Stock Options

12 Months Ended

Dec. 31, 2023

Stock Options

Stock Options

13. Stock Options

2012 Plan

The Company’s 2012 Plan expired in February 2022, which provided for the grant of options to purchase up to 1,193,000 shares of the Company’s Common Stock, par value $.05 per share (“Common Stock”), plus up to 57,000 shares under options previously granted under the 2002 Stock Option Plan of the Company (the “Prior Plan”).

The 2012 Plan provided for the granting of incentive or non-incentive stock options. Incentive stock options may be granted to employees at an exercise price equal to 100% (or 110% if the optionee owns directly or indirectly more than 10% of the outstanding voting stock) of the fair market value of the shares of Common Stock on the date of the grant and vested as to 1/3 on each of the first, second, and third anniversaries from the grant date. Non-incentive stock options shall be granted at the fair market value of the shares of Common Stock on the date of grant.

During the year ended December 31, 2023, the six months ended December 31, 2022 and the fiscal year ended June 30, 2022, under the 2012 Plan the Company granted 0, 0 and 60,000 to employees that had a fair value of $0, $0, and $268,848, respectively.

2022 Plan

The Company’s 2022 Plan provides for the issuance of up to 1,750,000 shares of the Company’s Common Stock, par value $0.05 per share, plus outstanding options granted under the Company’s 2012 Stock Option Plan that expire or are forfeited. Incentive stock options may be granted to employees at an exercise price equal to 100% (or 110% if the optionee owns directly or indirectly more than 10% of the outstanding voting stock) of the fair market value of the shares of Common Stock on the date of the grant. Nonstatutory stock options shall be granted at the fair market value of the shares of Common Stock on the date of grant. Both Incentive and Nonstatutory stock options cliff-vest over five years. As of December 31, 2023, 1,879,660 shares of Common Stock were available for grant of options under the 2022 Plan, of which 224,660 shares of Common Stock are from either terminated or expired options from the 2012 Plan.

During the year ended December 31, 2023, the six months ended December 31, 2022 and the fiscal year ended June 30, 2022, under the 2022 Plan the Company granted 0, 0 and 60,000 to employees that had a fair value of $0, $0, and $262,372, respectively.

On July 21, 2023, the Company’s Bioprocessing System segment entered into a separation agreement with their VP of Sales (“former employee”). In connection with the separation agreement, the Company extended the exercisability of the former employee’s vested stock options up through the original expiration date of July, 13, 2030, which the Company recorded a additional $684,900 of noncash stock base compensation expense related to the modification of the exercisability of the vested stock options.

On September 19, 2023, the Company’s Bioprocessing System segment entered into a one year consulting agreement with John Nicols. The agreement provided that the consultant be paid a monthly retainer fee of $8,000. For the year ended December 31, 2023, the Company paid fees of $19,200 and issued 35,000 stock options which vest monthly over the one year period, valued at $114,700 on the grant date using the Black-Scholes-Merton option pricing model.

The following table summarizes the weighted-average assumptions used for the Black-Scholes option pricing model to determine the fair value of our stock options for the year ended December 31, 2023, for the six months ended December 31, 2022 and for the fiscal year ended June 30, 2022, respectively:

	Year ended December 31,			Six months ended  December 31,		Year ended June 30,
	2023			2022		2022
Expected term (in years)		10			-		10
Risk-free interest rate		4.49	%		-		1.91	%
Expected volatility		72.5	%		-		72	%
Dividend rate		0			-		0

Total stock-based compensation costs were $2,240,100, $1,236,700 and $2,350,600 for the year ended December 31, 2023, for the six months ended December 31, 2022 and for the fiscal year ended June 30, 2022, respectively.

Stock-based compensation costs related to nonvested awards expected to be recognized in the future are $450,100 and

$1,945,300 and $3,187,300, as of December 31, 2023 and 2022 and June 30, 2022, respectively.

