STOCK OPTIONS

9 Months Ended

Sep. 30, 2022

STOCK OPTIONS

STOCK OPTIONS

5. STOCK OPTIONS

The new Stock Plan (the “Plan”) allows for the issuance of incentive stock options, nonqualified stock options, and stock purchase rights. The exercise price of options was determined by the Company’s board of directors, but incentive stock options were granted at an exercise price equal to the fair market value of the Company’s common stock as of the grant date. Options historically granted have generally become exercisable over four years and expire ten years from the date of grant. The plan provides for stock options to be granted up to 10% of the outstanding common stock shares.

There was no stock option activity during the nine months ended September 30, 2022. The following table summarizes the Company’s outstanding and exercisable stock options as of September 30, 2022:

	Number of Shares		Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life	Aggregate Intrinsic Value of In-the-Money Options   (in thousands)
Options outstanding as of September 30, 2022		1,500,000	$	0.49	7.8 years	$	-
Options exercisable as of September 30, 2022		1,227,136	$	0.49	7.8 years	$	-

The aggregate intrinsic value is calculated as the difference between the Company’s closing stock price as of September 30, 2022 and the exercise price, multiplied by the number of options. As of September 30, 2022, there was $131,735 of unrecognized stock-based compensation expense. Such costs are expected to be recognized over a weighted average period of approximately one year. The weighted-average fair value of awards granted was nil and $0.47 during the nine months ended September 30, 2022 and 2021, respectively.

The Company recognizes compensation expense for stock option awards on a straight-line basis over the applicable service period of the award. The service period is generally the vesting period.