NOTE 10. STOCK-BASED COMPENSATION
The Company has a stock-based compensation plan that is accounted for under APB
Opinion 25, Accounting for Stock Issued to Employees, and related
Interpretations. No options were granted under the plan for the periods ended
December 31, 2003 and 2002 and since inception (March 20, 2002). Options
outstanding as of December 31, 2003 that were granted under the stock option
plan of US Global Aerospace (fka Caring Products International) prior to the
merger with the Company and were fully vested as of the merger date (May 17,
2002) have all expired. Accordingly, no compensation expense would have been
recognized had the Company applied the fair value recognition provisions of FASB
Statement 123, Accounting for Stock-Based Compensation, during the periods ended
December 31, 2003 and 2002 and since inception (March 20, 2002).
On April 10, 2003, the Company adopted the Amended and Restated 2002 Stock Plan
(2002 Stock Plan). Under the 2002 Stock Plan, officers, directors, employees,
consultants, advisors and others related to the Company may be granted incentive
stock options or nonqualified stock options to purchase up to an authorized
15,000,000 shares of common stock. The options are to be granted at not less
than 85% of the fair value of the Company's common stock on the date of the
grant. The options generally vest over five years and expire ten years from date
of grant. The plan also allows for the granting of a stock award whereby the
purchase price of the stock award granted also may not be less than 85% of the
fair value of the Company's common stock. In addition the plan allows for the
granting of stock bonuses. The terms of the awards and bonuses are to be
determined by a committee appointed by the Board of Directors.
On April 10, 2003, the Company granted 2,794,684 shares of common stock under
the 2002 Stock Plan to employees in lieu of salaries and expenses with an award
valuation of $237,547, equaling 85% of the fair market value per share on the
date of grant of the award. When granting stock, accounting principles generally
accepted in the United States of America requires companies to record the
issuance of stock for services at the fair market value of the stock on the
grant date, and as a result, the Company recognized an additional $41,922 as
additional non-cash expense for the difference between the fair value of the
stock and the salaries due.
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US Global Nanospace, Inc.
(Formerly US Global Aerospace, Inc.)
(A development stage company)
Notes to the Financial Statements
NOTE 10. STOCK-BASED COMPENSATION (CONT'D)
On July 18, 2003, the Company granted 860,343 shares of common stock under the
2002 Stock Plan to employees in lieu of salaries and expenses with an award
valuation of $344,137, equaling 100% of the fair market value per share on the
date of grant of the award. However, on July 28, 2003, the Company cancelled and
redeemed 13,647 of these shares from an employee in exchange for monies owed the
Company, having a total value of $5,459.
On July 25, 2003, the Company granted 1,000,000 shares of common stock under the
2002 Stock Plan to our CEO in lieu of cash payment of salary with an award
valuation of $250,000, which was the fair market value per share on the date of
grant of the award.
On October 1, 2003, the Company granted 3,390,138 shares of common stock under
the 2002 Stock Plan to employees and our CEO in lieu of cash payment of salaries
with an award valuation of $491,569, equaling 85% of the fair market value per
share on the date of grant of the award. The Company recognized an additional
$84,754 as additional non-cash expense for the difference between the fair value
of the stock and the salaries due. However, on October 14, 2003, the Company
cancelled and redeemed 71,120 of these shares from an employee by mutual
agreement, having a total value of $12,090.
On December 15, 2003, the Company granted 1,328,070 shares of common stock under
the 2002 Stock Plan to employees and our CEO as a stock bonus for services
during January 1, 2003 through December 31, 2003 with an award valuation of
$1,195,260, equaling 85% of the fair market value per share on the date of grant
of the award. The Company recognized an additional $212,494 as additional
non-cash expense for the difference between the fair value of the stock and the
bonus amount due.
The Company has accrued payroll taxes relating to the issuance of stock in lieu
of wages in accrued salaries and expense as of December 31, 2003 and the
Company has recorded employee receivables for the employees portion of the
taxes due to the Company. |
