17.	STOCKHOLDERS' EQUITY

Preferred Stock

Within the limits and restrictions provided in the Company's Certificate of Incorporation, the Board of Directors has the authority, without further action by the shareholders, to issue up to

5,000,000

shares of preferred stock,

$.0001

par value per share, in

one

or more series, and to fix, as to any such series, any dividend rate, redemption price, preference on liquidation or dissolution, sinking fund terms, conversion rights, voting rights, and any other preference or special rights and qualifications. As of

September 30, 2020,

100,000

shares of preferred stock have been designated as Series A-

Convertible Preferred Stock and

105,000

shares of preferred stock have been designated as Series B-

Convertible Preferred Stock. There was

preferred stock outstanding as of

September 30, 2020

December 31, 2019.

Warrants

Securities Purchase Agreement dated

November 13, 2014:

As part of a Securities Purchase Agreement, dated

November 13, 2014,

by and between the Company and a number of private and institutional investors, the Company issued to certain private investors warrants to purchase

996,877

shares of common stock. The warrants expired in

November 2019.

Securities Purchase Agreement dated

September 23, 2015:

September 23, 2015,

the Company issued warrants (the

“2015

Warrants”) to purchase

69,445

shares of common stock in connection with the issuance of a promissory note. The warrants were immediately exercisable at an initial exercise price of

$3.60

per share and had a term of

five

years. The

2015

Warrants expired in

September 2020.

The

2015

Warrants had a "full ratchet" anti-dilution adjustment provision which could be triggered in the event the Company sold or

granted any additional shares of common stock, options, warrants or other securities that were convertible into common stock at a price lower than

$3.60

per share. The anti-dilution was

not

triggered by certain “exempt issuances” which among other issuances, includes the issuance of shares of common stock, options or other securities to officers, employees, directors, consultants or service providers.

Anti-dilution adjustments were triggered as follows:

August 24, 2018

the Company issued warrants to certain investors which triggered the anti-dilution provisions included in the

2015

Warrants. As a result, the number of shares of common stock issuable upon the full exercise of the

2015

Warrants was increased from

69,445

166,668

shares, and the exercise price was reduced from

$3.60

$1.50

per share.

February 14, 2020,

the

February 2020

Note was issued at a conversion price of

$1.15

that triggered the anti-dilution provisions included in these warrants. In addition, the amendments to the Original Note reduced the conversion price of the Original Note to

$0.65

which also triggered the anti-dilution provision of the

2015

Warrants. As a result of the forgoing transactions, the number of shares of common stock issuable upon the full exercise of the

2015

Warrants increased to

384,618,

the exercise was reduced to

$0.65

per share, and the Company recorded a non-cash deemed dividend in amount of

$41,688.

Referral Fees:

During the

second

quarter of

2020,

the Company issued a warrant to purchase

125,000

shares of common stock to an investor in payment for a business referral valued at

$94,655.

During the

third

quarter of

2020,

the Company issued a warrant to purchase

25,000

shares of common stock to a former employee for a business referral valued at

$12,921.

Common Stock

March 30, 2020,

the Company issued

972,000

shares of common stock for warrants that were exercised at

$1.50,

resulting in proceeds of

$1,458,000

to the Company.

April 2, 2020,

the Company issued

6,850

shares of common stock to its directors in payment of meeting fees valued at

$5,001.

May 12, 2020,

the Company issued

7,077

shares of common stock to its directors in payment of meeting fees valued at

$7,003.

May 14, 2020,

the Company issued

1,632

shares of common stock to its directors in payment of committee meeting fees valued at

$1,501.

June 8, 2020,

the Company issued

1,581

shares of common stock to its directors in payment of committee meeting fees valued at

$1,502.

July 23, 2020,

the Company completed an underwritten public offering of shares of common stock and warrants resulting in net proceeds of approximately

$22.7

million, after deducting underwriting discounts and commissions and estimated offering expenses.

34,114,500

shares of common stock were issued as a result of this offering, and a further

6,364,300

shares of common stock were issued upon the exercise of

4,100,000

prefunded warrants and

2,264,300

warrants exercised in conjunction with the offering.

10,328

shares of common stock were issued during the quarter ended

September 30, 2020

in payment of board and board committee fees valued at

$7,003.

See Note

- Convertible Notes Payable for common stock issuances related to conversion of convertible notes payable and shares of common stock issued for fees in connection with the agreements.

Issuances of Nonvested Stock

Nonvested stock consists of shares of common stock that are subject to restrictions on transfer and risk of forfeiture until the fulfillment of specified conditions. The fair value of nonvested shares is determined based on the market price of the Company's common stock on the grant date. Nonvested stock is expensed ratably over the term of the restriction period.

The Company issued

306,000

shares of restricted common stock during the quarter ended

September 30, 2020

to certain employees and directors of the Company. These shares vest in equal annual installments over a

three

-year period from the date of grant, and had a fair value on the date of issuance of

$198,900.

Nonvested stock compensation for the

three

months ended

September 30, 2020

was

$3,427.

Issuances of Stock Options

April 2, 2020,

the Company issued a stock option to a new employee to purchase

5,000

shares of common stock with a

three

-year vesting period,

seven

year term, and exercise price of

$0.73

per share.

The fair value of the option at date of issuance was estimated on the date of grant at

$2,267

using the Black-Scholes option-pricing model with the following assumptions: risk free interest rate:

0.36%,

expected life of options in years:

4.5,

expected dividends:

volatility of stock price:

83%.

197,500

options were granted during the quarter ended

September 30, 2020.

These options vest in

three

equal annual installments on each of the

three

anniversaries of the date of grant period, have

seven

year terms, and a weighted average exercise price of

$0.65.

The fair value of the options at date of issuance was estimated on the date of grant at

$80,093

using the Black-Scholes option-pricing model with the following assumptions: risk free interest rate:

0.28%,

expected life of options in years:

4.53,

expected dividends:

volatility of stock price:

83%.