Note 10 – Stock-Based Compensation, Restricted Stock and Stock Options:

The Company grants equity-based compensation under its 2016 Equity Incentive Plan (the "Plan"). The Plan allows the Company to grant incentive and nonqualified stock options, and shares of restricted stock to its employees, directors and consultants. On June 14, 2019, the Board of Directors of the Company approved increasing the number of shares allocated to the Company's 2016 Equity Incentive Plan to 22,000,000.

Stock-based compensation:

The Company recognized total expenses for stock-based compensation during the years ended March 31, 2020 and 2019, which are included in the accompanying statements of operations, as follows: 

As of March 31, 2020, the Company had approximately $0.2 million of unrecognized compensation expense related to options granted under the Company's equity incentive plan, which is expected to be recognized over a weighted-average period of 0.3 years.

Restricted stock awards:

A summary of the Company's restricted stock activity during the years ended March 31, 2020 and 2019 is as follows:

The Company did not issue any shares of restricted stock during the year ended March 31, 2019. The Company issued 6,000,000 shares of restricted stock to employees during the year ended March 31, 2020.

The fair value of restricted stock awards are measured based on their fair value at the grant date and amortized over the vesting period of 24 months. As of March 31, 2020, the unrecognized stock-based compensation expense related to restricted stock awards was approximately $1.2 million to be recognized over a period of 0.6 years.

Stock Options:

The Company provides stock-based compensation to employees, directors and consultants under the Plan. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing model. The Company historically has been a private company and lacks company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The risk-free interest rate is determined by referencing the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The Company did not grant stock options during the year ended March 31, 2020. The following was used in determining the fair value of stock options granted during the year ended March 31, 2019.

During the year ended March 31, 2019, the Company granted 2,235,000 stock options. Stock options totaling 1,360,000 were granted to employees and officers of the Company and 350,000 non-qualified stock options were granted to a related party consultant in return for services rendered.

A summary of activity under the Plan for the years ended March 31, 2020 and 2019 is as follows:

Warrants:

During the year ended March 31, 2020, the Company issued 346,338 warrants to purchase shares of the Company's common stock. During the year ended March 31, 2020, the Company recognized approximately $182,000 of stock-based compensation expense related to the warrants. The Company estimated the fair value of the warrants using the Black-Scholes pricing model consisting of; an expected term of 5 years, a risk-free interest rate of 2.34%, a stock price of $0.82 per share and a volatility of 50%.