7.17 $ 2,500,847 Expected to vest at December 31, 2021 6,246,466 $ 1.20 6.14 $ 4,056,639Exercisable at December 31, 2021 4,063,765 $ 1.17 4.84 $ 2,252,766Unrecognized expense at December 31, 2021$ 1,527,647 The aggregate intrinsic value of options was calculated as the difference between the exercise price of the underlying awards and the quoted price of our common stock. At December 31, 2021, options to purchase 1,692,332 shares of common stock were in-the-money. The weighted average grant-date fair value of options granted during the years 2021 and 2020 was $0.99 and $0.79, respectively. 2020 On March 24, 2020, the Company granted one employee a total of 15,000 options to purchase shares of the Company common stock at the closing price as of March 24, 2020 of $0.65 per share. The option shares will vest 25% on the first anniversary of the grant, then equally in 36 monthly installments thereafter and are exercisable until March 24, 2030. The total estimated value using the Black-Scholes Model, based on a volatility rate of 77.56% and an option fair value of $0.43 was $6,472. On April 6, 2020, the Company granted four employees a total of 700,000 options to purchase shares of the Company common stock at the closing price as of April 6, 2020 of $0.70 per share. 500,000 option shares will vest 25% on the first anniversary of the grant, then equally in 36 monthly installments thereafter and are exercisable until April 6, 2030. 200,000 option shares will vest ratably over forty-eight (48) months and are exercisable until April 6, 2030. The total estimated value using the Black-Scholes Model, based on a volatility rate of 78.21% and an option fair value of $0.47 was $326,752. On November 5, 2020, the Company granted one employee a total of 20,000 options to purchase shares of the Company common stock at the closing price as of November 5, 2020 of $0.96 per share. The option shares will vest 25% on the first anniversary of the grant, then equally in 36 monthly installments thereafter and are exercisable until November 5, 2030. The total estimated value using the Black-Scholes Model, based on a volatility rate of 77.36% and an option fair value of $0.63 was $12,689. On December 7, 2020, the Company granted one employee a total of 600,000 options to purchase shares of the Company common stock at the closing price as of December 7, 2020 of $1.55 per share. The option shares will vest 25% on the first anniversary of the grant, then equally in 36 monthly installments thereafter and are exercisable until December 7, 2030. The total estimated value using the Black-Scholes Model, based on a volatility rate of 77.35% and an option fair value of $1.03 was $615,495. On December 17, 2020, the Company granted six employees a total of 210,000 options to purchase shares of the Company common stock at the closing price as of December 17, 2020 of $1.83 per share. The option shares will vest 25% on the first anniversary of the grant, then equally in 36 monthly installments thereafter and are exercisable until December 17, 2030. The total estimated value using the Black-Scholes Model, based on a volatility rate of 77.41% and an option fair value of $1.21 was $254,373. 2021 On March 26, 2021, the Company granted five employee a total of 67,500 options to purchase shares of the Company common stock at the closing price as of March 26, 2021, of $1.80 per share. The Option Shares will vest ratably over forty-eight (48) months and are exercisable until March 26, 2031. The total estimated value using the Black-Scholes Model, based on a volatility rate of 73.97% and an option fair value of $1.16 was $78,492. On May 17, 2021, the Company granted one employee a total of 20,000 options to purchase shares of the Company common stock at the closing price as of May 17, 2021, of $1.67 per share. The option shares will vest ratably over forty-eight (48) months and are exercisable until January 21, 2031. The total estimated value using the Black-Scholes Model, based on a volatility rate of 74.79% and an option fair value of $0.93 was $18,628. On August 11, 2021, the Company granted one employee a total of 5,000 options to purchase shares of the Company common stock at the closing price as of August 11, 2021, of $1.53 per share. The option shares will vest ratably over forty-eight (48) months and are exercisable until August 11, 2031. The total estimated value using the Black-Scholes Model, based on a volatility rate of 73.29% and an option fair value of $1.12 was $5,606. On December 15, 2021, the Company granted nineteen employees a total of 545,000 options to purchase shares of the Company common stock at the closing price as of December 15, 2021, of $1.53 per share. The option shares will vest ratably over forty-eight (48) months and are exercisable until February 18, 2029. The total estimated value using the Black-Scholes Model, based on a volatility rate of 71.53% and an option fair value of $.97 was $528,434. Stock-based Compensation Expense The impact on our results of operations of recording stock-based compensation expense for the years ended December 31, 2021 and 2020 was as follows: Years Ended December 31, 2021 2020General and administrative$ 289,782 $ 267,306Sales and marketing 81,093 75,235Engineering, research, and development 178,893 171,394 $ 549,768 $ 513,935 As of December 31, 2021, there was approximately $1,527,647 of unearned stock-based compensation that will be expensed from 2022 through 2026. If there are any modifications or cancellations of the underlying unvested awards, we may be required to accelerate, increase or cancel all or a portion of the remaining unearned stock-based