Note 8 - Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE 8— STOCKHOLDERS’ EQUITY

Warrants

The following table summarizes information about shares issuable under warrants outstanding as of March 31, 2022:

	Warrant shares outstanding		Weighted Average exercise price		Weighted Average remaining life		Intrinsic value
Outstanding at January 1, 2022		4,268,221		2.18		1.50	$	1,187,546
Issued		-		-		-		-
Exercised		-		-		-		-
Outstanding and exercisable at March 31, 2022		4,268,221		2.18		1.25	$	580,142

Shares to Be Issued

As of March 31, 2022, and 2021, there were 2,000,127 and 2,264,127 shares respectively, to be issued whose issuance has been deferred to the employees of Milestone Scientific, Inc. respectively.  

As of March 31, 2022, and 2021, there were 174,364 and 144,024 shares, respectively, to be issued to non-employees,  that will be issued for services rendered. The number of shares was fixed at the date of grant and were fully vested upon grant date.

The following table summarizes information about shares to be issued on March 31, 2022, and 2021, respectively.

	March 31, 2022		March 31, 2021
Shares-to-be-issued, outstanding January 1, 2022 and 2021, respectively		2,066,343		2,440,878
Granted in current period		108,148		33,238
Issued in current period		-		(65,965	)
Shares-to be issued outstanding March 31, 2022 and 2021, respectively		2,174,491		2,408,151

Stock Options Plans

The Milestone Scientific Inc. 2020 Equity Compensation Plan, as amended and restated (the "2020 Plan"), provides for awards of restricted common, stock restricted stock units, options to purchase and other awards, up to a maximum 4,000,000 shares of common stock and expires in June 2031. Options may be granted to employees, directors, and consultants of Milestone Scientific for the purchase of shares of common stock at a price not less than the fair market value of common stock on the date of grant. In general, options become exercisable over a three-year period from the grant date and expire five years after the date of grant.

On April 8, 2021, as part of its Succession Plan going into effect on April 23, 2021, the Company announced that Leonard Osser, the Interim Chief Executive Officer, would be accepting the role of Vice Chairman of the Board of Directors. As part of accepting this role, he would be granted options to purchase 2,000,000 shares of common stock, exercisable at the fair market value of the common stock on the date of grant, vesting over the five-year period after he steps down as Interim Chief Executive Officer of the Company or ten years from the date of grant, whichever shall end first. The options were issued pursuant to the 2020 Plan.

Milestone Scientific recognizes compensation expense over the requisite service period. For three months ended March 31, 2022 and 2021, Milestone Scientific recognized $305,370, and $113,507 of total employee compensation cost, respectively, recorded in general and administrative expenses on the statement of operations.

As of March 31, 2022 and 2021, there was $3,140,335 and $914,389 of total unrecognized compensation cost related to non- vested options, respectively. Milestone Scientific expects to recognize these costs over a weighted average period of 3.25 and 2.70 for the three months ended of March 31, 2022 and 2021, respectively. 

A summary of option activity for employees under the plans and changes during the three months ended March 31, 2022 is presented below:        

	Number of Options		Weighted Averaged Exercise Price $		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Options Value $
Options outstanding January 1, 2022		2,843,693		2.39		7.69		49,246
Granted during 2022		216,296		1.52		2.98		-
Exercised during 2022		-		-		-		-
Forfeited or expired during 2022		-		-		-		-
Options outstanding March 31, 2022		3,059,989		2.37		7.36		-
Exercisable, March 31, 2022		594,914		1.98		3.80		-

The Company used the following assumptions to calculate the fair value of the stock option grants using the Black-Scholes option pricing model on the measurement date during three months ended March 31, 2022, risk free interest rate of 2.45%, Volatility of 89.76% (which is based on the Company’s historical over the expected term), expected term 3 years, dividend rate 0% and closing price of the Company’s common stock was $1.52.

A summary of option activity for non-employees under the plans and changes during the three months ended March 31, 2022 presented below:        

	Number of Options		Weighted Averaged Exercise Price $		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Options Value $
Options outstanding January 1, 2022		83,330		1.85		3.33		49,748
Granted during 2022		-		-		-		-
Exercised during 2022		-		-		-		-
Options outstanding March 31, 2022		83,330		1.85		3.08		22,585
Exercisable, March 31, 2022		63,883		1.68		2.85		22,582

 For the three months ended  March 31, 2022 and 2021, Milestone Scientific recognized approximately $4,978 and $10,329 expense related to non-employee options, respectively.

The information below summarizes the restricted stock award activity for year ended March 31, 2022.

	Number of Shares			Weighted Average Grant-Date Fair Value per Award
Non-vested as January 1, 2022		96,557			2.33
Granted		75,758			1.32
Vested		-
Cancelled		(41,499	)
Non-vested as March 31, 2022		130,816			1.90

As of March 31, 2022, there were 130,816 restricted shares granted and deferred under the terms of an employment agreements with the Territory Manager of Milestone Scientific. Such shares will be issued to each party upon completion of 2 years of employment. For the three months ended March 31, 2022, the Company recognized stock compensation expense of approximately $22,000. As of March 31, 2022, the total unrecognized compensation expense was $169,792 related to unvested restricted stock awards, which the Company expects to recognize over an estimated weighted-average period of 1.46 years.