Equity-Based Compensation

9 Months Ended

Sep. 30, 2021

Share-based Payment Arrangement [Abstract]

Equity-Based Compensation

Note 3: Equity-Based Compensation

The fair value of each option and equity warrant award is estimated on the date of grant using a Black-Scholes-Merton option pricing valuation model. Expected volatility is based on the historical volatility of the price of the Company’s stock. The risk-free interest rate is based on U.S. Treasury issues with a term equal to the expected life of the option and equity warrant. The Company uses historical data to estimate expected dividend yield, expected life and forfeiture rates. There were no options granted in the nine months ended September 30, 2021, and 2020.

Stock option for employees’ activity during the nine months ended September 30, 2021, is as follows:

Stock option activity for employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding January 1, 2021		1,049,695		$	5.38		9.28	$	—
Granted		—			—		—		—
Forfeited		(50,898	)		2.39		—		—
Expired		—			—		—		—
Outstanding September 30, 2021		998,797		$	5.53		8.96	$	—
Vested and expected to vest September 30, 2021		998,797		$	5.53		9.23	$	—
Exercisable September 30, 2021		725,198		$	4.07		7.85	$	—

Unvested stock option activity for employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Unvested January 1, 2021		767,029		$	3.71		9.68	$	—
Granted		—			—		—		—
Expired		(50,898	)		2.39		—		—
Vested		(442,532	)		2.47		—		—
Unvested September 30, 2021		273,599		$	13.99		4.28	$	—

Stock option activity for non-employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding January 1, 2021		166,533		$	11.03		6.88	$	—
Granted		—			—		—		—
Forfeited		—			—		—		—
Expired		(322	)		965.93		—		—
Outstanding September 30, 2021		166,211		$	9.18		7.05	$	—
Vested and expected to vest September 30, 2021		166,211		$	9.18		6.79	$	—
Exercisable September 30, 2021		166,211		$	9.18		7.56	$	—

Unvested stock option activity for non-employees:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Unvested January 1, 2021		66,202		$	7.24		6.13	$	—
Granted		—			—		—		—
Expired		—			—		—		—
Vested		(66,202	)		3.98		—		—
Unvested September 30, 2021		—		$	—		—	$	—

Stock-based compensation expense was approximately $1,320,000 and $596,000 for the nine months ended September 30, 2021, and 2020, resulting in an increase in general and administrative expenses, respectively.

As of September 30, 2021, and 2020, respectively, there was approximately $279,000 and $877,000 of unrecognized equity-based compensation cost related to options granted under the Equity Incentive Plan.