Quarterly report pursuant to Section 13 or 15(d)

Stockholders??? Equity

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Stockholders’ Equity
 3 Months Ended
Mar. 31, 2024
Equity [Abstract]  
Stockholders’ Equity

Note 8 - Stockholders’ Equity

 

Capital Stock

 

The Company has 260,000,000 authorized shares of capital stock, consisting of 250,000,000 shares of Common Stock, par value $0.001, and 10,000,000 shares of Preferred Stock, par value $0.001 per share.

 

Common Stock Options

 

A summary of the Company’s options activity and related information follows:

 

                       
    Number of   Weighted   Weighted
    Shares   Average   Average
    Under   Exercise   Contractual
    Options   Price   Life
Options Outstanding at December 31, 2023     595,347     $ 3.46       5.82  
Options Granted     136,255       3.32       5.15  
Exercised     —       —       —  
Expired/Cancelled     (2,448 )      5.41       —  
Options Outstanding at March 31, 2024     729,154     $ 2.66       6.83  
                         
Options Exercisable at March 31, 2024     282,072     $ 2.97       5.91  

 

Share-based compensation expense for options totaling $104,163 and $54,433 was recognized in the Company’s results for the three months ended March 31, 2024, and 2023, respectively.

 

The intrinsic value of outstanding options as of March 31, 2024 and December 31, 2023, was $653,725 and $391,283, respectively.

 

The valuation methodology used to determine the fair value of the options issued during the year was the Black-Scholes option-pricing model. The Black-Scholes model requires the use of a number of assumptions including the volatility of the stock price, the average risk-free interest rate, and the weighted average expected life of the options.

 

The risk-free interest rate assumption is based upon observed interest rates on zero-coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the options.

 

Estimated volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate each year during the expected life of the award. The Company’s calculation of estimated volatility is based on historical stock prices of the Company over a period equal to the expected life of the awards.

 

As of March 31, 2024, there was $851,984 of total unrecognized compensation expense related to unvested employee options granted under the Company’s share-based compensation plans that is expected to be recognized over a weighted average period of approximately 1.6 years.

 

The weighted average fair value of options granted, and the assumptions used in the Black-Scholes model during the three months ended March 31, 2024, and 2023, are set forth in the table below.

 

               
    2024   2023
Weighted average fair value of options granted   $ 3.32     $ 1.77  
Risk-free interest rate     3.94% - 4.21 %     3.48% – 4.01 %
Volatility     126 – 159 %     196% – 199 %
Expected life (years)     3.5 – 6 years       10 years  
Dividend yield     — %     — %

 

Share-based awards, restricted stock award (“RSAs”)

 

On January 2, 2024, the Company granted certain employees an aggregate of 53,328 RSA’s. Compensation as a group amount to $156,251. The shares vest one third each year for three years after issuance.

 

On March 31, 2024, the Board resolved that the Company shall issue to Board members an aggregate of 14,166 RSAs Compensation as a group amount of $81,030. The shares vest one year after issuance.

 

A summary of the activity related to RSUs for the three months ended March 31, 2024, is presented below:

 

               
Restricted Stock Units (RSUs)   Shares   Weighted Average Fair Value $
RSUs non-vested at January 1, 2024     208,472       1.90  
RSUs granted     84,559       3.40  
RSUs vested     49,490       1.74  
RSUs forfeited     —       —  
RSUs non-vested at March 31, 2024     243,541       2.45  

 

Stock-based compensation for RSU’s has been recorded in the consolidated statements of operations and totaled $67,162 and $52,285 for the three months ended March 31, 2024, and 2023, respectively.

 

As of March 31, 2024, there was $505,795 of total unrecognized compensation expense related to unvested RSUs granted under the Company’s share-based compensation plans that is expected to be recognized over a weighted average period of approximately 1.5 years.