Quarterly report pursuant to Section 13 or 15(d)

EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK AWARD PLAN

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EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK AWARD PLAN
6 Months Ended
Jun. 30, 2022
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK AWARD PLAN  
EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK AWARD PLAN

NOTE 11 – EMPLOYEE STOCK OPTIONS AND RESTRICTED STOCK AWARD PLAN

Compensation expense charged against income for share-based awards during the three and six months ended June 30, 2022 was $1,899,245 and $3,421,155, respectively, compared to $351,775 and $707,269 for the three and six months ended June 30, 2021. These amounts are included in General and administrative expense in the accompanying financial statements.

In 2011, the Company’s board of directors and stockholders approved and adopted a long-term incentive plan which allowed for the issuance of up to 2,500,000 shares of common stock through the grant of qualified stock options, non-qualified stock options and restricted stock. In 2013, the Company’s board of directors and stockholders approved an amendment to the long-term incentive plan, increasing the number of shares eligible under the plan to 5,000,000 shares. There were 341,155 shares remaining eligible for grant, either as stock options or as restricted stock, as of June 30, 2022.

In May 2021, the Company’s board of directors and stockholders approved and adopted a long-term incentive plan (the “2021 Plan”) which allowed for the issuance of up to 9,900,000 shares, including 341,155 shares that were reserved but unissued under the prior plan, of common stock subject to the grant of qualified stock options, non-qualified stock options, restricted stock units and restricted stock. There were 5,704,413 shares eligible for grant under the 2021 Plan as of June 30, 2022.

Stock Options

A summary of the stock option activity as of June 30, 2022 and 2021, respectively, and changes during the three and six months then ended is as follows:

    

    

    

Weighted-

    

Weighted-

Average

Average

Remaining

Aggregate

Exercise

Contractual

Intrinsic

    

Shares

    

Price

    

Term

    

Value

Outstanding, December 31, 2020

 

465,500

$

3.26

 

  

 

Granted

 

 

  

 

Forfeited or rescinded

 

 

  

 

Exercised

Outstanding, March 31, 2021

465,500

$

3.26

3.00 Years

$

134,850

Granted

Forfeited or rescinded

Exercised

 

 

  

 

Outstanding, June 30, 2021

465,500

3.26

2.75 Years

$

426,300

Exercisable, June 30, 2021

460,700

$

3.11

2.70 Years

Outstanding, December 31, 2021

365,500

$

3.61

Granted

Forfeited or rescinded

 

 

Exercised

 

 

 

  

Outstanding, March 31, 2022

365,500

$

3.61

2.21 Years

$

536,900

Granted

 

 

  

 

Forfeited or rescinded

 

 

  

 

Exercised

 

(100,000)

2.00

 

  

 

Outstanding, June 30, 2022

265,500

4.21

2.14 Years

$

128,700

Exercisable, June 30, 2022

265,500

$

4.21

2.14 Years

The intrinsic values were calculated using the closing price on June 30, 2022 of $2.66 and the closing price on June 30, 2021 of $2.98. As of June 30, 2022, there was $0 of unrecognized compensation cost related to stock options.

Restricted Stock

A summary of the restricted stock activity as of June 30, 2022 and 2021, and changes during the three and six months then ended is as follows:

    

    

Weighted- 

Average Grant

    

Restricted stock

    

Date Fair Value

Outstanding, December 31, 2020

 

2,132,297

$

1.03

Granted

 

 

Forfeited or rescinded

 

 

Vested

 

(94,350)

 

4.95

Outstanding, March 31, 2021

2,037,947

$

0.85

Granted

1,196,102

2.77

Forfeited or rescinded

Vested

(3,480)

5.96

Outstanding, June 30, 2021

3,230,569

$

1.55

 

Outstanding, December 31, 2021

2,572,596

$

1.75

Granted

1,247,061

2.79

Forfeited or rescinded

 

Vested

Outstanding, March 31, 2022

 

3,819,657

$

2.09

Granted

 

19,642

4.27

Forfeited or rescinded

(17,204)

2.79

Vested

(610,195)

2.80

Outstanding, June 30, 2022

3,211,900

$

1.97

As of June 30, 2022 there was $3,994,302 of unrecognized compensation cost related to restricted stock grants that will be recognized over a weighted average period of 2.06 years.

Grant activity for the six months ended June 30, 2022 was primarily restricted shares for the annual long-term incentive plan awards for employees.

Performance Stock Units

A summary of the performance stock unit activity as of June 30, 2022 and 2021, and changes during the three and six months then ended is as follows:

Weighted-

Performance

Average Grant

    

Stock Units

    

Date Fair Value

Outstanding, December 31, 2020

 

$

Granted

 

 

Forfeited or rescinded

 

 

Vested

 

 

Outstanding, March 31, 2021

 

$

Granted

Forfeited or rescinded

Vested

Outstanding, June 30, 2021

$

Outstanding, December 31, 2021

860,216

$

3.87

Granted

860,216

3.65

Forfeited or rescinded

Vested

Outstanding, March 31, 2022

1,720,432

$

3.76

Granted

Forfeited or rescinded

Vested

Outstanding, June 30, 2022

1,720,432

$

3.76

As of June 30, 2022, there was $5,326,433 of unrecognized compensation cost related to performance stock units that will be recognized over a weighted average period of 2.02 years.