Note 6 - Stockholders' Equity

9 Months Ended

Sep. 30, 2023

Notes to Financial Statements

Equity [Text Block]

NOTE 6— STOCKHOLDERS’ EQUITY

Warrants

The following table summarizes information about shares issuable under warrants outstanding as of September 30, 2023:

	Warrant shares outstanding			Weighted Average exercise price		Weighted Average remaining life		Intrinsic value
Outstanding at January 1, 2023		4,268,221			2.18		0.50		-
Issued		-			-		-		-
Exercised		-			-		-		-
Expired or cancelled		(3,953,649	)		-		-		-
Outstanding and exercisable at September 30, 2023		314,572			0.50		0.35		132,120

Shares to Be Issued

As of September 30, 2023 and 2022, there were 2,426,364 and 1,852,789, respectively, shares issuable, the issuance of which has been deferred under the terms of employment agreements with the Chief Executive Officer and other employees of Milestone Scientific. Such shares are issuable to each party upon termination of their respective employment.

As of September 30, 2023 and 2022, there were 382,696 and 174,364, respectively, shares issuable to non-employees,  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 September 30, 2023 and 2022.

	September 30, 2023		September 30, 2022
Shares-to-be-issued, outstanding January 1, 2023 and 2022, respectively		2,440,673		2,066,343
Granted in current period		368,387		108,148
Issued in current period		-		(147,338	)
Shares-to be issued outstanding September 30, 2023 and 2022, respectively		2,809,060		2,027,153

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 common stock and other awards, up to a maximum 11,500,000 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.

Milestone Scientific recognizes compensation expense over the requisite service period. For three and nine months ended September 30, 2023, Milestone Scientific recognized approximately $321,000 and $1.1 million, respectively, of total compensation cost, recorded in general and administrative expenses on the statement of operations. For three and nine months ended September 30, 2022, Milestone Scientific recognized approximately  $233,000 and $1.1 million, respectively, of total compensation cost, recorded in general and administrative expenses on the statement of operations.

A summary of option activity for employees under the plans and changes during the nine months ended September 30, 2023 is presented below: 

	Number of Options			Weighted Averaged Exercise Price $		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Options Value $
Options outstanding January 1, 2023		3,059,989			2.36		6.38		-
Granted during 2023		-			-		-		-
Exercised during 2023		-			-		-		-
Forfeited or expired during 2023		(18,000	)		-		-		-
Options outstanding September 30, 2023		3,041,989			2.29		5.66		-
Exercisable, September 30, 2023		1,469,651			2.37		4.97		-

A summary of option activity for non-employees under the plans and changes during the nine months ended September 30, 2023 presented below:

	Number of Options			Weighted Averaged Exercise Price $		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Options Value $
Options outstanding January 1, 2023		91,663			1.75		2.55		1,083
Granted during 2023		8,333			0.89		4.46		222
Expired during 2023		(8,333	)		0.75		-		-
Options outstanding September 30, 2023		91,663			1.76		2.25		8,000
Exercisable, September 30, 2023		77,776			1.89		1.93		6,777

For the three and nine months ended September 30, 2023, Milestone Scientific recognized approximately $3,800 and $17,000, respectively of expense related to non-employee options. For the three and nine months ended September 30, 2022, Milestone Scientific recognized approximately $5,000 and $15,000, respectively of expense related to non-employee options.

The information below summarizes the restricted stock award activity for the nine months ended September 30, 2023.

	Number of Shares			Weighted Average Grant-Date Fair Value per Award
Non-vested as January 1, 2023		435,293			1.18
Granted		617,978			0.89
Vested		(540,164	)		-
Cancelled		(30,676	)		-
Non-vested as September 30, 2023		482,431			0.91

As of September 30, 2023, there were 18,947 restricted shares granted and deferred under the terms of  employment agreements with each Territory Manager of Milestone Scientific. Such shares  are expected to be issued to each party upon completion of two  years of employment. For the three and nine months ended September 30, 2023, the Company recognized stock compensation expense of approximately negative $36,500 and $17,700 respectively. For the three and nine months ended September 30, 2022, the Company recognized negative stock compensation expense of approximately $10,400 and $37,500, respectively, due to termination of certain employees who had not vested in their grant in the current period. For the nine months ended September 30, 2023, the total unrecognized compensation expense was approximately $5,200, related to unvested restricted stock awards, which the Company expects to recognize over an estimated weighted-average period of .46 years. 

As of  June 28, 2023, the Company entered into restricted stock agreements with members of the Board of Directors of the Company. The Company granted 617,978 restricted stock awards with a fair market value of $0.89 per share. Such restricted stock vests as follows: 25% on the grant date in June 2023, and 25% quarterly, on the first day of the following months:  October 2023,  January 2024, and  April 2024. These awards vest immediately upon a change of control as defined in the agreements. For the three and nine months ended September 30, 2023, the Company recognized approximately $137,500 and $445,000, respectively, for restricted stock expenses recorded in general and administrative expenses on the statement of operations. For the nine months end September 30, 2023, the total unrecognized stock compensation expense was approximately $269,000 related to non-vested restricted stock awards with the members of the Board of Directors, which the Company expects to recognize over an estimated weighted average period of 0.50 years.