STOCK BASED COMPENSATION

The stock based compensation cost that has been charged against income by the Company was $642,840 and $659,836 for the years ended December 31, 2019 and 2018, respectively, for options awarded by the Company.

Stock option activity for the years ended December 31, 2019 and 2018 is summarized as follows:



OPTIONS ISSUED FOR COMPENSATION:	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)	Grant Date Fair Value
Outstanding at December 31, 2017	3,180,417		$	2.21	4.62	$	3,298,196
Options granted	697,000		1.17		8.10	610,305
Options exercised	(7,500	)	1.20		0.00	(4,241		)
Options cancelled/forfeited/expired	(409,167	)	1.80		0.00	(434,962		)
Outstanding at December 31, 2018	3,460,750		$	2.05	3.50	$	3,469,298
Vested at December 31, 2018	2,127,500		$	2.48	4.67	$	2,122,478
Exercisable at December 31, 2018	2,127,500		$	2.48	4.67	$	2,122,478

Outstanding at December 31, 2018	3,460,750		$	2.05	3.50	$	3,469,298
Options granted	1,150,000		1.40		8.76	1,148,662
Options exercised	(112,500	)	0.46		0.00	(41,789		)
Options cancelled/forfeited/expired	(80,000	)	0.46		0.00	(28,800		)
Outstanding at December 31, 2019	4,418,250		$	1.95	6.25	$	4,547,371
Vested at December 31, 2019	2,383,625		$	2.50	4.84	$	2,625,779
Exercisable at December 31, 2019	2,383,625		$	2.50	4.84	$	2,625,779

On October 9, 2019, the Board of Directors granted one employee options to purchase an aggregate of 75,000 shares of common stock at an exercise price of $1.13 per share with a 5 year term (subject to continued employment), vesting at the rate of 1/4th of such options per year on the first 4 anniversaries of the grant, under our 2013 Stock Incentive Plan, as amended, in consideration for services rendered and to be rendered to the Company.

On October 29, 2019, the Board of Directors granted the same employee above options to purchase an aggregate of 125,000 shares of common stock at an exercise price of $1.00 per share with a 5 year term (subject to continued employment), vesting at the rate of 1/4th of such options per year on the first 4 anniversaries of the grant, under our 2019 Equity Incentive Plan, in consideration for services rendered and to be rendered to the Company.

On May 20, 2019, the Board of Directors granted 12 employees, 1 officer/director (Benjamin P. Cowart, the Company’s Chief Executive Officer), and 5 board members options to purchase an aggregate of 487,000 , 163,000, and 300,000 , shares of common stock, respectively, at an exercise price of $1.45, $1.60, and $1.45 per share, respectively, with a ten year, 5 year, and ten year term, respectively (subject to continued employment/directorship), vesting at the rate of 1/4th of such options per year on the first 4 anniversaries of the grant, under our 2013 Stock Incentive Plan, as amended, in consideration for services rendered and to be rendered to the Company.

On April 12, 2018, the Board of Directors granted 11 employees and 1 officer/director (Benjamin P. Cowart, the Company’s Chief Executive Officer) options to purchase an aggregate of 521,000 and 166,000, shares of common stock, respectively, at an exercise price of $1.14 and $1.26 per share, respectively, with a ten year and 5 year term, respectively (subject to continued employment/directorship), vesting at the rate of 1/4th of such options per year on the first 4 anniversaries of the grant, under our 2013 Stock Incentive Plan, as amended, in consideration for services rendered and to be rendered to the Company.

On May 22, 2018, the Board of Directors granted 1 employee options to purchase an aggregate of 10,000 shares of common stock at an exercise price of $1.03 per share with a 10 year term (subject to continued employment/directorship), vesting at the rate of 1/4th of such options per year on the first 4 anniversaries of the grant, under our 2013 Stock Incentive Plan, as amended, in consideration for services rendered and to be rendered to the Company.

A summary of the Company’s stock warrant activity and related information for the years ended December 31, 2019 and 2018 is as follows:



WARRANTS ISSUED AND OTHER THAN SERIES B AND B1 PREFERRED STOCK:	Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)	Grant Date Fair Value

Outstanding at December 31, 2017	219,868		$	3.01	2.00	$	140,249
Warrants granted	—		—		—	—
Warrants exercised	—		—		—	—
Warrants canceled/forfeited/expired	—		—		—	—
Warrants at December 31, 2018	219,868		$	3.01	0.93	$	140,249
Vested at December 31, 2018	219,868		$	3.01	0.93	$	140,249
Exercisable at December 31, 2018	219,868		$	3.01	0.93	$	140,249

Outstanding at December 31, 2018	219,868		$	3.01	0.93	$	140,249
Warrants granted	1,500,000		2.25		9.70	1,496,372
Warrants exercised	—		—		—	—
Warrants canceled/forfeited/expired	(219,868	)	3.01		—	(140,249		)
Warrants at December 31, 2019	1,500,000		$	2.25	9.70	$	1,496,372
Vested at December 31, 2019	—		$	—	—	$	—
Exercisable at December 31, 2019	—		$	—	—	$	—

See "Note 14. Preferred Stock and Temporary Equity" for a description of the warrants that were granted in conjunction with our Series B and B1 Preferred stock. See "Note 6. Myrtle Grove Share Purchase and Subscription Agreement" for a description of the warrants that were granted in conjunction with the MG SPV closing.