Temporary Equity and Stockholders' Deficiency
|3 Months Ended|
Mar. 31, 2019
|Temporary Equity and Stockholders' Deficiency||
11. TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIENCY
Series B Preferred Stock
The Series B stockholders are entitled to cumulative cash dividends at an annual rate of 8% of the Series B liquidation value (equal to face value of $10 per share), as defined, payable when, as and if declared by the Board of Directors. Cumulative dividends earned by the Series B stockholders were $177,795 and $155,791 for the three months ended March 31, 2019 and 2018, respectively. Dividends payable of $85,223 are included in the current portion of other liabilities at March 31, 2019. Cumulative unpaid dividends in arrears related to the Series B totaled $721,099 and $546,335 as of March 31, 2019 and December 31, 2018, respectively.
Between February 8, 2019 and March 27, 2019, GGH sold a total of 2,527,857 shares of its common stock to accredited investors for total gross proceeds of $884,750.
On March 13, 2019, the Company issued 181,185 shares of common stock at $0.35 per share to employees for the year ended December 31, 2018 of the 401(k) profit sharing plan.
Accumulated Other Comprehensive Income (Loss)
For three months ended March 31, 2019 and 2018, the Company recorded $8,339 and $(285,609), respectively, of foreign currency translation adjustment as accumulated other comprehensive income (loss), primarily related to fluctuations in the Argentine peso to United States dollar exchange rates (see Note 3 – Summary of Significant Accounting Policies, Highly Inflationary Status in Argentina).
A summary of warrants activity during the three months ended March 31, 2019 is presented below:
A summary of outstanding and exercisable warrants as of March 31, 2019 is presented below:
On January 31, 2019, the Company granted five-year options for the purchase of 1,350,000 shares of the Company’s common stock under the 2018 Plan, of which options for the purchase of 1,100,000 shares of the Company’s common stock were granted to certain employees of the Company, options for the purchase of 100,000 shares of the Company’s common stock were granted to certain members of the Board of Directors and options for the purchase of 150,000 shares of the Company’s common stock were granted to consultants. The options had an exercise price of $0.385 per share and vest 25% at the first anniversary of date of grant, with the remaining shares vesting ratably on a quarterly basis over the following three years. The options had an aggregate grant date fair value of $200,092, which will be recognized ratably over the vesting period.
The Company has computed the fair value of options granted using the Black-Scholes option pricing model. Assumptions used in applying the Black-Scholes option pricing model during the three months ended March 31, 2019 are as follows:
The weighted average estimated fair value of the stock options granted during the three months ended March 31, 2019 was approximately $0.15 per share. The weighted average estimated fair value of the stock options granted during the three months ended March 31, 2018 was approximately $0.47 per share.
During the three months ended March 31, 2019 and 2018, the Company recorded stock-based compensation expense of $157,994 and $183,220, respectively, related to stock option grants, which is reflected as general and administrative expenses in the accompanying condensed consolidated statements of operations. As of March 31, 2019, there was $1,091,654 of unrecognized stock-based compensation expense related to stock option grants that will be amortized over a weighted average period of 2.91 years.
A summary of options activity during the three months ended March 31, 2019 is presented below:
The following table presents information related to stock options at March 31, 2019:
The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP).
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef