STOCKHOLDERS’ EQUITY

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

STOCKHOLDERS’ EQUITY

(8) STOCKHOLDERS’ EQUITY

In July 2021, the Company’s shareholders voted to increase the number of authorized shares of capital stock to 62,000,000 shares, consisting of 60,000,000 shares of Common Stock and 2,000,000 shares of Preferred Stock (see Note 1).

On April 17, 2023, the Company effected a 25:1 reverse stock split for each share of common stock issued and outstanding. All shares and associated amounts have been retroactively restated to reflect the stock split.

Preferred Stock

The Company is authorized to issue 2,000,000 shares of preferred stock at $0.001 par value per share. As of December 31, 2023 and 2022, no shares of preferred stock were outstanding.

The Board of Directors may determine the rights, preferences, privileges, qualifications, limitations and restrictions granted or imposed upon any series of preferred stock.

Common Stock

The Company is authorized to issue 60,000,000 shares of common stock at $0.01 par value per share. As of December 31, 2023 and 2022, the Company had 2,632,809 and 1,877,970, respectively, shares of common stock outstanding.

Equity Compensation Plans

In July 2019, the Company terminated the 2009 Stock Option Plan and the 2009 Directors Option Plan (collectively, the “Prior Plans”) and adopted the 2019 Stock Option Plan (the “2019 Stock Options Plan”) and the 2019 Directors Option Plan (the “2019 Directors Option Plan”) (collectively, the “2019 Plans”, and together with the Prior Plans, the “Plans”). The purpose of the 2019 Plans is to provide certain incentive and non-statutory stock options to employees, directors and certain non-employees. As a result, the Company may not grant any additional awards under the Prior Plans. The Prior Plans will continue to govern outstanding stock options previously granted thereunder. The Company has initially reserved 160,000 shares and 40,000 shares of common stock for issuance of awards under the 2019 Stock Option Plans and the 2019 Directors Option Plan, respectively.

The 2019 Plans authorize grants to purchase shares of authorized but unissued common stock. Stock options can be granted with an exercise price no less than or equal to the stock’s fair market value at the date of grant. All awards have 10-year terms. The 2019 Plans permit incentive stock options, or ISOs and non-qualified stock options, or NSOs. If the stock options are granted to a 10% stockholder, then the exercise price per share may not be less than 110% of the fair market value per share of the Company’s common stock on the grant date. The board of directors sets the fair value and exercise price for the underlying shares at the grant date.

On November 9, 2021, the Company’s Board of Directors approved the Omnibus Incentive Compensation Plan and Non-Employee Directors Compensation Plan (collectively, the “2021 Equity Plans”) and terminated the 2019 Plans. The purpose of the 2021 Equity Plans is to provide certain incentive and non-statutory stock options, restricted stock, restricted stock units, and stock appreciation rights to employees, directors, and certain non-employees. As a result, the Company may not grant any additional awards under the 2019 Plans. The Prior Plans and the 2019 Plans will continue to govern outstanding stock options previously granted thereunder. The Company has initially reserved 120,000 shares and 50,000 shares of common stock for issuance of awards under the Omnibus Incentive Compensation Plan and Non-Employee Directors Compensation Plan, respectively. On June 9, 2022, the 2021 Equity Plans were approved by the Company’s shareholders.

Stock Option Activity

Stock option activity under Stock Option Plans was as follows:

	Outstanding Options			Weighted average exercise price		Weighted average remaining contractual term		Aggregate Intrinsic Value
Outstanding at December 31, 2021		94,583		$	36.75		2.80	$	10.50
Granted		-			-		-		-
Exercised		(17,233	)		13.75		-		-
Forfeited		(38,424	)		36.75		-		-
Outstanding at December 31, 2022		38,926		$	46.75		2.20	$	10.50
Granted		-			-		-		-
Exercised		-			-		-		-
Forfeited		(38,926	)		46.75		-		-
Outstanding at December 31, 2023		-		$	-		-	$	-
Exercisable at December 31, 2023		-		$	-		-	$	-

There were no options granted during 2023 and 2022 under the stock option plan. The total intrinsic value of options exercised during the years ended December 31, 2023 and 2022 was $0 and $140 thousand, respectively. The intrinsic value is the difference between the estimated fair value of the Company’s common stock at the time of exercise and the exercise price of the stock option.

The total fair value of options that vested during the years ended December 31, 2023 and 2022 was $162 thousand and $710 thousand, respectively. As of December 31, 2023, the total unrecognized stock-based compensation expense related to the stock options was $0 thousand.

Stock-based Valuation Assumptions

During 2023 and 2022, the Company did not grant stock options and consequently had no requirement to value stock options.

Restricted Stock Units

During 2023, the Company granted 14,831 RSUs with a total fair value of $80 thousand under the 2021 Equity Plans. As of December 31, 2023, there were no RSUs vested with a fair value of $0 thousand. The Company recorded $118 thousand and $692 thousand in stock-based compensation expense for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, the total unrecognized stock-based compensation expense was $0 thousand.

A summary of plan activity for the 2021 Equity Plans is as follows:

				Weighted
				Average
	Units			Grant Date Fair value
Unvested at December 31, 2021		48,956		$	31.00
Granted		34,080			15.50
Vested		(25,331	)		21.00
Forfeited		(13,189	)		34.75
Unvested at December 31, 2022		44,516		$	23.75
Granted		14,831			5.39
Vested		(20,498	)		(21.63	)
Forfeited		(38,849	)		(17.86	)
Unvested at December 31, 2023		-		$	-

Stock-based Compensation Expense

The following table sets forth stock-based compensation expense included in the Company’s consolidated statements of operations:

	Years ended December 31,
	2023		2022
Cost of goods sold	$	17,205	$	79,498
Sales and marketing		55,657		201,373
General and administrative		75,921		456,970
Research and development		130,612		432,754
Total stock-based compensation expense	$	279,395	$	1,170,595