Stock Options and Stock Grants

12 Months Ended

Dec. 31, 2022

Share-Based Payment Arrangement [Abstract]

Stock Options and Stock Grants

(10) Stock Options and Stock Grants

We have entered into stock option agreements with certain officers, employees and directors. The stock options granted prior to the adoption of the 2019 Equity Compensation Plan (the “2019 Plan”) on November 19, 2019 generally expire ten years from the date of grant. Future options to be granted under the 2019 Plan will expire seven years from the date of grant.

Employee Stock Options

We follow ASC Topic 718, Share-Based Payments, in which compensation expense is recognized only for share-based payments expected to vest. 

	Years ended   December 31,
	2022		2021
Share-based compensation expense	$	625	$	160
Remaining unrecognized compensation expense	$	1,732
Remaining weighted average-period, expense recognition (years)		2.5

We use the Black-Scholes option pricing model to determine the fair value of stock-based compensation. The Black-Scholes model requires us to make several assumptions, including the estimated length of time employees will retain their vested stock options before exercising them (“expected term”), the estimated volatility of our common stock price over the expected term, and estimated forfeitures. Expected price volatility is based on the daily market rate changes of our stock. The active shares granted prior to fiscal 2020 had a contractual life of 10 years as dictated by the 2010 Plan. The Black-Scholes model also requires a risk-free interest rate, which is based on the U.S. Treasury yield curve in effect at the time of the grant, and the dividend yield on our common stock, which is assumed to be zero since we do not pay dividends and have no current plans to do so in the future. Changes in these assumptions can materially affect the estimate of fair value of stock-based compensation and consequently, the related expense recognized on the statement of operations. We recognize stock-based compensation expense on a straight-line basis over the requisite service period. 

The following table illustrates the various assumptions used to calculate the Black-Scholes option pricing model for options granted for all years presented:

	Years Ended December 31,
	2022			2021
Weighted-average risk-free interest rates:		3.5	%		1.4	%
Dividend yield:		0	%		0	%
Weighted-average expected life (years) of the option:		5			5
Weighted-average expected stock price volatility:		116	%		115	%
Weighted-average fair value of the options granted:	$	0.97		$	2.59

Additional disclosures for options granted for all years presented:

	Years Ended December 31,
	2022			2021
Vesting period (years) of shares granted in period		3			3
Contractual life (years) of shares granted in period		7			7
Estimated forfeitures		4	%		4	%

The following table summarizes the option activity for our employees and directors during the year ended December 31, 2022:

						Weighted
				Weighted		Average	Aggregate
				Average		Remaining	Intrinsic
	Shares			Exercise Price		Contractual	Value
Options	(Rounded)			per Share		Term (Years)	(000s)
Outstanding on January 1, 2022		3,193,216		$	1.18
Granted		768,400		$	1.61
Exercised		(414,455	)	$	0.44
Forfeited or expired		(103,500	)	$	2.50
Outstanding on December 31, 2022		3,443,661		$	1.33	4.9	$	1,230
Exercisable on December 31, 2022		2,193,254		$	0.86	4.1	$	1,126
Shares available for grant		1,119,100

The aggregate intrinsic value in the table above is based on our closing stock price of $1.13 on the last business day for the year ended December 31, 2022.

	Years ended  December 31,
	2022		2021
Shares exercised		414,455		535,100
Total intrinsic value	$	942	$	1,169
Cash received	$	182	$	234

Based on our election of the “with and without” approach, no realized tax benefits from stock options were recognized for the years ended December 31, 2022 and 2021.