Annual report pursuant to Section 13 and 15(d)

STOCK OPTIONS

v3.22.1
STOCK OPTIONS
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
STOCK OPTIONS

 

17. STOCK OPTIONS

 

A summary of option activity for the years ended December 31, 2021 and 2020 are presented below.

 

                Weighted-        
          Weighted-     Average        
          Average     Remaining     Aggregate  
          Exercise     Contractual     Intrinsic  
    Options     Price     Life (Years)     Value  
                         
Outstanding at January 1, 2020     4,233,722     $ 1.73       2.54     $ 995,000  
Granted     2,111,308       1.35       -       -  
Forfeited     (313,255 )     2.53       -       -  
Exercised     -       -       -       -  
Outstanding at December 31, 2020     6,031,775       1.55       2.68       1,932,000  
Granted     2,494,333       1.71       -       -  
Forfeited     (2,374,405 )     2.68       -       -  
Exercised     (747,480 )     2.03       -       -  
Outstanding at December 31, 2021     5,404,223     $ 1.72       2.24     $ 107,000  
                                 
Vested December 31, 2021     2,899,884     $ 2.22             $ 116,000  
                                 
Exercisable at December 31, 2021     1,934,874     $ 2.04             $ 21,000  

 

The following were stock options transactions during the year ended December 31, 2021:

 

During the year ended December 31, 2021, the Company granted stock options to employees and consultants to purchase a total of 2,494,333 shares of common stock for services rendered. The options have an average exercise price of $1.71 per share, expire between zero and five years, vesting from zero and four years from grant date. The total fair value of these options at grant date was approximately $3,927,000, determined using the Black-Scholes option pricing model. The total stock compensation expense recognized relating to the vesting of stock options for the year ended December 31, 2021 amounted to $1,596,000. As of December 31, 2021, the total unrecognized share-based compensation expense was $2,591,000, which is expected to be recognized as part of operating expense through December 2025.

 

 

The following were stock options transactions during the year ended December 31, 2020:

 

During the year ended December 31, 2020, the Company granted stock options to employees and consultants to purchase a total of 2,111,308 shares of common stock for services rendered. The options have an average exercise price of $1.35 per share, expire between four and five years, vesting from 0.43 to four years from grant date. The total fair value of these options at grant date was approximately $2,438,000 using the Black-Scholes option pricing model. The total stock compensation expense recognized relating to the vesting of stock options for the year ended December 31, 2020 amounted to $1,728,000. As of December 31, 2020, the total unrecognized share-based compensation expense was $4,146,000, which is expected to be recognized as part of operating expense through December 2024.

 

The fair value of the share option awards was estimated using the Black-Scholes method based on the following weighted-average assumptions:

 

    Years Ended December 31,  
    2021     2020  
             
Expected life in years     1 to 5 years       3.0, 4.0 and 5.0  
Stock price volatility     230%-271 %     255%-271 %
Risk free interest rate     0.17-1.26 %     0.17-0.39 %
Expected dividends     0 %     0 %
Forfeiture rate     25.56 – 39.66 %     21.2 – 21.3 %

 

The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of measurement corresponding with the expected term of the share option award; the expected term represents the weighted-average period of time that share option awards granted are expected to be outstanding giving consideration to vesting schedules and historical participant exercise behavior; the expected volatility is based upon historical volatility of the Company’s common stock; and the expected dividend yield is based on the fact that the Company has not paid dividends in the past and does not expect to pay dividends in the future.