STOCK-BASED COMPENSATION |
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK-BASED COMPENSATION |
AYRO 2020 Long Term Incentive Plan
On May 28, 2020, the Company’s shareholders approved the AYRO, Inc. 2020 Long Term Incentive Plan for future grants of incentive stock options, nonqualified stock, stock appreciation rights, restricted stock, restricted stock units, performance and other awards. The Company has reserved a total of shares of its common stock pursuant to the AYRO, Inc. 2020 Long-Term Incentive Plan, including shares of restricted stock that have been issued. The Company has stock options, restricted stock and warrants remaining under this plan as of June 30, 2021.
AYRO 2017 Long Term Incentive Plan
Prior to the Merger, the Company granted stock options and warrants pursuant to the 2017 Long Term Incentive Plan effective January 1, 2017. As of June 30, 2021, the 2017 Long Term Incentive Plan remains active, but no additional awards may be granted.
DropCar Amended and Restated 2014 Equity Incentive Plan
The DropCar Amended and Restated 2014 Equity Incentive Plan was amended in 2018 to increase the number of shares of Company common stock available for issuance. Pursuant to the 2014 Equity Incentive Plan (the “2014 Plan”), shares of common stock were reserved for issuance and there are options to purchase shares outstanding as of June 30, 2021. As of June 30, 2021, there were shares available for grant under the 2014 Plan.
Options
Of the outstanding options, were vested and exercisable as of June 30, 2021. At June 30, 2021 the aggregate intrinsic value of stock options vested and exercisable was $ .
The Company recognized $and will be recognized on a straight-line basis through the end of the vesting periods through October 2023. The amount of future stock option compensation expense could be affected by any future option grants or by any forfeitures. and $ of stock option expense for the three months ended June 30, 2021 and June 30, 2020, and $ and $ for the six months ended June 30, 2021 and June 30, 2020, respectively. Total compensation cost related to non-vested stock option awards not yet recognized as of June 30, 2021 was $
Determining the appropriate fair value of the stock-based awards requires the input of subjective assumptions, including the fair value of the Company’s common stock, and for stock options, the expected life of the option, and the expected stock price volatility. The Company uses the Black-Scholes option pricing model to value its stock option awards. The assumptions used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, stock-based compensation expense could be materially different for future awards.
The expected life of the employee stock options was estimated using the “simplified method,” as the Company has no historical information to develop reasonable expectations about future exercise patterns and employment duration for its stock option grants. No employee stock options were awarded in the six months ended June 30, 2021.
The simplified method is based on the average of the vesting tranches and the contractual life of each grant. The expected life of awards that vest immediately use the contractual maturity since they are vested when issued. For stock price volatility, the Company uses public company compatibles and historical private placement data as a basis for its expected volatility to calculate the fair value of option grants. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected life of the option at the grant-date.
Restricted Stock
In September 2020, the Company issued shares of restricted stock to non-executive directors, of which immediately vested and the remainder to During May 2021, of the remaining outstanding restricted stock vested and were forfeited. The Company recognized compensation expense during the three and six months ended June 30, 2021 of $ and $ , respectively.
In December 2020, based on objectives achieved, the Company issued shares of restricted stock to Rodney C. Keller, Jr. (“the “Keller Restricted Stock”) that vest according to Compensation expense recognized for the Keller Restricted Stock for the three and six months ended June 30, 2021 was $ and $ , respectively. Total compensation cost related to non-vested restricted stock not yet recognized as of June 30, 2021 was $ and will be recognized on a straight-line basis through the end of the vesting periods through December 4, 2022.
On February 24, 2021, pursuant to the AYRO, Inc. 2020 Long-Term Incentive Plan, the Company issued shares of restricted stock to non-executive directors at a value of $ per share. The Company recognized compensation expense during the three and six months ended June 30, 2021 of $ and $ . Total compensation cost related to non-vested restricted stock not yet recognized as of June 30, 2021 was $ and will be recognized on a straight-line basis through the end of the vesting periods through December 31, 2021.
Other Share-Based Payments
The Company granted stock warrants pursuant to the 2017 Long Term Incentive Plan (“LTIP”) effective January 1, 2017. The Company measured consultant stock-based awards at grant-date fair value and recognizes contractor consulting expense for contractor warrants on a straight-line method basis over the vesting period of the award. Grants to consultants are expensed at the earlier of (i) the date at which a commitment for performance by the service provider to earn the equity instrument is reached and (ii) the date at which the service provider’s performance is complete.
The Company recognized $0 and $14,704 of warrant expense related to consulting services for the three months ended June 30, 2021 and 2020, and $0 and $36,760 for the six months ended June 30, 2021 and 2020, respectively.
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