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Equity and Stock-based Compensation
6 Months Ended
Jun. 30, 2021
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Equity and Stock-based Compensation

Note 6 – Equity and Stock-based compensation

The following table presents stock-based compensation expenses included in our unaudited consolidated statements of operations (in thousands):

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Cost of services

 

$

6

 

 

$

4

 

 

$

8

 

 

$

5

 

Research and development

 

 

66

 

 

 

52

 

 

 

97

 

 

 

56

 

Selling and marketing

 

 

74

 

 

 

48

 

 

 

107

 

 

 

73

 

General and administrative

 

 

293

 

 

 

126

 

 

 

424

 

 

 

179

 

Stock-based compensation expense

 

$

439

 

 

$

230

 

 

$

636

 

 

$

313

 

 

Stock Options. We granted stock options for 2,875,000 shares in the six months ended June 30, 2021, and we granted stock options for 50,000 shares in the six months ended June 30, 2020.

Unrestricted Stock Grants. We grant unrestricted shares of stock under our 2001 Nonqualified Stock Plan. Stock-based compensation expense for stock grants is determined based on the fair market value of our stock on the date of grant, provided the number of shares in the grant is fixed on the grant date.  

We granted shares of unrestricted stock in 2021 and 2020 that affected financial results for the three and six month periods ended June 30, 2021 and 2020.  These grants are described below.

In February 2021 we granted an aggregate 56,533 shares of unrestricted stock to directors.  The shares are scheduled to be issued in two equal installments shortly after June 30, 2021 and December 31, 2021, provided each grantee is serving as a director, officer or employee on those dates. The total stock-based compensation expense related to these grants is $0.3 million, of which $0.1 million was charged to expense in the three and six months ended June 30, 2021. We anticipate the remaining $0.2 million will be charged to expense ratably over the remaining two quarters of 2021.

In 2020 we granted 256,250 shares of unrestricted stock to directors, officers, and employees.  In March and May 2020, we granted 243,000 shares of unrestricted stock to directors, officers, and employees. The shares were issued in two equal installments shortly after June 30, 2020 and December 31, 2020.  In October and November, we granted 13,250 shares of unrestricted stock to employees.  The shares were issued shortly after December 31, 2020.  The total stock-based compensation expense related to these grants is $0.7 million, of which $0.2 million was charged to expense in the three and six months ended June 30, 2020 and the remaining $0.5 million was charged over the remaining two quarters of 2020.

In 2019 we granted 120,000 shares, of which 30,000 were issued in 2020 and which the rest will be issued in three equal installments on their anniversary in September and October of 2021, 2022, and 2023, provided the grantee is serving as a director, officer, or employee on those dates.  The total stock-based compensation expense related to the 120,000 shares granted is $0.3 million of which $21,000 and $42,000 was charged to expense in the three months and six months ended June 30, 2020 and 2021 respectively .We anticipate the remaining $0.2 million will be charged to expense ratably through 2023.  

We issued shares of common stock related to the March 2019 grant as follows: i) 58,548 net shares of common stock were issued in early July 2019 after employees surrendered 12,952 shares for which we paid $43,000 of withholding taxes on their behalf; and ii) 56,605 net shares of common stock were issued in early January 2020 after employees surrendered 14,895 shares for which we paid $50,000 of withholding taxes on their behalf.

We issued 109,773 shares of common stock related to the March and May 2020 grant in early July 2020 after employees surrendered 11,727 shares for which we paid $0.1 million of withholding taxes on their behalf.  We also issued 30,000 shares of common stock related to September and October 2019 grants in September and October 2020.  We issued 115,403 shares of common stock related to the March, May and November 2020 grants in early January 2021 after employees surrendered 15,347 shares for which we paid $0.1 million of withholding taxes on their behalf.

Performance Share Awards. In September 2019, we granted 20,000 shares of stock to an officer as a performance share award under our 2001 Nonqualified Stock Plan. The shares were issued in September 2019 and were forfeitable if the grantee was not serving as a director, officer or employee on March 19, 2020. Stock-based compensation expense for this stock grant was determined based on the fair market value of our stock on the date of grant, as the number of shares in the grant was fixed on the grant date. The total stock-based compensation expense related to this grant was $55,000, of which $12,000 and $24,000 was charged to expense in the three and six months ended June 30, 2020 respectively and no expense in the six months ended June 30, 2021.

In October 2019, we granted 10,000 shares of stock to an officer as a performance share award under our 2001 Nonqualified Stock Plan. The shares were issued in October 2019 and were forfeitable if the grantee was not serving as a director, officer or employee on April 1, 2020. Stock-based compensation expense for this stock grant was determined based on the fair market value of our stock on the date of grant, as the number of shares in the grant was fixed on the grant date. The total stock-based compensation expense related to this grant was $29,000, of which $0 and $14,000 was charged to expense in the three and six months ended June 30, 2020 respectively and no expense was charged with respect to this grant in the six months ended June 30, 2021.

Share Purchases - On April 30, 2020, our Board of Directors approved a program authorizing us to purchase up to $10 million of our common stock, of which $1.0 million had been utilized to repurchase shares as of June 30, 2021.  During the three and six months ended June 30, 2021 we did not repurchase any shares of our common stock.  During the three and six months ended June 30, 2020, we repurchased 139,000 shares of our common stock for $0.5 million.  The shares may be purchased from time to time in the open market or through privately negotiated transactions at management’s discretion, depending upon market conditions and other factors.  The authorization to repurchase shares of our common stock expires on December 31, 2021.  Repurchases will be made under the program using our own cash resources and will been accordance with Rule 10b-18 under the Securities Exchange Act of 1934 and other applicable laws, rules and regulations.  The program does not obligate us to acquire any particular amount of common stock and the program may be modified or suspended at any time at our Board of Director’s discretion.