XML 26 R17.htm IDEA: XBRL DOCUMENT

STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2023

Note 11

STOCK-BASED COMPENSATION

Restricted Stock Awards and Restricted Stock Units

The table below includes issuances of restricted stock awards and units under the 2020 Plan and unvested equity interests of MOR which were converted into restricted Company common stock.

	Number of Restricted Shares and Units			Weighted Average Grant Date Fair Value Per Share
Unvested at January 1, 2022		1,146,131		$	1.28
Issued		—			11.71
Vested		(474,768	)		0.03
Canceled		(120,105	)		12.18
Unvested at December 31, 2022		551,258			3.28
Issued		570,000			3.79
Vested		(234,999	)		4.68
Canceled		(20,653	)		0.16
Unvested at June 30, 2023		865,606		$	3.31

The 865,606 of unvested awards at June 30, 2023 consisted of 128,608 restricted stock units and 736,998 shares of restricted stock.

Stock Options

As part of the business combination with Helix, the Company assumed the Helix TCS, Inc. Omnibus Stock Incentive Plan and the Bio-Tech Medical Software, Inc. 2014 Stock Incentive Plan, each as amended, pursuant to which options exercisable at prices between $2.00 and $51.80 per share for 455,089 shares of Company common stock were outstanding. The value attributable to service subsequent to the business combination is recognized as compensation cost by the Company.

The fair value of the stock options was estimated at Level 3 in the fair value hierarchy using the Black-Scholes option pricing model, and the assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgement. The assumptions used to calculate the grant date fair value of the options outstanding at June 30, 2023 and December 31, 2022 are as follows:

	June 30, 2023			December 31, 2022
Exercise Price		$	2.00 to $51.80	$	2.00 to $51.80
Fair value of Company common stock		$	2.98 to $15.61	$	2.98 to $15.61
Dividend yield			0%		0%
Expected volatility		83% to 188%		83% to 188%
Risk Free interest rate	0.27% to 4.52%			0.27% to 4.52%
Expected life (years) remaining	0.01 to 9.62			0.01 to 9.62

Stock option activity for the six months ended June 30, 2023 and the year ended December 31, 2022 is as follows:

	Shares Underlying Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)
Outstanding at January 1, 2022		4,046,973		$	14.25		8.75
Granted		1,203,250		$	4.02		9.14
Exercised		(33,334	)	$	2.47		2.55
Forfeited and expired		(1,233,081	)	$	13.87		8.12
Outstanding at December 31, 2022		3,983,808		$	10.53		8.23
Granted		1,097,500		$	3.71		8.45
Exercised		(2,452	)	$	8.34		8.34
Forfeited and expired		(1,528,312	)	$	12.60		7.70
Outstanding at June 30, 2023		3,550,544		$	7.54		8.54
Vested options at June 30, 2023		2,076,200		$	12.59		6.69

The weighted average exercise price and remaining contractual life of exercisable options as of June 30, 2023 is $7.54 and 8.54 years, respectively. The total aggregate intrinsic value of the exercisable options as of June 30, 2023 was approximately $25,482.

Stock Compensation Expense

The weighted-average grant date fair value per share for the stock options granted was $3.42 and $6.17 for the six months ended June 30, 2023 and 2022, respectively.

On February 10, 2023, the Company’s Chief Executive Officer, President and Class II member of the Board of Directors resigned. In connection with the resignation, the Company entered into a separation agreement providing for, among other things, accelerated vesting of 106,656 unvested restricted shares of the Company common stock. Stock based compensation expense for the six months ended June 30, 2023 includes $349,832 related to the accelerated vesting of stock.

On March 2, 2022, the Company and the former chief executive officer and the former chief financial officer of Helix mutually agreed not to renew special advisor agreements between the advisors and the Company. Per the terms of the agreements, options to purchase 366,166 shares of common stock continued to vest according to their original terms through March 2, 2023, and unvested stock options to purchase 732,332 shares of common stock were forfeited. The advisors were not required to perform services to the Company beyond the non-renewal date of March 2, 2022. As a result, the Company recorded $5,417,043 of stock compensation expense during March 2022 related to the options that vested through March 2, 2023.

At June 30, 2023, the total unrecognized stock compensation expense related to unvested stock option awards and restricted stock awards and restricted stock units granted was $13,823,992, which the Company expects to recognize over a weighted-average period of approximately 2.86 years. Stock compensation expense for the three and six months ended June 30, 2023 and 2022 is as follows:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2023		2022		2023			2022
Services	$	34,272	$	36,975	$	72,198		$	56,604
Research and development		36,964		86,491		75,156			133,932
Sales and marketing		49,915		188,728		103,917			240,549
General and administrative		1,419,191		1,062,000		2,767,472			3,140,044
Separation expenses		—		—		349,832			5,417,043
Subtotal		1,540,342		1,374,194		3,368,575			8,988,172
Discontinued operations		—		392,000		(247,308	)		682,606
Total	$	1,540,342	$	1,766,194	$	3,121,267		$	9,670,778

Total intrinsic value of options exercised during the period ended June 30, 2023 was $368. The total fair value of restricted shares vested during the period ended June 30, 2023 was $106,013.