The weighted-average period over which the nonvested awards is expected to be recognized are 0.87 years, 1.14 years and 1.51 years for the year ended December 31, 2023, for the six months ended December 31, 2022 and for the fiscal year ended June 30, 2022, respectively.

The following table summarizes option activity under all plans for the year ended December 31, 2023, for the six months ended December 31, 2022 and for the fiscal year ended June 30, 2022:

	Year Ended December 31,							Six months ended December 31,					Year Ended June 30,
	2023							2022					2022
Shares under option:	Shares			Weighted- Average Exercise Price		Aggregate Intrinsic Value		Shares			Weighted- Average Exercise Price		Shares			Weighted- Average Exercise Price
Outstanding, beginning		1,115,810		$	8.4	$	129,900		1,158,644		$	8.40		1,180,757		$	8.73
Granted		35,000			4.09		-		-			-		120,000			5.78
Exercised		-			-		-		-			-		-			-
Forfeited		(30,713	)		6.62		2,500		(42,834	)		8.33		(142,113	)		8.98
Outstanding, end		1,120,097		$	8.32		-		1,115,810		$	8.40		1,158,644		$	8.40
Options exercisable end of the period		963,228		$	8.45				632,175		$	8.30		567,594		$	8.13
Weighted average fair value per share of options granted during the period				$	3.28						$	0				$	4.43

	Year ended December 31,					Six months ended December 31,					Year ended June 30,
	2023					2022					2022
NonVested Shares under option:	Shares			Weighted-Average Grant Date Fair Value		Shares			Weighted-Average Grant Date Fair Value		Shares			Weighted-Average Grant Date Fair Value
Outstanding, beginning		483,635		$	6.76		591,050		$	6.75		970,082		$	7.16
Granted		35,000			3.28		-			-		120,000			4.43
Vested		(351,453	)		6.98		(106,248	)		6.73		(356,919	)		7.17
Forfeited		(10,313	)		5.09		(1,167	)		4.48		(142,113	)		6.53
Outstanding, end		156,869		$	5.60		483,635		$	6.76		591,050		$	6.75

	Year Ended December 31,
	2023
	Shares		Weighted-Average Exercise price		Weighted-Average Remaining Contractual term
Vested Shares under option:		963,228	$	8.45		6.47

	Six months ended December 31,
	2022
	Shares		Weighted-Average Exercise price		Weighted-Average Remaining Contractual term
Vested Shares under option:		632,175	$	8.30		7.30

	Year ended June 30,
	2022
	Shares		Weighted-Average Exercise price		Weighted-Average Remaining Contractual term
Vested Shares under option:		567,594	$	8.13		7.73

	As of December 31, 2023 Options Outstanding						As of December 31, 2023 Exercisable
Range Exercise Price	Number Outstanding		Remaining Contractual Life (Years)		Average Exercise Price		Number Outstanding		Average Exercise Price
$5.35 - $ 11.30		1,029,392		6.84	$	8.73		898,773	$	8.18
$2.91 - $ 4.65		90,705		2.29	$	3.61		64,455	$	3.41
		1,120,097						963,228

	As of December 31, 2022 Options Outstanding						As of December 31, 2022 Exercisable
Range Exercise Price	Number Outstanding		Remaining Contractual Life (Years)		Average Exercise Price		Number Outstanding		Average Exercise Price
$5.35 - $ 11.30		1,055,105		7.85	$	8.69		571,470	$	8.82
$2.91 - $ 4.65		60,705		4.00	$	3.36		60,705	$	3.36
		1,115,810						632,175

	As of June 30, 2022 Options Outstanding						As of June 30, 2022 Exercisable
Range Exercise Price	Number Outstanding		Remaining Contractual Life (Years)		Average Exercise Price		Number Outstanding		Average Exercise Price
$5.35 - $ 11.30		1,097,939		8.34	$	8.68		506,889	$	8.70
$2.91 - $ 4.65		60,705		4.51	$	3.37		60,705	$	3.37
		1,158,644						567,594