Annual report pursuant to Section 13 and 15(d)

14. Stock Options

v3.21.1
14. Stock Options
 12 Months Ended
Dec. 31, 2020
Share-based Payment Arrangement [Abstract]  
Stock Options

Note 14: Stock Options

 

On September 18, 2015, the Company adopted the Genius Brands International, Inc. 2015 Incentive Plan (the “2015 Plan”). The total number of shares that can be issued under the 2015 Plan is 2,167,667 shares.

 

On September 1, 2020, the Company adopted the Genius Brands International, Inc. 2020 Incentive Plan (the “2020 Plan”). On August 4, 2020, the Board of Directors voted to adopt the 2020 Plan. The shares available for issuance under the 2020 Plan was approved by stockholders on August 27, 2020. The 2020 Plan as approved by the stockholders increased the maximum number of shares available for issuance up to an aggregate of 32,167,667 shares of Common Stock.

 

During the year ended December 31, 2019, the Company granted options to purchase 81,000 shares of common stock to officers. These stock options generally vest between one and three years. The fair value of these options was determined to be $117,797 using the Black-Scholes option pricing model based on the following assumptions:

 

Exercise Price $1.99
Dividend Yield 0%
Volatility 125%
Risk-free interest rate 2.44%
Expected life of options 3.0 years

 

During the year ended December 31, 2020, the Company granted options to purchase 8,880,000 shares of common stock to officers. These stock options generally vest between one and three years. The fair value of these options was determined to be $12,231,185 using the Black-Scholes option pricing model based on the following assumptions:

 

Exercise Price $1.39 - $10.00
Dividend Yield 0%
Volatility 121% - 122%
Risk-free interest rate 0.31% -0.39%
Expected life of options 5.0 years

 

The following table summarizes the changes in the Company’s stock option plan during the year ended December 31, 2019 and December 31, 2020:

 

    Options Outstanding Number Of Shares   Exercise Prices Per Share     Weighted Average Remaining Contractual Life     Weighted Average Exercise Price Per Share  
Balance at December 31, 2018     1,259,415     $ 2.09 - 12.00       2.50 years     $ 7.39  
Options Granted     81,000     $ 1.99       3 years     $ 1.99  
Options Exercised     –     $ –       –     $ –  
Options Cancelled     50,549     $ 1.99 - 2.70       4.51 years     $ 6.34  
Options Expired     –     $ –       –     $ –  
                                 
Balance at December 31, 2019     1,289,866     $ 1.99 - 12.00       6.49 years     $ 7.18  
Options Granted     8,880,000     $ 1.39 - 10.00       4.91 years     $ 1.66  
Options Exercised     –     $ –       –     $ –  
Options Cancelled     2,000     $ 1.99       3.18 years     $ 1.99  
Options Expired     1,051,690     $ 2.70 - 2.82       –     $ 2.71  
Balance at December 31, 2020     9,116,176     $ 1.39 - 10.00       4.84 years     $ 1.69  
                                 
Exercisable December 31, 2019     1,176,416     $ 1.99 - 9.00       6.25 years     $ 7.67  
Exercisable December 31, 2020     6,449,452     $ 1.39 - 3.17       4.87 years     $ 1.44  

 

During the years ended December 31, 2020 and 2019, the Company recognized $8,365,745 and $184,259 in share-based compensation expense, respectively. The unvested share-based compensation as of December 31, 2020 is $4,008,320 which will be recognized through the fourth quarter of 2023 assuming the underlying grants are not cancelled or forfeited.