| Organization and Significant Accounting Policies | NOTE 1 – ORGANIZATION AND SIGNIFICANT
ACCOUNTING POLICIES THE COMPANY Boxlight Corporation (the “Company”
or “Boxlight Parent”) is a leading provider of interactive technology solutions under its award-winning brands Clevertouch ® ® The Company is headquartered in Atlanta, Georgia
and was incorporated in the State of Nevada on September 18, 2014. In 2016, the Company acquired Boxlight, Inc., Boxlight Latinoamerica,
S.A. DE C.V. and Boxlight Latinoamerica Servicios, S.A. DE C.V. (together, “Boxlight Group”), Mimio LLC (“Mimio”)
and Genesis Collaboration, LLC (“Genesis”). In 2018, the Company acquired Cohuborate Ltd. (“Cohuba”), Qwizdom
Inc. and its subsidiary Qwizdom UK Limited (the “Qwizdom Companies”), and EOSEDU, LLC (“EOS”). In 2019,
the Company acquired Modern Robotics, Inc. (“MRI”). In 2020, the Company acquired MyStemKits Inc. (“MyStemKits”)
and Sahara Presentation Systems PLC (“Sahara”). MyStemKits is in the business of developing, selling and distributing
3D printable science, technology, engineering and math curriculums incorporating 3D printed project kits for education, and owns
the right to manufacture, market and distribute Robo 3D branded 3D printers and associated hardware for the global education market.
Sahara is a leader in distributed AV products and a global manufacturer of multi-award winning touchscreens and digital signage
products. See Note 3 for further discussion regarding acquisitions. BASIS OF PRESENTATION AND PRINCIPLES OF
CONSOLIDATION The accompanying consolidated condensed financial
statements include the accounts of Boxlight Parent, Boxlight Group, Mimio, Genesis, Cohuba, Qwizdom Companies, EOS, MRI, MyStemKits,
and Sahara. Transactions and balances among all of the companies have been eliminated. The accompanying unaudited consolidated condensed
financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United
States of America (“GAAP”) for interim unaudited consolidated condensed financial information and interim financial
reporting guidelines and rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they
do not include all of the information and notes required by GAAP for complete consolidated financial statements. The unaudited
consolidated condensed financial statements reflect all adjustments (consisting of normal recurring adjustments) which are, in
the opinion of management, necessary for a fair statement of the results for the interim periods presented. Interim results are
not necessarily indicative of the results for the full year. These unaudited consolidated condensed financial statements should
be read in conjunction with the audited consolidated financial statements of the Company for the year ended December 31, 2019 and
notes thereto contained in the Company’s Annual Report on Form 10-K. Certain information and note disclosures normally included
in the consolidated financial statements have been condensed. The December 31, 2019 balance sheet included herein was derived from
the audited consolidated financial statements, but does not include all disclosures, including notes, required by GAAP for complete
financial statements. ESTIMATES AND ASSUMPTIONS The preparation of financial statements in
conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and
liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual amounts could differ from those estimates. The coronavirus disease (“COVID-19”)
pandemic has negatively impacted, and may continue to negatively impact, the macroeconomic environment in the United States and
globally, including our business, financial condition and results of operations. Due to the evolving and uncertain nature of COVID-19
and its effects on the U.S. and global economy, it is reasonably possible that it could materially impact our estimates, particularly
those that require consideration of forecasted financial information, in the near to medium term. These estimates relate to certain
accounts including, but not limited to, the valuation allowance related to deferred taxes, intangible assets, and other long-lived
assets. The magnitude of the impact will depend on numerous evolving factors that we may not be able to accurately predict or prepare
for, including the duration and extent of the pandemic, the impact of federal, state, local and foreign governmental actions taken
in response to the pandemic, changes in consumer behavior in response to the pandemic and such governmental actions, and the economic
and operating conditions that we may face in the aftermath of COVID-19. ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL
ACCOUNTS Accounts receivable
are stated at contractual amounts, net of an allowance for doubtful accounts. The allowance for doubtful accounts represents management’s
estimate of the amounts that ultimately will not be realized in cash. The Company reviews the adequacy of the allowance for doubtful
accounts on an ongoing basis, using historical payment trends, the age of receivables and knowledge of the individual customers.
