Stock-based Compensation

9 Months Ended

Sep. 30, 2022

Equity [Abstract]

Stock-based Compensation

Note 12 – Stock-based Compensation

Obligations for under-development and ramping hospitals. Under the terms of the Merger Agreement, contributing owners of the under-development hospitals and ramping hospitals are eligible to receive a one-time additional issuance of Company common stock based on their trailing twelve months earnings before interest, taxes, depreciation and amortization as determined on the 24^th anniversary of their respective opening, adjusted for the aggregate amount of such owner’s capital contribution minus such owner’s pro rata share of the aggregate debt of the applicable hospital outstanding as of the closing of the Merger. Such additional shares will be issued at the greater of (a) the price of the Company’s common stock at the time of determination or (b) $2.80. We have not recognized any expense for this stock-based compensation based on our current estimates of future obligations to the contributing owners.

Restricted stock. On May 9, 2022, the Company issued 83,547 restricted common stock awards, valued at $325,000 to the board of directors to vest 1/12^th per month over a 12 month period.  We recognized stock-based compensation expense of $81,249 and $135,415 during the three and nine months ended September 30, 2022 for these awards. Remaining compensation expense of $189,585 will be recognized over the awards’ remining seven month vesting term.

Options. In 2022, the Company adopted the Amended and Restated Nutex Health Inc. 2022 Equity Incentive Plan (the "2022 Plan"). The maximum aggregate number of shares that may be issued under the 2022 Plan is 5,000,000 shares, subject to increases on January 1st of each calendar year through January 1, 2027 of up to 5% annually at the discretion of the compensation committee of our Board of Directors. A total of 1,292,453 shares were available for issuance under the 2022 Plan at September 30, 2022. Awards granted under the 2022 Plan have a ten-year term and may be incentive stock options, non-statutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units or performance shares. The awards are granted at an exercise price equal to the fair market value on the date of grant and generally vest over a four-year period.

Clinigence had 6,500,010 options for the purchase of our common stock outstanding as of the merger date, all of which were fully vested and exercisable. The following table summarizes stock-based awards activity:

	Options Outstanding			Weighted Average		Weighted Average Remaining Contractual Life (Years)
Options outstanding at April 1, 2022 merger date		6,500,010		$	2.30		6.62
Options exercised		(312,019	)		2.08
Options outstanding at September 30, 2022		6,187,991		$	2.31		5.74

Options outstanding as of September 30, 2022 consisted of:

Expiration Date	Number Outstanding		Number Exercisable		Exercise Price
March 15, 2025		157,196		157,196	$	2.00
January 27, 2027		180,000		180,000		1.50
May 11, 2027		350,000		350,000		1.50
June 6, 2027		3,600		3,600		0.07
August 16, 2027		25,000		25,000		2.51
September 7, 2027		2,975,000		2,975,000		2.75
September 27, 2027		410,000		410,000		2.75
December 17, 2027		157,000		157,000		3.50
January 28, 2028		180,000		180,000		1.61
January 27, 2030		296,865		296,865		1.50
February 28, 2030		95,794		95,794		1.25
June 30, 2030		117,056		117,056		1.45
August 5, 2029		40,480		40,480		5.56
January 28, 2031		1,000,000		1,000,000		1.61
February 25, 2031		200,000		200,000		2.00
Total		6,187,991		6,187,991

Warrants. Clinigence had 12,401,240 common stock warrants outstanding as of the merger date. Warrant activity follows:

	Warrants Outstanding			Weighted Average Exercise Price		Average Remaining Contractual Life (Years)
Warrants outstanding at April 1, 2022 merger date		12,401,240		$	2.04		4.65
Warrants exercised		(2,187,225	)		2.27
Warrants outstanding at September 30, 2022		10,214,015		$	1.97		4.13

Warrants outstanding as of September 30, 2022 consisted of:

Date		Number Outstanding	Number Exercisable		Exercise Price
	February 5, 2023	1,500		1,500	$	25.00
	April 27, 2023	1,500		1,500		25.00
	December 31, 2024	554,873		554,873		6.67
	October 31, 2025	763,701		763,701		1.25
	February 26, 2026	288,236		288,236		4.00
	July 31, 2026	2,532,900		2,532,900		1.55
	February 1, 2027	1,456,452		1,456,452		1.55
	May 30, 2027	4,614,853		4,614,853		1.75
	Total	10,214,015		10,214,015