Stock Option Plans and Agreements

6 Months Ended

Jun. 30, 2023

Stock Option Plans and Agreements

Stock Option Plans and Agreements

Note 10. Stock Option Plans and Agreements

At the annual meeting of stockholders of the Company held on January 26, 2022; the Company’s stockholders voted to approve the Company’s 2021 Equity Incentive Plan (“2021 Plan”). The maximum number of shares of Common Stock available for grant and issuance under the 2021 Plan will be (a) 60,000, plus (b) any shares of Common Stock that are subject to options granted under the Prior Plans that expire, are forfeited or canceled or terminate for any other reason without the issuance of shares under the Prior Plans on or after January 26, 2022, plus (c) any shares of Common Stock that are subject to options granted under the Prior Plans that are used to pay the exercise price of an option or withheld to satisfy the tax withholding obligations related to any option under the Prior Plans on or after January 26, 2022.

The Company has approved stock options plans and agreements covering up to an aggregate of 249,113 shares of common stock. Such options may be designated at the time of grant as either incentive stock options or nonqualified stock options. Stock based compensation consists of charges for stock option awards to employees, directors and consultants.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model. 47,600 options were granted during the six months ended June 30, 2023. 1,267 options were granted during the six months ended June 30, 2022. The following assumptions were used for the six months ended June 30, 2023:

Risk-free interest rate	3.57% - 3.98		%
Expected dividend yield		0	%
Expected stock price volatility		110	%
Expected life of options (years)		2.75

The Company recorded expense for options issued to employees and independent service providers of $26,159 for both the three and six months ended June 30, 2023, and $51,708 and $52,631, for the three and six months June 30, 2022, respectively.

32,600 options vested during the six months ended June 30, 2023.

The Company issued 15,000 performance-based stock options during the six months ended June 30, 2023 at $1.17 per share to an executive of the Company. Certain bookings targets must be made for the options to vest. The unrecognized compensation expense for these options is approximately $12,000 at June 30, 2023.

A summary of all stock option activity for the six months ended June 30, 2023 follows:

	Number of			Weighted		Remaining	Aggregate
	Options			Average		Contractual	Intrinsic
	Outstanding			Exercise Price		Term	Value
Outstanding at December 31, 2022		131,789		$	6.03
Granted		47,600			1.20
Expired		(6,335	)		3.85
Outstanding at June 30, 2023		173,054		$	5.14	2.9 years	$	0.00
At June 30, 2023- vested or
expected to vest		158,054		$	5.14	2.7 years	$	0.00
Exercisable		158,054		$	5.14	2.7 years	$	0.00