When the analysis indicates, management increases or decreases the allowance accordingly. However, if the financial condition of
our customers were to deteriorate, additional allowances might be required. INVENTORIES Inventories are stated at the lower of cost
or net realizable value and includes spare parts and finished goods. Inventories are primarily determined using the specific identification
method and the first-in, first-out (“FIFO”) cost method. Cost includes direct cost from the contract manufacturer (“CM”)
or original equipment received from the manufacturer (“OEM”), plus material overhead related to the purchase, inbound
freight and import duty costs. The Company continuously
reviews its inventory levels to identify slow-moving merchandise and markdowns necessary to clear slow-moving merchandise, which
reduces the cost of inventories to its estimated net realizable value. Consideration is given to a number of quantitative and qualitative
factors, including current pricing levels and the anticipated need for subsequent markdowns, aging of inventories, historical sales
trends, and the impact of market trends and economic conditions. Estimates of markdown requirements may differ from actual results
due to changes in quantity, quality and the mix of products in inventory, as well as changes in consumer preferences, market and
economic conditions. Intangible
assets AND GOODWILL Intangible assets, other than goodwill are
amortized using the straight-line method over their estimated period of benefit. We periodically evaluate the recoverability of
intangible assets, other than goodwill, and take into account events or circumstances that warrant revised estimates of useful
lives or that indicate that impairment exists. No material impairments of intangible assets have been identified during any of
the periods presented. Goodwill is tested for impairment on an annual basis, and between annual tests if indicators of potential
impairment exist, using a market approach. Goodwill is not amortized and is not deductible for tax purposes. DERIVATIVES The Company classifies common stock purchase
warrants and other free standing derivative financial instruments as equity if the contracts (i) require physical settlement or
net-share settlement or (ii) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement
or net-share settlement). The Company classifies any contracts that (i) require net-cash settlement (including a requirement to
net cash settle the contract if an event occurs and if that event is outside the control of the Company), (ii) give the counterparty
a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (iii) contain reset provisions
as either an asset or a liability. The Company assesses classification of its freestanding derivatives at each reporting date to
determine whether a change in classification between equity and liabilities is required. The Company determined that certain warrants
to purchase common stock do not satisfy the criteria for classification as equity instruments due to the existence of certain net
cash and non-fixed settlement provisions that are not within the sole control of the Company. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company’s financial instruments primarily
include cash, accounts receivable, derivative liabilities, accounts payable, earn-out payable, debt, and redeemable preferred stock.
Due to the short-term nature of cash, accounts receivables and accounts payable, the carrying amounts of these assets and liabilities
approximate their fair value. Debt approximates fair value due to either the short-term nature or recent execution of the debt
agreement. The amount of consideration received is deemed to be the fair value of long-term debt net of any debt discount and issuance
cost. Derivative liabilities, the earn–out
payable, and certain related party debt are recorded at fair value at each period end. The Company’s redeemable preferred
stock was issued in conjunction with a business combination and was recorded at fair value at issuance (less the intrinsic value
of a beneficial conversion feature embedded in the Series C preferred shares). The redeemable preferred stock is not measured at
fair value on a recurring basis. See further discussion in Note 3 and Note 11. Fair value is defined as the price that would
be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. A fair value
hierarchy has been established for valuation inputs that gives the highest priority to quoted prices in active markets for identical
assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows: Level 1 Inputs - Unadjusted quoted prices in
active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 Inputs - Inputs other than quoted prices
included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices
for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that
are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities,
prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation
or other means. Level 3 Inputs - Prices or valuation techniques
that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market
activity). Financial assets and liabilities are classified
based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance
of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets
and liabilities and their placement within the fair value hierarchy levels. The following table sets forth, by level within
the fair value hierarchy, the Company’s financial liabilities that were accounted for at fair value on a recurring basis
as of September 30, 2020 and December 31, 2019:
Markets for Other Significant Carrying
Description (Level 1) (Level 2) (Level 3) 2020
Derivative liabilities - warrant instruments $ - $ - $ 385,944 $ 385,944
Earn-out payable – related party - - 119,132 119,132
Note payable – STEM Education Holdings - - 350,000 350,000
$ 855,076 $ 855,076
Markets for Other Significant Carrying
Description (Level 1) (Level 2) (Level 3) 2019
Derivative liabilities - warrant instruments $ - $ - $ 146,604 $ 146,604
Earn-out payable – related party - - 387,118 387,118
$ 533,722 $ 533,722 The following table shows the change in the
Company’s earn-out payable rollforward for the nine months ended September 30, 2020:
Amount
Balance, December 31, 2019 $ 387,118
Amount paid (268,298 )
Change in fair value of earn-out payable 312
Balance, September 30, 2020 $ 119,132 See rollforward of Derivative liabilities -
warrant instruments in Note 10. REVENUE RECOGNITION In accordance with the FASB’s Accounting
Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) Nature of Products and Services and Related
Contractual Provisions The Company’s sales of interactive devices,
including panels, projectors, and other interactive devices generally include hardware maintenance services, a license to software,
and the provision of related software maintenance. In most cases, interactive devices are sold with hardware maintenance services
with terms ranging from 36–60 months. Software maintenance includes technical support, product updates on a when and if available
basis, and error correction services. At times, non-interactive projectors are also sold with hardware maintenance services with
terms ranging from 36-60 months. The Company also licenses software independently of its interactive devices, in which case it
is bundled with software maintenance, and in some cases, subscription services that include access to on-line content, access to
replacement parts, and cloud-based applications. The Company’s software subscription services provide access to content and
software applications on an as needed basis over the Internet, but do not provide the right to take delivery of the software applications. The Company’s products sales, including
those with software and related services, generally include a single payment up front for the products and services, and revenue
is recorded net of estimated sales returns and rebates based on the Company’s expectations and historical experience. For
most of the Company’s product sales, control transfers, and therefore, revenue is recognized when products are shipped at
the point of origin. When the Company transfers control of its products to the customer prior to the related shipping and handling
activities, the Company has adopted a policy of accounting for shipping and handling activities as a fulfillment cost rather than
a performance obligation. For many of the Company’s software product sales, control is transferred when shipped at the point
of origin since the software is installed on the interactive hardware device in advance of shipping. For other software product
sales, control is transferred when the customer receives the related interactive hardware since the customer’s connection
to the interactive hardware activates the software license at which time the software is made available to the customer. For the
Company’s software maintenance, hardware maintenance, and subscription services, revenue is recognized ratably over time
as the services are provided since time is the best output measure of how those services are transferred to the customer. The Company’s installation, training
and professional development services are generally sold separately from the Company’s products. Control of these services
is transferred to our customers over time with hours/time incurred in providing the service being the best depiction of the transfer
of services since the customer is receiving the benefit of the services as the work is performed. For the sale of third-party products and services
where the Company obtains control of the products and services before transferring it to the customer, the Company recognizes revenue
based on the gross amount billed to customers. The Company considers multiple factors when determining whether it obtains control
of the third-party products and services including, but not limited to, evaluating if it can establish the price of the product,
retains inventory risk for tangible products or has the responsibility for ensuring acceptability of the product or service. The
Company has not historically entered into transactions where it does not take control of the product or service prior to transfer
to the customer. The Company excludes from revenue all taxes
assessed by a governmental agency that are both imposed on and concurrent with the specific revenue-producing transaction from
revenue (for example, sales and use taxes). The Company is reporting these amounts collected on behalf of the applicable government
agency on a net basis as though they are acting as an agent. The taxes collected and not yet remitted to the governmental agency
are included in accounts payable and accrued expenses in the accompanying consolidated condensed balance sheets. Significant Judgments For contracts with multiple performance obligations,
each of which represent promises within a contract that are distinct, the Company allocates revenue to all distinct performance
obligations based on their relative stand-alone selling prices (“SSPs”). The Company’s products and services
