Annual report [Section 13 and 15(d), not S-K Item 405]

Stock-Based Compensation

v3.25.0.1
Stock-Based Compensation
12 Months Ended
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation

8. Stock-Based Compensation

 

2021 Incentive Plan

 

The 2021 Incentive Plan authorizes the grant of stock options (incentive and non-statutory), stock appreciation rights and restricted stock covering a total of 3,166,167 shares of our common stock. Options are granted at the fair value of our common stock on the date of grant and generally vest either immediately or over a period of up to three years from the date of grant and expire 10 years from the date of grant. As of December 31, 2024, 993,753 shares of our common stock were reserved for issuance related to the 2021 Incentive Plan, and 2,032,914 shares remained available for awards.

 

Recipients of stock awards under our 2021 Incentive Plan become the owner of record of the stock immediately upon grant, which may be subject to certain restrictions. The balance of unvested restricted stock will be forfeited and automatically transferred back to us at no cost upon the termination of the recipient’s employment. Upon vesting of restricted stock that is made to recipients who are employees, the recipient has the option to settle minimum withholding taxes by electing to have us withhold otherwise deliverable shares having a fair value equal to the required tax obligations (“net-settlement”). The net-settlement shares are then immediately cancelled and retired and reduce the shares available for issuance under the 2021 Incentive Plan.

 

We use the Black-Scholes Pricing Option Pricing Model to estimate the fair value of stock-based awards on the date of grant. The assumptions employed in the calculation of the fair value of share-based compensation expense were calculated as follows for all years presented:

 

Expected dividend yield – zero based on the fact that we do not plan to issue dividends.
Expected volatility – based on our historical market price at consistent points in a period equal to the expected life of the options.
Risk-free interest rate – based on the U.S. Treasury yield curve in effect at the time of grant.
Expected life of options – based on the simplified method of estimating the expected life. Forfeitures are accounted for as they occur.

 

Assumptions used to estimate the fair value of stock options granted were as follows:

 

Granted in Period   High     Low     Weighted Average  
Award/Strike Price     0.48       0.48       0.48  
Market Price     0.48       0.48       0.48  
Volatility     120.76 %     110.12 %     114.00 %
Dividend Yield     0.00 %     0.00 %     0.00 %
Expected Life     5.50 yrs       2.50 yrs       4.74 yrs  
Risk Free Rate     3.53 %     3.49 %     3.50 %

 

Total stock-based compensation related to stock options was $516,049 and $550,083 for the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, there was $21,154 of unrecognized stock-based compensation related to stock options, which is expected to be recognized over a weighted average period of less than one year.

 

 

Stock option activity for the year ended December 31, 2024 was as follows:

 

    Number of Shares     Weighted Average Exercise Price     Weighted Average Remaining Contractual Term
(In Years)
    Aggregate Intrinsic Value(1)  
Outstanding at December 31, 2023     244,733     $ 20.17       8.73     $ 74,559  
Granted     799,583       0.48              
Forfeited     (50,563 )     13.76              
Outstanding at December 31, 2024     993,753       4.65       6.72        
Exercisable at December 31, 2024     922,353       4.97       6.49        

 

(1)   The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock option awards and the closing market price of our common stock as of December 31, 2024 and 2023, respectively

 

Certain other information regarding our stock-based awards was as follows:

 

    2024     2023  
Weighted average grant date fair value of stock options granted per share   $ 0.38     $ 4.59  
Grant date fair value of stock options that vested   $ 305,632     $ 291,401  

 

Restricted stock activity was as follows for the year ended December 31, 2024:

 

 Schedule of Restricted Stock Activity

    Number of Shares     Weighted Average Grant-Date Fair Value  
Non-vested restricted stock at beginning of year     6,000     $ 3.34  
Vested     (6,000 )     3.34  
Non-vested restricted stock at end of year           -  

 

The fair value of restricted stock vested in 2024 was $20,220, and stock-based compensation expense related to restricted stock was $5,055. As of December 31, 2024, there was no unrecognized stock-based compensation related to non-vested restricted stock.