| Equity and Stock-based Compensation | Note 6 – Equity and Stock-based compensation The following table presents stock-based compensation expenses included in our unaudited consolidated statements of comprehensive income (in thousands):
Three Months Ended March 31,
2021
2020
Cost of services
$
3
$
1
Research and development
30
4
Selling and marketing
33
25
General and administrative
131
53
Stock-based compensation expense
$
197
$
83
Stock Options. We granted stock options for 2,875,000 shares in the three months ended March 31, 2021. We did not grant any stock options in the three months ended March 31, 2020. Unrestricted Stock Grants . We grant unrestricted shares of stock under our 2001 Nonqualified Stock Plan. Stock-based compensation expense for stock grants is determined based on the fair market value of our stock on the date of grant, provided the number of shares in the grant is fixed on the grant date. We granted shares of unrestricted stock in 2021 and 2020 that affected financial results for the three month periods ended March 31, 2021 and 2020. These grants are described below. In February 2021 we granted an aggregate 56,533 shares of unrestricted stock to directors. The shares are scheduled to be issued in two equal installments shortly after June 30, 2021 and December 31, 2021, provided each grantee is serving as a director, officer or employee on those dates. The total stock-based compensation expense related to these grants is $0.3 million, of which $0.1 million was charged to expense in the three months ended March 31, 2021. We anticipate the remaining $0.2 million will be charged to expense ratable over the remaining three quarters of 2021. In 2020 we granted 256,250 shares of unrestricted stock to directors, officers, and employees. I n March and May 2020, we granted 243,000 shares of unrestricted stock to directors, officers, and employees. The shares were issued in two equal installments shortly after June 30, 2020 and December 31, 2020. In October and November, we granted 13,250 shares of unrestricted stock to employees. In 2019 we granted 120,000 shares, of which 30,000 were issued in 2020 and which the rest will be issued in three equal installments on their anniversary in September and October of 2021, 2022, and 2023, provided the grantee is serving as a director, officer, or employee on those dates. The total stock-based compensation expense related to the 120,000 shares granted is $0.3 million of which $21,000 and was charged to expense in the three months ended March 31 2020 and 2021. We anticipate the remaining $0.2 million will be charged to expense ratably through 2023. We issued shares of common stock related to the March 2019 grant as follows: i) 58,548 net shares of common stock were issued in early July 2019 after employees surrendered 12,952 shares for which we paid $43,000 of withholding taxes on their behalf; and ii) 56,605 net shares of common stock were issued in early January 2020 after employees surrendered 14,895 shares for which we paid $50,000 of withholding taxes on their behalf. We issued 109,773 shares of common stock related to the March and May 2020 grant in early July 2020 after employees surrendered 11,727 shares for which we paid $0.1 million of withholding taxes on their behalf. We also issued 30,000 shares of common stock related to September and October 2019 grants in September and October 2020. We issued 115,403 shares of common stock related to the March, May and November 2020 grants in early January 2021 after employees surrendered 15,347 shares for which we paid $0.1 million of withholding taxes on their behalf. Performance Share Award . In September 2019, we granted 20,000 shares of stock to an officer as a performance share award under our 2001 Nonqualified Stock Plan. The shares were issued in September 2019 and were forfeitable if the grantee was not serving as a director, officer or employee on March 19, 2020. Stock-based compensation expense for this stock grant was determined based on the fair market value of our stock on the date of grant, as the number of shares in the grant was fixed on the grant date. The total stock-based compensation expense related to this grant was $55,000, of which $24,000 was charged to expense in the three months ended March 31, 2020 and no expense in the three months ended March 31, 2021. In October 2019, we granted 10,000 shares of stock to an officer as a performance share award under our 2001 Nonqualified Stock Plan. The shares were issued in October 2019 and were forfeitable if the grantee was not serving as a director, officer or employee on April 1, 2020. Stock-based compensation expense for this stock grant was determined based on the fair market value of our stock on the date of grant, as the number of shares in the grant was fixed on the grant date. The total stock-based compensation expense related to this grant was $29,000, of which $14,000 was charged to expense in the three months ended March 31, 2020 and no expense in the three months ended March 31, 2021. Share Purchases - On April 30, 2020, our Board of Directors approved a program authorizing to purchase up to $10 million of our common stock, of which $1.0 million had been utilized to repurchase shares as of March 31, 2021. During the three months ended March 31, 2021 and 2020 we did not repurchase any shares of our common stock. The shares may be purchased from time to time in the open market or through privately negotiated transactions at management’s discretion, depending upon market conditions and other factors. The authorization to repurchase Company stock expires on December 31, 2021. Repurchases will be made under the program using our own cash resources and will been accordance with Rule 10b-18 under the Securities Exchange Act of 1934 and other applicable laws, rules and regulations. The program does not obligate us to acquire any particular amount of common stock and the program may be modified or suspended at any time at our Board of Director’s discretion. |