included in its contracts with multiple performance obligations generally are not sold separately and there are no observable prices
available to determine the SSP for those products and services. Since observable prices are not available, SSPs are established
that reflect the Company’s best estimates of what the selling prices of the performance obligations would be if they were
sold regularly on a stand-alone basis. The Company’s process for estimating SSPs without observable prices considers multiple
factors that may vary depending upon the unique facts and circumstances related to each performance obligation including, when
applicable, the estimated cost to provide the performance obligation, market trends in the pricing for similar offerings, product-specific
business objectives, and competitor or other relevant market pricing and margins. When pricing is highly variable or uncertain,
the Company applies the residual approach to determining SSP by subtracting the SSP of other products or services from the total
transaction price to arrive at the SSP for the performance obligations with highly variable or uncertain pricing. When multiple
performance obligations in a contract have highly variable or uncertain pricing, the Company allocates the residual value to those
performance obligations using an alternative method of allocation that is consistent with the allocation objective and the guidance
on determining SSPs in Topic 606 considering, when applicable, the estimated cost to provide the performance obligation, market
pricing for competing product or service offerings, product-specific business objectives, incremental values for bundled transactions
that include a service relative to similar transactions that exclude the service, and competitor pricing and margins. A separate
price has not been established by the Company for its hardware maintenance services and software maintenance services. In addition,
hardware maintenance services, software solutions, and the related maintenance services are never sold separately and are proprietary
in nature, and the related selling price of these products and services is highly variable or uncertain. Therefore, the SSP of
these products and services is estimated using the alternative method described above, which includes residual value techniques. The Company has applied the portfolio approach
to its allocation of the transaction price for certain portfolios of contracts that are executed in the same period, contain the
same performance obligations and are priced in a consistent manner. The Company believes that the application of the portfolio
approach produces the same result as if they were applied at the contract level. Contract Balances The timing of invoicing to customers often
differs from the timing of revenue recognition and these timing differences can result in receivables, contract assets, or contract
liabilities (deferred revenue) on the Company’s consolidated condensed balance sheets. Fees for the Company’s products
and most of its service contracts are fixed, except as adjusted for rebate programs when applicable, and are generally due within
30-60 days of contract execution. Fees for installation, training, and professional development services are fixed and generally
become due as the services are performed. The Company has an established history of collecting under the terms of its contracts
without providing refunds or concessions to its customers. The Company’s contractual payment terms do not vary when products
are bundled with services that are provided over multiple years. In such contracts, services are expected to be transferred on
an ongoing basis for several years after the related payment, and the Company has determined that the contracts generally do not
include a significant financing component. The upfront invoicing terms are designed 1) to provide customers with a predictable
way to purchase products and services where the payment is due in the same timeframe as when the products, which constitute the
predominant portion of the contractual value, are transferred, and 2) to ensure that the customer continues to use the related
services, so that the customer will receive the optimal benefit from the products over their lives. Additionally, the Company has
elected the practical expedient to exclude any financing component from consideration for contracts where, at contract inception,
the period between the transfer of services and the timing of the related payment is not expected to exceed one year. The Company has an unconditional right to consideration
for all products and services transferred to the customer. That unconditional right to consideration is reflected in accounts receivable
in the accompanying consolidated condensed balance sheets in accordance with Accounting Standards Update No. 2014-09, Revenue
from Contracts with Customers Variable Consideration The Company’s otherwise fixed consideration
in its customer contracts may vary when refunds or credits are provided for sales returns, stock rotation rights, or in connection
with certain rebate provisions. The Company generally does not allow product returns other than under assurance warranties or hardware
maintenance contracts. However, the Company, on a case by case basis, will grant exceptions, most often in cases of “buyer’s
remorse” where the distributor or reseller’s end customer either did not understand what they were ordering or determined
that the product did not meet their needs. An allowance for sales returns is estimated based on an analysis of historical trends.
In very limited situations, a customer may return previous purchases held in inventory for a specified period of time in exchange
for credits toward additional purchases. In addition, rebates are provided to certain customers when specified volume purchase
thresholds have been met. The Company includes variable consideration in its transaction price when there is a basis to reasonably
estimate the amount of the fee and it is probable there will not be a significant reversal. These estimates are generally made
using the expected value method based on historical experience and are measured at each reporting date. There was no material revenue
recognized in 2020 related to changes in estimated variable consideration that existed at December 31, 2019. Remaining Performance Obligations A performance obligation is a promise in a
contract to transfer a distinct good or service to the customer and is the unit of accounting within the contract. The transaction
price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is
satisfied by transferring the promised good or service to the customer. The Company identifies performance obligations at contract
inception so that it can monitor and account for the obligations over the life of the contract. Remaining performance obligations
represent the portion of the transaction price in a contract allocated to products and services not yet transferred to the customer.
As of September 30, 2020, the aggregate amount of the contractual transaction prices allocated to remaining performance obligations
was approximately $11.6 million. The Company expects to recognize revenue on approximately 20% of the remaining performance obligations
in 2020, 55% in 2021 and 2022, with the remainder recognized thereafter. In accordance with Topic 606, the Company has
elected not to disclose the value of remaining performance obligations for contracts for which the Company recognizes revenue at
the amount to which it has the right to invoice for services performed (for example, for time-and-materials professional services
contracts). In addition, the Company has elected not to disclose the value of remaining performance obligations for contracts with
performance obligations that are expected, at contract inception, to be satisfied over a period that does not exceed one year. Disaggregated Revenue The Company disaggregates revenue based upon
the nature of its products and services and the timing and manner in which it is transferred to the customer. Although all product
revenue is transferred to the customer at a point in time, hardware revenue is generally transferred at the point of shipment,
while some software is transferred to the customer at the time the hardware is received by the customer or when software product
keys are delivered electronically to the customer. All service revenue is transferred over time to the customer; however, professional
services are generally transferred to the customer within a year from the contract date as measured based upon hours or time incurred
while software maintenance, hardware maintenance, and subscription services are generally transferred over 3-5 years from the contract
execution date as measured based upon the passage of time.
Three Months Ended Nine Months Ended
September 30, September 30,
2020 2019 2020 2019
Product Revenues:
Hardware $ 8,248,763 $ 9,410,977 $ 19,694,758 $ 23,424,710
Software 410,813 1,066,846 855,352 1,683,659
Service Revenues:
Professional Services 329,491 382,380 1,025,603 877,502
Maintenance and Subscription Services 487,889 444,528 1,452,010 1,113,783
$ 9,476,956 $ 11,304,731 $ 23,027,723 $ 27,099,654 Contract Costs The Company capitalizes incremental costs to
obtain a contract with a customer if the Company expects to recover those costs. The incremental costs to obtain a contract are
those that the Company incurs to obtain a contract with a customer that it would not have otherwise incurred if the contract were
not obtained (e.g. a sales commission). The Company capitalizes the costs incurred to fulfill a contract only if those costs meet
all of the following criteria:
● the costs relate directly to a contract or to an anticipated contract that the Company can specifically identify,
● the costs generate or enhance resources of the Company that will be used in satisfying (or in continuing to satisfy) performance obligations in the future, and
● the costs are expected to be recovered. Certain sales commissions incurred by the Company
were determined to be incremental costs to obtain the related contracts, which are deferred and amortized ratably over the estimated
economic benefit period. For those sales commissions that are incremental costs to obtain where the period of amortization would
have been recognized over a period that is one year or less, the Company elected the practical expedient to expense those costs
