|12 Months Ended|
Dec. 31, 2020
NOTE 14 – STOCKHOLDERS’ EQUITY
In February 2020, the Company filed a certificate of elimination to return all shares of the Series A convertible preferred stock to the status of authorized and unissued shares of undesignated preferred stock. Concurrent with this filing, the Company also filed a certificate of designation to designate the rights and preferences of newly authorized Series B convertible preferred stock, shares of which were issued in February 2020 as discussed in Note 13 – Mezzanine Equity.
In March 2021, upon the closing of the financing transaction discussed in Note 22 – Subsequent Events, the Company filed a certificate of designation with respect to the rights and preferences of newly-issued Series C convertible preferred stock. Such stock is zero coupon, non-voting, and has a liquidation preference equal to its investment amount plus declared but unpaid dividends. Holders of Series C convertible preferred stock are entitled to receive dividends on an as-converted basis.
In February 2020, pursuant to the TIS Exchange Agreement, the shares of common stock exchanged for shares of Series B convertible preferred stock were treated as an increase to treasury stock of $ ($ per share), and then immediately cancelled, thereby reducing treasury stock to zero, with corresponding reductions to common stock of approximately $ (the par value of the exchanged common shares) and additional paid-in capital of approximately $ .
In 2019, the Company sold 2,750,000. No common stock was sold in 2020. shares of common stock at prices of $ and $ per share, resulting in total proceeds of $
In 2020 and 2019, the Company issued 699,000 and $121,000, respectively. Based on the price of the Company’s common stock on the dates of issuance, the Company incurred non-cash losses on these settlements of approximately $45,000 in 2020 and $5,000 in 2019 which were reflected under Loss On Debt Settlements on the statement of operations. and shares of common stock, respectively, to settle obligations of approximately $
In 2020, the Company granted shares of common stock to a current employee. The fair value of the shares of approximately $was charged to employee compensation during the period. Of these granted shares, were yet to be issued at December 31, 2020 and were reflected in Common Stock Subscribed But Not Issued on the balance sheet. In 2019, the Company granted shares of common stock to employees. The fair value of these shares of approximately $was charged to employee compensation during the period. Of these granted shares, were yet to be issued at December 31, 2019 and were included in Common Stock Subscribed But Not Issued on the balance sheet.
In 2020 and 2019, the Company issued 1,168,000 and $169,000, respectively. and shares of common stock, respectively, associated with previously issued subscriptions on common stock with a value of approximately $
In 2020, (i) shares of common stock granted to employees, and (ii) shares of common stock issued from the exercise of stock options by a related party, were forfeited by the holders of such common stock. The Company recorded these returned shares at par value. common stock forfeitures occurred in 2019.
As previously disclosed in Note 3 – Acquisitions, the Company issued in 2019 (i) shares of common stock in connection with the acquisition of the KPGs and Mari-IL, (ii) shares of common stock as a good faith deposit on the Harvest acquisition, and (iii) shares of common stock in connection with the acquisition of MediTaurus.
As previously disclosed in Note 4 – Investments, the Company issued shares of common stock in 2019 to purchase a minority interest in Terrace.
As previously disclosed in Note 11 – Debt, in 2020 and 2019, the Company issued 1.4 million and $1,0 million of promissory notes (principal and accrued interest). and shares of common stock, respectively, to retire approximately $
As previously disclosed in Note 12 – Debentures Payable, the holder of the $21M Debentures converted (i) in 2020, approximately $10.1 million of principal and interest into and shares of common stock, and (ii) in 2019, approximately $9.0 million of principal and interest into shares of common stock and subscriptions on shares of common stock.
As further disclosed in Note 15 – Stock Options, in 2020 and 2019, and shares of common stock, respectively, were issued in connection with the exercise of stock options.
As further disclosed in Note 16 – Warrants, warrants to purchase 686,104 shares of common stock were exercised in 2019. No warrants were exercised in 2020.
Common Stock Issuance Obligations
At December 31, 2020, the Company was obligated to issue shares of common stock, valued at approximately $ , in connection with a stock grant to a current employee. These shares were issued in February 2021.
At December 31, 2019, the Company was obligated to issue (i) 1,117,000, with respect to the December 2019 conversion of a portion of the $21M Debentures as previously disclosed in Note 12 – Debentures Payable, and (iii) 200,000 shares of common stock associated with exercise of stock options by the Company’s CEO as further disclosed in Note 20 – Related Party Transactions. These shares were issued in the first quarter of 2020. shares of common stock, valued at approximately $ , in connection with the stock grants disclosed earlier in this Note 14 – Stockholders’ Equity, (ii) shares of common stock, valued at approximately $
Amended and Restated 2018 Stock Award and Incentive Plan
In August 2019, the Company’s board of directors approved the Amended and Restated 2018 Stock Award and Incentive Plan (the “Incentive Plan”), based on the board’s belief that awards authorized under the Incentive Plan provide incentives for the achievement of important performance objectives and promote the long-term success of the Company. In September 2019, the Incentive Plan was approved by the stockholders at the Company’s annual stock-holders meeting.
The Incentive Plan is an omnibus plan, authorizing a variety of equity award types as well as cash and long-term incentive awards. The Incentive Plan amends and restates the Company’s 2018 Stock Award and Incentive Plan (the “Previous Plan”), which was approved by the board of directors in July 2018 but never presented to stockholders for approval. Any grants made under the Previous Plan prior to the approval date of the Incentive Plan shall continue to be governed by the terms of the Previous Plan.
The Incentive Plan authorizes a broad range of awards, including stock options, stock appreciation rights, restricted stock, deferred stock, dividend equivalents, performance shares, cash-based performance awards, and other stock-based awards. Such awards can be granted to employees, non-employee directors and other persons who provide substantial services to the Company and its affiliates. Nothing in the Incentive Plan precludes the payment of other compensation to officers and employees, including bonuses based upon performance, outside of the Incentive Plan.
An aggregate of shares are reserved for delivery to participants, and may be used for any type of award under the Incentive Plan. Shares actually delivered in connection with an award will be counted against such number of reserved shares. Shares will remain available for new awards if an award under the Incentive Plan expires, is forfeited, canceled, or otherwise terminated without delivery of shares or is settled in cash. Each award under the Incentive Plan is subject to the Company’s claw back policy in effect at the time of grant of the award.
The board of directors may amend, suspend, discontinue, or terminate the Incentive Plan or the authority to grant awards thereunder without stockholder approval, except as required by law or regulation or under rules of the stock exchange, if any, on which the Company’s stock may then be listed. Unless earlier terminated, grants under the Incentive Plan will terminate ten years after stockholder approval of the Incentive Plan, and the Incentive Plan will terminate when no shares remain available and the Company has no further obligation with respect to any outstanding award.
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef