NOTE 9 – SHARE-BASED COMPENSATION

Stock Options

The Company has a Global Stock Incentive Plan (the “Plan”) under which the Company may grant stock options for up to 1,503,421 common shares. Both incentive stock options and non-qualified stock options expire ten years from the date of the grant.

The fair value of options and share awards granted under the stock option plan during the three months ended March 31, 2021 was estimated at the date of grant using the Black-Scholes option pricing model and the following assumptions for grants:

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The following table summarizes the stock option activity:

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NOTE 9 – SHARE-BASED COMPENSATION (CONTINUED)

The following table summarizes the Company’s non-vested stock options:

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For the three months ended March 31, 2022 and 2021, the Company recognized $104,402 and $81,175 of stock compensation expense relating to stock options, respectively. As of March 31, 2022, there was $947,792 of unrecognized stock compensation expense related to non-vested share-based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted-average period of approximately four years.

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Restricted Stock Awards

In July 2019, the Board of Directors of the Company authorized grants of restricted stock awards (“RSAs”) through a restricted stock award purchase agreement to certain founders, consultants, and advisors of the Company. Certain grants to the Company’s founders were fully vested at the date of incorporation, other grants vest over a four-year period on each anniversary of the grant date, based on continued employment, and other grants vested based on various milestones. The shares of common stock underlying the RSAs are issued upon grant.

The following table summarizes the restricted stock awards activity:

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For the three months ended March 31, 2022 and 2021, the Company recognized $144,585 and $149,303 of stock compensation expense relating to RSAs, respectively. As of March 31, 2022, there was $801,672 of unrecognized compensation expense related to unvested restricted share awards that is expected to be recognized over a weighted-average period of approximately two years.

During the three months ended March 31,2022, the Company recorded an additional share-based compensation expense of $416,667 relating to its employment contract with an officer who joined the Company on February 28, 2022. Under the terms of the contract the Company agreed to issue to the officer a one-time grant of fully vested shares of the Company’s Class A common stock with a fair market value of $250,000 as a signing bonus to be provided following the twelve month anniversary of the officer’s start date with the Company. The Company also agreed to issue an equity grant subject to the approval of the Company’s board of directors comprised of restricted shares with a fair market value of $2 million subject to the terms of the Plan that will vest over 12 months in four equal quarterly installments. The grant of the restricted shares is expected to occur after March 31, 2022. Included in accrued expenses in the condensed consolidated balance sheets is an amount of $416,667 representing the full value of the signing bonus and the prorated value of the vested restricted shares.