Note 9 - Equity, Share-based Compensation and Warrants

6 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Shareholders' Equity and Share-Based Payments [Text Block]

NOTE 9. EQUITY, SHARE-BASED COMPENSATION AND WARRANTS

A summary of equity activity follows (in thousands, except share amounts).

	Shares
	Preferred				Preferred		Common		Accumulated
	Series G		Common		Stock		Stock		Deficit			Equity
Balance, December 31, 2021		150		51,589,674	$	75	$	326,279	$	(307,859	)	$	18,495
Common stock awards under equity incentive plans		-		224,751		-		241		-			241
Common stock issued to vendor		-		6,000		-		5		-			5
Net income		-		-		-		-		(1,516	)		(1,516	)
Balance, March 31, 2022		150		51,820,425		75		326,525		(309,375	)		17,225
Common stock awards under equity incentive plans		-		483,879		-		146		-			146
Common stock issued to vendor		-		6,000		-		1		-			1
Net loss		-		-		-		-		(2,621	)		(2,621	)
Balance, June 30, 2022		150		52,310,304	$	75	$	326,672	$	(311,996	)	$	14,751

	Shares
	Preferred				Preferred		Common			Accumulated
	Series G		Common		Stock		Stock			Deficit			Equity
Balance, December 31, 2020		225		45,238,087	$	112	$	322,218		$	(298,910	)	$	23,420
Common stock awards under equity incentive plans		-		29,943		-		250			-			250
Common stock issued to vendor		-		6,000		-		3			-			3
Other		-		-		-		(3	)		-			(3	)
Net income		-		-		-		-			591			591
Balance, March 31, 2021		225		45,274,030		112		322,468			(298,319	)		24,261
Common stock awards under equity incentive plans		-		29,643		-		290			-			290
Common stock issued to vendor		-		6,000		-		5			-			5
Exercise of common stock warrants		-		177,936		-		171			-			171
Other		-		-		-		3			-			3
Net loss		-		-		-		-			(1,923	)		(1,923	)
Balance, June 30, 2021		225		45,487,609	$	112	$	322,937		$	(300,242	)	$	22,807

Share-based compensation by type of award follows (in thousands).

	Three Months Ended
	June 30, 2022		March 31, 2022
Stock options	$	21	$	29
Restricted stock units		125		212
Compensation expense related to common stock awards issued under equity incentive plan	$	146	$	241

In the three months ended June 30, 2022, holders forfeited options for the purchase of up to 44,547 shares of common stock (average $2.14 per share exercise price, average 6.8 years remaining life). In the three months ended March 31, 2022, holders forfeited options for the purchase of up to 9,703 shares of common stock (average $1.85 per share exercise price, average 7.7 years remaining life).

In the three months ended March 31, 2022, warrants for the purchase of up to 6,142,980 shares of common stock ($0.96 per share exercise price) expired.

Summaries of nonvested and vested restricted stock unit (RSU) activity follow.

	Number of RSUs			Unrecognized Stock Compensation (in thousands)			Weighted Average Expense Period (Years)
Nonvested at December 31, 2021		1,266,033		$	(658	)		0.9
Granted		370,000			(153	)		2.0
Forfeited		(10,000	)		7			0.7
Vested with Service		(224,751	)		-			0.0
Expensed		-			212
Nonvested at March 31, 2022		1,401,282			(592	)		0.9
Impact of Modification:
Before modification		(114,680	)		125
After modification		114,680			(60	)
Forfeited		(94,535	)		55			0.0
Vested with Service		(344,040	)		-			0.0
Expensed		-			125
Nonvested at June 30, 2022		962,707		$	(347	)		0.9

	Number of RSUs
Vested at December 31, 2021		865,052
Vested with Service		224,751
Issued at Vesting		(224,751	)
Vested at March 31, 2022		865,052
Vested with Service		344,040
Issued at Termination of Service		(483,879	)
Vested at June 30, 2022		725,213

Each RSU represents a contingent right to receive one share of common stock. The RSUs granted in the first three months of 2022 vest within two years of the grant. As of June 30, 2022, issuance of 725,213 shares of common stock subject to the vested RSUs is deferred to the date the holder is no longer providing service to our company.

In April 2022, we modified 114,680 RSUs held by resigning directors such that the awards vested on the date of their termination of service. Prior to the modification, the unvested RSUs would have been forfeited on the date of the resignations. As a result of the modifications, we adjusted cumulative expense on the RSUs to equal the fair value of the awards on the date of the April 28, 2022, modification ($0.52 per unit), in accordance with applicable accounting guidance.

In the three months ended June 30, 2022, we issued a total of 483,879 shares of common stock pursuant to the terms of vested RSUs, which included the114,680 modified RSUs discussed in the preceding paragraph. Issuance of the shares of common stock subject to these RSUs was deferred to the date the holder was no longer providing service to our company. In the three months ended March 31, 2022, we issued a total of 224,751 shares of common stock upon the vesting of RSUs.

On July 14, 2022, shareholders approved a 6,000,000 share increase in the number of shares of common stock authorized for issuance under our Amended and Restated 2014 Equity Incentive Plan (2014 Plan). On July 14, 2022, we granted RSUs with a total grant date fair value of $1.4 million ($0.38 per unit). The grants are listed below.

● 2,781,498 RSUs, the issuance of which was subject to shareholder approval of the increase in the shares of common stock authorized for issuance under the 2014 Plan. The RSUs vest over an average of forty-nine months from the July 14, 2022, grant date.

● 657,895 RSUs to our directors which vest on July 14, 2023, or one day prior to the next annual meeting of our shareholders.

● 190,024 RSUs to our directors which were immediately vested, in lieu of paying board fees in cash.

As of the date of this filing, 2,645,122 shares of common stock remain available for issuance under the 2014 Plan