SHARE BASED COMPENSATION

6 Months Ended

Jun. 30, 2024

SHARE BASED COMPENSATION

SHARE-BASED COMPENSATION

10. SHARE-BASED COMPENSATION

During 2019, the Company’s Board of Directors adopted the 2019 Stock and Incentive Plan (the “Plan”), which was amended in April 2020, March 2021 and June 2023. The Plan permits the issuance of stock options, stock appreciation rights, stock awards, share units, performance shares, performance units and other stock-based awards, and, as of June 30, 2024, 2.3 million shares have been authorized to be issued under the Plan and 1.0 million are available for future grant. The Plan provides for the grant of options as either non-statutory stock options or incentive stock options and restricted stock units to employees, officers, directors, and consultants of the Company to attract and retain persons of ability to perform services for the Company and to reward such individuals who contribute to the achievement by the Company of its economic objectives. The awards granted generally vest in 25% increments over a four-year period and option awards expire 6 years from grant date. 

The Plan is administered by the Board or a committee appointed by the Board, which determines the persons to whom the awards will be granted, the type of awards to be granted, the number of awards to be granted, and the specific terms of each grant, including the vesting thereof, subject to the provisions of the Plan.

During the six months ended June 30, 2024 and 2023, the Company granted shares to certain employees as compensation for services. These shares were accounted for in accordance with ASC 718 - Compensation - Stock Compensation. The Company amortizes awards over the service period and until awards are fully vested.

For the three and six months ended June 30, 2024 and 2023, share-based compensation expense was as follows:

	Three Months Ended				Six Months Ended
	June 30,		June 30,		June 30,		June 30,
(in thousands)	2024		2023		2024		2023
Cost of goods sold	$	-	$	-	$	-	$	-
General and administrative expense		10		41		36		101
Total share-based compensation	$	10	$	41	$	36	$	101

The following table summarizes the status of stock option grants and unvested awards at and for the six months ended June 30, 2024:

	Stock			Weighted-Average Exercise		Weighted Average Remaining Contractual		Aggregate Intrinsic
(in thousands except per share amounts)	Options			Price		Life		Value
Outstanding-December 31, 2023		1,453		$	1.9		5.3	$	-
Granted		250			0.16		-		-
Exercised		-			-		-		-
Expired		-			-
Cancelled		(405	)		1.73		-		-
Outstanding-June 30, 2024		1,298		$	1.62		1.97		-
Exercisable-June 30, 2024		1,081		$	2.77		4.47	$	-
Vested and expected to vest-June 30, 2024		1,298		$	1.62		1.97	$	-

The weighted-average fair value of options granted during the three and six months ended June 30, 2024, estimated as of the grant date were $0.16. As of June 30, 2024, there was $63 of total unrecognized compensation cost related to non-vested options, which is expected to be recognized over a remaining weighted-average vesting period of 1.0 years.

For the three and six months ended June 30, 2024 and 2023, the fair value of the stock options granted were determined using the Black-Scholes option-pricing model with the following weighted average assumptions at the time of grant.

	Six Months Ended			Six Months Ended
	June 30,			June 30,
	2024			2023
Expected volatility		50	%		50	%
Dividend yield		0	%		0	%
Risk-free interest rate		4.15	%		1.1	%
Expected term in years		4.25	%		4.50	%