as incurred. Commission costs that are deferred are classified as current or non-current assets based on the timing of when the
Company expects to recognize the expense, and are included in prepaid and other assets and other assets, respectively, in the accompanying
consolidated condensed balance sheets. Total deferred commissions as of September 30, 2020 and December 31, 2019 and the related
amortization for 2019 were less than $0.1 million. No impairment losses were recognized for the nine months ended September 30,
2020 and 2019. The Company has not historically incurred any
material fulfillment costs that meet the criteria for capitalization. The Company’s consolidated condensed
statements of operations and cash flows for the nine months ended September 30, 2019 were recorded under the prior GAAP, without
including the adjustments now required under Topic 606. As such, we have revised these statements to be comparable to the September
30, 2020 period which are recorded under Topic 606. The following table presents the effects of
adopting Topic 606 on the Company’s consolidated condensed statement of operations for the three and nine months ended September
30, 2019: Reconciliation of Topic 606 Adjustments for
the three months ended September 30, 2019
Balances under Balances under
Topic 606 Adjustments Prior GAAP
STATEMENT OF OPERATIONS
Revenues $ 11,304,731 $ (297,991 ) $ 11,602,722
Cost of revenues 8,070,930 (92,881 ) 8,163,811
Gross profit 3,233,801 (205,110 ) 3,438,911
General and administrative expenses 4,230,372 (27,794 ) 4,258,166
Total operating expense 4,581,476 (27,794 ) 4,609,270
Loss from operations (1,347,675 ) (177,316 ) (1,170,359 )
Net loss $ (471,812 ) $ (177,316 ) $ (294,496 )
Net loss per common share – basic and diluted $ (0.04 ) $ (0.02 ) $ (0.03 ) Reconciliation of Topic 606 Adjustments for
the nine months ended September 30, 2019
Balances under Balances under
Topic 606 Adjustments Prior GAAP
STATEMENT OF OPERATIONS
Revenues $ 27,099,654 $ (611,798 ) $ 27,711,452
Cost of revenues 19,204,342 (235,433 ) 19,439,775
Gross profit 7,895,312 (376,365 ) 8,271,677
General and administrative expenses 11,892,814 (19,617 ) 11,912,432
Total operating expense 12,804,496 (19,617 ) 12,824,114
Loss from operations (4,909,184 ) (356,747 ) (4,552,437 )
Net loss $ (6,500,868 ) $ (356,747 ) $ (6,144,121 )
Net loss per common share – basic and diluted $ (0.62 ) $ (0.03 ) $ (0.58 ) The following table presents the effects of
adopting Topic 606 on the Company’s consolidated condensed statement of cash flows for the nine months ended September 30,
2019:
Balances under Balances under
Topic 606 Adjustments Prior GAAP
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (6,500,868 ) $ (356,747 ) $ (6,144,121 )
Prepaid expense and other current assets (302,683 ) (19,617 ) (283,066 )
Warranty reserve (36,086 ) (235,433 ) 199,347
Deferred revenues (52,551 ) 611,798 (664,349 )
Net cash used in operating activities $ (6,280,556 ) $ - $ (6,280,556 ) WARRANTY RESERVE For customers that do not purchase hardware
maintenance services, the Company generally provides warranty coverage on projectors and accessories, batteries and computers.
This warranty coverage does not exceed 24 months, and the Company establishes a liability for estimated product warranty costs,
included in other short-term liabilities in the consolidated condensed statements of operations, at the time the related product
revenue is recognized. The warranty obligation is affected by historical product failure rates and the related use of materials,
labor costs and freight incurred in correcting any product failure. Should actual product failure rates, use of materials, or other
costs differ from the Company’s estimates, additional warranty liabilities could be required, which would reduce its gross
profit. RESEARCH AND DEVELOPMENT EXPENSES Research and development costs are expensed
as incurred and consists primarily of personnel related costs, prototype and sample costs, design costs, and global product certifications
mostly for wireless certifications. INCOME TAXES An asset and liability approach is used for
financial accounting and reporting for income taxes. Deferred income taxes arise from temporary differences between income tax
and financial reporting and principally relate to recognition of revenue and expenses in different periods for financial and tax
accounting purposes and are measured using currently enacted tax rates and laws. In addition, a deferred tax asset can be generated
by net operating loss carryforwards. If it is more likely than not that some portion or all of a deferred tax asset will not be
realized, a valuation allowance is recognized. STOCK COMPENSATION The Company estimates the fair value of each
stock option award at the grant date by using the Black-Scholes option pricing model. The fair value of each restricted stock unit
award is equal to the market value of the underlying shares at the grant date. Th |