compensation expense. Future unearned stock-based compensation will increase to the extent we grant additional equity awards. Stock Option Valuation Assumptions We calculated the fair value of each stock option award on the date of grant using the Black-Scholes option pricing model. The ranges of assumptions were used for the years ended December 31, 2021 and 2020:     Years Ended December 31,    2021 2020Risk-free interest rate  0.42% to 0.58% 0.42% to 0.58%Expected life (years)  6.00 6.00Expected dividend yield  — —Expected volatility  59.90% to 80.26% 77.36% to 78.21% The risk-free interest rate assumption is based upon published interest rates appropriate for the expected life of our employee stock options. The expected life of the stock options represents the weighted-average period that the stock options are expected to remain outstanding and was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior as influenced by changes to the terms of its stock-based awards. The dividend yield assumption is based on our history of not paying dividends and no future expectations of dividend payouts. The expected volatility in 2021 and 2020 is based on the historical publicly traded price of our common stock. Restricted stock units The following table summarizes restricted stock unit activity under our stock-based plans as of and for the years ended December 31, 2021 and 2020:   Shares Weighted Average‎Grant Date Fair Value Weighted Average‎Remaining‎Contractual Term‎(Years) Aggregate‎Intrinsic ValueOutstanding at December 31, 2019 1,152,248 $ 0.86 — $ 1,120,404Awarded 284,480 $ 0.91 — $ 60,003Released — $ — — $ —Canceled/forfeited/expired — $ — — $ —Outstanding at December 31, 2020 1,436,728 $ 0.86 — $ 1,180,407Awarded 654,663 $ 1.77 — $ 260,005Released — $ — — $ —Canceled/forfeited/expired (406,250) $2 — $ (192,339)Outstanding at December 31, 2021 1,685,141 $ 1.18 — $ 1,248,073 Vested at December 31, 2021 1,685,141 $ — — $ 2,595,117Unvested at December 31, 2021 — $ — — $ —Unrecognized expense at December 31, 2021$ — ‎2020 On March 24, 2020, the Company issued to four independent directors a total of 100,000 restricted stock units. These restricted stock units were issued for the $65,000 of board compensation earned for the first quarter of 2020. The units were valued at $65,000 or $0.65 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) March 24, 2023, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On August 7, 2020, the Company granted four independent directors a total of 81,252 restricted stock units. The units were valued at $65,000 or $0.80 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) August 7, 2023, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On November 5, 2020, the Company granted four independent directors a total of 67,708 restricted stock units. The units were valued at $65,000 or $0.96 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) November 5, 2023, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On December 17, 2020, the Company granted four independent directors a total of 35,520 restricted stock units. The units were valued at $65,000 or $1.83 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) December 17, 2023, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. In the twelve months ended December 31, 2020, the company recorded $260,003 respectively, in restricted stock units as board compensation. 2021 On March 26, 2021 an employee was granted 500,000 restricted stock units. These restricted stock units were issued as compensation The units were valued at $900,000 or $1.80 per share, based on the closing stock price on the date of grant. units vested 1/48th monthly for four years. The total units vested in 2021 were 114,583. On March 26, 2021 the Company issued to four independent directors a total of 36,112 restricted stock units. These restricted stock units were issued for the $65,000 of board compensation earned for the first quarter of 2021. The units were valued at $65,000 or $1.80 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) March 26, 2024, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On May 12, 2021, the Company granted four independent directors a total of 38,924 restricted stock units. The units were valued at $65,000 or $1.67 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) May 12, 2024, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On August 11, 2021, the Company granted four independent directors a total of 37,144 restricted stock units. The units were valued at $65,000 or $1.75 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) August 11, 2024, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. On December 15, 2021, the Company granted four independent directors a total of 42,484 restricted stock units. The units were valued at $65,000 or $1.53 per share, based on the closing stock price on the date of grant. All units vested immediately. The shares of Common Stock associated with the Restricted Stock Unit evidenced by this Agreement will be issued to the director upon the earliest to occur of (A) December 15, 2024, (B) a change in control of the Company, and (C) the termination of the director’s service with the Company. In the twelve months ended December 31, 2021, the company recorded $447,506 in restricted stock units as board compensation. Restricted Stock Unit Compensation Expense The impact on our results of operations of recording stock-based compensation expense for years ended December 31, 2021 and 2020 was as follows: Years Ended December 31, 2021 2020General and administrative$ 260,005 $ 260,003Sales and Marketing 187,501 — $ 447,506 $ 260,003