Share-Based Compensation

12 Months Ended

Dec. 31, 2022

Share-Based Compensation [Abstract]

SHARE-BASED COMPENSATION

NOTE 16 SHARE-BASED COMPENSATION

Share-based compensation for employees and non-employees is recorded in the Consolidated Statement of Operations as a component of general and administrative expense with a corresponding increase to additional paid-in capital in stockholders’ (deficiency) equity. For employee awards, the Company elected to utilize the simplified method of estimating the expected life of options as allowed by SAB 107. The Company believes this to be a better estimate of the expected life given the lack of historical information. For nonemployee awards, the Company will utilize the stated term of the award. Forfeitures will be accounted for as they occur for both employee and nonemployee awards. Upon exercise or conversion of any share-based payment transaction, the Company will issue shares, generally as new issuances.

2020 Long-Term Incentive Plan

On April 22, 2020, the Company’s Board of Directors adopted the 2020 Long-Term Incentive Plan (the “2020 Plan”), which was approved by the stockholders on or about May 6, 2020. Employees, officers, directors and consultants that provide services to the Company or one of its subsidiaries may be selected to receive awards under the 2020 Plan. Awards under the 2020 Plan may be in the form of incentive or nonqualified stock options, stock appreciation rights, stock bonuses, restricted stock, stock units and other forms of awards including cash awards and performance-based awards.

A total of 33,334 shares of the Company’s common stock were initially authorized for issuance with respect to awards granted under the 2020 Plan. On June 25, 2021, the stockholders approved the increase of the number of shares of common stock authorized for issuance under the 2020 Plan by an additional 50,000 shares. Any shares subject to awards that are not paid, delivered or exercised before they expire or are cancelled or terminated, or fail to vest, as well as shares used to pay the purchase or exercise price of awards or related tax withholding obligations, will become available for other award grants under the 2020 Plan. As of December 31, 2022, 58,655 options have been issued under the 2020 Plan, of which 33,303 were forfeited. Any shares forfeited are available for re-issuance. As of December 31, 2022, a total of 57,982 shares authorized under the 2020 Plan remained available for award purposes. On November 21, 2022, our board of directors adopted a resolution proposing to add 300,000 shares of the Company’s common stock to the 2020 Plan, which was approved by our stockholders on February 8, 2023 on a post-split basis.

The 2020 Plan will terminate on May 1, 2030. The maximum term of options, stock appreciation rights and other rights to acquire common stock under the 2020 Plan is ten years after the initial date of the award.

Restricted Stock Awards

During the year ended December 31, 2021, the Company’s Board of Directors granted an aggregate of 667 shares of restricted stock awards to one director with a grant date value of $0.3 million, of which 333 vested on the one-year anniversary of the grant date and 334 vest on the two-year anniversary of the original grant date.

During the year ended December 31, 2021, the Company issued 2,347 shares of common stock as consideration for services with a grant date value of $1.2 million.

During the year ended December 31, 2022, the Company issued 2,400 shares of common stock to a debt placement agent as consideration for services with a grant date value of $81,000.

For the years ended December 31, 2022 and 2021, the Company recognized $0.1 million and $0.8 million of compensation expense related to restricted stock awards and had $0.0 million and $0.3 million of unrecognized compensation cost as of December 31, 2022 and 2021, respectively. 

Stock Options

All options are valued utilizing the Black-Scholes pricing model using the assumptions listed below. No options were issued during the year ended December 31, 2022. The weighted average grant date fair value of all options issued during the year ended December 31, 2021 was $92.00 per share.

The following table summarizes the assumptions used to estimate the fair value of stock options granted during the year ended December 31, 2022 and 2021:

	For the Years Ended
	December 31,
	2022	2021
Expected dividend yield	N/A	0.00%
Expected volatility	N/A	63.39%
Risk-free interest rate	N/A	0.48 - 0.89%
Expected life of options	N/A	3.25 - 5.00 years

The following table represents stock option activity for the year ended December 31, 2022:

				Weighted		Weighted
				Average		Average		Aggregate
	Number of			Exercise Price		Contractual		Intrinsic
	Options			Per Share		Life in Years		Value
Outstanding - December 31, 2021		70,405		$	233
Exercised		(2,098	)		15
Cancelled or Expired		(41,753	)		250
Outstanding - December 31, 2022		26,554		$	223		2.72		-
Exercisable - December 31, 2022		19,096		$	203		2.52		-

Total recognized compensation expense related to the Company’s stock options was $0.9 million and $1.3 million for the years ended 2022 and 2021, respectively. Compensation expense related to stock options is recorded in share-based compensation expense, a component of general and administrative expenses, in the Consolidated Statements of Operations. For the years ended December 31, 2022 and 2021, the Company had unrecognized compensation expense related to options of $0.3 million and $3.0 million, respectively. As of December 31, 2022, the Company is expected to recognize this compensation expense over the next 1.25 years.

The following table presents information related to stock options as of December 31, 2022:

Options Outstanding			Options Exercisable
			Weighted
	Outstanding		Average		Exercisable
	Number of		Remaining Life		Number of
Exercise Price Per Share	Options		In Years		Options
$0.01 - $50.00		-		-		-
$50.01 - $100.00		5,688		2.51		5,688
$100.01 - $150.00		-		-		-
$150.01 - $200.00		2,900		0.99		2,900
$200.01 - $250.00		-		-		-
$250.01 - $300.00		17,033		3.18		9,575
$300.01 - $350.00		933		0.46		933
		26,554		2.52		19,096